Sanyo Electric plans to expand production of solar cells in response to rising global demand for the devices.
The company will build a new ¥6 billion (£46 million) factory at an existing plant in Osaka in western Japan and add production capacity at a factory in Shimane, which is also in western Japan.
Construction of the new factory is scheduled to begin on Tuesday and be completed by the end of October this year. The start of production will depend on market conditions but Sanyo currently expects to begin immediately the construction is finished, it said.
Sanyo's annual solar cell production stands at 340 megawatts but will rise to 600 megawatts by March 2011 through the two measures, it said.
Sanyo has been engaged in an aggressive expansion of its solar cell production. Just two years ago its total capacity stood at less than half of the current figure.
Sanyo is Japan's number two solar cell maker, behind Sharp, and its position in the industry is one of the things that attracted Panasonic to acquire the company - an acquisition that is currently underway and expected to be completed soon.
Panasonic intends to build-up its own solar and battery technology divisions through Sanyo and its know-how.
But even with the expansion it is well behind Sharp in terms of production capacity.
Last year Sharp said it planned to more than double production of solar cells by 2010 and take output from 710 megawatts to around 1.7 gigawatts per year.