TOKYO, Jan. 3 (Kyodo) — NEC Corp. will invest about 10 billion yen to build a factory in Tokyo and make low-cost satellites for emerging countries, sources close to the matter said Thursday.

The maker of electronics and telecommunication equipment plans to mainly manufacture small satellites from fiscal 2014, which starts April 2014, at the plant to be built in the city of Fuchu as part of its joint efforts with the government to win satellite-launching contracts from other countries, they said.

A globally competitive cost for commercial satellite building and launch is said to be around 10 billion yen. NEC has succeeded in lowering the cost of building a small satellite and other necessary equipment to between 6 billion and 8 billion yen.

IHI Corp., a Japanese engineering firm, has already developed a rocket which can launch a small satellite at a cost of around 3 billion yen. Combined with NEC's satellite, the Japanese public-private consortium will be able to offer a competitive launch package.

NEC's new plant, which will be equipped with a vacuum chamber for performance and durability testing, will have capacity to manufacture and assemble eight satellites at a time, they said.