INTERVIEW-UPDATE 1-NEC Elec, Renesas to keep advanced plants

* President says hybrid, electric car demand to jump

* NEC Electronics, Renesas product overlap 20%-30%

* Need to consider outsourcing non-car related chips

* Plant use rate of more than 60 percent July-September

* Shares close 3.7 percent lower in flat market

(Adds detail, background)

By Mayumi Negishi and Kentaro Hamada

KAWASAKI, July 2 (Reuters) - Japanese NEC Electronics Corp (6723.T) and Renesas Technology Corp will both keep their advanced 300-millimetre chip-making plants after they merge, the newly appointed president of NEC Electronics said.

Nobody needs to decide between NEC Electronics's Yamagata factory in northeast Japan and Renesas's plant in Hitachinaka outside Tokyo, Junshi Yamaguchi said in an interview.

"Both will remain," Yamaguchi said on Thursday, adding usage rates for both were rising. "Using these advanced lines will actually reduce costs."

The two loss-making chipmakers plan to unite operations in April to survive and grow as sales fall faster than their ability to cut costs, but analysts have said their diverging technologies would force them to keep duplicate facilities.

NEC Electronics, the world's 11th-largest chip maker, has slashed jobs and capital spending and merged factories, but still faces its fifth straight year of losses.

The deal with Renesas, the world's sixth-biggest chipmaker, is aimed at helping it focus resources on products with high market share and profitability, cut development costs and, according to government sources, apply for public funds.

"We need to have high profit magins, like some other chip makers. If we just gain scale and don't make profit, there's no point in existing," said Yamaguchi, who in May said a chip maker needed a 10 percent profit margin to survive.

He said nothing had been decided on whether or not it, Renesas or the merged company would need to raise money.