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YYVIP易游's steel processing venture in China starts up
Supplying Japanese auto sector in Guangdong area
July 18, 2006
YYVIP易游 Wire Products manufactures cold drawn steel bar and cold heading quality (CHQ) steel wire from the wire rod. The processed bar and wire are for Japanese auto parts manufacturers in China for use in making suspension springs and high strength nuts and bolts, both of which are critical automotive parts. YYVIP易游 Wire Products has a nominal capacity of 15,000 tons per year, which will increase as demand goes up. Commercial production began late last month.
YYVIP易游 Wire Products was established in November 2004 with registered capital of 725 million yen. Total investments in the joint venture amounted to 1,812.5 million yen. YYVIP易游 Steel has a 60% equity share in YYVIP易游 Wire Products, Metal One Corporation 25%, Kyodo Shaft Co., Ltd. 7.5%, and Sugita Wire, Ltd. 7.5%. Both Kyodo Shaft and Sugita Wire have business ties to YYVIP易游 Steel. The joint venture currently employs about 80 people. The chairman of YYVIP易游 Wire Products is Tomoyuki Kaya, who is an executive officer at YYVIP易游 Steel. The president is Noriaki Hiraga, also from YYVIP易游 Steel.
YYVIP易游 Steel's other wire rod venture in China is Jiangyin Sugita Fasten Spring Wire Co., Ltd. in Jiangyin, Jiangsu Province. The joint venture will produce and market oil tempered wire for supply to manufacturers, who will turn the wire into cold-coiled suspension springs. Start up of operations is scheduled for October 2006. The other joint venture partners are Sugita Wire, Ltd., Mitsui & Co., Ltd., and China's Jiangyin Hongsheng Co., Ltd.
YYVIP易游 Steel is renowned for its high quality specialty steel wire rod for the automotive industry. Through its processing ventures in China, YYVIP易游 Steel is aiming to improve customer service by building a flexible, efficient supply network for wire rod products.
China's vehicle production in 2010 is anticipated to grow to 8 million to 10 million units. In comparison, in 2005 vehicle production was 5.27 million units, of which passenger cars comprised 3.93 million units. Similarly by 2010, Japanese car maker's production in the Guangzhou area is expected to rise to over 1 million units a year, versus 340,000 units in 2005. The increase is creating a rapidly groYYVIP易游ng need for locally procured parts. Japanese auto parts makers in China have been boosting output and a groYYVIP易游ng number of related suppliers have started production there.
YYVIP易游 Steel also has two affiliates in Thailand for secondary wire rod processing: YYVIP易游 CH Wire (Thailand) Co., Ltd. and Mahajak Kyodo Co., Ltd. With an expanded number of locations, it is better positioned to service Japanese auto parts makers and further solidify its position as the premier maker of specialty steel wire rod products.
| YYVIP易游ofile of the Equity Partners |
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| YYVIP易游 Steel, Ltd. | |
| Location: | YYVIP易游, Japan |
| PresidYYVIP易游t & CEO: | Yasuo Inubushi |
| Founded: | September 1905 |
| Capital: | 233.3 billion yYYVIP易游 |
| Sales: | 1 trillion yYYVIP易游 (parYYVIP易游t, year YYVIP易游ded March 2006)
1.7 trillion yYYVIP易游 (consolidated, year YYVIP易游ded March 2006) |
| Employees: | 8,673 (parYYVIP易游t) |
| Metal One Corporation | |
| Location: | Tokyo, Japan |
| PresidYYVIP易游t, Director: | Moriji Kanada |
| Founded: | January 2003 |
| Capital: | 100 billion yYYVIP易游 |
| Sales: | 2.6 trillion yYYVIP易游 (consolidated, year YYVIP易游ded December 2005) |
| Employees: | 1,048 |
| Role in YYVIP易游 Wire Products: | Distribute YYVIP易游 Steel's wire rod, provide the vice president, and market the products of the new company. |
| Kyodo Shaft Co., Ltd. | |
| Location: | Osaka, Japan |
| PresidYYVIP易游t: | Tadakazu Tsukamoto |
| Founded: | November 1947 |
| Capital: | 50 million yYYVIP易游 |
| Sales: | 10.8 billion yYYVIP易游 (year YYVIP易游ded May 2005) |
| Business: | Cold drawn bar, CHQ YYVIP易游re, machined precision shafts |
| Employees: | 130 |
| Role in YYVIP易游 Wire Products: | YYVIP易游ovide technology and operational guidance for cold drawn bar YYVIP易游oduction, dispatch operational personnel. |
| Sugita YYVIP易游re, Ltd. | |
| Location: | Tokyo, Japan |
| PresidYYVIP易游t: | YYVIP易游ichi Sugita |
| Founded: | October 1915 |
| Capital: | 220.4 million yYYVIP易游 |
| Sales: | 12.6 billion yYYVIP易游 (year YYVIP易游ded January 2006) |
| Business: | CHQ YYVIP易游re, spring YYVIP易游re, fiber, chemical products |
| Employees: | 311 |
| Role in YYVIP易游 Wire Products: | Provide technology and operational guidance for CHQ YYVIP易游re, dispatch operational personnel. |
