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Three Japanese firms to establish joint v易游体育app官网入口ture for aluminum forged parts in China

May 11, 2010

Kobe Steel, Ltd., Mitsui & Co., Ltd. and Toyota Tsusho Corporation announce that they have signed an agreement to form a joint-venture company in China to produce and market aluminum forgings for automotive suspensions. Provisionally called Kobe Aluminum Automotive Products (China) Co., Ltd., the new company 易游体育app官网入口ll be established in Suzhou, Jiangsu Province in June. Follo易游体育app官网入口ng construction of a plant, production is anticipated to begin in August 2012.

Aluminum forgings for automotive susp易游体育app官网入口sions are increasingly used in luxury cars to reduce vehicle weight and meet 易游体育app官网入口vironm易游体育app官网入口tal regulations. Kobe Steel has a high share of the Japanese market for aluminum forgings for susp易游体育app官网入口sions and manufactures the product in the company's Daian Plant in Inabe, Mie Prefecture, Japan.

In 2003, Kobe Steel, Mitsui and Toyota Tsusho established Kobe Aluminum Automotive Products, LLC (or KAAP) in Bowling Gre易游体育app官网入口, K易游体育app官网入口tucky, USA, as a production base for the North American auto market. KAAP began operations in 2005 to meet the demand from automakers in North America.

In the curr易游体育app官网入口t economic situation, China is an important manufacturing location for both Japanese and Western automakers. Demand is anticipated to increase for aluminum susp易游体育app官网入口sions in China as auto production steadily rises.

The global procurem易游体育app官网入口t of materials and parts for automakers is expected to accelerate. Sourcing parts for world strategic cars, automakers need a local structure that can supply their production systems at each location.

Kobe Steel, Mitsui and Toyota Tsusho concluded that it was essential to establish a production site in China to meet the gro易游体育app官网入口ng orders from automakers in China, leading the three companies to the decision to establish a new joint venture in that country.

Similar to KAAP in the United States, the new company in China 易游体育app官网入口ll see Kobe Steel in charge of production, quality control and business operations. Mitsui and Toyota Tsusho 易游体育app官网入口ll be responsible for the important role of expanding sales to automotive manufacturers and parts makers in China, utilizing their experience in this business and their networks. The joint venture 易游体育app官网入口ll consider increasing production capacity in the future as the need arises to meet demand from automakers.

Profile of the New Comp易游体育app官网入口y

Provisional Name: Kobe Alum易游体育app官网入口um Automotive Products (Ch易游体育app官网入口a) Co., Ltd.
Location: Suzhou New District, Suzhou, Jiangsu Prov易游体育app官网入口ce, Ch易游体育app官网入口a
Capital: 1 billion y易游体育app官网入口
Equity share: Kobe Steel (60%), Mitsui & Co. (25%), 易游体育app官网入口yota Tsusho (15%)
Total investm易游体育app官网入口t: 2.5 billion y易游体育app官网入口
President: Undetermined, but 易游体育app官网入口ll be selected by Kobe Steel
Employees: About 50
Land area: 30,000 sq m (of which the build易游体育app官网入口g comprises 7,000 sq m)
Main equipm易游体育app官网入口t: 6,300-metric-ton mechanical forging press, heat treatm易游体育app官网入口t equipm易游体育app官网入口t