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Japanese manufacturers move into China

01 September, 2004

Several Japanese companies, including Omron, Hitachi and Matsushita, have announced plans to step up their automation activities in China, including new motors and drives joint ventures.

Hitachi is setting up a JV with a Chinese firm to produce high-power inverter drives. The company, provisionally called DongFang Hitachi (Chengdu) Electric Control Equipments, will be based in Chenngdu, with Hitachi controlling 49% of the business. Around £3.5m is being invested in the JV, which is expected to generate sales worth some £17.7m by 2008.

Matsushita Electric is forming a JV with another Japanese company, Daikin Industries, to produce hermetically sealed motors for use in air-conditioning systems. About £11.6m will be invested in the new business, Daikin Motor Suzhou, in which Daikin will have a 60% stake. Production is due to start in December.

Omron`s Industrial Automation Business is establishing a new venture in Shanghai to integrate and expand the existing IAB activities in China, which include the production of sensors, PLCs and temperature controllers. Omron is investing about £25m in the new operation, and hopes that it will quadruple its Chinese sales to £250m by the fiscal year ending March 2008. The number of IAB employees in China will also grow four-fold to 2,600 by 2008.

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