Japanese suppliers in China (Part 1): East/North/Northeast regions

Suppliers set up new companies, launch new products, and enhance development capacities

2015/11/16

Summary

 In the January to October 2015 period, the Chinese automotive industry remained stagnant with a production volume of 19.28 million units, down 0.04% year-over-year (y/y), and a sales volume of 19.27 million units, up 1.5% y/y. A large decrease was observed in the commercial vehicle sector, while passenger cars showed a slight increase. By brands, those other than Chinese and Japanese resulted in a y/y decrease. Despite of such conditions, not only Japanese but also European, American, and Korean automakers have not revised their plans to expand their production capacities yet. However, Volkswagen is reviewing all of its investment plans to prepare for the influence of the diesel engine emissions scandal, which broke in September 2015. Most of the contents of this report are based on the assumption that Chinese automobile production continues to grow and thus may not be applicable in the future, depending on the subsequent sales and production conditions.

 To satisfy growing demands from European, American, and Chinese automakers as well as from Japanese OEMs, Japanese parts suppliers are also expanding their production capacities and development functions in China to enhance their supply networks and attract new customers. Many of these suppliers are expanding their facilities or establishing new companies to launch high-value products, such as those related to electric vehicles (EVs), hybrid vehicles, weight reduction, environmental regulation compliance, safety, and in-vehicle information devices.

 Some are also transferring their production to India or Japan, following rising labor costs in China and a higher Chinese yuan.

 This report summarizes activities of Japanese suppliers in the east, north, and northeast regions as well as nationwide during the ten months from December 2014 to early October 2015.

East China
East China
North/Northeast China
North/Northeast China
Boost production capacity
(* Also produce new product)
Add production line and equipment Jiangsu Province: Asahi Kasei Chemicals, Sekisui Chemical*, Taiho Kogyo,
  Toray Industries, Hibino Industry, and The Yokohama Rubber
Shanghai City: Exedy Corporation
Zhejiang Province: Aichi Steel
Add plant Jiangsu Province: Mitsuboshi Belting (second plant)
Tianjin City: Tsubakimoto Chain*
Establish new subsidiary/construct new plant/begin production
(* Also produce new product)
Jiangsu Province: Sumitomo Riko (joint venture), Hitachi Metals* (joint venture),
  Musashi Seimitsu Industry (second plant), and JSP (branch in Jilin Province)
Shanghai City: Alpine (joint venture) and Usui Kokusai Sangyo
Zhejiang Province: Usui Kokusai Sangyo and Central Glass* (joint venture)
Tianjin City: Suncall and GS Yuasa
Liaoning Province: Kotobukiya Fronte (plant expansion in Hubei Province)
  and Tachi-S (new company also in Hubei Province)
Region yet to be disclosed: Nissin Kogyo* (joint venture)
Establish/expand technology development center Jiangsu Province: Aisin Seiki (expansion)
  and Ichikoh Industries (division establishment)
Shanghai City: Toyoda Gosei (expansion)
Tianjin City: Stanley Electric (new company establishment)
Certified as contract developer/manufacturer Shanghai City: Pioneer
Transfer production outside China Shanghai City: Showa and JVC Kenwood


Japanese Supplier Reports:
* Thailand (Sep. 2015)
* Europe (Aug. 2015)
* Mexico (Jun. 2015), Mexico and Brazil (Jul. 2015)
* Southeast Asia (May 2015), the U.S. (Mar. 2015)
* China (Part 1): Southern, Central and Southwestern regions (Jan. 2015)
* China (Part 2): East/North/Northeast regions and overview (Feb. 2015)
* India (Nov. 2014)