Riken Corporation Business Report FY2008
Business Highlights
Financial Overview | (in millions of JPY) |
FY2008 | FY2007 | Rate of Change(%) | Factors | |
Overall | ||||
Sales | 80,909 | 95,765 | (15.5) |
-Sales declined because of sluggish sales in the global car market. |
Operating income | 245 | 7,346 | (96.7) | |
Ordinary income | 482 | 8,765 | (94.5) | |
Current net income | (1,118) | 4,165 | - | |
Automotive/Industrial Machinery Component Division
(excludes transactions among divisions) |
||||
Sales | 67,627 | 81,590 | (17.1) | -Cuts in auto production caused a decline in orders and resulting decline in sales. |
Operating income | (1,377) | 5,297 | - | -Income declined due to cuts in auto production and to higher material prices. |
R&D
R&D Expenditure | (in millions of JPY) |
FY2008 | FY2007 | FY2006 | |
Group | 1,542 | 1,576 | 1,482 |
Automotive/Industrial Machinery Component | 1,168 | 1,393 | 1,378 |
R&D Structure
-The R&D Division, Ring Technology Development Division, and Product Development and Engineering Technology sections under each manufacturing division, are in charge of the Company's R&D activities.
-The Company established a new department, called the Next-generation Product Planning Department, in order to reinforce the Company's planning activities for creating new products that can be used in new and expanding areas such as hybrid and electric vehicles.
Main R&D activities
-Automotive/Industrial Machinery Component
1. Low friction and long-lasting gasoline-engine piston rings that lower fuel consumption
2. Diesel-engine piston rings that comply with emissions regulations
3. Valve parts, transmission sealing rings
4. Various surface treatment technology that enables a high degree of high sliding
performance
5. Light- weight and high-strength chassis parts
Product Development
DLC piston rings for aluminum liners
-Improving fuel economy is one of the important themes in recent development activities on engines, as it directly contributes to cutting CO2 emissions. A growing number of manufacturers, therefore, choose to use aluminum instead of cast iron as an alternative material for liners, as aluminum is lighter and cools down faster. The Company developed DLC piston rings for aluminum liners. These piston rings are being used by European automakers in their engines. The Company started mass-producing this particular piston ring in March 2008, becoming the first company in Japan to do so.
Technical Tie-ups (As of Mar. 2009)
Company name | Country | Contract | Contract date | Contract period |
Taiwan Riken Ind. Co., Ltd. | Taiwan | Manufacturing methods for various forged steel engine components such as piston rings, cylinder liners, blocks and pistons | Aug. 22, 2005 | Terms for extending the agreement are subject to negotiation |
Siam Riken Ind. Co., Ltd. | Thailand | Manufacturing methods for piston rings and other forged steel engine components | Apr. 19, 2009 | 5 years |
P. T. Pakarti Riken Indonesia | Indonesia | Manufacturing methods for joint and forged parts | Jan. 1, 2006 | 5 years |
Shriram Pistons & Rings Ltd. | India | Manufacturing methods for piston rings | Mar. 1, 2007 | 7 years |
Allied Ring Corp. | USA | Manufacturing methods for piston rings | Sept. 1, 1989 | Terms for extending the agreement are subject to negotiation |
Grede Foundries, Inc. | USA | Manufacturing methods for ductile forged components | Jul. 17, 2005 | by 2007.07.16 |
Manufacturing methods for lower control arm | Jul. 23, 2001 | 8 years from the start of delivery of mass produced products | ||
Manufacturing methods for Sheet parts | Sep. 16, 2003 | 8 years from the start of delivery of mass produced products | ||
Korea Piston Ring Inc. | Korea | Manufacturing methods for piston rings | Mar. 1, 2005 | by 2010.03.01 |
Xiamen Riken Ind. Co., Ltd. | China | Manufacturing methods for piston rings | Aug. 1, 1999 | 10 years |
Manufacturing methods for camshafts | Oct. 1, 2004 | 5 years | ||
Riken Automobile Parts (Wuhan) Co., Ltd. | China | Manufacturing methods for piston rings, seal rings, valves and other cast iron products. | Mar. 1, 2005 | 10 years |
Investment Activities
Investment Expenditure | (in millions of JPY) |
FY2008 | FY2007 | FY2006 | |
Group | 6,292 | 7,208 | 6,428 |
Automotive/Industrial Machinery Component | 5,469 | 6,334 | 5,735 |
Automotive/Industrial Machinery Component Division
-The Company invested mainly in production facilities for increasing the production capacity for piston rings and valve lifters.
Planned Capital Investment (As of Mar. 2009)
Company Office (Location) |
Purpose | Planned investment amount (in millions of JPY) | Starting | Estimated completion | Production capacity increase upon completion |
New addition | |||||
Riken Corp. Kashiwazaki Plant (Niigata Prefecture, Japan) |
Installing production facilities for making piston rings | 914 | Apr. 2009 | Oct. 2010 | No effect on production capacity |
Refurbishment | |||||
Riken Corp. Kashiwazaki Plant (Niigata Prefecture, Japan) |
Installing production equipment to manufacture piston rings and other automotive components | 198 | Apr. 2009 | Oct. 2010 | No effect on production capacity |
Riken Corp. Kumagaya plant (Saitama Prefecture, Japan) |
Enhancing utilities and working environment | 169 | Apr. 2009 | Oct. 2010 | No effect on production capacity |
P. T. Pakarti Riken Indonesia Head office plant (Surabaya, Indonesia) | Installing new equipment to produce auto parts | 293 | Apr. 2009 | Oct. 2010 | No effect on production capacity |