MHI Gearing Up to Produce Tyre Manufacturing Machinery in China

Vehicle production in China is said to have exceeded an estimated 13.5 million units last year, with 2010 production expected to grow to around 14 million units. Alongside this growth, demand for tyres in this market has also risen sharply, and during the course of the coming year China is anticipated to surpass the US as the world’s largest tyre market. In a “strategic response” to moves by global tyre makers to enter the Chinese market, Mitsubishi Heavy Industries, Ltd. (MHI) has taken the decision to manufacture tyre production machinery there through its wholly owned Changshu Ryoju Machinery Co., Ltd subsidiary. The Jiangsu Province based operation is now in the final stages of readying its plant, and this preparation should be complete by the end of February in time for a March commencement of production.

As an affiliate of Mitsubishi Heavy Industries (China) Co., Ltd. (MHIC), the regional headquarters established in Beijing last December to oversee MHI’s business in China, the new tyre machinery manufacturing company, which is capitalised at 450 million yen (₤3.15 million), will conduct business by securing funds from MHIC. MHI has acquired a 5,000 square metre building within the Changshu Southeast Economic Development Zone and has been preparing for the start of production launch since last August. The new company will enter operation with 64 employees, with Minoru Kimura from MHI’s Machinery & Steel Structures headquarters appointed to the role of general manager.

While the Chinese plant will initially manufacture and assemble equipment using major parts received from MHI’s Industrial Machinery Business, Technology & Solutions Division in Japan, the company intends to further solidify its operation base in China by establishing a supply chain through the development and cultivation of local suppliers. Plans call for the manufacture of 40 units in the initial business year, increasing to approximately 160 units within three years.

In tandem with this initiative, the company’s production base in Japan – the Industrial Machinery Business, Technology & Solutions Division – will strengthen its function as a technology development centre; it will also shift production to machinery intended for use by domestic customers, including high-end models and machines to produce tyres for heavy-duty construction vehicles.