2012

[Developing a local integrated production system in the Southeast Asian region]

NTN Corporation (hereafter, NTN) will establish a new plant in the Pinthong industrial area (located in Chonburi Province) as its second production base in Thailand, to meet growing demand for automobiles in the Southeast Asian region. A forging and turning joint venture will also be established with a Japanese supplier.

The move aims to increase production capacity of CVJ, hub bearings and other automotive products, as well as develop a local integrated production system in India and other countries in the Southeast Asian region, covering all processes from raw materials to finished products.

1. Aim of the newly established production base

Pinthong Plant (right) and NTPT (left) Image

NTN has focused on accelerating the “at local sites, with local materials by local personnel”^* policy announced in the three-year medium-term management plan “Global Advance 2013” beginning in April 2011, to expand business within growing markets and to increase profits in the automotive business.

Demand is growing for models such as compact cars and pickup trucks within the automotive market in the Asian region. NTN is aiming to expand its share in this market by increasing local production of automotive products and improving cost competitiveness by sourcing parts locally, and by improving productivity and maintaining a reliable, high level of quality by establishing a local integrated production system.

Until now, NTN had been producing automotive products such as CVJ and hub bearings at NTN Manufacturing (Thailand) Co., Ltd (hereafter, NMT Eastern Seaboard Plant) located in Thailand's Eastern Seaboard Industrial Estate (Rayong Province). The new NMT Pinthong Plant will be established in the Pinthong industrial area as NTN's second production base in Thailand as a means of increasing production capacity. NTPT Company Limited (hereafter, NTPT), a forging and turning joint venture with Takao Kogyo Co., Ltd., a company with highly advanced manufacturing technology, will also be established on the same site to develop a local integrated production system.

The NMT Pinthong Plant and NTPT are able to openly utilize the free trade agreement (FTA) in place between ASEAN and other regions to increase cost competitiveness by sourcing parts and raw materials from local suppliers. In addition to Thailand, NTPT will also supply semi-finished automotive products to India, and in the future, to Europe and Americas, to increase NTN Group profits and further enhance the group's competitive capability to overcome the long-term effects of a high yen.

* “at local sites, with local materials by local personnel”: a local system established to use local materials and equipment, managed by local people.

2. Overview of the NMT Pinthong Plant

CVJ currently manufactured at the NMT Eastern Seaboard Plant will be transferred to the larger NMT Pinthong Plant site to increase production capacity. The forging and turning joint venture NTPT will also be located on the same site to develop an integrated production system, and parts will be sourced locally to increase productivity and cost competitiveness. This will help increase market share.

After CVJ production has been transferred, both plants will gradually increase production capacity of automotive products other than CVJ, such as hub bearings and ball bearings.

3. Overview of the joint venture company(NTPT)

NTPT, a forging and turning joint venture with Takao Kogyo, a company with highly advanced manufacturing technology and quality management knowhow, will also be established on the same site as the NMT Pinthong Plant. The company is able to openly utilize the free trade agreement (FTA) in place with other regions to source parts from Korea and other countries, to develop a local integrated production system with the NMT Pinthong Plant for improving productivity, maintaining a reliable, high level of quality, and improving cost competitiveness.

In addition to Thailand, NTPT will also supply semi-finished automotive products to NTN group production bases around Southeast Asia, Europe and America.

Reference: Integrated production system for automotive products in the Asian region