Mitsubishi Electric to push automation

PUBLISHED : Thursday, 15 December, 2011, 12:00am
UPDATED : Thursday, 15 December, 2011, 12:00am


Japan's Mitsubishi Electric is expanding its factory automation systems business in China to boost annual domestic sales in that market segment to 100 billion yen (HK$9.99 billion), by March 2016.

The Tokyo-based electronics and information-technology company plans to invest nearly four billion yen to establish three new plants producing a range of factory automation equipment in China by the end of next year.

It currently generates about 60 billion yen in annual sales in China from factory automation systems, which include low-voltage switchgears, programmable logic controllers, servo motors, numerical controllers, and so-called human/machine interfaces.

'We have determined that we must strengthen our factory automation solutions capabilities to support our customers' manufacturing productivity, and to provide them with more prompt and reliable service,' Hideyasu Nonaka, a senior vice-president at Mitsubishi Electric and its group president for factory automation systems, said yesterday.

The opportunities for the company to supply automation equipment to manufacturers operating outside Japan have rapidly expanded because more Japanese firms have increased their offshore capital investments. Mitsubishi Electric says China, nations in Southeast Asia and other emerging markets are investing more in infrastructure such as railways, subways and water treatment facilities, creating new demand for integrated automation equipment designed to provide energy savings, environmental protection and safety.

The company's new investments on the mainland include 2.55 billion yen to make servo motors, numerical controllers and drive products in Changshu, Jiangsu province; 320 million yen to produce low-voltage switchgears in Xiamen from 2012; and an undisclosed amount for Mitsubishi Electric Dalian Industrial Products, which makes so-called mechatronic systems, programmable logic controllers and human/machine interfaces.

'We have decided to collaborate more closely with our partners who provide factory automation solutions, and strengthen our production and sales capacities,' Nonaka said. The Xiamen plant, for example, will be on the premises of an affiliate of Taiwan's Shihlin Electric.

'Manufacturers in China, both domestic and foreign-owned, are moving to boost productivity via factory automation. This is fuelling strong demand for industrial robots, computerised numerical control systems, and other automation technologies,' Bob Smith, lead portfolio manager of the T Rowe Price International Stock Fund, said.

The global industrial automation electronics equipment market is projected to be worth US$97 billion this year, according to IMS Research.