Sumitomo Electric to Expand Global Automotive Wiring Harness Production through Mainland China
JapanCorp: <http://www.japancorp.net/?page_num=1> Sumitomo Electric to Expand Global Automotive Wiring Harness Production through Mainland China Osaka, Japan, Oct. 28, 2003 - (JCN Newswire) - Sumitomo Electric Industries, Ltd. , working to expand the Sumitomo Electric Group's global automotive wiring harness business, has announced plans to further strengthen operational capacity in mainland China. Sumitomo Electric Industries, with gross annual sales in excess of US $13.6 billion, recorded global automotive sales of more than US $5.6 billion in fiscal 2003. Sumitomo Electric has been strengthening its overseas capacity as Japanese automotive manufacturers have shifted their production overseas. The group is expanding its manufacturing and delivery system in North America, Europe, and Asia, an especially promising region for expansion. Presently, the Sumitomo Electric Group has 65 overseas facilities in 25 countries, and each of these production plants, sales offices, and technical centers are organically linked with one another. Sumitomo Electric is already present in China with one automotive wire production company, two wiring harness assembling companies, and a wiring harness component production company. Additionally, a new entity to develop and produce wiring harness applications for business equipment, Sumidenso Mediatech Suzhou Co., Ltd. is scheduled to begin with the assembly of automotive wiring harnesses in April 2004. Sumitomo Electric is planning to expand the capacity in all other assembling plants as well, and the total number of employees in mainland China is scheduled to double from the present staff of 5,000 to 10,000. Wiring harnesses in an automobile increasingly take on the roles of the blood vessels and nerves in human body. Harnesses distribute electric power from the battery to the lamps, motors, and computers, and communicate information on speed and temperature, and transmit other data such as sounds and images. In future, wiring harnesses developed and manufactured in mainland China by the Sumitomo Electric Group will not only be supplied to Japanese automotive manufacturers in Japan and across Asia, but to other China-based automotive manufacturers as well. Sumitomo Electric's Automotive Business: Global Capacity and Leadership Sumitomo Electric's automotive business, composed of wiring harnesses, brake systems and powder metal products, amassed global sales of more than US $5.6 billion in fiscal year 2003. Yet, the market for automotive parts is undergoing significant change, with increasing M&A activity among automakers, global sourcing for parts and intensified global competition. Consequently, capturing a top share of the global market will be essential for ensuring survival for automotive part manufacturers. In light of this trend, Sumitomo Electric is fortifying its global production network as part of its strategy to contend with the world's major players in this arena. Our optimal global procurement efforts have been highly regarded by automakers, earning the Global Contribution Award from Toyota Motor Corporation in February 2003. In May, Sumitomo Electric established a production base in Hungary to capitalize on the operating environment in Europe, where the majority of automotive wiring is purchased locally. Sumitomo Electric's Wiring Harness Production: from 15 to 20% of the Global Market Share by 2010 Wiring harnesses comprise Sumitomo Electric's principal business in the automotive segment. As such, the company is pushing forward with reorganizing and restructuring production bases to optimize global production. Sumitomo Electric has shifted North American bases to Mexico and European bases from England to central and eastern Europe. In Japan, the company has already shifted 40% of production to mainland China and other Asian countries and plans to continue this shift. Quickly securing production bases through M&A will be instrumental in raising SEI's global market share. To this end, since 1999, Sumitomo Electric has made one acquisition a year on average. These successive initiatives have contributed to forecasts that we will garner a 15% share of the wiring harness market in fiscal 2005, making us the world's number three manufacturer of these products, and 20% of the global market share by fiscal 2010. Sumitomo Electric Group's Wiring Harness Companies in Mainland China Tianjin Jin-Zhu Wiring Systems Co, Ltd.: assemblesautomotive wiring harnesses Tianjin Jin-Zhu Wiring Systems Components Co. Ltd.: production of automotive wiring harness components Huizhou Zhurun Automotive Wire Co. Ltd.: production of automotive wires Huizhou Zhurun Wiring Systems Co. Ltd.: assembles automotive wiring harnesses For photographs and more information about Sumitomo Electric's Automotive Business, please visit the company's Tokyo Motor Show display at http://sei.corpnet.jp/sei_motorshow/index.html About Sumitomo Electric Industries Limited Sumitomo Electric Industries, Ltd. (SEI/ TSE: 5802), one of the leading electronics groups in the world, designs, manufactures and sells optical fibers and components, advanced electronic devices, and automotive parts. The company has operations around the world in more than 25 countries and employs 79,000 people. SEI reported group net sales of more than US $13.6 billion for the year ended March 2003.For further information, please visit the Sumitomo Electric Industries Limited home page at: www.sei.co.jp <http://www.sei.co.jp> Contact Sumitomo Electric Industries, Ltd. Osaka, Japan Saiki Yutaka saiki-yutaka@sei.co.jp +81-6-6220-4119 _____ Oct. 28, 2003, 22:57 (JST) Source: Sumitomo Electric Industries Limited Sumitomo Electric Industries Limited www.sei.co.jp <http://www.sei.co.jp> From the Japan Corporate News Network www.japancorp.net <http://www.japancorp.net> Topic: Construction of Facility Sectors: Auto Manufacturing, Auto Parts & Equipment, Manufacturing General, Trade & Commerce General, Auto General © 2003 JCN Newswire. A division of Japan Corporate News Network KK. All rights reserved.