Author: Tronserve admin
Wednesday 4th August 2021 11:01 AM
Japan's Electric Wire Makers Expand in Asia to Ride EV Boom
Japanese electric wire manufacturers are transferring their production and investment into high gear in Asia as they prepare for growth in the region’s electric vehicle market.
SWCC Showa Holdings will invest about 700 million yen ($6.5 million) to relocate and integrate two plants in China. The company will likewise establish a method to develop, manufacture and sell EV cables through Jaxing Showa Interconnect Products, its Chinese subsidiary.
In Southeast Asia, Hitachi Metals will increase its production capacity in Vietnam and Thailand, while Furukawa Electric will also boost its capacity in Vietnam.
Japanese wire makers are eager to grow sales elsewhere in Asia as automobile electrification takes off and Japan's auto parts suppliers shift their own production bases.
Jaxing Showa's two existing plants, which at present make products like copper wire for consumer electronics, will be coupled into a new plant that is scheduled to go online in July 2020. The new plant will probably be double the size of the existing two factories' 10,000 sq. meter area, and will include automated facilities to increase productivity. The company's sales totaled about 4 billion yen in fiscal 2017. SWCC Showa aims to lift the Chinese subsidiary's gains by improving logistics.
According to Fuji Keizai, a Tokyo-based research company, EV sales in China are expected to nearly quintuple to about 2.46 million vehicles in 2035, compared with 2017.
SWCC Showa’s current mid-term management plan calls for enhancing the company’s operating profit by 5% to 7 billion yen in fiscal 2022, compared with fiscal 2018. The company believes this target is achievable thanks to its EV-related business expansion. In Southeast Asia, in the meantime, Hitachi Metals is building its capacity to produce wire for electric parking brakes in Vietnam and Thailand.
The company will widen production capacity at its existing plants and build new facilities during the first half of fiscal 2020. It plans to supply EPB wire mainly to Japanese auto-sector manufacturers in Southeast Asia. It will also open new production facilities at its plant in Hai Duong Province in northern Vietnam and beef up the capacity of present facilities at its plant in Ayutthaya, north of Bangkok.
EPBs do not require conventional mechanical levers, making it possible to more properly use space around the driver’s seat. Hitachi Metals is rushing to enlarge local processing in anticipation of growing demand for EPB wire in Asia. In Vietnam, Furukawa Electric will also invest about 3.5 billion yen to quadruple its existing local plant’s capacity to produce aluminum wire for automobiles. A new building will go online in September 2020.
Furukawa Electric intends to cash in on increasing demand due to greater use of aluminum in EVs to make them lighter. Many Asian countries are marketing EVs under government initiatives. The Chinese government is promoting the spread of ecologically friendly cars like EVs the help address environmental problems due to auto emissions.
The Thai government is also pursuing "Thailand 4.0," a policy to enhance the nation’s industries. Next-generation automobiles such as EVs have a striking place in the place. There are also moves to establish charging infrastructure for EVs in Asia, which is also supporting Japan's electric wire makers to expand their operations in the region.
Source: NIKKEI ASIAN REVIEW