MHI to Boost Turbocharger Production Capacity Worldwide, Aiming

MHI to Boost Turbocharger Production Capacity Worldwide, Aiming for 10 Million
Units/Year Production Structure 
1st Stage: Near 11 Billion Yen Investment into Global Production Bases, in Quest
to Acquire Top Market Share 
Tokyo, Aug 6, 2013 - (JCN Newswire) -  Mitsubishi Heavy Industries, Ltd. (MHI)
is taking steps to strengthen its global turbocharger production capacity,
ultimately targeting a structure enabling production of 10 million units per
annum (p.a.). As the first stage, the company intends to invest a total of 11
billion yen into its overseas production bases to boost its worldwide
production capacity from the current 5.8 million units p.a. to 8.9 million by
2015. By enhancing its production capacity MHI aims to respond to rapidly
expanding global demand for turbochargers amid spreading adoption of tighter
fuel efficiency requirements. The company is also planning further investments
toward its final goal of achieving a production structure capable of 10 million
units p.a. Through these cumulative investments, the company ultimately aims to
move swiftly toward securing a position as the world leader in the automotive
turbocharger market. 
New initiatives will also be implemented with respect to development,
manufacturing and marketing. In terms of development, the company is looking to
develop next-generation turbochargers as a way of carving out new markets. The
forthcoming innovations will be a "New Concept Turbocharger"
achieving the world's highest efficiency level and an "electrically
driven two-stage supercharging system (turbocharger)" enabling further
downsizing of gasoline engines. To carry out these development programs,
Mitsubishi Turbocharger and Engine Europe B.V., MHI's wholly owned
production base in Europe, is to be elevated to the company's No.2
development base, second only to its corresponding facilities in Japan,
offering local customers enhanced development support. 
Relevant to manufacturing, the company will pursue further automation of
installations at its production bases, particularly those in Japan. It will
also push to achieve a flexible production structure with four focal points -
Japan, North America, Europe and Asia - in a quest to strengthen
cost-competitiveness further. In addition, going forward final product assembly
will be performed at bases close to each product's market. By creating a
locally responsive support structure, the company will be able to respond to
diverse market needs precisely and with short delivery schedules. 
A breakdown of the near 11 billion yen investment planned in the first
investment phase is as follows. A significant portion of the total sum will be
allocated to Mitsubishi Turbocharger Asia Co., Ltd. (MTA), its wholly owned
turbocharger subsidiary in Thailand, to further strengthen MTA's
production structure for cartridges, the core components of turbochargers.
Specifically, annual cartridge production capacity will be increased more than
2.5-fold by 2015 through substantial expansion of parts processing lines and
cartridge assembly lines. The cartridges produced at MTA will be supplied to
MHI's final assembly bases in Europe, China and elsewhere. Additionally,
because demand for turbochargers is also increasing from automobile and truck
manufacturers with production bases in Thailand, final assembly lines will also
be substantially increased, to double production capacity by 2015. 
Shanghai MHI Turbocharger Co., Ltd. (SMTC), a turbocharger production and
marketing company originally established jointly by MHI, Sumitomo Corporation
and Shanghai Diesel Engine Co., Ltd. (SDEC), became a consolidated subsidiary
of MHI this June through acquisition of a portion of shares formerly owned by
Sumitomo Corporation. MHI now plans to increase SMTC's capitalization and
to progressively expand its production lines. In doing so, MHI looks to expand
SMTC's turbocharger production capacity roughly threefold by 2015 and
fourfold in 2016. 
In the U.S., MHI is currently in the process of establishing a local
turbocharger production facility in Indiana in the form of a production plant
of Mitsubishi Engine North America, Inc. (MENA), a wholly owned engine and
turbocharger marketing subsidiary serving North America, aiming for commercial
production launch in the autumn of 2014. The U.S. production plant will
function as a key base in MHI's global turbocharger production structure.
Under the investment program announced today, the plant will initially have a
production capacity of approximately 600,000 turbochargers p.a., to be
progressively doubled by 2016. Sales are to be targeted at the major U.S. auto
manufacturers and the North American production bases of Japanese and European
automakers. 
In tandem with the expanding adoption of tighter fuel efficiency regulations -
for example, Corporate Average Fuel Economy (CAFE) regulations in the U.S. -
market demand for turbocharged engines, especially gasoline engines, is
increasing rapidly. In light of this market trend, MHI will continue to make
necessary investments in a quest to attain the top share in the global market
for automotive turbochargers. 
About Mitsubishi Heavy Industries 
Mitsubishi Heavy Industries, Ltd. (MHI), headquartered in Tokyo, Japan, is one
of the world's leading heavy machinery manufacturers, with consolidated
sales of 2,820.9 billion for the year ended March 31, 2012. MHI's diverse
lineup of products and services encompasses shipbuilding, power plants,
chemical plants, environmental equipment, steel structures, industrial and
general machinery, aircraft, space rocketry and air-conditioning systems. For
more information, please visit the MHI website at www.mhi.co.jp. 
Contact: 
Mitsubishi Heavy Industries
Hideo Ikuno
h.ikuno@daiya-pr.co.jp
+81-3-6716-5277 
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