30.11.2005

Tadano to “Realign” Production in Japan

Tadano has said that in the light of increasing demand for cranes in both its domestic and overseas markets, it is planning spend 7.5 billion yen (£36.2/$62.6 million) on refurbishing its existing plants and adding capacity within its three facilities in Japan.

The investment has already started and will be complete by 2008 the expenditure will increase its domestic manufacturing capacity by 30 percent.

These extensive plans will include a realignment of its plants as follows:

Its Shido Plant will build the full line of construction cranes, largely mobiles.

The Takamatsu Plant will build aerial work platforms as well as specialised equipment.

And the Tadotsu Plant, currently owned by Shikoku Kiko K.K, a manufacturing subsidiary of Tadano, will build truck loader cranes.

The transfer of production that is required, will be carried out gradually in order not to disturb operations at each of the plants. The company says it has targeted the end of 2008 for its completion.

Details of the work at each plant includes:

Shido Plant:
It will build a new manufacturing structure to add production capacity of rough terrain cranes and to assemble truck crane carriers.
A second building will produce booms and hydraulic cylinders including those used by Tadano Faun.

Takamatsu Plant
A new manufacturing structure will be added to raise production levels of aerial platforms and for an expanded parts centre

Tadotsu Plant
Production lines for truck loader cranes will be set up, including a new 18,000 sq metres building.

Over half of the investment will be used to upgrade and refurbish tools and equipment in order to increase production efficiency. Tadano says that it will fund the capital expenditure mainly from its own funds.

At the same time Tadano has announced that it is investing $10 million to increase its shareholding in its Chinese joint venture, BQ-Tadano (Beijing) Crane Co Ltd. In which it is a minority partner with Beijing Jingcheng Construction Machinery Co, Ltd (BJCM).

The $10 million will be used to increase the company’s paid up capital from $20 million to $30million which will boost Tadanos holding from 25 to 50 percent. As part of this investment the management will change in January, with Seiji Tadano taking over as president from Yuan Xiaofeng, a BJCM employee.

Tadano aims to expand Tadano’s market share of the Chinese truck crane market. Seiji Tadano will assume full responsibility for the business in order to further improve and strengthen its manufacturing, sales and service activities.

Demand in China for construction cranes has grown rapidly over the past few years, from 4,000 units in 2001, to 6,300 in 2002, 9,500 in 2003 and 11,500 in 2004. A modest slowing is forecast for 2005, to around 10,000 units.

Tadano says that 90 percent of the market comprises 25 tonne or under, domestic truck cranes.

BQ-Tadano currently employs around 300 staff and will complete 323 cranes in 2005 with a sales value of 200 million RMB.(£14.3/$24.8 million).