Furukawa Electric and Furukawa Precision Engineering Jointly Establish Company in China to Plate Connector Terminals with Precious Metals

September 30, 2002

Furukawa Electric Co., Ltd. and its wholly owned subsidiary, Furukawa Precision Engineering Co., Ltd. (based in Kiyotaki-Shinhosoomachi, Nikko, Tochigi Prefecture, and headed by President Akisada Nakamura) have jointly established a connector terminal plating company in Zhongshan, Guangdong Province, China. The new company named Furukawa Precision (Zhongshan) Co., Ltd. is scheduled to begin the full-scale plating of connector terminals with precious metals in January 2003. The investing companies completed official registration of this joint project with Chinese authorities on September 4, 2002.

Japanese electronic device manufacturers are now moving production facilities overseas to China at a rapid pace. Connector makers are no exception as evidenced by their relatively recent shift to overseas production in an attempt to cope with declining sales of products related to information technology. Many connector makers began relocating production facilities overseas, especially to China, in the second half of 2000. There are virtually no precious metal-plating companies in China, however, that can meet their quality requirements. The lack of quality local suppliers has caused many companies thinking about relocating to China to give up their plans. Conversely, many Japanese manufacturers that took risks and moved operations to China eagerly awaited the availability of a reliable plating firm.

In view of this situation, Furukawa Electric and Furukawa Precision Engineering, a company with many years' experience in plating connector terminals with precious metal, jointly established a company to plate connector terminals with precious metals on mass-production basis in Zhongshan, Guangdong Province. Many Japanese connector makers maintain production facilities in Zhongshan. Both investors expect terminals plated by their subsidiary to replace imports from Japan and project the company's monthly output to surpass 500 million pins in 2007. The new company's office buildings and production facilities are scheduled for completion by the end of this year. The company will begin making samples in January 2003 and launch mass-production plating in March 2003. This plating firm will join an integrated copper-strip manufacturing company (announced earlier this year by Furukawa Electric) in Wuxi, Jiangsu Province. Both production bases in China are expected to help Furukawa Electric meet diverse user demands in the Chinese market. The plating company in Zhongshan will be the second overseas manufacturing subsidiary for Furukawa Precision Engineering, which also owns a semiconductor lead frame manufacturing company (Furukawa Precision Thailand Co., Ltd.) in Thailand.

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