Dowa: Construction of Heat Treatment Factory in Fast-Growing Indonesia

August 02, 2012

-- Strengthen Network in Asia, Further Expansion of Overseas Development --

August 1, 2012 -- PT. DOWA THERMOTECH INDONESIA, the local Indonesian company of DOWA Thermotech Co., Ltd. (14-1, Sotokanda 4-Chome, Chiyoda-ku, Tokyo; Capital: 1,000 million yen; President: Toshiro Sumida), a subsidiary of DOWA Holdings Co., Ltd. (same location; Capital: 36,400 million yen; President: Masao Yamada), on July 30 signed a purchase and sale contract for industrial land with Karawang International Industrial City (Karawang Regency, West Java Province, Indonesia) and, going forward, will proceed with the construction of a heat treatment factory.

Operations are scheduled to start in April 2013 which will also be combined with the full-fledged start of an industrial furnace maintenance business.

In recent years, Indonesia has seen remarkable economic growth as GDP recorded an annual increase of 6.5% during the last fiscal year, continuing steady development. In motorcycle production in particular, Indonesia is the world’s third largest, after China and India, and Japanese companies hold nearly a 100% market share.

In automobile production, approximately 840,000 vehicles were manufactured in Indonesia during the last fiscal year, the second largest in ASEAN behind Thailand. In automobile production too, Japanese makers have an overwhelming market share of more than 95% and, as a market where long-term growth is expected in the future, it is forecast that automobile manufacturers and auto parts makers will build even more new factories and expand existing production facilities.

DOWA Thermotech Co., Ltd. has supplied many industrial furnaces to automobile manufacturers and auto parts makers in Indonesia and, by starting the heat treatment business and starting a full-fledged maintenance business, as a comprehensive heat treatment maker, an organization will be built that can meet the multi-faceted needs of its customers.

The factory construction site is located about 50 kilometers east of the center of the capital city, Jakarta, a place that is within easy reach, about one hour by car. There are many Japanese companies, including those in the automobile industry, located in the industrial park where the factory will be built and in nearby industrial parks in the surrounding area and many of the Company’s customers are already operating there.

By advancing into Indonesia, following on from overseas heat treatment facilities in North America, Thailand, China and India, expanding demand in Southeast Asia can be acquired proactively. In addition, by progressing with the commonality of products purchased from each facility, including Japan, the provision of low-cost, high-quality products can be realized and, by strengthening business in Southeast Asian markets, overseas development can be expanded and improved.

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(press release)

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