HIDAJournal 2012 SPRING No.2

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HIDA Journal No. 2 ● SPRING 20134Our company is a manufacturer of automobile body frame components, precision parts, and metal mold and welding equipment, headquartered in Saitama City. Our company was established as a result of the merger of KIKUCHI CO., LTD. (headquartered in Hamura City, Tokyo) and TAKAO KINZOKU KOGYO Co., Ltd. (headquartered in Koka City, Shiga Prefecture) in April 2011. Originally, these two companies were manufacturers procuring automobile body frame components to the same customers and collaborated with each other as good partners by implementing business targeting overseas markets for 30 years. However, they merged to improve their competitiveness through enhancing business globalization, business volumes, and business base as the automobile industry was required to enhance global operations and respond to the changing business environment.We established a new locally-incorporated subsidiary in Indonesia in March 2012. We used to have 14 production sites in seven countries before that. This entity is our first operation overseas after the merger. Indonesia’s population totals 250 million, ranked fourth in the world, with its per-capita gross domestic product (GDP) exceeding USD 3,000 in 2010, a threshold considered to promote a shift from motorcycles to automobiles. This country is certain to drive the automobile market on a mid- to long-term basis. In fact, Japanese automobile manufacturers, which record a market share of over 80% in total in Indonesia, have successively announced their plan to enhance their production capacity or start up new factories. I myself have visited many countries to study the business environment of our globalization destination sites, and Indonesia, in spite of such issues as the delayed development of transportation infrastructure and rising human resource costs, still looks very attractive. We have defined our global strategy as “Getting closer to customers, with competitive pricing,” establishing our factories close to our customer sites so that we can provide automobile body frame components with competitive pricing in a timely manner. Thus, we have decided that there is no better time than now for us to implement our business in Indonesia, which promises growth in automobile demand. Furthermore, estimated de-mand growth is not confined to automobile body frame components. We manufacture a variety of precision parts for automobiles, with a focus on transmission parts, and we have seen rapid growth of demand for continuously variable transmission (CVT) parts, which constitute more than half of our precision parts. Automobile transmis-sion is categorized into man-ual transmission (MT) and automatic transmission (AT). CVT is a form of AT but is more fuel-efficient and triggers less CO2 emissions than other AT products, which makes it a more environment-friendly option. As CVT draws higher demand on a global scale as a countermeasure for environmental issues, we have advocated “Helping establish a low-carbon society through the combination of high-quality, cost-efficient technology with advanced technology” as our vision for 2020 to focus on the pro-duction of CVT parts.The production of CVT parts requires high technology and a variety of machinery and equipment, meaning that so far we have had to manufacture them solely in our factory in Tochigi Prefecture without being able to manufacture them in overseas factories. With a rapid increase of incoming orders, however, we have decided to expand our factory buildings in Tochigi and build a factory for CVT parts in addition to a factory for automobile body frame components in Indonesia as we expand our business there. Initially, we plan to manufacture CVT parts for our customers in Thailand. As the Indonesian government is expected to announce measures in favor of low-cost, low-fuel-consumption automobiles, however, we can expect a substantial increase of demand for our products in proportion to a production increase of newly-manufactured automobiles as well as an increase in the adoption ratio of our CVT parts. This environment will surely enable us to deliver our products to our existing customers as well as to our new customers. Indonesia poses huge growth potential for us both in automobile body frame components and in CVT parts.We are going to manufacture CVT parts overseas for the first time. Our future leaders in front-line operations should not only obtain technical skills but also understand our corporate philosophy, management strategy, and their backgrounds as future executives. Thus, we have decided to leverage the training program offered by AOTS (currently HIDA) to train six trainees in Japan. This program offers introductory training for learning the basic Japanese language skills required to communicate with other employees and fundamental skills needed to work for a Japanese company, and understanding Japanese culture and people on our behalf. Other advantages of this program include a subsidy that covers part of the training cost and the smoother General Manager of Human Resources Division Katsumi MatsumotoPIndonesia: a Country with Huge Growth PotentialKatsumi MatsumotoGeneral Manager of the Human Resources DivisionCorporate Management OperationsG-TEKT CorporationExterior view of Tochigi factoryHuman resource development of HIDA

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