Komatsu to establish new company to manufacture crawlers for construction equipment in China

Komatsu Ltd. (President & CEO: Kunio Noji) is going to establish Komatsu Undercarriage Shandon Corp. (provisional), a subsidiary to produce crawlers for construction equipment in Jining, Shandong. Komatsu is expecting to obtain an official approval of incorporation by November 2007, and thus plans to start up production in August 2008.
With respect to links and other undercarriage components for construction equipment, Komatsu has conventionally engaged in concentrated production of component parts of the undercarriage for construction equipment in Japan and Indonesia, and supplied them to other Komatsu Group companies around the world. Against the backdrop of surging demand for construction equipment worldwide, our supply capacity has reached its top level.
Demand for hydraulic excavators in China climbed to some 30,000 units in the previous fiscal year, and it is projected that demand will further increase sharply into the future as the Chinese government continues to advance infrastructure development and other construction projects around the country.
With this new facility in China, which integrates the production of crawlers, from their components to final assembly, for hydraulic excavators, Komatsu will be better positioned to secure a stable supply of them. Similarly, Komatsu is working to improve the parts and service operations to reinforce its parts business foundation in China.

Company name: Komatsu Undercarriage Shandong Corp.
Location: Jining, Shandong Province, China
Capitalization:¥4.8 billion
Holding ratios: Komatsu Ltd. 75.0%
Nagatsu Industries Ltd. 10.4%
Neturen Co., Ltd.10.4%
Hokuriku Kogyo Co., Ltd. 4.2%
Area: Approx. 50,000 square meters for site and approx. 20,000 square meters for buildings
Line of business: Manufacture and sale of undercarriage components for hydraulic excavators
Projected sales: Approx. ¥2.8 billion for the first year
Number of employees: 145 persons at startup

Representative director: Shigeo Tsuda
Established: 1960
Head office: Kyoto City, Kyoto
Capitalization: ¥15 million
Main lines of business: Manufacture and sale of undercarriages, transmissions and hydraulic units for construction equipment
Sales: ¥14.5 billion for FY2006

Representative director: Eiji Yamashita
Established: 1946
Head office: Shinagawa Ward, Tokyo
Capitalization: ¥6.4 billion
Main lines of business: Manufacture and sale of steel bars for pre-stressed concrete, high-frequency heat treatment on contract, and manufacture and sale of induction heating devices
Sales: ¥39.2 billion for FY2006

Representative director: Tadanao Igarashi
Established: 1927
Head office: Sanjo City, Niigata
Capitalization: ¥50 million
Main lines of business: Manufacture and sale of castings and machined items
Sales: ¥7.2 billion for FY2006