Mitsubishi Steel Targets Stable Growth under New 3-Year Plan

Mitsubishi Steel Mfg. announced on Tuesday the firm expands businesses of automotive spring and precision parts for cell phone and other applications to meet higher demand under the new business plan starting April 2006. The firm tries to increase sales for other than steel products to improve the business portfolio though the firm also expands the supply capacity for the core business of special steel. The firm targets 13.5 billion yen of recurring profit with 130 billion yen of sales keeping 10% of recurring profit on sales in fiscal 2008 ending March 2009. The firm strengthens partnership with Muroran works of Nippon Steel for the special steel unit, which represents near 40% of the total sales. The firm expends 15 billion yen under the 3-year plan to renew old facilities and to supply high-quality alloy steel stably. The firm produces larger sized products to improve the productivity and cost competitiveness under partnership with Nippon Steel, which is good at smaller sized products. The firm expands automotive spring and precision parts business to improve the profitability when the firm expects the special steel unit will decrease the profit contribution from current 65% of total profit to 40% in 3 years. The firm tries to increases the sales of automotive spring from the Chinese subsidiary, MSM Ningbo Spring, which starts operation in June 2007. The firm expects the Chinese operation adds annual 5 billion yen of sales for the spring business, which represents 30% of the total sales. The firm tries to reduce cost by improving line efficiency and yield along with better production technology to meet higher quality required by transplants of Japanese automakers. The precision parts unit tries to expand the self manufacturing of parts for hinge of cell phone and other applications along with the shift to high performance hinge. The firm also establishes production system to design and make all of metal mold materials. The formed and fabricated products unit focuses on expansion of precision castings and powder products businesses and development of new products. The firm also improves human resource development and research and development along with better personnel system to utilize younger talents.