Kobe Steel plans aggressive actions to expand Chinese business under mid-term plan from fiscal 2013 starting April 2013. The firm will reveal cold rolled high tensile steel making joint venture with Anshan Iron and Steel later the year. The firm tries to follow growing demand for high grade automobile through the local ventures including aluminium flat products joint venture with Jiangsu ALCHA Aluminium of China. Kobe Steel eyes more than 50 billion yen of investment in China. The firm targets to double Chinese sales to more than 500 billion yen of in fiscal 2020.
The firm expects Chinese sales represent a third of targeted 1.5 trillion yen of offshore sales in fiscal 2020. The construction machinery sales represent more than 60% of the Chinese sales while the firm increases the sales for steel, welding and machinery units. The firm launched Kobelco (China) Holding in January 2011 to manage Chinese business with 36 affiliates. The steel unit expanded cold heading steel wire making plant, Kobe Special Steel Wire Products (Pinghu) in November 2011 and launched high grade spring steel wire processor, Kobelco Spring Wire (Foshan) in January 2012. The firm tries to follow growing steel demand for automobile when Chinese automobile output is expected to 30 million units in 2015 from 18.24 million units in 2011. China is the firm’s strategic area for the new mid-term plan from fiscal 2013. The firm would expend more than 50 billion yen including 32 billion yen for aluminium flat products joint venture. The construction machinery unit, which represents 50% of the Chinese sales, already completed expansion to annual 25,000 units of production capacity in China.