Kobe Steel’s Chofu Plant to Improve Profitability with Better Cost, Productivity

Kobe Steel’s aluminium and copper unit tries to improve the profitability at Chofu plant in Yamaguchi. The plant expects more than 2 billion yen of cost cutting for fiscal 2009 ending March 2010, which is higher than original target. The copper flat and strop products division posted operating profit in the first half year through the better profitability program. The plant also targets profitability for aluminium extrusion division in fiscal 2010 despite of the slow demand.

The plant’s production level reached around 80% for copper products and near 70% for aluminium products recently compared with the peak while the production plunged in second half of fiscal 2008 after Lehman Shock.

The plant tries to reduce the cost to secure profit under the lower level production and shipment. The firm’s copper and aluminium unit launched cost and cash innovation 50 program, under which the unit targets 5 billion yen of cost cutting and cash generation. The plant also tries to improve the profitability.

The plant’s copper flat and strip products output reached around 5,000 tonnes in September, which was almost full capacity operation with current workforce. The division tries to improve the profitability by keeping the production level. The aluminium extrusion division tries to secure profit under low level operation at monthly 2,800 tonnes level compared with peak of 4,000 tonnes.