Dec 5, 2013
Hitachi Chemical Co., Ltd.

Increasing Production Capacity of a Powder Metal Product Manufacturing Subsidiary in Indonesia

- Aiming to increase sales for powder metal products for automobiles and motorcycles in Indonesia by 50% in 2015 -

Hitachi Chemical Co., Ltd. (Head Office: Tokyo; President and CEO: Kazuyuki Tanaka; Capital: 15.5 billion yen; hereinafter referred to as "Hitachi Chemical") has decided to increase production capacity at its manufacturing subsidiary in Indonesia in order to meet increasing demands for powder metal products in Indonesia. Operations will begin in spring 2015 and Hitachi Chemical is aiming to increase sales for powder metal products for automobiles and motorcycles in Indonesia by 50% (compared to FY2012) in that year.
Moreover, the name of the subsidiary was changed as of November 22 from PT Hitachi Powdered Metals Indonesia to PT Hitachi Chemical Indonesia (hereinafter referred to as "HCID") with a view to future business expansion of the Hitachi Chemical Group in Indonesia.

Indonesia has been exhibiting continued healthy growth in the motorcycle market. Meanwhile, with the large increase in demand for automobiles predicted to result from the government's implementation of the Low Cost Green Car Policy* in 2013, automobile manufacturers and auto parts manufacturers are moving to increase production capacity and work to procure parts locally and increase local production.

HCID had been producing powder metal products mainly for motorcycles in Indonesia since 2012. However, the decision was made to increase its production lines within the premises of its already-existing plant in order to incorporate increasing demand with the growth seen in the automobile market. The new lines will begin operation in spring 2015 and will mainly comprise powder metal products for automobiles. Hitachi Chemical Group aims to expand its business operations for powder metal products for automobiles and motorcycles in Indonesia in FY2015 and increase its sales within Indonesia by 50% (compared to FY2012).

Hitachi Chemical Group's powder metal products bases have spread to Japan, the US, China, Singapore, Thailand, Indonesia and India. We are working to expand our product supply network worldwide to meet customer needs and to reinforce and increase our powder metal product business.

*Low Cost Green Car Policy: Policy whereby cars with engine exhaust volume and fuel consumption etc. that meet standards laid out by the Indonesian government are subject to reduced luxury tax

<Outline of PT Hitachi Chemical Indonesia (previously: PT Hitachi Powdered Metals Indonesia)>
(1) Location: Suryacipta Industrial Park, Karawang, West Java, Indonesia
(2) Representative: Kunio Maki (Managing Director and Representative Director)
(3) Description of Business: Manufacture and marketing of powdered metal products
(4) Capital: 37 Million US$
(5) Establishment: October 2010
(6) Shareholder Structure: Hitachi Chemical Group 100%
(7) Number of Employees: Approximately 180 (when full-scale operations initiated in 2015)

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