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Japan's electronics firms investing a lot in China

Major Japanese electronics parts makers have been boosting capital expenditures in China in an effort to raise production there, a leading Japanese financial daily reported yesterday.

According to the Nihon Keizai Shimbun, Japanese parts manufacturers are trying to increase output in China because producers of finished equipment are boosting their presence in the country.

China now boasts the world's highest production of cell phones and personal computers, and the local car market is also expanding.

Alps Electric is having five out of six manufacturing bases in China open new facilities or take on manufacturing that had been conducted elsewhere, the report said.

Although its Chinese plants now use materials and components shipped from Japan, Alps aims to have the Chinese plants perform more production on its own in order to quickly respond to sudden rises in local demand, the report said.

The company plans total capital investment worth ?5 billion (US$47 million) over the next two years in China, with a view to boosting Chinese sales, including those to Hong Kong and Taiwan, to ?130 billion next year, up ?30 billion from the current level.

According to the report, Dalian Alps Electronics will also build a new plant to increase capacity by 40 percent for items such as airbag connectors for sale to major Japanese, US and European automakers.

Alps' sales staff in China is to be doubled to 100 by next year.

Kyocera plans to double the output of ceramic multi-layer capacitors used in cellphones and other digital home electronics products at its Shanghai plant in fiscal 2004, the report said.

Meanwhile, a second Chinese plant of NEC Tokin is due to be opened in Jiangsu Province to make capacitors for computers and cellphones at a cost of ?3 billion.

The company currently exports capacitors from Thailand to China, according to the report. Monthly output in China is projected at 10 million units for June, with the output capacity to be tripled by March next year.
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