New company for manufacture and marketing of electrical components founded in Indonesia

Yamaha Motor Co., Ltd.'s electrical components subsidiary Moric Co., Ltd. (President: Kazuhiko Nomura ; Location: Morimachi, Shuchi-gun, Shizuoka Pref.) has recently established a new company in Indonesia for the manufacture and marketing of electrical components. The new company takes as its core the electrical components related factory and facilities of YMC's Indonesian motorcycle manufacturing company PT. Yamaha Indonesia Motor Manufacturing (President: Takashi Kanamori, Location: suburbs of Jakarta, abbreviated name: YIMM) and consolidates it as a separate company that will be a subsidiary of Moric Co., Ltd. Official approval from the Indonesian government for the establishment of the new company was received this July, and with the reception of the official registration certificate in August, plans call for the new company to being operation in January of 2002.

Named PT. Moric Indonesia, the new company will engage primarily in the manufacture and marketing of components for motorcycle ignition systems, starter systems, light and switch systems. The new company's starting capital of US$ 5 million will be invested 80% by Moric Co., Ltd. and 20% by Yamaha Motor Asia Pte. Ltd. (President: Yoshiki Ishida, Location: Singapore, abbreviated name: YMAP), the YMC subsidiary that provides financial support for Yamaha manufacturing bases in the ASEAN region and promotes cross-trade.

As a subsidiary of Moric Co., Ltd., the new company will be the recipient of technology transfers from Moric, and plans also call for new facility investment aimed at promoting increased levels of manufacturing independence and cost reduction. Also, beginning operations with approximately 500 employees, the first-year (2002 F/Y) sales goal for the new company will be about 4.2 billion yen. The new company's products will initially be supplied mainly to YIMM, but plans call for sales to eventually be expanded to include other motorcycle makers in Indonesia and the neighboring ASEAN countries. In the future, there are plans to expand sales to Europe as well.

Last year, total demand for the Indonesian motorcycle market was about one million units, and in general the market is showing signs of recovery from the 1997 currency crisis. However, the introduction of Chinese-made motorcycles in recent years has intensified price competition. Within such a market environment, YMC has promoted the consolidation of YIMM's electrical components factory as a separate and more specialized company as part of our comprehensive efforts to increase competitiveness in the motorcycle market. Meanwhile, within the context of its mid- and long-term plans to achieve increased competitiveness in the global market, Moric Co., Ltd. sees the new company playing an important role as a manufacturing base for expanding electrical components business in the ASEAN region. For Moric, this new company represents its third electrical component manufacturing base in Asia following the establishment of companies in Taiwan and China.