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OMRON opens its new Automotive Electronic Components Production Base in Guangzhou, China

FOR IMMEDIATE RELEASEDecember 16, 2005

Kyoto - On 16th December, OMRON Corporation (TSE: 6645; US: OMRY), a US$5.5 billion Japanese manufacturer of automation and sensing products, will officially open a new automotive electronic components production and sales base in Guangzhou, China, in a strategic move to address global customer needs for low-cost procurement and strengthen business with major automotive manufacturers operating in the region.

The new company, officially named Omron (Guangzhou) Automotive Electronics Co., Ltd. (abbreviation: OAG), will initially employ approximately 80 staff and start producing keyless entry systems and power window controllers from January 2006. In the future, production will expand to include new electronic control devices that are currently under development. Sales projections for the first year (January - March 2006) are 100 million yen, rising to 5 billion yen in 2007, and 15 billion yen for FY 2010.

Currently, the number of automotives produced in China is estimated at around 5 million per annum. Expectations for annual growth of over 10% have led experts to project that this figure will top Japan's annual production of 7 million vehicles by around 2007-2008. Omron's Automotive Electronic Components Business (abbr. AEC) President Hiroki Toyama said "Many of the major players in the global automotive manufacturing industry have entered the Chinese market, and competition is rapidly intensifying. By starting local production in Guangzhou, a city that has become a global hub for the industry, we intend to target the rapidly growing Chinese market head on."

Omron has earmarked AEC, together with its Industrial Automation (abbr. IAB) and Electronic Components (abbr. ECB) businesses as growth areas in its long-term corporate management strategy "GD2010". China has also been identified as an engine to power the company's growth, and Omron is accelerating business expansion in the region.

Strengthening OMRON's Automotive Electronic Components Business

With "aiming for best-class in each business" as its guiding policy, AEC constantly strives to leverage its key strengths to grow its share in the global car electronics market.

Working towards this goal, AEC expanded its domestic production facility, OMRON Iida Co. Ltd (located in Nagano prefecture, Japan) in June 2004, and installed a high-output, continuous automatic production line befitting its status as the AEC global mother plant. Overseas, AEC strengthened its European operations by establishing an automotive relay business in Italy last October, through a joint-venture with Bitron Industrie S.p.A, an Italian automotive electronic components manufacturer. On the R&D front, Omron set up the "Keihanna Automotive Technology Research Department" within its Keihanna Innovation Center (Kyoto Prefecture) in March 2005, to conduct research into automotive safety technology. In addition, AEC expanded the research facilities at its Komaki Office in August, and is continuing to actively invest in R&D.

By boosting R&D capabilities and production capacity, Omron's AEC is aiming to grow its sales from 64.6 billion yen in FY 2004 to 100 billion yen in FY 2007.

Outline of the New Company

Company Name Omron (Guangzhou) Automotive Electronics Co., Ltd.
Location Guangzhou Economic and Technological Development Zone,
Guangzhou, China
Representative Chairman            Hiroki Toyama (AEC President)
Vice Chairman     Shigeo Iguchi
President            Jiro Fujiwara
Date of establishment 11 May, 2005
Opening date 16 December, 2005
Start of operations January 2006
Capitalization US$16 million (1.6 billion yen) *Fully owned by OMRON (CHINA) CO., LTD. *OMRON (CHINA) Co. Ltd. is a wholly owned company of Omron Corporation
Main business Manufacture of automotive electronic components and devices (electronic control devices, electric window units, keyless entry systems, relays etc.)
Number of Employees 80 (at start of operations). Planned to increase to 450 by 2010.
Production output First year (Jan - Mar 2006) 100 million yenTarget of 5 billion yen by fiscal year ending 31 March 2008.
Investment US$16 million (including land, buildings and machinery)

Automotive Electronic Components Company Sites

Headquarters / Development

  • Komaki AEC Office (Aichi Prefecture, Japan)

R&D Centers

  • Keihanna Automotive Technology Research Department (Kyoto Prefecture, Japan)
  • IMS Vision Motion Control G.m.b.H. (Stuttgart, Germany)

Development & Production Sites

  • OMRON AUTOMOTIVE ELECTRONICS, INC. (Illinois &•ichigan, U.S.)
  • OMRON DUALTEC AUTOMOTIVE ELECTRONICS INC. (Ontario, Canada)
  • OMRON BITRON Automotive Components S.r.l. (Alatri, Italy)

Production Sites

  • Omron Iida Co., Ltd.( Nagano Prefecture, Japan)
  • OMRON AUTOMOTIVE ELECTRONICS KOREA, CO., LTD. (Seoul, Republic of Korea)
  • OMRON Automotive Electronics Co., Ltd. (Ayutthaya, Thailand)
  • Omron Automotive Electronics UK Ltd. (Kingswinford, U.K.)
  • OMRON ELETRONICA AUTOMOTIVA DO BRASIL Ltda (Sao Paulo, Brazil)
  • Omron (Guangzhou) Automotive Electronics Co., Ltd. (Guangzhou, China)

About Omron

Headquartered in Kyoto, Japan, OMRON Corporation is a global leader in the field of automation. Established in 1933 and headed by President and CEO Hisao Sakuta, OMRON has more than 26,000 employees in over 35 countries working to provide products and services to customers in a variety of fields including industrial automation, electronic components, social systems (ticket gate machines, ticket vending machines, and traffic control), and healthcare. The company is divided into five regions and head offices are in Japan (Kyoto), Asia Pacific (Singapore), China (Shanghai), Europe (Amsterdam) and US (Chicago). For more information, visit OMRON's website at www.omron.com

For media related enquiries, please contact:
Omron Corporation
Corporate Brand Communications Department
Takayuki Nakamura (takayuki_nakamura@omron.co.jp)
James Seddon (james_seddon@omron.co.jpp)
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