Developing Domestic Production Sites While Taking into Account the Balance with Overseas Production

「The company opened the Tono Supplier Park (Tono, Iwate Prefecture), a new production base that brings in approximately 20 major suppliers to establish an integrated production system with its Tono Plant.」

「Of the major capital investment plans at the end of the previous consolidated fiscal year, construction of the buildings for the Tono Supplier Park (Tono, Iwate Prefecture) and the Japan Technical Center (Kashiwa, Chiba Prefecture) was completed during the interim consolidated accounting period, and the facilities were handed over to the company.」

「The Group had traditionally pursued thorough cost reductions through concentrated production and location saving, meaning production in countries and regions with low production costs, particularly labor costs. However, in anticipation of various risks, including natural disasters, infectious diseases and trade disputes, it is diversifying production, mainly at mass-production bases in 6 countries worldwide, to establish a system capable of fulfilling its responsibility to supply products to customers regardless of what occurs.」

「Establishing a BCP system, including diversifying suppliers」

「The group actively expanded its production and logistics sites and began construction of a new head office and research and development center, with the aim of securing production capacity for medium- to long-term sales growth and establishing a system capable of maintaining global product supply even in emergencies.」

「In this environment, to achieve its target of ¥1 trillion in sales in FY2026, the group continued to pursue such initiatives as active capital investment in Japan and overseas to strengthen its product supply system, developing new products and proposing solutions that can contribute to reducing customers’ CO2 emissions, establishing a BCP system, and utilizing global talent.」

「The Group actively pursued capital investment in Japan and overseas to strengthen its product supply system and continued to work on establishing its BCP system.」

「In addition to actively pursuing capital investment in Japan and overseas, the Group continued to address such issues as developing new products that can make a significant contribution to reducing customers' CO2 emissions, establishing a BCP system including improved procurement capabilities for materials and components, and strengthening global coordination in sales activities through the use of IT.」

「To secure production capacity in preparation for medium- to long-term sales growth and establish a system capable of maintaining global product supplies even in emergencies, the Group actively proceeded with the construction and expansion of production and logistics bases. It also acquired land for the relocation of a research and development base and introduced new equipment and renewed molds to improve efficiency, reduce costs and lower its environmental impact.」

「In this environment, the group continued various efforts to reduce the impact on production from shortages of components and materials, while making active capital investments to secure product supply capacity in line with demand growth and establish diversified production based on its BCP. During the third quarter, the Tonono No. 2 Plant and Kamaishi No. 5 Plant were completed.」

「The company continued various efforts to reduce the impact on production from shortages of components and materials, while making active capital investments to secure product supply capacity in line with demand growth and establish diversified production based on its BCP.」

「In this environment, the group continued various efforts to reduce the impact on production from shortages of components and materials, while making active capital investments to secure product supply capacity in line with demand growth and establish diversified production based on its BCP.」

「In this environment, the group undertook various initiatives to diversify suppliers and improve their quality in order to avoid production impacts from shortages of components, while continuing active capital investment to secure product supply capacity in line with demand growth and diversify production sites.」

「In this environment, although production was affected in some areas by disruptions in component supplies, the group promoted a sustainable BCP and worked to maintain and expand supply capacity.」

「Against this backdrop, the group formulated a sustainable BCP (business continuity plan), thoroughly implemented measures against COVID-19, and worked to maintain and expand product supply capacity.」

「To secure production capacity for the future and establish a system capable of maintaining global product supplies even in emergencies, the Group is actively proceeding with the construction and expansion of plants and the acquisition of plant sites. It is also introducing new equipment and renewing molds to achieve further efficiency improvements and cost reductions.」

「From a business continuity planning (BCP) perspective, we are working to establish a system that can be restored quickly in the event of an unforeseen incident by developing a production base in Vietnam comparable to that in China and securing a certain level of supply capacity in Japan as well.」

「For the year following the end of the consolidated fiscal year, planned investment totaled ¥12,900 million in production equipment at SMC Co., Ltd.'s facilities in Kamaishi, Iwate Prefecture, and elsewhere, funded from internal resources.」

「In Japan, the Group completed Phase 2 construction at the Yamatsuri No. 2 Plant, acquired adjacent land for the Shimotsuma Plant and land for the new Kamaishi Plant, and invested a total of ¥12,627 million in capital expenditure, up 6.7% year on year, including new equipment to improve efficiency and reduce costs and the renewal of molds.」

「The Group is taking measures to mitigate country risk, including developing domestic production bases while maintaining a balance with overseas production.」