Production fluctuations in construction machinery and other equipment due to lower resource prices and a slowdown in China’s economy

「In the fourth quarter, sales to the construction and agricultural machinery sectors remained solid, but sales of forklift parts in North America, Europe and Japan did not recover. Full-year sales consequently fell below the previous year, with results diverging by industry. Sales were ¥7,988 million, down 0.7% year on year.」

「北米・欧州・国内向けフォークリフト部品販売は回復せず」

「The Industrial Machinery Sales Division sells assembled components to construction machinery, agricultural machinery and industrial vehicle manufacturers. Production cuts by major customers have continued amid vehicle price increases caused by U.S. tariffs and a tendency to defer purchases stemming from an increasingly uncertain economic outlook. As a result, sales were ¥3,875 million, down 7.5% year on year.」

「The Industrial Machinery Sales Division states that production cuts by major customers became pronounced and continue against a backdrop of declining demand in North America and economic stagnation in Europe. Rather than relying solely on an economic recovery and increased production by customers, the division continues to explore new markets and products.」

「European market conditions remain sluggish, while the previously strong North American market has shown a rapid downward trend since August. Although the operating environment remains uncertain, we will continue to promote the development and consultative sales of products that improve environmental and safety performance.」

「The operating environment remains uncertain, with weak demand in Europe and China and an unclear outlook for North American demand, which had supported strong performance.」

「While the North American and Japanese markets remain relatively firm, the operating environment is becoming more uncertain as the weak Chinese market is joined by a slowdown in Europe, with production cuts and inventory adjustments emerging in large construction machinery and agricultural machinery.」

「Looking toward the second half of the fiscal year, the operating environment is becoming more uncertain, with concerns over the Chinese economy, lower production at customers’ Chinese plants due to the acceleration of electrification in Europe, and lower production of engine-powered vehicles at European plants. Nevertheless, to meet the market’s continuing demand for improved environmental and safety performance, we will continue to work closely with our business partners to develop environmentally friendly and safety-related products and contribute to a decarbonized, autonomous-driving society.」

「Production by the Industrial Machinery Sales Division’s major customers, including construction machinery, agricultural machinery and industrial vehicle manufacturers, was recovering as component procurement improved, and increased production was also supported by the order backlog accumulated since the previous year. As a result, sales were ¥1,797 million, up 34.2% year on year. However, customer production remains exposed this fiscal year to the risk of increases and decreases caused by difficulties in procuring components and soaring material costs.」

「Although production at major customer construction equipment, agricultural machinery and industrial vehicle manufacturers remained unstable due to difficulties procuring materials and higher material and component costs, customer production showed signs of recovery against a backdrop of order backlogs that had continued since the previous year. As a result, net sales were ¥6.001 billion, up 10.9% year on year.」

「The industrial vehicle market recovered from the slowdown caused by COVID-19, led particularly by strong markets in Europe and North America, and construction equipment, agricultural machinery and forklift manufacturers continued to increase production. As a result, net sales were ¥4.008 billion, up 29.6% year on year.」

「Industrial vehicle production recovered from the slowdown caused by COVID-19, led particularly by strong markets in Europe and North America, and construction equipment, agricultural machinery and industrial vehicle manufacturers continued to increase production. As a result, net sales were ¥2.646 billion, up 33.3% year on year.」

「Although demand for industrial vehicles in Japan and elsewhere remained stagnant due to the impact of COVID-19, strong markets in Europe and North America led construction, agricultural and industrial vehicle manufacturers to shift from production cuts to increased production. As a result, net sales were ¥1.318 billion, up 27.5% year on year.」

「The Industrial Machinery Sales Division saw a recovery in production of small construction machinery and agricultural machinery as some customers recovered from the production cuts caused by COVID-19 through the second quarter. However, a full-scale recovery across industrial vehicles, including construction machinery, agricultural machinery and forklifts, has not yet been achieved.」

「Economic activity stalled and economic conditions worsened as COVID-19 spread, causing capital investment demand and logistics activity to decline and reducing production of construction and agricultural machinery and industrial vehicles such as forklifts. Demand is expected to recover for some mini and compact construction equipment and agricultural machinery models, but overall recovery is still expected to take time. As a result, net sales were ¥1.985 billion, down 20.5% year on year.」

「The spread of COVID-19 and measures to prevent infection stalled economic activity and worsened economic conditions. In particular, the resulting decline in capital investment demand led to a substantial decrease in production of construction and agricultural machinery and industrial vehicles such as forklifts. As a result, net sales were ¥1.034 billion, down 15.3% year on year.」

「In addition to declining demand for forklifts due to reduced volumes, mainly in the United States and China, and lower construction vehicle production amid the economic downturn, production of construction, agricultural and industrial vehicles fell substantially due to the impact of COVID-19. As a result, net sales were ¥4.719 billion, down 12.1% year on year.」

「In addition to lower volumes in the United States and China, reduced forklift production mainly due to the economic downturn and lower production of large construction machinery, the Industrial Machinery Sales Division was affected by submerged component suppliers and production delays caused by typhoons and record rainfall in Japan. Sales consequently fell significantly to ¥3,616 million, down 11.1% year on year.」

「The slowdown in the industrial vehicle market that began at the start of the year continued and worsened. In particular, reduced logistics activity in the United States and China led industrial vehicle manufacturer customers, which account for a large share of our sales, to cut production and reduce inventories. As a result, net sales were ¥2.496 billion, down 6.2% year on year.」

「The industrial vehicle market slowed during the current fiscal year, and forklift and some large construction equipment manufacturers began cutting production. In particular, the slowdown in North American and Chinese markets caused customer manufacturers' inventories of forklifts to surge, leading to substantial production adjustments to reduce inventories. As a result, net sales were ¥1.220 billion, down 8.1% year on year.」

「The Industrial Machinery Sales Division expanded sales, mainly of vehicles for North America, Europe and Asia, targeting major construction equipment customers that continued to grow steadily. As a result, net sales were ¥5.369 billion, up 12.6% year on year.」

「The Industrial Machinery Sales Division's sales remained generally strong, supported by strong production at major construction, industrial and agricultural vehicle manufacturers, against a backdrop of rising global demand for construction, industrial and agricultural machinery, particularly increased demand for construction equipment in the United States, China and emerging markets. As a result, net sales were ¥4.069 billion, up 14.8% year on year.」

「The Industrial Machinery Sales Division’s sales remained generally firm, supported mainly by strong production at major construction, industrial and agricultural vehicle customers, against a backdrop of robust construction demand in Europe, the United States, China and parts of ASEAN, as well as increased domestic capital investment. As a result, sales were ¥2,662 million, up 14.5% year on year.」

「The Industrial Machinery Sales Division remained generally solid, supported by strong production of construction, industrial and agricultural vehicles by major customers, mainly driven by increased construction demand in North America and China and active global logistics facilities. As a result, net sales were ¥1.328 billion, up 18.4% year on year.」

「The Industrial Machinery Sales Division performed generally well, supported by solid sales of construction equipment and other products by major customers in Europe, North America and China. Net sales were ¥4.768 billion, up 7.8% year on year.」

「The Industrial Machinery Sales Division performed generally well, supported by strong performance among major customers, driven by increased overseas demand for construction equipment and industrial vehicles in Europe, North America, China and elsewhere. Net sales were ¥3.544 billion, up 8.7% year on year.」

「The Industrial Machinery Sales Division performed generally well, supported by strong performance among major customers, including construction equipment and industrial vehicle manufacturers. Net sales were ¥2.324 billion, up 7.6% year on year.」

「Although the Industrial Machinery Sales Division launched new development projects, this was not enough to offset the decline in sales caused by the stronger yen and other factors in the first half. As a result, sales were ¥3,260 million, down 3.2% year on year.」

「The Industrial Machinery Sales Division’s major customers, including construction machinery manufacturers, continued to experience sluggish vehicle sales amid the stronger yen. Although signs of a bottoming-out in some areas suggested an improvement toward year-end, this was not enough to offset the decline during the first six months of the fiscal year. Sales were ¥2,159 million, down 7.0% year on year.」

「The Industrial Machinery Sales Division’s major customers, including construction machinery manufacturers, continued to see sluggish vehicle sales from the previous year, particularly exports. The appreciation of the yen since the beginning of the year also had a major impact. As a result, sales were ¥1,025 million, down 9.0% year on year.」

「However, in the consolidated accounting period of the third quarter, production rates for some vehicles in the construction machinery and other industries, which are among our major customer industries, declined under the impact of lower prices for crude oil and other resources and the economic slowdown in China, but ultimately recovered.」