Japanese Machinery and Tool Giants Forecast Strong Growth
Top Japanese machinery and tool companies are projecting growth in 2024, fueled by increased investments in semiconductors and electric vehicles.
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Japan, May 27, 2024 – Leading machinery and tool trading companies are forecasting increased revenue and operating profits for the fiscal year ending March 2025. Machine tool orders are expected to recover in the second half of the year, boosted by increased investment in semiconductors and electric vehicles. However, rising raw material and fuel costs due to the weakening yen, the sluggish Chinese economy, and global monetary tightening cast uncertainty on capital investment.
Yamazen plans to promote technology sales in industrial goods and receive large semiconductor orders after summer in the fiscal year ending March 2025. For overseas markets, President Kishida Mitsuji stated they will "expand its business in India and North America, which are experiencing rapid growth." However, considering the slow domestic recovery and China's economic trend, the company revised its sales target for the final year of its three-year plan by 70 billion yen.
Yuasa Shoji aims for record profits for three consecutive years in the fiscal year ending March 2025. President Tamura Hiroyuki predicts a recovery in machine tools from August and September, driven by demand for semiconductor manufacturing equipment. Their growth strategy prioritizes overseas business, focusing on capital goods, housing environments, and construction in Thailand and India. A new office building will be completed in Thailand by the end of 2024, and they will double their presence in India to four bases by the end of the fiscal year 2024.
Tomita also forecasting growth, will strengthen its Indian business.
For the fiscal year ending March 2025, Tsubakimoto Kogyo president Masashi Koda emphasized achieving their plan by "proposing products to combat the labor shortage such as automation and labor-saving." In addition to expanding sales of environmental equipment, they will propose facilities suitable for the mass production of secondary batteries.
While four companies saw increased revenue and profits in the fiscal year ending March 2024, the other four experienced a decrease due to the sluggish Chinese economy. With no clear prospect of a Chinese recovery, expanding into growing overseas markets like India and Southeast Asia is likely the key to business expansion.
To achieve their plans for the fiscal year ending March 2025, these companies need strategies to capture the growing demand for capital investment in automation, labor-saving, and decarbonization, particularly in the recovering semiconductor and automotive sectors.
