1. Increasing demand for robots
In China, a sudden rise in labor costs and the emergence of a personnel shortage have made it more and more difficult to ensure a supply of workers at production sites. In addition to the automotive industry, where automation has progressed relatively quickly up to now, the need for automation and robotization of manual work has increased in the industrial machinery field and other general industries.

2. Expanding this company’s robot business
(1) Expanding our business structure

a.Past approaches

In 2010, we established a robot business center at Nachi (Shanghai) Co., Ltd., and added 50 employees to the organization, mostly local hires.
We established sales and service bases in Shanghai, Tianjin, Shenyang, Beijing, Changchun, and Guangzhou, and expanded our sales network.
b.Approaches to increase orders even further

We will establish new sales and service locations in Dalian and Chongqing, expanding across all of China.
We will double the number of system integrators as business partners (100 companies by 2015).
c.At our factory for hydraulic equipment for construction machinery, we will construct our newest production line, using the latest robots produced by this company, and use it as a model line for customer demonstrations.

(2) Begin local production

Recently, through local production and local procurement and product development in the Chinese market, we have been able to provide timely service and products to existing customers and develop new customers.
In addition, we are developing robots that suit the needs of the Chinese market by extracting QCDS needs.

[Outline of local production]

· Production base : Nachi (Jiangsu) Industries Co., Ltd. (NJI)
· Production items : High-speed Robot SRA Series, Palletize Robot LP Series, etc.
· Production numbers : 1,500 units in 2013; 3,000 units in 2015 (yearly)
· Capital investment : 2 billion yen (through 2015)
We will introduce the latest production methods, and make the assembly process automated and skill-less.
· Start of production : From February 2013
· Procurement : With all materials to be locally sourced, we will develop local suppliers.
· Product development: Establish a technical center within NJI (to function as R&D and showroom).

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