To boost global sales and green molding, Matsui head moves from Japan to Hong Kong

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: February 4, 2014 11:56 am ET
Updated: February 4, 2014 9:59 pm ET

Image By: Steve Toloken Hironobu Matsui, president of Osaka, Japan-based plastics equipment maker Matsui Manufacturing Co. Ltd.

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Topics Sustainability, Asia, China, Machinery

GUANGZHOU, CHINA — Japanese plastics executive Hironobu Matsui recently took an unusual step for someone in his position, as president of a 101-year-old, $200 million Japanese manufacturer — he relocated from his Osaka headquarters to Hong Kong.

For Matsui, president of auxiliary equipment maker Matsui Manufacturing Co. Ltd., the move to Chinese territory is in one way following customers to growing markets, whether that's China, Southeast Asia or India.

But it's more than that. It's part of an attempt by one of Japan's biggest auxiliary equipment makers to be a more nimble, globally-oriented firm. Since 2009, for example, the company has reduced manufacturing costs by making China its biggest production center. In 2011 it opened a plant in India.

"Still half of our customers are Japanese companies and Japanese related companies but already almost 50 percent are non-Japanese customers, so I would like to have more close relationship with non-Japanese customers," he said, explaining his move to Hong Kong.

Matsui is in 14 countries, he said, and living in Hong Kong is a more central location to monitor all of them.

"My thinking is that Japan is one country among those 14 countries," he said. "Every other (of those) 13 countries can be managed without my staying there all the time for many years."

At the same time, the company has put a lot of effort in the last few years into building partnerships and joint ventures with other manufacturers of plastics technologies worldwide.

Matsui is the main driving force behind a 2-year-old group, the Association of Green Molding Solutions, an alliance of 13 Japanese, American, European and Taiwanese firms marketing their technologies to reduce the electricity, water and other resources used in molding factories.

Last year, the company turned part of its Osaka factory over to the AGMS companies for a studio to jointly showcase their technologies. The group also regularly holds seminars throughout Asia.

The company has formed joint ventures with some AGMS partners. In September, it formed a company in Tokyo with U.S. microcellular foam molding specialist Trexel Inc. It already had a Shanghai venture with Japan's OPM Laboratory Co. Ltd.

Matsui sat down with Plastics News in early January in the company's office in Guangzhou to talk about the changes underway and his move nine months ago to Hong Kong, where he plans to stay for three to four years.

One of the main focuses for the company and the AGMS is promoting the idea that injection molding factories are very inefficient users of energy and resources.

Explicitly borrowing language from the Club of Rome's 1997 report "Factor Four: Doubling Wealth, Halving Resource Use," they adopted a theme of "Factor 4" and argue that technology can double productivity while cutting in half the energy and raw material resources needed.

"We are trying to provide that solution to realize Factor 4, but to achieve that goal it is not enough to work by yourself, with your own products," he said. "We are saying that we can achieve Factor 4 efficiencies... That means the current efficiency is less than 25 percent."

In the Club of Rome report, the term describes how the Earth could support an estimated 9.3 billion people by 2050, with more and more people consuming at a "middle class" level.

For Matsui, on the factory floor it means things like finding ways to reduce electricity consumption for its dryers, since on average dryers consume about one-third of the energy of a molding cell, roughly the same amount as the injection machine, he said.

For the AGMS, it can mean promoting more expensive but more energy efficient water cooling systems or new technology using 3D printing to make molds with better conformal cooling channels, a potentially more energy efficient technology because it can reduce part cooling time and energy needed to manufacture.

Particularly in Asia, Matsui maintains, companies often don't have a real idea of the cost of the resources they use. Given competitive business pressures, he said they focus on metrics to make goods parts but don't fully analyze energy.

"They care about defects, the quality issue or delivery time," he said. "But they don't know how much electricity they consume to produce these parts [or] how much water do they use for cooling."

"That means they don't know the real cost," he said.

Part of that, he said, could come from the relatively low price of resources.

According to the Hong Kong-based group China Water Risk, for example, water in China's big cities is as much as five times cheaper than Singapore, 10 times cheaper than Tokyo and 15 times cheaper than San Francisco. Even increasing prices to Singapore's level would help the economics of conservation technologies, it said.

China also faces a water shortage. While it has 20 percent of the world's population, it has just seven percent of the freshwater resources and still underprices water, the group said.

Large water price hikes are inevitable, China Water Risk said, "increasing operating expenditure of manufacturing plants and eating into profits."

"The reality is that China is lacking of water but the price is very low," Matsui said.

While resource costs may rise in the long-term, in the short term, though, the company has been hit by slower sales in China, he said.

Late last year, it closed sales offices in Dongguan, Guangdong province, and Yantai, Shandong province, although it expects the Chinese market to rebound in 2014, he said.

Globally, the company saw sales rise about 10 percent in 2012, to just over US$200 million, but anticipates final 2013 numbers will be basically flat, as markets in Southeast Asia and India also stumbled, he said.

The move to Hong Kong for Matsui mirrors bigger changes in the company. In 2009, its Zhangjiagang, China, factory became its largest global manufacturing center, both as a way to cut costs and grow in China, he said.

But cost is not always king. He said the company also needs to focus on developing new technology, like research it has underway in Japan to make what it says will be the first equipment to easily recycle carbon fiber plastic, and developing more integrated solutions for manufacturers.

"Both sides are very important for us. We must compete as a machinery manufacturer, this is a kind of basic competence," he said. "So we are always trying to develop cheaper or better products. But we think only that kind of thing is not enough to expand our business."


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To boost global sales and green molding, Matsui head moves from Japan to Hong Kong

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: February 4, 2014 11:56 am ET
Updated: February 4, 2014 9:59 pm ET

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