OSAKA, JAPAN (Aug. 5, 12:25 p.m. ET) — Daikin Industries Ltd. plans to build a 3 billion yen (US$38.2 million) fluoroelastomer factory in Changshu, Jiangsu province, to meet what it says is growing demand in the automotive industry.
The Osaka-based company said the factory, which is estimated to be operational in 2013, will boost its fluoroelastomer capacity globally by 60 percent. The company currently makes fluoroelastomers at plants in Osaka, Japan and Lyon, France.
The company said auto makers in China are increasingly shifting to local procurement for parts that use fluoroelastomers, including oil seals and fuel hoses, and that the market is expected to grow 1.6 times larger by 2015.
The Chinese market was estimated at 8 billion yen (US$101.9 million) last year, and will be 13 billion yen (US$165.6 million) in 2015, Daikin said.
“The number of automobiles being manufactured around the world is increasing, and a conspicuous expansion is seen, especially in the Chinese response to expanding demand from tighter environmental regulations,” Daikin said.
Fluoroelastomers can reduce fuel and oil leaks in cars and cut the environmental impact over the long-term, the company said.
Daikin said with the Changshu factory it is targeting a rapid increase in its market share in China, from about 10 percent now to 30-40 percent in 2015.
