Ryobi to Start Die Casting Production for GM in Mexico

Ryobi will start die casting production at RDCM, the productive subsidiary in Mexico, in August 2008. The subsidiary plant is located in Irapuato, Mexico whose construction completed in April 2007 with total investment at 5.1 billion yen. The subsidiary will supply die casting for transmissions to General Motors of USA. The annual sale is estimated at 300-400 million yen in fiscal 2009 ending March 2010 while expected to exceed 4.2 billion yen in fiscal 2010 when the productivity would become higher. The outline was explained at Ryobi’s press conference for its annual results of fiscal 2007.Ryobi explained that another subsidiary in Dalian, China started high-grade die casting production in December 2007. The products are supplied to Shanghai GM. Susumu Yoshikawa, the president of Ryobi, said Shanghai GM gives a high evaluation to Ryobi’s product quality and the orders are increasing. Dalian plant is receiving die casting orders from other auto related makers in the region as well. The annual sale is expected to exceed 1.8 billion yen in fiscal 2010. Mr. Yoshikawa suggested the capacity expansion with additional sites and facilities at Dalian in future.Ryobi Group estimates the consolidated profits would decrease year-on-year in fiscal 2008. The profitability is impacted by higher oil and material costs, lower product selling prices, and rough exchange fluctuation. The net sale is estimated to keep almost flat year-on-year at 216.5 billion yen in fiscal 2008 while the operating profit to decline by 37% to 10.5 billion yen.