Shift of Development, Manufacturing Base for Japanese-market Scooters to Taiwan Motorcycle Joint Ventures

In order to increase international competitiveness in its main product line of motorcycles, Yamaha Motor Co., Ltd. (YMC) is promoting a "Revolution in Product Creation" aimed at building quality products inexpensively and quickly. This revolution involves revising our manufacturing layout from a global perspective and revolutionizing our development and manufacturing processes based on wide-scale revisions of the components and systems involved.

As an important step in this restructuring, YMC has decided to shift the develop and manufacture of scooters for the Japanese market to its joint venture companies in Taiwan, while at the same time strengthening these companies to serve as a base for the development and manufacture of scooters for the world markets.
The aim of this shift in manufacturing is to make effective use of these Taiwan joint ventures which have already been successful in selling their 100cc and 125cc motorcycles on the Japanese market with the goal of concentrating development and manufacturing activities and achieving the benefits of reduced cost from mass production in order to manufacture high quality scooters inexpensively for the Japanese market. As for the space this shift will leave open in our manufacturing bases in Japan, it will be used for promoting the improvement of manufacturing processes and concentrating production of larger displacement, higher value-added motorcycles.

The production involved in this shift will be the 50cc models that make up about 90% of our scooter production, and this will make Taiwan the manufacturing base for scooters for the Japanese market ranging from 50cc up to 125cc. This shift will begin in December of 2002 and be completed within a space of two years. The total production planned to be shifted represents about 150,000 units annual. The manufacturing base to which this production will be shifted is the 51% YMC-owned Yamaha Motor Taiwan Co., Ltd., (Representative: Yasushi Iikubo/location: Chunli, Taiwan), which last year manufactured about 280,000 units of 50cc~125cc scooters for the Taiwanese and export markets and after the shift will have an annual production of about 400,000 units, roughly equal to the full production capacity of its facilities.
In conjunction with this production shift, YMC also adopts a policy of strengthening its Taiwan subsidiaries as bases for the development and manufacture of scooters for export to Japan and the world market. In particular, the development staff at Yamaha Motor R&D Taiwan (Representative: Toshiharu Minami/location: Chunli, Taiwan), which handles development and design work will be increased. At the same time the marketing strength of Yamaha Motor Taiwan Trading Co., Ltd. (Masahiro Nagatani/location: Taipei, Taiwan), which handles primarily the export business, will also be increased and the number of countries to which it exports expanded, with the aim of increasing its present volume of exports to the European, Latin American and Japanese market of about 60,000 annually to a total over 200,000 units by the year 2005.

At present YMC's scooters are manufactured in bases in four countries in Japan, Taiwan, Europe and China, with a total annual production level of about 800,000 units. Due to the inherent convenience and fashionable appeal of scooters, the total world demand that stood at about 7.7 million units in 2000 is expected to grow to exceed 8 million units annually by the year 2005.

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