Performance by Region Thailand/Others
Aiming to Expand Business via Additional Large-scale Investment and Becoming Profitable Early by Improving Production Efficiency
President
UACJ (Thailand) Co., Ltd.
The construction of UATH Rayong Works began in 2012, and it has since become the core plant for UACJ in Asia. With the first- and second-phase construction work completed, the plant currently has an annual production capacity of 180,000 tons, producing can stock, heat exchanger materials, and general-purpose materials. It is the sole integrated aluminum production plant in Southeast Asia. Against the backdrop of growing populations and other factors, further demand for aluminum is expected; a prospect that led to the decision in November 2016 to commit a third phase of capital investment. The plan will increase annual production at the Rayong Works to 320,000 tons, one of the largest in Asia.
It has been 18 months since fully-integrated manufacturing began, and production efficiency is improving along with operations proficiency levels. The monthly sales volume at UATH is currently running 8,000-9,000 tons, and is expected to increase to an average of 13,000 tons in the second half of fiscal 2017. The increased sales volume is also bringing about an improvement in profitability. Our aim is to turn operating income profitable in the second half of fiscal 2017 and ordinary income profitable in fiscal 2018.
Fiscal 2016 Highlights
- Can stock demand increased from Asia to the Middle East and Australia as population and economy grew
- UATH clientele expanded to more than 50 companies, including transactions outside of the Asian region
- Rayong Works’ proficiency levels improved, with monthly production reaching 10,000 tons
- Annual sales volume at UATH rose from 32,000 to 65,000 tons
- Investment amounting to approximately 39 billion yen earmarked for Rayong Works casting, cold-rolling, surface finishing and coating lines with aim to raise annual production capacity to 320,000t
UATH：UACJ（Thailand）Co., Ltd.
Net sales
Regional Activity Increase in Demand Expected Over Broad Areas from Asia to Middle East and Australia, Likely to Expand 1.4-fold by 2020
In Asia, the Middle East and Australia, against the backdrop of economic growth and rising populations, the demand for can stock and heat exchanger materials is expanding rapidly. Our estimates suggest that can stock demand in these areas is likely to grow from 880,000 tons in 2014 to 1.25 million tons in 2020, a growth of approximately 1.4 times.
UATH is often recognized as a supply base for the surrounding Southeast Asian region because of the location of its plant in Thailand. Despite this common perception, our customer base is widespread, including the Middle East and Australia. Our clients currently comprise more than 50 companies, including numerous beverage can and heat exchanger manufacturers in these regions.
Accumulated Improvement in Network and ESG Activities
Towards Asia’s largest production capacity – 320,000 tons
ESG Activity 1Contributing to Job Creation and Development of Industry through Rayong Works Operations
Recent years have seen momentum gathering towards the development of various industries, mainly manufacturing, in Thailand. The UATH Rayong Works is situated in Thailand’s eastern economic corridor, where the country is promoting development. The company is contributing to the development of local industry by creating jobs, nurturing human resources, and committing large-scale investment. A good relationship with the local community has also been developed through various initiatives, such as environmental surveys based on visits to surrounding villages and regional contributions. In June 2017, a meeting between UACJ Chairman, Shigenori Yamauchi, and Thailand’s Deputy Prime Minister, Somkid Jatusripitak, materialized. We will continue to contribute to the development of industry in broader areas of Asia, as well as in Thailand.
ESG Activity 2Meticulous Training Results in Operations Being Run by Local Staff
For UATH to achieve its immediate target of an annual production of 300,000 tons, nurturing the skills of local personnel is imperative. To this end, skilled engineers were sent from Japan at the time of starting up the Rayong Works, and they focused on providing local staff with education and on-the-job training, backed by the full support of our R&D Division. Moreover, standard operating procedures were prepared in three languages: Japanese, Thai, and English. Meticulous training that explains operating procedures and their purpose together has led to operation of the first-phase lines to be manned exclusively by local employees. Some of the young local personnel have trained at plants in Japan to learn cutting-edge manufacturing. We expect that they will become key personnel for the future of UATH and the industry in Thailand.
- Performance by Business
