Mitsubishi Heavy Industries, Ltd. (MHI) is planning to launch production of gear cutting machines in China at a facility that will simultaneously serve as a production base for other company business. MHI has determined to build a new plant on the premises of Changshu Ryoju Machinery Co., Ltd. (CRM) in Changshu, Jiangsu Province, an existing local production base for the company's rubber tire machinery. The new facility will serve both for production of gear manufacturing equipment and for expanded production of rubber tire machinery.

Adoption of this "shared factory" scheme is intended to enable the company's gear machinery business to launch local production swiftly and cost-effectively. Production of gear cutting machines at the new plant is slated to commence in March 2011. The initiative will mark the implementation of MHI's first shared factory scheme for launching overseas production.

MHI decided to launch production of the gear cutting machines in expectation of large demand from Chinese automobile manufacturers, whose output has been expanding rapidly. MHI will initially manufacture its best-selling GE15A dry cut gear hobbing machine at the new plant. By securing the same technological features and high quality as in corresponding machines being produced in Japan, the company intends to expand sales to manufacturers of high-precision, small-size gears for automobiles, motorcycles, decelerators, etc. The company looks to produce 40 units during the first year, and 100 units by the fourth year.

In addition to being equipped with various gear cutting machine manufacturing equipment, including assembly and measurement-related facilities, the new plant will also have a showroom to exhibit machines as well as to accommodate test-cutting requests from potential customers. Plans call for construction to be completed by February 2011.