Boldly and strategically entering the North American and Asian markets
Moriroku took its first step outside Japan in 1986 when it set up a joint-venture in the United States to begin manufacturing auto parts with a view to capitalize on favorable international trends and business opportunities. This story looks back at the Moriroku Group's bold steps to expand into North America and Asia over the past three decades.
Launching overseas operations together with Honda
From the 1960s, sales of Japanese cars in the United States grew rapidly. This was the result of efforts by Japanese automakers to improve quality and develop appealing new models. Trade friction between the U.S. and Europe also created favorable conditions for Japanese companies. By the mid-1980s, backed by a booming domestic economy, Japanese companies began actively investing overseas and globalizing their businesses.
In that context, Moriroku looked to set up manufacturing facilities in the United States, following its main business partner, Honda Motor Company, which started manufacturing automobiles there in 1982. This was in line with Honda's strategy to avoid trade friction by having more of its auto parts produced locally. As a supplier, Moriroku recognized the many benefits of manufacturing parts locally, including lower transport costs and the absence of tariffs and foreign exchange risks. It also looked forward to engaging directly with the Honda Group's U.S. subsidiaries.
This plan was realized in 1986 when Moriroku jointly established Greenville Technology, Inc., together with Honda and its subsidiary American Honda Motor Co., Inc. Based in Ohio, this joint venture became a wholly owned subsidiary of Moriroku in 1993. Moriroku then established Listowel Technology, Inc., in Ontario, Canada, in 1996, followed by Rainsville Technology, Inc., in Alabama, U.S.A, in 2000. In less than 15 years, Moriroku had succeeded in creating a large-scale production network in the North American market.
Greenville Technology's first product shipmentAfter it was established in 1986, Greenville Technology began shipments of auto parts one year later and achieved profitability within four years.
Building a diversified manufacturing network through steady-handed investment
Towards the end of the 1980s, many companies started setting up production operations in China and Southeast Asian countries. As income levels rose and infrastructure was built throughout the region, the Asian automobile market was expected to grow dramatically.
Against that backdrop, Moriroku established Moriroku Philippines, Inc., in the outskirts of Manila in 1994, followed by Moriroku UT India Pvt., Ltd., in suburban New Delhi in 1996. It then expanded into China several years later, establishing Guangzhou Moriroku Technology, Co., Ltd., in 2001, and Wuhan Moriroku Technology, Co., Ltd., in 2004. Within a decade, Moriroku had set up a diversified manufacturing network in the region, far in advance of the "China plus one" strategy of risk diversification that has become widespread in recent years.
In 2008, the auto industry was shaken by the global financial crisis and Great Recession that followed. Nevertheless, the Moriroku Group accelerated its global expansion, believing that a level-headed vision was needed over the long term, regardless of temporary slowdowns in North America and China. Accordingly, Moriroku Technology North America was established as a technical development center in 2009, and a second factory was completed for Greenville Technology in 2012. At the same time, the Group built new factories and expanded its existing factories in Asia. Moriroku Technology (Thailand) Co., Ltd., was established in 2010, followed by PT. Moriroku Technology Indonesia in 2012, increasing operations in Asia to five countries in total.
Pushing ahead with global expansion and local production
Anticipating future trends, the Moriroku Group has steadily expanded its business internationally, even during economic downturns. Through its manufacturing and product development network, the Group supplies products locally to customers in various markets of the world while promoting local production and consumption. Today, sales outside of Japan account for about two-thirds of the Group's total sales. Furthermore, the Group's product development and design capabilities in the United States are already approaching the level of Japan, and are being rapidly advanced in China and Thailand. At present, international employees who received training for multiple years in Japan have begun applying the skills and knowledge they gained in their home countries. Looking forward, the Moriroku Group remains committed to local production and plans to continue expanding its business globally.
Technical training offered to international employees Employees of group companies around the world receive technical training from skilled engineers in Japan.
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