Strengthening of Agricultural Machinery Sales in Cambodia and Laos
— Establishment of new companies wholly owned by joint subsidiary in Thailand —
August 23, 2013
Siam Kubota Corporation Co., Ltd. (hereinafter, SKC), which is a joint subsidiary of Kubota Corporation (Head Office: Naniwa-ku, Osaka, Japan, Chairman, President&CEO: Yasuo Masumoto) and the Siam Cement Group, a company affiliated with Thailand's royal family, will establish new companies in Cambodia and Laos in January 2014. The companies will be fully owned by SKC.
It is expected that demand for agricultural mechanization will grow in both Cambodia and Laos from now onwards. We will reinforce our dealer networks and service structures in each country and further expand our agricultural machinery business in Asia.
Background to and aims of the establishment of the new companies
- Both Cambodia and Laos are agricultural countries that produce mostly rice and also cassava, sugar cane and other items. Kubota Corporation currently sells tractors, combine harvesters, horizontal type diesel engines and power tillers to dealers in both countries through SKC, a joint subsidiary in Thailand.
- In recent years, the increase in wages in Thailand has led to an increase in the number of people moving to work in Thailand from both Cambodia and Laos. This has resulted in labor shortages in the agricultural areas of the two countries and a rapid expansion in demand for agricultural mechanization. In addition, the establishment of the ASEAN Economic Community (AEC) is planned for 2015 and it is expected that the further economic development of both countries will lead to further mechanization of their agriculture.
- With this establishment of new companies in the two countries, we will expand our agricultural machinery business through the further expansion of the network of dealers and by strengthening the service organizations, the activities to support sales and the activities to gather market information.
Plans for the future
- We will aim for sales in 2015 of around 15 billion yen in Cambodia and around 6 billion yen in Laos.
Overview of the new companies
Company name Kubota Cambodia Co.,Ltd. Establishment January 2014 (Planned) Location Phnom Penh Municipality, Kingdom of Cambodia Capital 5 billion riel (approximately 120 million yen *Exchange rate 1 riel = 0.0244 yen) Investment ratio SKC 100% Business Sales support for agricultural machinery, the collection of market information and servicing, etc., in Cambodia Number of employees Approximately 30 (at the end of 2015)
Company name Kubota Laos Co.,Ltd. Establishment January 2014 (Planned) Location Vientiane Prefecture, Lao People's Democratic Republic Capital 7 billion kip (approximately 90 million yen *Exchange rate 1 kip = 0.0126 yen) Investment ratio SKC 100% Business Sales support for agricultural machinery, the collection of market information and servicing, etc., in Laos Number of employees Approximately 30 (at the end of 2015)
- <Positions of new companies>
<Overview of SKC>
Company name SIAM Kubota Corporation Co.,Ltd. Establishment August 2010 (Established through the integration of The Siam Kubota Industry Co., Ltd. and Siam Kubota Tractor Co., Ltd.) Location Navanakorn Plant:
Navanakorn Industrial Estate, Pathumthani, the Kingdom of Thailand Amata Nakorn Plant: Amata Nakorn Industrial Estate, Chonburi, the Kingdom of Thailand Capital Approx. 2.74 billion baht Investment ratio Kubota: 60%, Siam Cement Group: 40% Business Manufacturing and sales of tractors, combine harvesters, implements,
horizontal type diesel engines and power tillers and sales of construction machinery