Japan's Spare Parts Enterprises Transferring to China's Midwest

Due to rising labor costs in China's coastal areas and the transfer of downstream product companies to the interior, Japanese parts manufacturers have begun to develop business in the central and western regions of China.

Recently, TDK opened a business office in Xi'an and plans to set up offices in Chengdu and Chongqing next spring to co-ordinate operations in the western region. Since July of this year, Murata Manufacturing Co., Ltd. has opened sales offices in Xi'an and other places, and has strengthened its sales operations in Chongqing. Nippon Denki Co., Ltd., which specializes in micro-motors for vehicles, has set up sales offices and offices in cities such as Chengdu, Chongqing, and Wuhan in the western region this year to develop local sales resources.

Japanese companies believe that the central and western regions such as Xi'an and Chongqing are places where China's electronics and information technology industries are gathered. European, American and Chinese Taiwan and Hong Kong companies have entered earlier, and thus the demand for upstream components and core products has increased. Product-oriented Japanese companies have great potential for development in these areas.