Japanese supplier responds to emerging-market demand for high-performance machines

TOKYO -- Japanese machinery maker Tsugami will invest about 2 billion yen ($17.1 million) to increase production capacities in China and India in fiscal 2017, aiming to meet rising demand there for more sophisticated tools.

The company's mainstay product is small automatic lathes used in producing electronics parts. Tsugami looks to increase sales of larger, more expensive products, such as machining centers.

The company's main factory in China has a monthly production capacity of 1,500 of its mainstay machines. Tsugami will renovate some 8,750 sq. meters of storage into manufacturing space within the roughly 90,000-sq.-meter facility. This will raise output capacity there of higher-value equipment like the machining centers to 250 to 300 a month, from the current 150 to 200.

And in India, the company will increase factory space by 50% to 9,000 sq. meters. Tsugami will boost its monthly production capacity of moderately large machine tools from 20-30 machines to 40-50.

Demand is growing in emerging economies for high-performance machine tools as suppliers of autoparts and other manufactured goods invest heavily in factory automation. Mitsubishi Heavy Industries Machine Tool will also begin making more complex products in China as early as fiscal 2017.