Meiwa is providing its clients with quality die-cast molds with added-value services at a low price.
It is a pivotal time for Japanese manufacturers. Policies like the US Inflation Reduction Act are forcing corporations to diversify their supply chains for reliability and to reduce country risks with nations such as China. Japan is known for its reliability and advanced technology, and a weak yen makes Japan a more cost-effective option, meaning Japanese firms have an opportunity to expand their existing global market share. Do you agree with this sentiment, and what are the advantages of Japanese suppliers in this current macro environment? stainless casting foundry
The macroscopic environment has a huge effect on our business, especially the depreciation of the yen. That is a positive thing for our exports and a negative thing for our imports. Our business uses a lot of steel for mold and cast creation, so this rise in import costs, combined with rising energy costs, is affecting our business negatively. So, there is a positive and negative aspect to the current macroeconomic conditions.
As for the supply chain, the strength of Japanese companies is that their products are highly reliable, with a short lead time and a stable supply.
I think a great example of that is Tesla working closely with Panasonic to increase their production capacity, and we saw that a shift in Tesla’s business model recently was to reduce the cost of their cars. This was thanks to Panasonic’s quick turnaround and efficient production processes. Could you comment on your business and how you’re able to replicate the quality that you have here in Japan in your overseas location? What kind of quality control system or management system do you have in place to ensure consistency?
To elevate and maintain a high production standard throughout our global factories, we have a personnel exchange program where the employees of overseas factories come to Japan for two or three years in rotation to learn about the Japanese high-quality standards and production methods. They then go back to their respective countries and continue working and applying their newly acquired production knowledge there.
Our factories across the globe are consolidated as the Meiwa group network, and we have a close-knit relationship and share information about making improvements (kaizen). Having a personnel exchange from Japan to overseas and vice versa enhances the elevation of our technical capabilities. Some technological aspects in overseas factories are more advanced than in Japan, so it is important to share these good practices.
We have already accumulated 26 or 27 years of history in our Thailand based factory and twenty years in Indonesia. Our most recent factory was established in Mexico in 2016. In opening that factory, it wasn’t only Japanese engineers involved. Engineers from Indonesia also went to Mexico to help, so it was a global group effort.
The challenges facing Japan come in different forms. One example is the population crisis. Statistics show that people over 65 now represent 29% of the population, 13% of whom are actively working right now. This is one of the highest rates among all the first-world economies, and it presents a challenge on two fronts. The first is knowledge transfer from your more experienced veterans to a younger generation. The second is a shrinking domestic base for you to service. How is your company tackling these challenges, and what opportunities do you foresee?
There is a huge impact on our business from the Japanese demographic decline. What we are now doing is shifting to a new means of production. Initially, our mold manufacturing was heavily reliant on the technical capability of the technician. Presently, we continue to standardize the process using machining tools to produce a consistent result and more efficient productivity. We are also introducing more automation technology to reduce labor requirements, and we are shifting our business from our Japanese factory to our overseas factories, where a more abundant labor force is available.
With the introduction of automation technology, we are automating the process and reducing the reliance on manpower in processes such as cutting by applying more machine tool utilization. As for the shifting of production overseas, we try to keep R&D and more highly added value business in Japan while delegating manufacturing, creation of drawing designs, and numerical control (NC) programming to our overseas locations. We are trying to find the best balance of work allocation and the relationship between the Japanese and overseas factories. We are also trying to reduce overlapping work and streamline as many processes as possible while standardizing the work so we don’t need to rely on the experience of the technician or the engineer. Our standardization efforts are not only targeted at production quality but also the time required for production to increase efficiency. As for importing, we’re not only reliant on our overseas factories. We are opening up to new overseas suppliers since domestic suppliers like ourselves are struggling in this aging society, and we want to mitigate this potential risk.
Traditionally, the automotive industry has been Japan’s biggest export, and I think China has recently overtaken Japan. If we talk about customer diversification within the automotive industry, we’re seeing the transition away from internal combustion engines (ICE) to EVs and EUVs. With this transition comes new demands. An EV car is more straightforward. You have the battery, the inverter, and the powertrain, and that’s basically it. Can you talk to us about how your customer is changing with that transition in the automotive industry and what kind of new technologies you’re looking to introduce to cater to this next generation of vehicles?
EVs have drastically changed what components are needed. For battery EVs, the type of die-cast parts required is completely different than that of ICE cars, and the number of die-cast parts for EVs is also higher. For example, we are aware of the need for die-casting molds for automobile bodies, as well as drive units that integrate the motors, inverters and reduction gears required for EVs. The primary market is in China and our current production capacity at our China factory is 2,500 tons of die casting molds. In order to meet the growing demand there, we are planning to strengthen our existing factory and build a second factory on the same site. This new factory will be able to produce 6,000 tons of die casting molds, with Giga Cast needs in mind. In Japan, we will be upgrading our factory to be able to handle a wider range of die casting molds. Currently, our Japan factory has a die casting mold manufacturing capacity of 2,500 tons, but this year we will be introducing a 30-ton crane to raise our die casting mold manufacturing capacity to 4,000 tons.
Die casting and plastic injection molding are manufacturing processes that differ in materials and applications. Die casting injects molten metal, such as aluminum, zinc, or magnesium, into molds to create strong and durable metal parts. In contrast, plastic injection molding involves injecting molten plastic into molds to produce lightweight and versatile plastic components. Most companies don’t cater to both, but your company does. Can you talk about how you’re able to cater to both?
On our website, we call ourselves a die casting and plastic injection molding manufacturer, but in fact, almost 100% of our current business is on the die casting side. In the course of the automotive industry development, there was a time when plastic injection molding parts became popular, but that has ceased to be true and now we are solely focused on die casting.
Diecast mold in closed state Diecast mold in open state Diecast mold in open state Previous Next
Mold machines are prone to cracking and water leakage due to high internal stress, excessive injection pressure, and inadequate cooling system maintenance. These stresses cause brittle materials to crack during the molding, while the sealing components and thermal cycle often lead to water leaks. In response, you developed the CHC Cooling Half Cap. Can you explain how you overcame these challenges with your CHC Cooling Half Cap and what’s unique about the cooling holes in this product?
The reason for developing the CHC technology is that during my predecessor’s time as president, a customer had trouble during the molding process. The exterior of the mold became too hot with the molten metal, and also, with the pressure, there was a risk that the mold would break and the cooling water would leak through the cracks. To mitigate that risk, this technology was developed.
Molten aluminum for die casting is typically 620-670°C, and the product surface of the mold is extremely hot, exceeding 450°C. To cool this hot aluminum product, cooling holes are designed inside the mold to allow cooling water to pass through. Ideally, the cooling holes should be designed as close to the mold surface as possible in order to cool the hot molten aluminum in a short time. However, if the cooling holes are designed too close to the mold surface, the possibility of cracks in the mold increases due to the repetition of rapid cooling, rapid heating, and high pressure. Therefore, it is necessary to design the cooling holes at a certain distance from the mold surface. This will require more cooling time and lower productivity. By using our CHC, it is possible to design the cooling holes as close to the mold surface as possible without worrying about cooling water leakage due to mold cracks. As a result, shorter cooling times, i.e., shorter cycle times, can be achieved without worrying about cooling water leakage.
In addition, rust can occur in the cooling holes of molds that have been used for long periods of time, and cracks can also occur due to rust. Using CHC can help to prevent rust and cracks caused by rust.
CHC lineup Picture of the cooling hole after 70,000 shots Picture of the cooling hole after 180,000 shots Previous Next
From the customer’s point of view, this is more efficient, and it saves money. Could you tell us how much the customer can save in terms of cost or product lifetime?
There are several advantages. For example, a cooling hole without our CHC technology might develop rust and cracks after 70,000 shots, but with CHC it can be used as a cooling hole for 180,000 shots. In the photos of the cooling holes after 70,000 and 180,000 shots, you can see that the CHC is still reflecting light. In the cooling holes without CHC, they were already covered in rust after 70,000 shots, and after 180,000 shots, the cooling holes were already blocked by rust.
This not only extends the longevity of the mold but also reduces cycle time and product defects, resulting in cost savings.
The conventional method would be, for example, so-called stainless cooling bush, but when comparing prices with CHC, ours are much lower for the amount used. Also, this bush requires grease to be applied to the surface of the cooling hole to fill the gap, whereas our product directly contacts the cooling hole, resulting in high thermal conductivity and high cooling efficiency. Since no grease is used, the product is maintenance-free. On the other hand, conventional bushings and grease application require maintenance because the grease solidifies when the temperature exceeds a certain level. Finally, the CHC method eliminates the risk of cooling water leakage. If water leakage occurs in a mold, production must be halted, the mold parts must be replaced or repaired, and production must be started up again.
Is this something that you’ve patented or registered?
Yes, we have patented our CHC cooling half cap in Japan.
Your customers are prestigious OEMs, including the well-known automotive companies. These companies are known for stringent quality controls requiring the highest standards in the components they use. Could you explain how you’re able to cater to the controls that these companies require?
Each client of ours has different demands and quality standards, but all Japanese companies demand quality that meets the highest standard. Through our accumulated experience, we acquired the know-how, and we are presently able to cater to any type of demand which has become our strength and competence.
As you mentioned, you’ve been operating overseas for over 25 years, especially with your operation in Thailand. When Japanese SMEs go overseas, they normally follow their main customer to produce locally alongside them. Given that you’ve been overseas for such a long period, have you expanded your customer base beyond Japanese manufacturers, and if so, could you tell us more about the issue of over-spec? Is it true that Japanese products really are over-spec for those new customers, whether they are local or international?
The reason we expanded to Thailand is that back in 1997, one of our customers wanted our help in their Thailand factory. They wanted to manufacture molds themselves, and they asked us to give them technical assistance. That became our first overseas touchpoint, and after this technical support period finished, we decided to establish our own base there.
As you mentioned, many Japanese companies have followed the major Japanese manufacturers overseas, but in our case, it has been more of our own decision after doing our own market research, finding the market, and establishing our base to provide our services to the local market.
Japanese companies are famous for their ability to develop new products which serve the ever-evolving needs of society. At 3% of annual GDP, Japan’s R&D spending is among the highest in the world, compared to 2% in the US and 1.5% in China. You mentioned that your R&D facilities are based in Japan. Can you tell us more about your R&D strategy and how it works?
Our R&D focuses on facilitating die-cast and mold manufacturing. We are currently improving our CHC technology to improve the cooling process further. We are also focusing on the use of simulation software to help our customers visualize their production with the molds we create. They can see the speed, the quality, and the production efficiency with this simulation software. We are trying to lengthen the lifespan of our molds while reducing the lead time from receiving the order to customer delivery.
To meet the developing needs in the overseas market, it is often important to collaborate with partners, especially in sharing knowhow and penetrating the market. In your specific case, are you looking for any new types of partnerships in overseas markets, and if so, what kinds of partnerships are you looking for?
Until now, we have depended mostly on our internal resources for product development and overseas expansion, but the world is rapidly changing. It is now important for us to find trustworthy partners to help us expedite the speed of development and production. Finding a partner for the die-casting technology is on our radar. We have the mold manufacturing technology, and combining it with casting technology would provide a good synergy.
Meiwa has a strong international presence with factories in the United States, Thailand, China, Mexico, and Indonesia. Could you explain the strategic importance of these locations and where you would like to expand next?
How we started our overseas business and the reason we decided to have bases in Thailand, Mexico, and Indonesia is because through our extensive research, we have learned that there is a high demand in these markets, especially from Japanese affiliated companies operating locally. Our desire to serve these companies in those locations led us to open our factories overseas. We recently opened an office in the US, but there is a limit in our ability to establish a factory in the US at this time. Therefore, we think collaborating with new partners, even a competitor or a company in the same industry, to establish new production sites overseas could be a smart, strategic move.
Your company was founded in 1979. If we fast forward to 2029, you’ll be a 50-year-old company. Presuming you’re still the president on that date, what kind of personal goal or ambition have you set yourself to achieve for the business?
We started our business as a mold manufacturer and we have been doing that for decades, so we hope to continue our business as the premier mold manufacturer and be a company that our customers and industries can depend on. Local contribution and being integrated as a member of the local community is also very important to us, and our mindset from the beginning has been to be proactive at a local level. In doing so, our goal is to become a locally respected company in every overseas location.
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