Tsuneishi Corporation (Head office: 1083 Tsuneishi, Numakuma-cho, Hiroshima, President: Katsushige Kambara) announces that it will establish a new shipbuilding company on Shuzan Island, China, as part of its global strategy to strengthen its competitiveness in the international shipbuilding market.

On March 21, 2003, we filed an application to newly establish a wholly owned subsidiary “TSUNEISHI GROUP (ZHOUSHAN) MARINE & DEVELOPMENT INC.” on Shuzan Island, one of the Zhoushan Islands located at the southern end of the Yangtze Delta, Mid-China. The Chinese Government’s permission is due to be granted on March 28. As soon as we receive permission, we will commence construction of the factory, after receiving the rights to use a large land area of 26 hectares.

“TSUNEISHI GROUP (ZHOUSHAN) MARINE &amp DEVELOPMENT INC.” is capitalized at about 6.50 million U.S. dollars, and its total capital investment is about 13.50 million U.S. dollars.
The new company will initiate production starting with accomodation blocks for Tsuneishi Corporation’s vessels, which it plans to deliver for the first ship in early September 2003.
At the initial stages of manufacturing, along with new facility construction, it will only assemble cut materials brought from Japan. Equipment such as steel cutters is to be progressively installed. The company plans to manufacture accomodation blocks for two vessels within 2003, increasing output as it upgrades and expands its facilities such as NC steel cutters.

Within a few years, the company will boost output of accomodation blocks, while expanding its product lineup to built-up longitudinal beam, hatch covers and customized pipes, among others, with an annual steel use target of 30,000-40,000t.
Utilizing the location, which has easy access to both Japan and other Asian countries, the new company is planned to pump up output, in view of supplies to other shipbuilders than Tsuneishi Corporation.

Tsuneishi Corporation established Tsuneishi Heavy Industries, Inc., a wholly owned subsidiary in Cebu, the Philippines, in 1997, actively pushing forward with globalization of its shipbuilding business. The foundation of “Tsuneishi” in China is a foothold for establishing shipbuilding docks following on from those in Japan (Tsuneishi and Tadotsu) and the Philippines. We intend to further boost our international competitiveness, while improving our global business structure.