Global economic crisis has dragged down operations of all enterprises and Exedy Vietnam Co,. Ltd is not an exception. But, for a big trademark with strong foothold in Japan and in the world, Exedy is still growing firmly in the integration process. Vietnam Business Forum was granted an exclusive talk with Mr Shigeru Sugiyama , CEO of Exedy Vietnam Co., Ltd.
Could you introduce your company’s production activities in the past time?
Exedy Vietnam started in Vietnam operations in 2006 as a joint venture between Japan and Taiwan. The company specialises in providing precision equipment for automaker and motorcycle producers. The Vietnamese market holds huge potentials as leading manufacturing firms like Honda, Yamaha and Toyota have entered in Vietnam.
Our presence in Vietnam helps these firms raise locally sourced component ratios - an important factor to reduce production costs. Our operations have been very good since our debut. Revenues reached US$10 million in 2007-2008 and US$142 million in 2009. Ongoing global crisis has left negative impacts on our operations as our company produces under the request of our customers. Our performances depend on business results of our customers.
How do you think about the development of Vietnamese precision engineering industry?
The Vietnamese market is quite large, the demand for precision mechanical products is very high, and this is a good climate for concerned enterprises. But, production capacities of domestic enterprises failed to meet the demand because they have small scales and lack investment. When we surveyed the market and decided to invest, we carefully weighed on supply and demand of the market.
In my opinion, the Vietnamese precision mechanical industry will develop very strongly because enterprises have started increasing investments. In addition, this is an open market because it not only serves domestic demand but also export.
Vietnam has more than 86 million residents and they create a potential market for the automobile industry. Anticipating the surge in demand, we will expand our operations in Vietnam and invest in more factories.
Your company’s inputs are mostly imported and foreign reliance causes certain impacts on your operations. So, does Exedy Vietnam have any solutions to gain initiative in production?
Our production uses most imported materials and bases on customers’ orders. In the past months, unpredictable changes in imported prices seriously affected our production and output product prices. We will seek domestic suppliers to increase our localisation ratio to lower production costs to sharpen our competitive edge.
How do you think about the second wave of Japanese investors into Vietnam in the past time?
The investment atmosphere in Vietnam has become better and more attractive to investors. This is evidenced by new projects in Vietnam, including those from Japanese investors. In my point of view, there are two types of Japanese investors in Vietnam: One comes for a certain period of time and the other invests for a long term.
Arguably, investors withdraw their assets from China to invest in Vietnam on lower production costs and more incentives but they will be ready to move to other destinations where production costs are lower and there are more incentives.
Thus, managers need broader views in assessing investment waves from foreign nations, including Japan, to employ suitable policies to gain sustainable development.
What should Vietnam do to polish its image in the eyes of investors?
Possibly, the highest barrier to investors is administrative procedure. It takes too much time although it has been considerably streamlined in the past three years. Vietnam should perfect its administrative formalities to catch the eyes of investors when they come to Vietnam to explore business opportunities. Except entirely protected industries, the Government should widen market-based liberation in industries for enterprises to compete and develop.
Luu Hiep
Vietnamese
