Steel-pipe maker Maruichi to supply motorcycle parts in Philippines

09, Jul. 2019

Maruichi Philippines Steel Tube Inc.’s manufacturing plant in Lipa City, Batangas Province.
Maruichi Philippines Steel Tube Inc.’s manufacturing plant in Lipa City, Batangas Province.

LIPA CITY, Philippines, NNA – Japanese steel-pipe maker Maruichi Steel Tube Ltd. will begin supplying components to motorcycle manufacturers in the Philippines this year, which government officials hope will help expand the country’s supply chain network and reduce motor vehicle production costs.

The company on Monday opened a plant in Lipa City in Batangas province, its first in the Philippines. It has set up Maruichi Philippines Steel Tube Inc., a joint venture with Toyota Tsusho Corp. Maruichi has a 70-percent stake while Toyota Tsusho holds the rest.

Koji Kobayashi, president of the subsidiary, told NNA that the Philippines’ economy and auto industry are expected to grow further. The company will supply components to motorcycle manufacturers first, and eventually to carmakers in two to three years, he said.

The company may begin mass production of about 500 tons of steel pipes per month in September or October, Kobayashi said.

Many motorbike and car manufacturers in the Philippines import steel tube components from Indonesia and Thailand, as there are few domestic parts suppliers, he said.

Steel pipes are used widely in motor vehicle parts, such as handle bars and mufflers.

Charito Plaza, director-general of the Philippine Economic Zone Authority, said the opening of the steel tube plant might eventually help lower the cost of manufacturing motor vehicles in the Philippines.

“We want to maximize the production and manufacturing capability so we [can] complete the supply chain,” Plaza told NNA. “And when our supply chain is complete, it will attract more industries because they will no longer import the raw materials or manufacturing materials they need in their production.”

“It will help industries lower down their production costs. It will also give them a competitive advantage in the pricing of their goods,” she said.

Motorbike sales in the Philippines have been growing steadily in recent years as household purchasing power has increased and as commuters try to avoid gridlock on major roads, particularly in the Metropolitan Manila area.