EVs and carbon neutrality as business opportunities

Staff Editor:          Atsushi Kuwasaki

Brother Industries has set a target in its new mid-term strategy for next three years to increase sales of its industrial equipment business, mainly machine tools, to 100 billion yen in FY2024, the final year of the strategy. The company intends to expand sales to the automobile and general machinery industries, as well as to take the growing popularity of electric vehicles (EVs) and carbon neutrality as business opportunities to expand its market share. The company is also accelerating product development, having launched new products in April and May of this year.

Japanese market will hit a record high

In May 2022, Brother Industries announced its new medium-term strategy “CS B2024” for the three-year period from FY2022 to FY2024. One of the key elements of the strategy is “substantial growth of the industrial equipment business,” and the company has publicly expressed its stance to reinforce sales expansion of its small machining center “SPEEDIO” in the market.

Mr. Makoto Hoshi, Managing Executive Officer, explains the new mid-term strategy at the press conference held on the day before the open house.

In FY2021, sales of the industrial equipment business recovered significantly to 56,553 million yen, up 46.1% from the previous year, mainly driven by the Chinese market. In FY2022, the company expects sales to grow by 16.2% year-on-year (YoY) to 65.7 billion yen. Mr. Makoto Hoshi, Managing Executive Officer of Brother Industries, analyzes, “In 2022, our sales will increase in all regions, and especially in Japan, it will be the highest in history”.

The company aims to further grow sales in the industrial equipment business during the three years of CS B2024, raising them to 100 billion yen by the final year of the plan, FY2024. “We hope to achieve this goal by continuing to improve SPEEDIO’s high productivity and energy-saving performance, and by contributing to the competitiveness and carbon neutrality of our customers’ production sites,” explains Mr. Hoshi.

Update mainstay machines

The company will also focus on expanding its customer base to reach the 100 billion yen sales target. In order to achieve steady growth without depending on special demand from the electronics industry, the company is working to expand sales to the automobile and general machinery industries, and is also newly tapping into the need for machining EV parts. Furthermore, the company sees social issues such as carbon neutrality as a business opportunity, and intends to expand its market share by appealing to customers and trading companies about SPEEDIO’s high environmental performance, such as low-power consumption.

By market, the company has designated China, India, and Japan as “priority areas” and is working to expand its sales and service bases. Mr. Hoshi said, “We would like to build a system that covers the market in all aspects by establishing bases in each region”.

Many visitors gathered around the “U Series (Photo provided by Brother Industries)

In order to distinguish itself from competitors, the company will also accelerate product development. In April of this year, the company renewed its mainstay products, “S Series” and “R Series” models, for the first time in about three years.

Mr. Hoshi said, “The S and R series are the core of our flagship products. They are the “ace and cleanup,” as in baseball. Depending on how well these mainstay products are selling will decide whether or not we achieve our goals,” emphasizing the purpose of the model change.

In May, the new “U Series,” capable of 5-axis indexing, was also added to the lineup.

At the end of May, they held an open house at “Brother Technology Center”, a showroom in Kariya, Aichi Prefecture, and introduced the details of the new products to about 800 visitors.