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CORPORATE NEWS [latest news list] November 9, 2005
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Withdrawal from Oil Hydraulic Multi-tier Parking System Business



Daikin Industries, Ltd. (head office: Osaka, Japan; President: Yukiyoshi Okano) will stop manufacture and sales of oil hydraulic multi-tier parking systems. Orders for the parking systems will be taken until the end of November 2005. Customers who have already concluded contracts for such products will be consulted and their wishes to continue or cancel such contracts will be respected accordingly.

Daikin Industries' After Sales & Service Department will continue to handle maintenance and service on systems already sold (approximately 80,000 units cumulatively). The department is and will continue to be available to customers 24 hours a day, 365 days a year.

Annual sales for this business were in the range of 5 billion yen (financial results for March 2005). The decision to withdraw from the market will result in approximately a 2 billion yen appropriation (on a consolidated basis) posted as an extraordinary loss in the March 2006 midterm settlement of accounts (announced November 9, 2005).

Daikin Industries entered the multi-tier parking system market in 1991 in response to the lack of available parking in urban centers as well as suburbs, applying its oil hydraulic technology gained from developing oil hydraulic equipment for industrial and construction purposes. Business expansion was achieved thanks to product differentiation that utilized the energy savings inherent to oil hydraulic technology, high-speed operation and low noise and vibration.
However, demand for multi-tier parking systems has dropped substantially while increased competition in recent years has led to lower prices. Additional factors such as sharp rises in the cost of raw materials including steel have led to marked deterioration in the business environment. Substantial growth in demand is not projected, and in light of the necessity to concentrate operations in selected fields the decision was made to withdraw from the market.

In the future, the Oil Hydraulics Division will strive to develop and expand business in the two fields of oil hydraulic equipment for general industrial equipment and machine tools (industrial oil hydraulics) and oil hydraulic equipment for construction equipment (construction oil hydraulics).
In the field of industrial oil hydraulics, in addition to conventional oil hydraulic products Daikin Industries is working to expand business through development of new hybrid equipment combining oil hydraulic and electrical controls.
In the field of construction oil hydraulics, Daikin Industries is striving to achieve No.1 market share in Asia through expansion of its business alliance with Sauer-Danfoss Inc. (USA).



  For more information, please contact
     Daikin Industries, Ltd.
 
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