JAPAN: Faced with continuing covid lockdowns in China, Japanese air conditioning manufacturer Daikin says it will end its reliance on component supplies from China by March 2024.
According to reports in the Nikkei Asia, Daikin will seek to produce its own core components for air conditioners outside mainland China and encourage its other parts suppliers to do likewise. It is reported that Daikin could also help its suppliers to reduce costs, such as assisting in the introduction of increased automation.
Like many other manufacturers, Daikin has previously relied heavily on China where production costs are cheap. However, covid prevention measures and city closures have interrupted the production and supply of vital components. According to reports, the company now believes that it needs to have emergency suppliers in other regions and has decided to source from other manufacturers outside China.
Daikin has already begun to manufacture PCBs at its factory in Shiga Prefecture, Japan. It has also recently launched a production line in Malaysia, and is said to be planning to produce motors in many places.
Last year, Daikin’s component imports from China were 20% by value, down from 35% in 2020.