Oiles Expands Manufacturing Base in U.S. and Europe

Oiles Corp. (Japan; TSE: 6282), forecasting higher demand from its primary customer base of Japanese automakers, is increasing its manufacturing capacity in both the United States and Czech Republic. Founded in 1939, Oiles is a diversified manufacturing and engineering company headquartered in Tokyo. Its primary business is Oiles Bearing, a world leader in self-lubricating bearings. The company employs over 1,200 people in 17 subsidiaries worldwide. It is a primary supplier of self-lubricating polymer bearings and seals to Japanese automakers such as Toyota, Honda, and Nissan. Oiles operates in four divisions: Bearing Division, Structural Division, Architectural Division, and Other. Both the Bearing Division and Structural Division manufacture bearings. Bearing Division produces oilless bearings and related devices for a variety of applications in transportation equipment, electrical equipment, general industrial machinery and other miscellaneous markets. The Structural Division produces earthquake isolation and damping devices, bridge bearings, suspension bridge bearings, and related devices. Together the two bearing-related divisions dominate Oiles sales, accounting for 77% of sales, up from 68% in 2001. However, as structural bearing sales slid 28% since 2001, traditional Bearing Division bearing sales have risen 33% in the same period. Oiles bearings use graphite, polyacetyl, sintered and tetrafluoroethylene surfaces on a wide variety of base materials, producing an extensive product lineup for rotating and linear motion applications. Oiles bearings are used in everything from small precision machine tools to industrial equipment to automotive applications to the pivot of the world's first floating, rotating highway bridge in Osaka. One of those rotating bridge bearings weighs over 16,200kg. Other applications include food processing, cigarette manufacturing and environmentally-sensitive areas where eliminating the potential for oil contamination is a key design parameter. However, it is the company's sales of self-lubricating polymer bearings used in automotive applications that have been particularly strong; Oiles said projections show the market will grow faster than expected. Alongside those projections, Oiles stock has continued to test and reset new highs not seen since 1999. Oiles' U.S. bearing manufacturing facility in Plymouth, Michigan is being expanded by nearly 50%, the company investing as much as USD $3.5 million and boosting employment by 50%. Another Oiles facility supplying automakers is located in Concord, North Carolina. In the Czech Republic, Oiles' recently-completed plant in Kadan is already at capacity. An expansion plan there will more than double capacity and employment by 2008. The Kadan plant was announced in 2003 and came online in September 2004.