KONICA MINOLTA Konica Minolta Group 1st Quarter/March 2013 Consolidated Financial Results  


Reorganization of production bases in China in Business Technologies

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Next, this slide provides an explanation on the reorganization of production sites in China in Business Technologies Business.
Although this will be the first time we have talked about this matter, up until now we have produced all of our MFPs at three locations in China, the fully owned plants in Wuxi and Dongguan and a contracted plant in Shenzhen. Manufacturing at the Shenzhen plant ended in June, and we have moved the role played by this plant to the Dongguan plant.
Consolidating these three locations into two will provide benefits in terms of strengthened production capabilities and a larger business scale that will improve productivity and efficiency, reductions in logistics expenses, and the streamlining of redundant functions such as administrative divisions. However, costs rose temporarily in the first quarter due to the simultaneous launch of mass production for new products at the Wuxi plant and the acceptance of Shenzhen production at the Dongguan plant. Naturally, these costs will be eliminated from the second quarter.