Taiyo Stainless Spring is a precision parts manufacturer with expertise in transforming metal materials into valuable metal parts supplied to a wide range of industries including automobile, IT devices, and household goods. In this interview, president Yutaka Sakaiya talks to us about their unique technologies, how they’re adapting their products to the EV era, and how they’ve added plastic injection moulding to their long list of their capabilities.
You’ve stated that the source of your company’s competitiveness is from your monozukuri. What is your take on monozukuri, and what are the advantages of it?
We don’t define monozukuri as one step of the production; its a combination of various aspects – everything combined makes the perfect monozukuri, at least from our perspective. In-house manufacturing, production and sales creates an overall strength for Taiyo Stainless’ monozukuri spirit. We started from R&D, then switched to manufacturing and sales, then to promotion and introduction of our products to the customers. All this combined is a long chain of monozukuri.
Regional competitors such as Korea, China and Taiwan are replicating the Japanese monozukuri process, but doing so at a cheaper labour cost. What is the advantage of the Japanese manufacturing philosophy over such regional competitors?
Let’s face the facts: the price matters. What differentiates us from competitors is the price and it’s fair to say that the Japanese monozukuri is losing in this aspect of the competition, in comparison to cheaper Chinese or Korean products. However, what Japanese monozukuri can offer is what I described earlier – we can provide customers a service that begins in the R&D phase, have the best knowledge in technical know-how, integrated development ability of sales, technical and manufacturing, which creates a wealth of credibility and loyalty to Japanese customers in terms of stable supply and high quality at a value price.
Already, 28% of the Japanese population is over the age of 65, and with this trend expected to continue, one in three people will be over 65 by 2035. This will have two major effects: a shrinking domestic market and a shrinking labour pool. What challenges does this demographic shift pose for your company and how are you reacting to it?
There are several solutions that have been adopted by Taiyo stainless, one which is automizing our processes, with some fully automatic, and others semi-automatised, which means we eliminate any unnecessary human work in the factories that we have in Japan or overseas. Another solution is to receive foreign trainees from Asia countries such as China and Vietnam. These are the two strategies that we are employing to combat this demographic challenge.
Taiyo Stainless is a precision parts manufacturer with expertise in producing small metal parts. Which is your best-selling product? Which one is increasingly seeing demand in overseas markets?
By percentage, the prefabricated and specialized products that have two segments. 30% is prefabricated production, while 70% is customised and specialised. Recently, we have also begun making plastic moulding products.
You supply to automobile industries, IT devices, household goods and among others. How do you respond to different diverse customer needs? What synergies have you created to do so?
We try to diversify our plans and portfolio to as many industries as possible, and that is part of our policy. The biggest industry that our products are used in is automobile, but we are not limiting ourselves. It could be domestic appliances, office appliances, medical, entertainment or recreational areas. This diverse profile has become a strength for our company. The reason we adopted this policy was because of the situation with the tape guides used in VHS cassettes. The sales within our company were 50% , but VHS soon become obsolete, with the rise of discs and digitalisation, and when this happened, we lost a significant amount of our sales. As a result, our diversification policy was adopted.
The main industry that you supply to is the automotive industry, which is undergoing a major shift with the adoption of EV vehicles and CASE technologies. How are you adapting to this shift in the automotive industry?
The era of gasoline and combustion engine vehicles is coming to an end. The transition to battery-based vehicles is a large one, but so is the change in automobile parts manufacturers, with lighter weight materials, such as aluminium, replacing more conventional materials, such as iron. The engines have also been made lighter, with plastics being introduced. For these reasons, in 2018 , we introduced the capabilities to do plastic injection moulding, specifically targeted for the changes in the automobile industry.
You possess sub-micron processing and assembly technology, which you use to create guide pins and split sleeves for optical fibre connections. Can you explain to us how your products are designed ensure minimum data loss in telecommunications?
We put effort into in-house development, metal forming technology and press-processing technology, in which we can take pride. In particular, this in-house processing technology is irreplaceable for us, as stainless-steel products have been generally hard to process and handle. By utilising our know-how, our outstanding adjustment skill and mould technologies, we can produce low connection loss products constantly.
Guide Pins
You also possess microfine cutting technology for very thin linear wire materials. What are the applications of this technology?
In cutting technology, there are some in–house developed machinery which linearly cuts thin, linear wires called suspension wires. This is widely used in optical pickups. Inside modern cell phones, the camera lends are laid on the wires, with these precise wires being introduced by us. It is widely used in IT, manufacturing, camera lenses, zoom lenses on digital cameras and many other fields. It is also used in some iPhone models, too.
Suspension Wires
5G will be a $13 billion dollar industry in the coming years. Are you looking for partners to co-create for the service industry?
No. We do not do co-creation, however we work closely with our customers, as most of our products are made under their request. It is frequent for them to ask us to make certain adjustments and improvements during the manufacturing process, so in a way, it is a form of co-creation. We act as a commission-based company, where we outsource production for most of the customers. On many occasions, we will get returning clients telling us that what we made is not what was expected and ask to change it, which of course we will work with them to do.
You are already established in Hong Kong, Malaysia, and Thailand. What countries will you be targeting in the future for your mid-term strategy?
There is no definite plan on which countries we are aiming to expand our business to, or further expanding in nations that we are currently located in. We are conducting market research and doing our due diligence on countries such as India, which is possible, but not definitive.
We are taking a step-by-step approach because once market research is conducted, there will be stand out solutions. In that instance, there could be a variety of strategies, but ideally, we would like to find a trusted local partner that could act as either a trading or distribution company. In the case of India, if a distribution office proved successful, then we would start considering shifting production locally too.
You have more than 1,000 customers in Asia, more than 30 customers in the US and 50 in Europe. Are you looking to increase this customer portfolio and diversify into different industries to cater to their needs?
The sales activities are not done only by Taiyo Stainless directly, but through trade companies and houses, so we plan to carry out sales activities from multi-faceted perspectives.
Your company will be celebrating is 80th anniversary next year. Imagine we come back in 6 years for your 85th anniversary and have this interview all over again. What would like to tell us? What are dreams for this company and what goals would you like to achieve?
Plastic moulding products is something that is listed in the mid-term strategy plan as one of the major targets, among the other challenges that we had discussed. We have three major technological pillars at the company: metal forming technology, press processing technology and precisions shaft processing technologies, allowing us to carry out all necessary tasks within the company. The plastic moulding capabilities of the company was a recent introduction, due to the automotive industry and customer demands, and this will become our fourth pillar. For the next five to ten years, we wish to be capable of creating our own, original plastic moulding products, with overall sales of 10 billion Japanese yen.
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