The king of optical glass

Since the rise of Japan’s private sector in the post-war period, Japanese Monozukuri has been widely spoken about, but often misunderstood. In recent years, we have seen regional peers copying and replicating the manufacturing processes of Monozukuri at a lower cost. What are the main competitive advantages of Japanese manufacturing compared to its competitors (China, Korea)?Could you explain to us what the essence of Monozukuri means to you?

Before World War II, optical glass was primarily imported from Germany. The founder of Ohara Inc, ObaraJinpachi, established the company 83 years ago as a means to provide a domestic source of this optical glass. During the war, the production processes were tailored to satisfy the demands and the needs of the military. Once the war subsided, however, the main purpose of production became to manufacture camera lenses. This line of production continues to this day and our company has forged partnerships with companies such as Nikon, Fujifilm and Canon.

Over the years and notably since the year 2000, film cameras have progressively been replaced by digital cameras and large camera companies, seeking to minimize costs of production, have begun relocating their factories to China. As expected, this movement ultimately catalyzed the establishment of rival Chinese companies. The way we have been able to stay competitive and stand out amongst our competitors is by investing a lot of time and effort into our R&D forces; as a result, we have successfully implemented innovative ideas into our manufacturing processes, thereby offering a quality of product that is truly unique to Japanese products and that cannot be emulated by rival companies in China.

One of our most recent achievements in terms of innovations is our ‘glass ceramics’ production line – our technologies and know-how to yield and control the unique product properties like thermal expansion, strength, and transmission are simply beyond what any Chinese companies can replicate. We are very proud of such an innovative material, as we believe that it really distinguishes us from our rival companies

Another remarkable advance for usis our newly designed optical glass material with negative temperature dependency of refractive index (negative dn/dT). The new products show the presence by combination with existing optical glass with positive dn/dT to maintain the vision through the lenses without blur, even at high temperature. Now the lens made of such materials are installed in the automobile production field.

Oftent, Chinese companies buy Japanese products in order toanalyze them and attempt to recreate them. However, what has been demonstrated is that even though they can analyze the composition, they cannot maintain the same level of consistency that Japanese companies provide. Our company has always maintained a high level of quality, consistency and reliability in our products, which has allowed us to continue living up to, and even exceed the expectations of what it means for products to be ‘Made in Japan’.

Can you tell us a bit more about the company’s diversification strategy and the importance of Lithium-Ion Conducting Glass-Ceramics (LICGC^TM) in the future of the company?

Over the past several years, demand for digital cameras has decreased significantly and consequently, our company’s production of materials for these types of cameras has drastically dropped from 4800 tons to 3000 tons. In order to compensate for this drop in production, we have had to explore new types of markets and production lines, from which LICGC^TM manufacturing came to fruition.

Overall, our company’s diversification strategy revolves around three major business activities: (1) mobile business, (2) mobility business and (3) battery business. For our mobile business, Ohara makes use of a new line of glass ceramics called ‘NANOCERAM^TM’ to create durable glass that can be implemented in the production of mobile phones. The reason mobile phone companies are interested in our glass ceramic products is because with the introduction of 5G, there is a need for a material that offers high transmission of signals but that can also remain durable. Glass alone can shatter too easily, so the use of ‘glass ceramics’ allows the mobile phones to remain sturdy all whilst giving the best available connection to the user. 

We are also trying to appeal to automobile manufacturing companies through our mobility business by offering similar glass-ceramic products that can be implemented in the manufacturing of automobiles. As mentioned earlier, the dn/dT lens falls into this business category and all of our products in this line of activity are made with the purpose of improving the overall quality of glass within automobiles.

Finally, for our battery business we are looking into novel products that could replace liquid lithium batteries. These batteries are widely being used today, however, as you may have seen on the news, products containing these batteries can unexpectedly combust and can therefore be quite dangerous to customers. Solid lithium batteries are an alternative that are currently under research and development, but are yet to be made available. One of the reasons for this is because implementation of these batteries would require the collaboration of several companies to manufacture additional components that could complement the battery and be integrated alongside them in final products. Hopefully, implementation of solid lithium batteries will be possible in the near future.

Does Ohara work in collaboration with other Japanese companies within the same manufacturing sector?

We do indeed collaborate with many other companies in the country. We usually set up non-disclosure agreements with them whereby we exchange products and rely on our mutual trust to give each other constructive feedback that can help propel us forward. From the feedback we receive, we will revamp our manufacturing processes and build prototypes that showcase these improvements. In this way, we provide our customers with tangible proof of our ameliorated products.

In part due to Japan’s decreasing demographic, Prime Minister Abe has urged Japanese companies to internationalize their activities. With an established presence in North America, Europe, and namely China in Asia, your company perfectly exemplifies the type of activity Prime Minister Abe has been prompting. According to your manufacturing strategy, which markets display the greatest growth potential for Ohara?

Since we establish partnerships with camera producing companies to provide them with our materials, our expansion scheme towards foreign markets has been primarily influenced by which countries our partners geographically establish themselves in or relocate their factories to. As such, we began expanding towards North America, then Europe, Taiwan, Malaysia and finally China.

With an increasing shift towards production of batteries and smartphones, if our company experiences a rise in demand for our materials from partner companies that manufacture those products, then we will tailor our expansion scheme towards those companies. As it stands, demand for our products is particularly prevalent in Asia because a majority of our clients are based in this region. The fundamental reason for this is because products are usually assembled in China and in other Asian countries, therefore in response to your question, Asia presents itself as the market with the most potential for our company.

The company has 10% of foreign shareholders. Are you looking for more international shareholders, and if yes, how do you plan on attracting them?

We are hoping that more international investors will hold our stocks. Currently, we are changing our business structure, and we are certain that we can show them further business achievement in the new business field.

Looking to the future, where would you like to see Ohara in the upcoming 10 years and what objectives would you hope to have accomplished in that period of time?

Our two main businesses at the moment are those related to optical products, which accounts for 75% of our business activity, and electronic products. In addition to these core businesses, we will begin a business in the environment and energy sector that will push our production systems to be more eco-friendly and to improve the global environment. Within the time frame given, we hope to equilibrate our production systems across our three business activities, (1) mobile business, (2) mobility business and (3) battery business, and overcome our competitive rivals in China. Today, we maintain the leading share of the optical glass market. We would like to contribute to the growth of worldwide technological innovation by developing and supplying our new materials that meet the needs of the time.