Porite Corporation ensures smooth operations for the automotive and electronics industries through advanced powder metallurgy.
Japanese manufacturing is globally known for its “precision” and “high quality,” and Porite has demonstrated a strong presence in precision technology for many years. How, specifically, is your company’s monozukuri spirit—its manufacturing ethos—embedded in your processes?
To be honest, if I handed you a copy of our company motto, that might be the end of the story, but that would be far too brief, so let me explain a little. Our motto includes the words “sincerity and technology.” This doesn’t simply mean having sincerity or having technology. What matters is “sincerity backed by technology.”
In my view, the most important thing for a Japanese company is quality. We can never say, “quality comes second.” Quality is at the core of what Japanese companies are, and protecting that quality is directly tied to protecting our brand. Take Rolex watches, for example—they’re not made in China. Of course there are countless counterfeits, but the value of a genuine Rolex is its quality. That quality is the brand. The same applies to cars or any product. Protecting a brand means protecting quality. That’s why, whether a product is made in Taiwan, China, or anywhere else, as long as it carries the Porite name, we must never damage that brand image. This is a policy I strictly require all of our group companies to uphold.
Next, I’d like to ask about the current macroeconomic environment. As global supply chains are being diversified, Japan has been experiencing a weaker yen, which is creating tailwinds for manufacturing in some respects. Beyond traditional strengths such as precision and high quality, Japan is also expected to regain cost competitiveness. Under these conditions, what do you see as Japan’s strengths for global expansion in manufacturing?
I think the biggest factor is the weak yen. In our case, around 70–80% of our products are for export, and most transactions are denominated in U.S. dollars. So even a move in the exchange rate from 150 to 153 yen per dollar has a huge impact. A shift of just one yen in the assumed exchange rate creates an enormous difference in value terms. Of course, when the yen strengthens, producing in Japan becomes less advantageous. In those situations, using overseas factories is an option. But right now, currencies in places like Taiwan, Singapore, and Malaysia are also relatively weak, which makes exporting from Japan easier. So with strong tailwinds for domestic manufacturing at the moment, I feel this is truly a chance to demonstrate the global value of “Made in Japan.”
Porite headquarters in Ina Town
I understand Porite counts many automakers among its customers. Japan’s automotive industry has long been a pillar of exports, but with the accelerating shift to electric vehicles (EVs), some argue Japan has been slower to respond compared with China’s BYD or America’s Tesla. It’s also said EVs require fewer parts than internal-combustion vehicles. How do you view this EV shift—as a challenge, or as an opportunity?
It’s true that electrification is a major turning point for our industry. In conventional reciprocating-engine vehicles, sintered parts (powder metallurgy components) have mainly been used for two categories: engine parts and transmission parts. They have been essential for decades. However, sintered parts have one weakness. Because they are made by compacting powder, their density never reaches 100%. That means they are difficult to use in areas requiring extremely high strength, such as critical safety components like braking systems.
As a result, with EVs, demand for those large sintered components will decline. EVs don’t have complex traditional transmissions. Even when they do have gear mechanisms, they are simplified gearboxes inside e-Axles, where cut-steel components are used rather than sintered parts. There has also been demand for sintered parts in engine-related systems such as VVT (variable valve timing). But if the engine itself disappears, naturally the market for those parts shrinks as well. Major competitors are still strongly active in this space, and our group is also responding, but looking ahead, I believe the market for large mechanical sintered parts will inevitably contract.
Given that outlook, what kinds of components will you focus on going forward? Are there new growth areas?
Yes. The key shift is from “mechanical components” to “functional components.” Gears and sprockets are “mechanical components”—parts used to physically move something. “Functional components,” on the other hand, are not for movement itself; they contribute to a product’s performance and efficiency. A representative example is bearings. In EVs, improving energy efficiency—how far you can go per unit of power—is extremely important. Bearing performance plays a major role in maximizing motor efficiency. I expect demand for these small, high-precision functional components to grow significantly. Functional components are also generally small. They don’t require the massive machinery that large manufacturers rely on. In fact, companies like ours, which have operated with small-to-mid-scale equipment, are better suited to produce them. What used to be a disadvantage for us in terms of capital investment may actually become an opportunity.
So in other words, precisely because SMEs face constraints in large-scale capital investment compared with major manufacturers, they can be strong in small parts, large-volume orders, multi-type low-volume production, and high-precision processing. Do you think Porite can respond more flexibly to future market needs in that sense?
Exactly. When automakers select suppliers, they tend to choose major companies because their “guarantee capacity” is completely different. That matters a lot in large-scale transactions. However, companies like ours have strengths in areas such as large-lot production of small parts, multi-type low-volume manufacturing, and high-precision machining. We have long focused on parts that are low in unit price but high in profit margin.
To mass-produce tens of thousands of large components the way some other firms do would require equipment investment on the scale of billions of yen, which isn’t realistic for us. Instead, we’ve competed by manufacturing small, precise components like those used inside Apple products, relying on technology and efficiency. I feel that this strategy is now aligning with market trends. As EV adoption advances and demand grows for smaller, more precise components, I’m convinced our significance in the supply chain will only increase.
For more information, visit their website at: https://www.porite.co.jp/
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