headquartered in Tokyo, Japan, led by President, Michihiro Kitazawa, and its subsidiary, Fuji Electric (China) Co., Ltd. (hereinafter referred to as “FEC”), headquartered in Shanghai, China, led by President, Teruo Yamamoto, is pleased to announce that it agreed with Shanghai Electric Group Co., Ltd. (hereinafter referred to as “SEC”), headquartered in Shanghai, China, Chairman and CEO, Xu Jianguo, on establishing two joint ventures for high-voltage inverters in China.

1. Background and purpose

Combined with a high-voltage motor, a high-voltage inverter used for high-voltage power supplies (3kV or more) has an energy saving effect by controlling the motor’s rotational speed.  Therefore, recently there has been increased demand for high-voltage inverters in industrial plants such as electric power and petrochemical plants and electricity and social infrastructures.

The high-voltage inverter market in China is expected to grow over 15%* per year.  China is the largest primary energy consumption market, and the industrial field accounts for 70% of its total energy consumption.  In the industrial field, electric motor systems account for 70% of the total electricity consumption.  Thus, there are high expectations for the good energy saving effect of introducing inverters.  The government also is making an effort to promote energy efficiency.

SEC is a leading industrial electrical equipment manufacturer that has a nationwide sales network and the highest market share of high-voltage motors to which high-voltage inverters are applicable in China.

The establishment of joint ventures will combine our power electronics and control field technologies and SEC’s machine technology and sales force based on strong brand. We will create synergy and expand our high-voltage inverter business with the local completion framework, based on the concept of local design and production for local consumption.  The specific activities are shown in (1) and (2) below.

We will establish two joint ventures, one is a sales joint venture (hereinafter referred to as “SJV”) that SEC will have the majority stake in, and the other is a production joint venture (hereinafter referred to as “PJV”) that we will have the majority stake in, to make the most of the characteristics of individual companies.

In the future, in addition to high-voltage inverters, we will consider further expanding business by launching power electronics products such as uninterruptible power supply systems and power conditioners onto the market.

   *Estimated number by Fuji Electric

(1) Deployment of energy-saving systems

We will offer highly energy efficient systems by combining SEC’s excellent high-voltage motors and our high-voltage inverters to increase sales.

(2) Development of products appropriate for the Chinese market

Taking advantage of SEC’s marketing information, we will develop products which meet the Chinese market’s needs in terms of functionality and pricing.

2. Outline of JVs