News Release

Dec. 26, 2002
Daifuku recently opened representative offices in the Chinese cities of Tianjin and Chongqing in a move to broaden support for the installation and maintenance of its automotive production systems.

The new offices create a network of three locations, including the Beijing office opened in 1993. The opening of the two new locations is in response to rapid growth in demand for automotive production systems, resulting from the arrival of Japanese and other foreign automakers, and to explosive growth in vehicle ownership in China. The move is also intended to demonstrate Daifuku's commitment to its area strategy in this enormous country, the third largest in the world, with its land area of 9.6 million square kilometers. The new offices will strengthen Daifuku's ability to provide comprehensive after-sales service at the local level. The company plans to make the Tianjin office a local corporation during the 2003 fiscal year.

Daifuku is currently pouring considerable energy and resources into its China business operations. The Tianjin office, covering the area north of Tianjin, and the Chongqing office, covering the wider central-southern area, will allow the company to ramp up its operations in China. Plans call for renewed efforts to supply systems for major projects, such as the construction of new manufacturing plants. The Shanghai office already works in conjunction with local businesses, covering the surrounding region as well as the city proper. Daifuku will consider establishing additional offices in the future.

Under the company's strategy of "producing and procuring in optimal locations worldwide"-part of Daifuku's new mid-range, three-year business plan-its Chinese operations will be assigned an even greater role. The company strategy seeks to promote even stronger alliances with local suppliers.

The Chinese government has projected that China's current annual domestic auto production of around 2.4 million vehicles will increase over the next three years, reaching 3.2 million in 2005. China's entry into the WTO (World Trade Organization) has prompted plans to reorganize China's current automakers, currently numbering over 100 of various sizes, to concentrate some 70% of annual production at the three largest companies. The government has clearly signaled its desire to enhance the global competitiveness of the domestic auto industry by improving quality, a policy likely to boost demand for the automation of production lines.

To date, more than 20 companies in China have taken delivery of Daifuku's automotive production systems. With the opening of these two new locations, the company expects to further expand its sales in China.

Daifuku Co., Ltd. Tianjin Representative Office

Address:

Room 31E, Block B, The Mansion Triumphal Arch, No.66, Nanjing Road, Tianjin 300042 CHINA

Telephone:

86-22-2311-1291

Staff:

Two (increasing to ten in FY2003)

Opened:

November 2002

Daifuku Co., Ltd. Chongqing Representative Office

Address:

4-2, 4 GATE, No.68 Xing Sheng Road, Yang Jia Ping District, Chongqing 400050 CHINA

Telephone:

86-23-6867-2118

Staff:

Two (increasing to five in FY2003)

Opened:

November 2002