News Release

Jul. 16, 2003
Collaboration of hardware and software systems for the European market

Daifuku Co., Ltd., has established an alliance with ABB Ltd. ("ABB", CEO: Juergen Dormann, Headquarters: Zurich, Switzerland) for the targeting of material handling system business in the Scandinavian market through the signing of an agreement by the respective subsidiaries of Daifuku and ABB. ABB is a world leader in the power and automation industry.

Under the alliance, Daifuku will distribute its optimum Warehouse Management Systems in the Scandinavian market which integrates Daifuku's hardware, including AS/RS systems, and ABB's WMS software (Warehouse Management System: "SattStore"), together with well-established robotic technologies.

ABB was formed in 1988 pursuant to a merger between Asea in Sweden and BBC in Switzerland.

ABB is particularly competitive in the Scandinavian automation industry. Daifuku and ABB hope to first target the Scandinavian market and then expand to other European markets, including the UK, Ireland, Benelux region and ultimately to Germany.

The agreement was entered into between Daifuku Europe Ltd. (Managing Director: N. Morita, Headquarters: London) which is wholly-owned by Daifuku Co., Ltd. and ABB A/S (President: C. Madsen, Headquarters: Skovunde) which is a subsidiary of ABB.

The relationship between the parties started when in 1999 Daifuku Europe Ltd., as prime contractor for a large distribution center project for Netto A/S, contracted with ABB for the supply of ABB's WMS software for such project. Netto A/S is a fast, growing major supermarket company with approximately 350 supermarket stores in Denmark and 400 supermarket stores in the UK, Ireland and Poland. The Netto system, which is currently being installed in Netto A/S' distribution center, is an automated warehouse system with 32 cranes and has been recently drawing the attention of the automation industry due to the large scale of the system. The project is scheduled to be completed during the fall of 2003. Thereafter, Daifuku and ABB have collaborated with each other on other projects for increasing market share in the U.K., Ireland and Denmark.

Under this alliance, Daifuku hopes to strengthen its name value and recognition, expand business and increase its competitiveness in the European market and ABB hopes to expand its WMS business by integrating Daifuku's world-competitive AR/RS system and peripheral equipment ("STV") with its software.

ABB has already installed its SattStore system for over 400 of its customers and the new version of the SattStore software (version 9.2) which was released during the spring of 2003 is expected to be easily interoperable with Daifuku hardware, including Daifuku's AS/RS systems, STV, etc. Daifuku and ABB hope to achieve a win-win relationship through the combination of the respective strengths of the parties.

Outline of ABB

ABB is a leader in power and automation technologies enabling utilities and industries to improve their performance while minimizing environmental impacts. ABB has 135,000 employees in around 100 countries. In ABB in Denmark are approx. 1,900 employees.

ABB Group has its headquarters in Switzerland.
Headquarters: ABB Ltd., Zurich, SWITZERLAND

Turn over: 18,295 MUSD (2002)
Web Site: www.abb.com

Denmark subsidiary: ABB A/S, Skovlunde, DENMARK

Turn over: 396 MUSD (2002)
Web Site: www.abb.dk

After signing the agreement Mr. T. Tunkelo, Senior Vice President of ABB Automation Technologies Management Ltd., shakes hands with Mr. K. Takeuchi, President of Daifuku Co., Ltd. as witnesses of the agreement and Mr. C. Madson, President of ABB A/S on the left and Mr. N. Morita, Managing Director of Daifuku Europe, Ltd. on the right.