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Japan-China joint ventures will target HV drives market

23 October, 2013

The Japanese inverter manufacturer Fuji Electric is forming two joint ventures in China with the Shanghai Electric Group (SEC) to produce and sell high-voltage inverters. They will target the Chinese market for HV (3kV and higher) inverters which is expanding at about 15% a year, due to growing demand from sectors such as such as power generation and petrochemicals­.

The establishment of joint ventures will combine Fuji’s power electronics and control technologies with SEC’s machine technology and sales force.

SEC is an industrial electrical equipment manufacturer which leads the Chinese market for HV motors and has a nationwide sales network. It employs about 30,000 people and achieved sales worth more than $12.6bn in 2012.

Fuji will have the majority share (51%) in one of the joint ventures, which will focus on production, while SEC will have the majority stake in the second, which will focus on sales. They are capitalised at $30m each, and are due to start operating in February 2014. The companies will develop and sell products that meet the Chinese market’s needs in terms of functionality and pricing.

In the future, the businesses may expand into other power electronics applications such as UPSs (uninterruptible power supplies) and power conditioners.

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