Nippon Yusoki Co Ltd (Nichiyu) and Mitsubishi Heavy Industries Ltd (MHI) have signed a contract manufacturing agreement.

Nichiyu president Hideaki Ninomiya says that the forklift manufacturer signed the agreement after studying the possibility of producing IC forklifts for the Japanese market at the request of MHI.

MHI, which has entered into a capital tie-up with Nichiyu, is committed to restructuring its global production system. As part of the restructure, it will consign production to Nichiyu for small-sized, engine-powered forklifts for the domestic market (Forkliftaction.com News#569).

In April 2009, Nichiyu and MHI jointly established Nichiyu MHI Forklift Co Ltd, a domestic sales company that sells electric and engine forklifts. However, the two companies currently manufacture electric and engine-powered forklifts at separate locations.

Electric units are made at Nichiyu's Kyoto and Shiga plants, and IC units at MHI's Sagamihara Machinery Works for General Machinery & Special Vehicles in Sagamihara, Kanagawa prefecture.

Under its restructure, MHI will terminate forklift production at its Sagamihara site by December 31, 2013.

With MHI supplying parts, Nichiyu's Shiga plant will undertake welding and assembly of the mast, while the Kyoto plant will perform final assembly. Manufacturing is scheduled to begin in May 2013, with annual production volume estimated at 4,000 units.

Nichiyu's total production for electric units alone - including the output from plants in Japan and China, combined with a plant being built in Thailand- is anticipated to reach 20,000 units in fiscal 2014 (Forkliftaction.com News #531). The addition of engine-powered vehicles to the production portfolio is expected to further strengthen Nichiyu's revenue base.