Metalworking Insiders' Report

With business leaders from the Sacramento area on hand, Mori Seiki Co. Ltd. CEO Dr. Masahiko Mori last month officially launched construction on what will be his company’s first machine-tool-manufacturing plant outside Japan. The 195,000-sq.-ft. factory in Davis, California, will employ around 150 and is adjacent to the Japanese builder’s research facility, Digital Technology Laboratory Corp. The two installations will draw on resources at nearby Univ. of California at Davis, where an engineering professor with ties to Mori Japan has been performing contract research for the builder (see M.I.R, 11/1/2010).

The machine-tool plant will boost Mori Seiki’s monthly capacity by 100 machines to more than 900 in preparation for what the company sees as a global market expansion in the next decade.

Groundbreaking for the plant came shortly after the official opening of a joint technical center in Houston, Tex., operated by

DMG/Mori Seiki (Hoffman Estates, Ill.), the marketing and sales combination of Japan’s Mori Seiki and Germany’s Gildemeister, and by distributor Ellison Technologies, Inc. (Santa Fe Springs,Calif.), the Mori partner company. The 22,500-sq.-ft. facility with a 6,500-sq.-ft. showroom is one of the largest of Ellison’s 21 locations.

Gildemeister A.G. (Bielefeld, Germany) had launched the marketing combination with Mori Seiki two years ago when the two builders started acquiring shares in each others’ companies. Progressively around the world, Gildemeister has been merging outlets of its DMG (originally for Deckel-Maho-Gildemeister) marketing arm with those of Mori’s.

For example in Australia, one of the first regions to be merged in March 2010, the joint company is now undergoing a restructuring in which three formerly independent Mori Seiki dealers are now integrated into the new company and the formerly DMG direct-sales structure with seven area managers now has responsibility for sales and support of the combined list of product offerings.

The two major builders—both are listed among the world’s top ten in annual revenues—have been strengthening their capital ties as well as their business relationships. In April, following a capital increase the Japanese builder now holds slightly more than 20% of Gildemeister. Now Gildemeister, with a further purchase of 1.6-million shares of Mori Seiki, increases its holding of its Japanese partner to 5.10%, exceeding the 3.9% ownership by CEO Dr. Mori.

Meanwhile, the DMG/Mori Seiki business partnership is being extended into Europe. The two companies intend to combine their sales and service networks there, with operations in Germany managed from Stuttgart, where the existing DMG Vertriebs und Service G.m.b.H. is being renamed DMG/Mori Seiki Germany, and with operations in the rest of Europe, now working under 17 national companies, being brought under a new DMG/Mori Seiki Europe to be located in Switzerland. The deal is expected to be concluded by the start of the EMO in September.

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