TOKYO -- Mitsubishi Electric will construct a new air conditioner distribution center in Thailand, aiming to improve its logistics capabilities in the country, a hub for exports to Asia and Europe.
Expected to cost just over 10 billion yen ($79.7 million), the roughly 100,000-sq.-meter center is slated to open in July. It will be built in an industrial park in Chonburi Province, close to production facilities, allowing for efficient inventory management. Mitsubishi Electric will hire 300 people to work at the new center.
The Japanese company will gradually move inventory from production facilities and four third-party warehouses to the new hub. It estimates that centralizing inventory management will save 600 million yen a year.
Thailand houses Mitsubishi Electric's largest air conditioning plant. But increased production volume had left space at a premium. The company will use the space vacated by the inventory shift to rework production lines to boost efficiency, leaving room to further ramp up output later on.
Asia's commercial and household air conditioner market is seen growing nearly 10% a year. But because specifications vary between countries and regions, Mitsubishi Electric's product lineup has grown year by year. Air conditioner demand fluctuates heavily based on such factors as weather, making stockpile management important. The company decided having an efficient distribution center was crucial to its efforts to expand in Asia.