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November 24, 2005

Regarding the Decision to Consolidate the Piano Business Division of Yamaha Corporation of Japan in the Kakegawa Plant


- Most of functions including the main grand piano production division and piano marketing/engineering division staff to be consolidated in Kakegawa
Scheduled for completion by spring 2011 -

Yamaha Corporation has decided on a policy of business base integration that will consolidate all the functions, including those of the piano division and its staff, of its two domestic piano production plants (Main Plant: 10-1, Nakazawa, Hamamatsu City, Shizuoka Prefecture; Kakegawa Plant: 1480, Ryoke, Kakegawa City, Shizuoka Prefecture). The plan calls for the consolidation of all piano division functions in the Kakegawa Plant, the improvement of the manufacturing process, the restructuring of the business, and the establishment of a base to sustain the growth of the piano business.

Since the middle of 1980s, Yamaha has been producing pianos at two separate locations: grand pianos (hereafter referred to as "GP"), which are shipped all over the world, have been produced almost entirely at its main plant, while upright pianos (hereafter referred to as "UP") have been produced at its Kakegawa plant.

In consideration of shifts in piano production, the primary goals of the consolidation of the piano-related divisions in the Kakegawa Plant is to establish an environment for human resource development that ensures that piano manufacturing technology and know-how are fully disseminated as well as to create greater efficiencies by integrating GP and UP production. The Yamaha Piano Technical Academy (4-36-1, Saiwai, Hamamatsu City, Shizuoka Prefecture), which is responsible for training piano technicians and production staff, will also be integrated. We expect to further enhance operational functions by adjoining this facility to the production site.

The consolidation will be carried out in three separate phases. In the first phase, from 2006 to 2007, Yamaha will transfer the staff organization unit (approx. 190 people) to the site and build a customer service function, a tryout hall for pianos, and a new building to house the Yamaha Piano Technical Academy. In the second phase, Yamaha will redesign the plant for UP production division’s greater efficiency, thus creating extra space at Kakegawa factory. In phase three, the final phase, Yamaha will commence the relocation of the GP assembly division. The division responsible for GP wood processing and other pre-production functions will relocate, with facilities’ integration scheduled for completion by Spring 2011. The cost of consolidation is expected to total ¥6 billion.

Yamaha has set its sights on sustaining piano division growth while promoting the integration of the production facilities of its piano business division, further manufacturing improvements, business restructuring, and cooperation with overseas production bases.

The following is an overview of the planned consolidation of the piano business division at the Kakegawa Plant.

Primary Integration Objectives
  •  
Improvement of quality, cost-competitiveness, and material flow
  Sharing of resources (people, skills, equipment, space). Shorten lead times by combining processes. Streamline staff services through organizational integration.
  •  
Strengthen manufacturing capability, ensure that technologies and specialized skills are fully disseminated
  Strengthen cooperation between the engineering and production divisions of both plants. Promote transmission of the technologies and skills. Improve manufacturing methods.
  •  
Establish a base to serve as the interface to Yamaha Piano
  Increase the level of satisfaction for plant visitors and customers who visit the plant for piano tryouts. Increase the amount of space allotted for customer visits. Improve Yamaha’s public image.
Overview of Facilities to be Integrated
Main Plant
   
Address : 10-1, Nakazawa, Hamamatsu City, Shizuoka Prefecture
Product Line : Grand pianos
Employees : 560(including staff organization unit)
Floor Space : 53,000 square meters

Kakegawa Plant
Address : 1480, Ryoke, Kakegawa City, Shizuoka Prefecture
Product Line : Upright pianos
Employees : 450
Floor Space : 84,000 square meters

Yamaha Piano Technical Academy
Address : 4-36-1, Saiwai, Hamamatsu City, Shizuoka Prefecture
Function : Piano technician training
Employees : 10 (excluding students)


For further information, please contact

YAMAHA CORPORATION

Public & Investor Relations Group,
Public Relations Division
Mr. Mike Tanaka

TEL. +81-3-5488-6601
FAX.
+81-3-5488-5060

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