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The pursuit of unique and innovative carbon products

Naotaka Kondo, President of Toyo Tanso Co Ltd

Naotaka Kondo

President of Toyo Tanso Co Ltd

Toyo Tanso was the first company in the world to successfully mass produce large-size isotropic graphite in 1974, and its carbon products and technology have continued to evolve with the needs of the times. Its products can be found everything from automobiles and home appliances to cutting-edge products in fields such as aerospace and medical care. In this interview, Naotaka Kondo discusses the company’s products and their adoption in various industries, as well as the its plans to expand globally.

Could you give us a brief introduction to Toyo Tanso?

Toyo Tanso began as Kondo Carbon Kogyosho, manufacturing carbon brushes in 1941. Since our inception, we have embraced the pioneering spirit of ‘manufacturing completely unique products’, and continued to take on challenges in the pursuit of unique and innovative carbon products specialized for highly functional fields.

Since becoming the first company in the world to successfully mass produce large-size isotropic graphite in 1974, the Toyo Tanso Group's carbon products and technology have continued to evolve with the needs of the time. Our products are being adopted in a wide variety of fields, from familiar daily products such as automobiles and home appliances to cutting-edge products in such fields as aerospace and medical care. To meet the needs of an ever-expanding global market, we established production and sales bases in more than 10 countries across the globe, including China, America, Europe, and Asia. We continue to be dedicated to exploring the seemingly endless possibilities of carbon.

Today we are witnessing tremendous changes with the rise of next-generation electronic products, for example, with the rise of IoT. In addition we are also witnessing the rise of new energy sources. Could you explain to us the impact of all these new technologies on your company as graphite is an important component for all of these products?

You're quite right about the recent trends happening on a worldwide scale. First of all, tends happening in global society such as the rise of IOT and AI is something we cannot ignore. Even the production of smartphones or the shift from combustible engines to electrical engines are new trends where we have to consider ways to apply our manufacturing capabilities. Power semiconductors and micro-memory flashcards are also experiencing a new trend towards being smaller. All these factors combined have to be considered carefully and applied to the needs of the customers. What's happening is that our customers now have to be making things cheaper, but faster.

What this leads to in terms of mass machine-made production is that production itself will have to be bigger in size, but for the sake of dispatching products, the finished product itself will have to be smaller in size. What we can take out of this trend is that our machinery for this particular production has to be very precise and has to be compliant to all the necessary criteria of mass production. So we have to be constantly improving and constantly putting up new targets for ourselves to be able to reach this bar that has recently risen.

To that end, the quality and stability of graphite material and advanced processing technology are necessary. In addition, the surface treatment of graphite used in the special environment of the semiconductor manufacturing process requires precision in the order of micro millimeters, which cannot be seen even by human eyes. Our company possesses a high level of manufacturing capacity and technical power that other companies cannot imitate. For these reasons, we believe that we have advantages compared with other companies.

Is there any Toyo Tanso product which you are particularly proud?

One product that I am very proud of is C/C composite, which is used in the ‘Hayabusa’ and Hayabusa 2’ asteroid probes developed by Japan Aerospace Exploration Agency (JAXA). Our C/C composite was adopted as the grids of the ion engine, which is at the heart of the asteroid probe, and the most important requirement for the grids was that they should be lightweight and thin.

Our C/C composite and isotopic graphite materials are also adopted in critical plasma testing equipment for nuclear fusion reactors, such as ‘JT-60SA’ and ‘LHD’ in Japan. Japan is one of the most advanced countries in nuclear fusion technology and is one of the leading countries taking part in the International Thermonuclear Experimental Reactor (ITER) project to create a fusion reactor that will create an artificial sun. In nuclear fusion reactors that require extremely high quality, our C/C composite, which use pyrolytic carbon as a matrix and has extremely high thermal conductivity, is adopted.

Your biggest market is semiconductors. With all the changes that we were talking about before, how foresee the future of the industry and is there a particular industry that you would also like to tap in?

In the semiconductor industry, the trend we are seeing is that manufacturing equipment for semiconductors is becoming bigger in size to increase the volume of production. According to this trend, our graphite products that are used in manufacturing equipment for semiconductors also are getting bigger in size, and are so heavy that one person cannot carry them by himself.

Therefore, semiconductor customers are adopting C/C composite (carbon fiber) products that are lighter and easier to handle than graphite. Trends in size, upgrading equipment and lightweight requirements of equipment parts are not only seen in the semiconductor industry but also in other industries, so we are looking towards more expansion of this product.

Throughout the years your company has really throughout the world to Asia, Europe and the United States. Can you tell us more about your international strategy?

The first thing to do is maintain the strength of our existing subsidiaries overseas. To realize that, we have established a new specialized department for strengthening overseas subsidiary management, which means coming up with new strategies for our company's management. We already have established mid-term plans four our overseas facilities.

Furthermore, we also make forecasts on how to implement these kinds of mid-term strategies to attract more personnel which allows for more interesting ideas for the benefit of these kinds of facilities. Of course, we also keep an eye out for any potential expansion into other countries in the world. While we look forward to that, we naturally take this matter into serious consideration and think carefully about the reasons behind our next steps.

Do you have some idea on what regions you personally feel have the highest growth potential?

There are several categories that define what regions are predicted to have better growth in production sales. Of course we see China and the US as good existing markets that still have good potential growth. The EU is also a division in itself that shows good results and has good potential expansion. Those are the markets that are seen to be very healthy and very good and we're looking towards new strategies to develop in those parts of the world.

As a listed company on the Tokyo Stock Exchange, are you looking to attract more international shareholders to Toyo Tanso and if so how would you convince shareholders to invest in your company?

First of all we have a department called the IR department which is people responsible for these kinds of opportunities. They go to some overseas locations like Hong Kong or Singapore and introduce our merits and what is so good about our carbon products by appealing to people on the local stage and they introduce all the benefits that could be coming out with this investment.

If we were to come back in 10 years and have this interview with you again where would you like to see your company and what objectives do you hope to have accomplished in that period of time?

First of all let's break it down into two time frames: five years and ten years. This is a question that has frequently been asked inside the company: What is the company going to be in five or ten years? We can more or less see what the company's future is going to be in the next five years to come because that is more or less visible. We would like to improve our equipment and try to introduce more products here.

But 10 years is more tricky because it's a really long time frame and how the market will change is really hard to predict since it's always changing at a very fast pace. But what I can say is for sure is that the technology will have to be constantly improving. We already have quite splendid and outstanding technology being made in Toyo Tanso but without constant improvement of our technology, we cannot say that we are allowing the company to grow further. We have to try to challenge ourselves and face new markets. Inevitably, in the near future, new markets will emerge and we have to be ready for this change in the future. We through this by not only expanding our existing products but the expanding the line of products that we are involved in which will lead to an increase in sales by reaching out to new kinds of profit lines.


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