HITACHI and Toshiba, Japan's two biggest electric machinery manufacturers, have agreed to set up a new firm aimed at winning orders for nuclear power plants in Asia. US group General Electric (GE) and Tokyo Electric Power Company of Japan are expected to also join the venture.
The new firm is to sell advanced boiling water reactors (ABWRs), jointly developed by the four companies, to China and other Asian countries, where demand for nuclear power plants is expanding.
The new firm will offer tenders for nuclear plant projects in place of Hitachi and Toshiba. If it wins an order, it is to assign engineering and equipment production to the two companies.
As a first step, Hitachi and Toshiba will form a preparatory body, named Asia ABWR development organisation, early next year ahead of upgrading the body into a corporation.
GE plans to participate in the body before it is to start sales operations as a corporation, it said.
The move is seen as an effort by Hitachi and Toshiba to raise their international competitiveness in the nuclear power plant business, and maintain employment at their factories in Japan.
Hitachi has already cut the number of employees at its heavy industry plant in Ibaragi, northern Japan, by 600 due to sluggish demand for nuclear plants in Japan.
In Asia, Canadian, European and US power plant manufacturers are taking the lead in the industry. In the short term, nearly 30 orders for nuclear plants are expected to be offered in the region.
Hitachi and Toshiba are also expected to join hands in the future for receiving orders for nuclear power plants in Japan. The combined number of nuclear power plants built by Hitachi and Toshiba in Japan stands at 26, accounting for 52 per cent of the total.