Nagoya based water heater manufacturer Rinnai aims to open its first U.S. plant, as the company shifts toward local manufacturing in order to meet rising demand.
Rinnai
exports many of the water heaters it sells in the U.S. from Japan and
may be worried about the possibility of trade friction with the
administration of President Donald Trump. The Nagoya-based company will
decide on the U.S. plant's location and resolve other details this year,
aiming to start production there in 2018 or 2019.
The
plant initially would employ 50 to 60 people and assemble products
using imported components. Within a few years the site would switch to
in-house manufacturing, with 200 to 300 workers. Total investment in the
factory could surpass 10 billion yen ($90.1 million).
Rinnai
established a U.S. arm in the 1970s. Its standard water heaters carry
price tags in the $1,000 range. The manufacturer sold around 239,000
units in the U.S. in 2016, up 13% from the year before.
While
most heaters in the U.S. store hot water in tanks, demand has grown for
Rinnai's instant heaters, which consume less energy. An incentive from
the U.S. Department of Energy likely contributed to last year's sales
growth, but the company still expects a 10% rise this year even though
the tax credit has expired, President Hiroyasu Naito said.
NIKKEI
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