Mitsubishi Electric to Establish North American Company to Make Diamondtron (Cathode Ray Tubes) for Computer Monitors

Tokyo, September 16, 1997 -- Mitsubishi Electric Corporation (Takashi Kitaoka, President) has decided to establish a new company in the U.S. to exercise general control over the manufacture and sale of its cathode ray tubes (CRTs) for computer monitors. The new company will operate as a wholly owned subsidiary of Mitsubishi Electric America, Inc. (MEA), Mitsubishi Electric's local subsidiary overseeing its North American operations.

The CRTs will be manufactured by a Mexican company to be set up with investment by the new U.S. subsidiary.

Description of the new operations

1. Operating environment surrounding CRTs for computer monitors

Mitsubishi Electric Corporation is further strengthening and expanding its CRT operations by establishing a CRT base in North America, in response to the following important market trends:

(1) Demand for personal computers (PCs) is expected to continue to experience strong growth worldwide in the future. Although the use of liquid crystal displays is expanding vigorously, demand for monitors employing CRTs is also increasing robustly, at a rate of some 12 percent a year. Mitsubishi Electric Corporation estimate that CRT demand will reach 86 million units in the year 2000. The growth of demand is expected to be particularly strong for medium-sized (17-inch) and larger displays, given the ever higher performance of today's PCs.

(2) At present, about 70% of all CRT monitors made in the world are produced in Southeast and East Asia, mainly in Taiwan. However, there is an increasing orientation to manufacture at the place of consumption, therefore set makers are accelerating their moves to build manufacturing and distribution bases in North America, which is the home of most final demand for PCs.

2. Profile of a new company and its subsidiary

(1) Profile of the new U.S. company

i. Company name: Mitsubishi Display Devices America, Inc.

ii. Location: California, U.S.A.

iii. Capital: US$55 million (about 6 billion yen)

iv. Investment ratio: 100% by Mitsubishi Electric America, Inc. (a w

holly-owned subsidiary of Mitsubishi Electric Corporation, overseeing our North American operations)

v. Foundation: September 1997 (Sales will begin in October 1998.)

(2) Profile of the Mexican subsidiary of the new U.S. company

i. Company name: MELCO Display Devices Mexico, S.A. DE C.V.

ii. Location: Mexicali, Baja California, Mexico

iii. Capital: 250 million pesos (about 3.5 billion yen)

iv. Investment ratio: 100% by Mitsubishi Display Devices America, Inc.

v. Foundation: September 1997 (Production will begin in October 1998)

vi. Number of employees:About 950 people (planned for 1999)

vii. Production items: 17-inch Diamondtron tubes

Production of about 300,000 tubes in the initial year, with an eventual target of about 1.8 million tubes a year