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October 11, 2017
NGK INSULATORS, LTD.

Expansion in Production Capacity for NOx Sensors

NGK INSULATORS LTD. (President Taku Oshima; Headquarters: Nagoya, Japan; "NGK") today announced that, in order to address expanding demand for high precision NOx sensors, which are used for the on-board measurement of nitrogen oxide (NOx) concentration in vehicle exhaust gas, it has decided to increase its production capacity from approximately 18 million units per year to 25 million units per year.

NGK currently manufactures the ceramic elements that serve as the heart of NOx sensors at the Komaki Plant (Komaki City, Aichi Prefecture) and Ishikawa Plant (Nomi City, Ishikawa Prefecture), both of which belong to its manufacturing subsidiary NGK CERAMIC DEVICE CO., LTD., and assembles the NOx sensors at NGK's Nagoya Site and the No.1 Plant of NGK CERAMICS POLSKA SP. Z O.O. (Gliwice, Silesian Province, Poland), a manufacturing subsidiary in Poland. The investment will add elements manufacturing equipment at the NGK CERAMIC DEVICE Ishikawa Plant and add sensor assembly lines at the NGK CERAMICS POLSKA No.1 Plant. Overall, the investment will increase NGK's annual production capacity from approximately 18 million units at present to 25 million units in fiscal 2019. The total investment amount is scheduled to be approximately ¥14.0 billion.

NOx sensors are mounted in the exhaust pipes of automobiles. These sensors can measure the NOx concentrations in the vehicle exhaust emission in real time with high precision at the ppm (parts per million) level. The detected values of NOx concentration in the exhaust emission are then used in controlling the exhaust gas after being treated and in its on-board diagnosis (OBD). The tightening of automobile exhaust gas regulations for diesel vehicles worldwide together with the new regulations in Europe will create the need for even higher precision exhaust gas processing systems, and the number of vehicles requiring NOx sensors and the number of on-board NOx sensors are expected to increase accordingly. Based on this outlook, demand for NOx sensors is forecasted to continue increasing, going forward.

NGK has increased its production capacity of NOx sensors through the start of operations at the NGK CERAMIC DEVICE Ishikawa Plant in April 2017. However, as demand is now projected to far exceed the current production capacity, NGK has decided to invest in expanding production.

As a leading company in the field of NOx sensors, NGK will establish a production system that is properly able to cope assuredly with the continued expansion in demand, thereby contributing to the preservation of the atmospheric environment.

NOx sensors

NOx sensors

<Capital Expenditures>

Investment amount: Approx.¥14.0 billion
Production start: January 2019 at NGK CERAMIC DEVICE Ishikawa Plant (elements)
October 2019 at NGK CERAMICS POLSKA No.1 Plant (assembly)

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