March 29, 2024
News Release

New KAGA ELECTRONICS Factory Under Constructionin Mexico Selected for METIʼs Indo-Pacific andCentral-South America Regional Supply ChainInvolvement Support Project
KAGA ELECTRONICS CO., LTD. (Head Office: Chiyoda-ku, Tokyo; Representative Director,
President & COO: Ryoichi Kado; hereinafter “the Company”) hereby announces that its newfactory construction project in Mexico, aimed at strengthening and expanding its EMS*
production base, has been selected for the Indo-Pacific and Central-South America Regional
Supply Chain Involvement Support Project promoted by the Ministry of Economy, Trade andIndustry (METI), and that the maximum subsidy of 100 million yen has been approved.

（*）Electronics Manufacturing Service: Provision of product development and manufacturing services
on an outsourcing basis

The Indo-Pacific and Central-South America Regional Supply Chain Involvement Support
Project is a subsidy scheme implemented by METI to encourage business initiatives that
contribute to increasing the resilience of supply chains between Japan and the Indo-Pacificand Central-South America regions.
As announced on August 16, 2023, the Company, through its wholly owned subsidiary
TAXAN MEXICO S.A. DE C.V. (Head Office: San Luis Potosí, Mexico; Representative Directorand President: Takayuki Tsurumi; hereinafter, “TAXAN MEXICO”), is strengthening andexpanding its production base to meet the increasing demand for EMS in Mexico.
Since its establishment in 2017, TAXAN MEXICOʼs EMS business has been focused on theassembly of lighting units used in four-wheeled vehicles intended for the U.S. market. In
addition to meeting an increase in orders from existing customers, the construction of thisnew factory is designed to use the acquisition of new customers requiring the assembly of
circuit boards used in air-conditioning equipment for the U.S. market as an opportunity toinstall the latest energy-saving equipment, promoting manufacturing that is both highly
efficient and environmentally friendly. In the future, the Company plans to expand its
integrated production capability encompassing component molding, sheet metal processing,and finished product assembly functions, in addition to current unit assembly and circuitboard assembly. Through the introduction of a system enabling the visualization of internal
factory data and data linkage between the Companyʼs global network of EMS bases in 10countries, including Japan, the Company plans to meet production demand for the North
American and Central-South American markets, where continued growth is anticipated.
By promoting local and localized production, beginning with this new factory in Mexico,
the Company will reduce transportation times and control logistics costs, as well as
contribute to the construction of resilient supply chains for the stable provision of products
to the market in collaboration with its customers and suppliers.
(Reference)■BCG Decides the Indo-Pacific and Central-South America Regional Supply Chain ResilienceSupport Companies (3rd Round)
https://www.bcg.com/ja-jp/press/10october2023-bcg-sc-recruitment-second-annoumcement-of-the-results■Strengthening and Expanding the EMS Production Base in Mexico

https://www.taxan.co.jp/news-information/wp-content/uploads/2023/08/E_release_20230816.pdf■Inquiries concerning this matter
KAGA ELECTRONICS CO., LTD.（URL：https://www.taxan.co.jp/en/）Ichiro Shirai, General Manager
Investor Relations & Public Relations Department
TEL: +81-3-5657-0106 / FAX: +81-3-3254-7133