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Japanese Firm's U.S. Unit Plans Plant in Mexico

August 06, 1988|CHRIS KRAUL | San Diego County Business Editor

SAN DIEGO — Scripto Tokai, the U.S. subsidiary of Japan-based Tokai Corp., the largest disposable butane lighter manufacturer in the world, has agreed to purchase land in Tijuana to build a manufacturing plant that could approach 200,000 square feet in size and employ several hundred workers.

Scripto Tokai would be the latest of several Japanese companies to move or expand in Tijuana in recent years to take advantage of low labor costs. Products made at maquiladoras , as Tijuana plants are known, are typically shipped back across the border for sale in U.S. markets. The Scripto Tokai plant would be built on 5.5 acres next to a future Canon computer printer plant in southwest Tijuana.

Big Share of Lighter Market

Based in Rancho Cucamonga, Scripto Tokai makes pens and pencils in addition to disposable butane lighters. The company currently employs more than 500 at plants in Rancho Cucamonga and Monrovia, a company spokesman said Friday. If Scripto Tokai completes the sale, layoffs of existing employees would be unlikely because the company is looking to expand production capacity, he said.

A closely held company, Scripto Tokai did not disclose its sales or those of its parent company, which is based in Yokohama. Other company sources said only that Scripto Tokai annual sales exceed $100 million. The company also declined to disclose the precise amount of plant space that it has in Southern California.

Scripto Tokai has the second-largest share of the $300-million disposable lighter market after Milford, Conn.-based BIC Corp. BIC, a U.S. subsidiary of France-based Societe BIC, will sell 67% of the estimated 510 million disposable lighters sold here in 1988, a BIC spokeswoman said Friday. Currently, BIC makes all its products for the U.S. market at its Milford plant complex.

Although lighters are Scripto Tokai's biggest-selling product line, its future emphasis may be more on its line of writing instruments because the growth rate in lighters has slowed due to growing anti-smoking sentiment in the United States and other major markets.

Founded in 1923, Scripto was an independent, Atlanta-based manufacturer of writing instruments until it was acquired by Allegheny International in 1981. Allegheny sold the company in 1984 to Tokai which renamed it Scripto Tokai. The company, which was relocated to Rancho Cucamonga in 1986, was Tokai's entry into the writing instrument business.

The Scripto Tokai spokesman said the company has not closed the purchase of the property in the Fundadores section of Tijuana and has a year to back out of the deal.

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