March 30, 2005 No.1054

MHI to Boost Industrial Diesel Engine Production to 4,200 Units/Year -- Active Investment Targeted at Joining Top Global Ranks --

Tokyo, March 30, 2005 - Mitsubishi Heavy Industries, Ltd. (MHI) is taking steps to nearly double its production capacity in medium- and large-scale industrial diesel engines (600-2,500 kW) from the current 2,300 to 4,200 units per year by FY2006 (the fiscal year starting April 1, 2006 and ending March 31, 2007). The company is expanding its production capacity for two reasons: 1) to respond to surging demand for distributed power sources in China, as a way of coping with electricity shortages; and 2) to meet anticipated increases in engine sales in the Southeast Asian and North American markets.

MHI's S12R diesel engine     To boost capacity, MHI is to invest more than 3.5 billion yen into the engine production line at the Sagamihara plant (Kanagawa) of its General Machinery & Special Vehicle Headquarters. The target calls for the new production line to commence operations in early FY2006. Today, demand for medium- and large-scale industrial diesel engines is increasing steadily in China, Southeast Asia and North America. From 25,500 units in FY2004, MHI expects global demand for engines in these categories to grow by roughly 12% to 28,500 units in FY2007. In FY2004 MHI sold approximately 3,000 units, and it anticipates growth to 3,500 units in FY2005 and targets sales of 4,200 units in FY2007. The investment into the Sagamihara facility will involve installation of new processing systems, including 5-face machine tools, machining centers and grinding machines, into the parts processing lines for crankshafts and crank cases. Existing assembly lines will also be upgraded for enhanced production capacity. With the establishment of this new structure capable of producing 4,200 medium- and large-scale diesel engines per year, MHI aims to double its market share from 7% as of FY2003 to 15% in FY2007. By the latter date it seeks to rank among the world's top manufacturers of industrial diesel engines, moving from the present 4th position to 3rd, after Cummins Inc. of the U.S. # # # About Mitsubishi Heavy Industries Mitsubishi Heavy Industries, Ltd. (MHI), headquartered in Tokyo, Japan, is one of the world's leading heavy machinery manufacturers, with consolidated sales of 2,373 billion yen in fiscal 2003 (year ended March 31, 2004). MHI's diverse lineup of products and services encompasses shipbuilding, steel structures, power plants, chemical plants, steel plants, environmental equipment, industrial and general machinery, aircraft, space rocketry and air-conditioning systems. For more information, please visit the MHI website (http://www.mhi.co.jp). PRESS CONTACT: Hideo Ikuno: h.ikuno@daiya-pr.co.jp Tel: +813-6716-5277, Fax: +813-6716-5929 Daiya PR (in charge of public relations for Mitsubishi Heavy Industries, Ltd.)

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