Tokai Carbon - Company History

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Financial history 1952–2025 — revenue, cost structure, balance sheet, cash flow and key ratios, year by year →

Founded 1918
Founder Samukawa Tsunesada 寒川恒貞
Founding location 東京都
Core business at founding Synthetic graphite electrodes for electric steelmaking
Listed 1949
President Nagasaka Hajime President since 2015 (age 76, as of 2026)
Current priority Business restructuring · Higher value-added products Shrinking the graphite electrode business and building up fine carbon for semiconductors
Founding
On 8 April 1918 Samukawa Tsunesada (寒川恒貞), consulting electrical engineer to Nagoya Electric Light, incorporated Tokai Denkyoku Seizo with capital of ¥500,000 and became its first president. The head office was in Tokyo and the plant in Nagoya. Nagoya Electric Light, which had been widening hydroelectric generation on the Kiso river system, needed an outlet for its surplus power, and running Denki Seikosho, the steelworks it had separated out in 1916, called for expensive graphite electrodes imported from Acheson of the United States. Samukawa proposed making them in Japan to Fukuzawa Momosuke (福沢桃介), who ran the utility, but the new firm was not raised as an in-house shop for the steelworks — it was raised as an independent carbon maker answering demand across the related industries. In 1919 it absorbed Daisanmi Seisakusho and widened into small carbon goods such as electrical brushes, and in 1936 it began making its own pitch coke feedstock at the Kyushu Wakamatsu plant.
The Decision
By 1975, the year the company took the word for electrodes out of its own name, the founding product was no longer the mainstay. Carbon black had begun with research started in 1937 into the pitch oil produced as a by-product at the Kyushu Wakamatsu plant, and in 1950 the company industrialised the first furnace-process manufacture in Japan with its own technology. After it tied up with Cabot of the United States on manufacturing technology in 1960 and built the Chita plant in 1962 to move to volume production, carbon black passed four-tenths of total sales in the second half of 1975. The name was changed from Tokai Denkyoku to Tokai Carbon in June of that same year, and by 1980 carbon black accounted for more than half of internal sales. In January 1992 the company merged with Toyo Carbon, founded in the same year as itself, and took first place in Japan in three products — carbon black, synthetic graphite electrodes and impervious graphite. A company raised to make electrodes found its scale in what the technique of baking them could be applied to instead.
Today
Tyres take 47% of sales, but the thicker margins are in semiconductors. Consolidated revenue for the year to December 2025 was $2.2B (¥323bn) and operating profit $172.7M (¥26bn). Carbon black turned over $982.9M (¥147bn) for a segment profit of $87.8M (¥13bn), while fine carbon for semiconductor production equipment turned over $374M (¥56bn) for $51.5M (¥8bn) — margins of 8.9% and 13.8%. Graphite electrodes, which gained an Asia–North America–Europe footing when the company acquired SGL GE of the United States in September 2017, ran into a market that turned as cheap Chinese and Indian product flowed in, and an extraordinary loss of $507.6M (¥77bn) was booked in the year to December 2024. In June 2025 the company stopped production at the Shiga plant and transferred TOKAI ERFTCARBON of Germany, and electrode sales fell to $251.1M (¥38bn), 12% of the whole.
Competition
Where the company is at a competitive disadvantage is in graphite electrodes, its founding product. The electrode market spiked in 2018 as Chinese environmental controls and a surge in electric-furnace steel demand came together, and Tokai Carbon posted record earnings of $2.1B (¥231bn) in sales and $662.1M (¥73bn) in operating profit. Showa Denko, reading the same market, went into graphite electrodes by acquiring SGL’s electrode business itself; what Tokai Carbon could take was the American site the competition authorities carved out as a condition attached to that acquisition. From 2019 cheap Chinese and Indian product broke the price, and the plant the two companies had bought at the same moment met the same reversal. In carbon black, by contrast, Tokai Carbon has grown to an annual capacity of some two million tonnes, on a par with Cabot of the United States, which taught it the manufacturing technology in 1960. The pupil’s technology has scaled up to a position where it competes with its teacher.

Timeline

1918–1949From import substitution in electrodes to postwar recovery

  1. 1918Tokai Denkyoku Seizo incorporated with ¥500,000 capital
  2. 1919Absorbs Daisanmi Seisakusho, maker of small carbon goods
  3. 1925Prototype synthetic graphite electrodes (electrolytic plates) for the soda industry
  4. 1926Succeeds in manufacturing large synthetic graphite electrodes
  5. 1929Begins production of small-diameter graphite electrodes for steelmaking
  6. 1934Prototype 18-inch electrode delivered to the Kure Naval Arsenal
  7. 1935Establishes Dai-ni Tokai Denkyoku; merged the following year
  8. 1936Kyushu Wakamatsu plant built; own pitch coke production begins
  9. 1938Chigasaki plant built for special carbon products
  10. 1941Carbon black manufacture begins at Kyushu Wakamatsu
  11. 1949Shares listed on the Tokyo, Osaka and Nagoya exchanges

1950–1991Running alongside the car and steel industries, and going international

  1. 1950First furnace-process carbon black in Japan, made with in-house technology
  2. 1955Carbon black reaches a 40% domestic share
  3. 1959Completes the first 20-inch electrode in Japan
  4. 1960Technical tie-up in carbon black with Cabot of the United States
  5. 1962Chita plant built for carbon black
  6. 1971Hofu plant built for synthetic graphite electrodes
  7. 1975Renamed from Tokai Denkyoku to Tokai Carbon
  8. 1978Ishinomaki plant built
  9. 1983Isotropic graphite production technology established at the Tanoura plant
  10. 1986Fuji Research Laboratory opened for advanced materials
  11. 1987TOKAI CARBON AMERICA established in New York
  12. 1988Plants consolidated and rationalised against the strong yen
  13. 1990THAI CARBON PRODUCT established as a joint venture

1992–2019Four businesses go global, and the electrode market runs high

  1. 1992Merges with Toyo Carbon, founded the same year as Tokai
  2. 1996Otake Shikio becomes president; TOKAI CARBON KOREA established
  3. 1999TOKAI CARBON EUROPE established in Britain
  4. 2003Delisted from the Osaka and Nagoya stock exchanges
  5. 2005ERFTCARBON, German graphite electrode maker, made a wholly owned subsidiary
  6. 2006Tokai Carbon (Dalian) established; 80% of CARBON INDUSTRIE-PRODUKTE acquired
  7. 2007Kudo Yoshinari becomes president; European fine carbon holding company set up
  8. 2009Sales halve in the wake of the Lehman shock
  9. 2015Nagasaka Hajime becomes president
  10. 2016First net loss in company history, ¥7.9bn
  11. 2017SGL GE acquired, completing an Asia–North America–Europe electrode network
  12. 2018Sid Richardson Carbon acquired; record sales ¥231.3bn, operating profit ¥73.1bn
  13. 2019COBEX Holdco acquired, adding smelting and lining

Founding Story

1918–1949From import substitution in electrodes to postwar recovery

Tokai Carbon began as an answer to two problems at once — what to do with the surplus hydroelectric power of the Kiso river system, and how to stop paying import prices for the graphite electrodes that electric steelmaking consumed. Incorporated in April 1918 as an independent carbon maker rather than a department of the steelworks it was built to serve, it spent its first three decades widening from electrodes into small carbon goods, pitch coke and, from 1941, carbon black — the second pillar that would carry it into the postwar economy.

A company born as an outlet for surplus electricity

The founding of Tokai Carbon is inseparable from the growth of the electric power business in the Nagoya business world. Fukuzawa Momosuke (福沢桃介), the son-in-law of Fukuzawa Yukichi and the man running Nagoya Electric Light, needed uses for the surplus power he was creating as he expanded hydroelectric generation on the Kiso river system[1]. His consulting electrical engineer, Samukawa Tsunesada (寒川恒貞), examined electric iron-making, aluminium and soda manufacture after a tour of Europe and the United States, and judged electric steelmaking to be the most promising of them. A steelmaking department was established inside Nagoya Electric Light in 1913, and in 1916 it was separated out as Denki Seikosho (電気製鋼所), today Daido Steel[2].

Running the electric steelworks called for large volumes of graphite electrodes, but at the time these were bought as imports from Acheson of the United States and were expensive. Samukawa put the case to Fukuzawa for making them in Japan, and on 8 April 1918 Tokai Denkyoku Seizo Co., Ltd. was incorporated with capital of ¥500,000[3]. Its head office was in Tokyo and its plant in Nagoya, and Samukawa himself became the first president[4]. What distinguished the new company was that it was not an in-house electrode shop for the steelworks but an independent carbon maker set up to serve electrode demand across the related industries[5]. Because it was constituted as a separate company rather than a division of the steelworks, room was left for the later widening of its business into carbon products beyond electrodes, into carbon black, and into fine carbon.

From synthetic graphite to large-diameter electrodes

In 1919, the year after its founding, Tokai Denkyoku began developing manufacturing technology for synthetic graphite, then an unexplored field, and in 1925 it succeeded in producing prototype synthetic graphite electrodes (electrolytic plates) for the electrolytic soda industry[6]. After considerable difficulty it succeeded in 1926 in manufacturing large synthetic graphite electrodes[7], and from then on it would play a leading part in the development of Japan’s carbon industry. In 1929 it began production of small-diameter synthetic graphite electrodes for steelmaking[8], and in 1934 it produced a prototype 18-inch electrode — among the largest of its day — and delivered it to the Kure Naval Arsenal[9]. Answering the expansion of military and heavy chemical industry with ever larger electrode diameters and improving quality is what fixed the company’s position in the industry.

The company moved quickly to widen its business as well. In 1919 it absorbed Daisanmi Seisakusho (大三位製作所), a Tokyo maker of small carbon goods, adding production of electrical brushes and other small carbon components and so entering the carbon products field[10]. In 1935 it established Dai-ni Tokai Denkyoku (第二東海電極) at Tanoura in Kumamoto Prefecture, merging it the following year and acquiring the Tanoura plant[11]. In 1936 it built the new Kyushu Wakamatsu plant and began making its own pitch coke feedstock[12]. In 1938 it built the Chigasaki plant[13], moved the equipment of the Daisanmi works there, and began full-scale production of electrical brushes and the like[14]. Even under wartime controls it went on widening its production base, and the prototype of a vertically integrated carbon maker producing everything from feedstock to finished goods took shape; capital, ¥500,000 at the founding, had reached ¥37 million by the end of the war[15].

The origins of the carbon black business

Carbon black, which would become the second pillar alongside electrodes, began with trial research using as its feedstock the pitch oil produced as a by-product at the Kyushu Wakamatsu plant. Research started in 1937 and full manufacture began in 1941, making the company a pioneer of domestically produced carbon black[16]. Having come through the tight supply and demand of the war years, in May 1949 it listed its shares on the Tokyo, Osaka and Nagoya stock exchanges[17], putting its capital base in order in step with the reopening of the equity market in the postwar recovery.

When a GHQ memorandum of October 1949 removed every restriction relating to motor vehicles, the car tyre and rubber industry began to grow, and with it the prospect of a dramatic expansion in demand for carbon black as a reinforcing agent. Where electrodes had been born as an outlet for a by-product of electric steelmaking, carbon black became an entrance into a quite different growth market — the tyre industry. The fact that the company now had two principal materials in hand is what determined the shape of its business for the decades that followed.

1950–1991Running alongside the car and steel industries, and going international

The four decades after 1950 turned a maker of electrodes into a maker of two materials on different cycles. Furnace-process carbon black, industrialised with the company’s own technology in 1950 and reinforced by a technical tie-up with Cabot in 1960, rode the tyre boom until it passed half of internal sales by 1980; electrodes grew in diameter alongside the electric arc furnaces they fed, then lost price competitiveness when the yen rose after the Plaza Accord. Consolidation of plants, a research institute for advanced materials, and the first overseas subsidiaries and joint ventures were the answers the company reached for.

Domesticating furnace-process carbon black

Postwar demand for carbon black expanded with the revival of the motor industry. In 1950 Tokai Denkyoku succeeded, using its own technology, in the first furnace-process carbon black manufacture in Japan, industrialising Seast 116 for rubber[18]. By 1955 it had reached a 40% domestic share[19] and had established itself as a principal supplier to the tyre makers. Through the 1950s the shift of electric arc furnaces to high-power operation raised demand for large-diameter electrodes, and in 1959 the company completed the first 20-inch electrode in Japan[20]. With electrode demand rising and falling in step with swings in the domestic economy, it pushed exports, and in the first half of 1959 the export ratio for electrodes reached 49%[21].

In 1960 it concluded a technical tie-up agreement in carbon black with Cabot of the United States, bringing in the manufacturing technology of a global leader[22]. Alongside improvements to the equipment at the Wakamatsu plant, it built the Chita plant at Taketoyo in Aichi Prefecture in 1962[23]. From then on, carried by the buoyancy of the tyre industry, carbon black sales rose steeply, exceeding 40% of total sales in the second half of 1975 to become the company’s principal product. Reflecting the change in the shape of the business, in June 1975 the company name was changed from Tokai Denkyoku to Tokai Carbon[24]. In 1978 the new Ishinomaki plant gave it a three-plant structure[25], and by 1980 carbon black accounted for more than 50% of internal sales.

The strong yen after the Plaza Accord, and consolidation

As the yen rose following the Plaza Accord of September 1985, the international competitiveness of electrodes declined. Between 1987 and 1988 Tokai Carbon carried through a consolidation and rationalisation of its plants and rode out the strong-yen phase[26]. Out of a sense of crisis that both of its principal products, electrodes and carbon black, belonged to mature industries, it opened the Fuji Research Laboratory in July 1986[27] and began research into advanced materials including silicon carbide whiskers, C/C composites, carbon for fuel cells and glassy carbon.

The globalisation of the business also began in earnest. In September 1987 it established the local subsidiary TOKAI CARBON AMERICA in New York[28], and in February 1990 it set up THAI CARBON PRODUCT as a joint venture in Thailand to manufacture and sell carbon black[29]. In December of the same year it licensed carbon black technology to Jung Woo Coal Chemical of South Korea, building up its expansion into Asia and North America. This was the period in which the internationalisation of the 1960s, which had depended on exporting electrodes, gave way to the 1990s pattern of combining local production, joint ventures and technology licensing.

The Toyo Carbon merger and the leading position in the industry

The turning point in strengthening international competitiveness was the merger with Toyo Carbon in January 1992. Both companies were carbon makers founded in 1918, and they had existed side by side for more than seventy years[30]. The merger brought in the Shiga, Yamanashi and Chigasaki No. 2 plants and made Tokai Carbon the largest integrated carbon products maker in Japan — first in domestic share in carbon black, synthetic graphite electrodes and impervious graphite, and second in electrical brushes and fine carbon. New fields were added as well — friction materials for construction and industrial use (Chigasaki No. 2 plant) and sliding materials[31].

From the scale of the merger period — sales of $427.5M (¥44bn) and 947 employees in the year to December 1994[32] — the company put in place a structure as an integrated carbon products maker with four businesses, electrodes, carbon black, fine carbon and friction materials, each holding a leading domestic position. Under the prolonged recession that followed the collapse of the bubble economy and a continuing rise in the yen, the economies of scale and the wider business portfolio delivered by the Toyo Carbon merger became the foundation for the overseas expansion and the acquisitions that followed. At the same time imports of carbon black, the raw material of tyres, were gradually increasing, and improving international competitiveness remained an issue for the industry.

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Notes

  1. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  2. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  3. Tokai Carbon, annual securities report, corporate history section↩
  4. Tokai Carbon, annual securities report, corporate history section↩
  5. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  6. Tokai Carbon, annual securities report, corporate history section↩
  7. 企業の歴史（明治百年） (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
  8. Tokai Carbon, annual securities report, corporate history section↩
  9. Tokai Carbon, annual securities report, corporate history section↩
  10. Tokai Carbon, annual securities report, corporate history section↩
  11. Tokai Carbon, annual securities report, corporate history section↩
  12. Tokai Carbon, annual securities report, corporate history section↩
  13. Tokai Carbon, annual securities report, corporate history section↩
  14. 企業の歴史（明治百年） (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
  15. 企業の歴史（明治百年） (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
  16. Tokai Carbon, annual securities report, corporate history section↩
  17. Tokai Carbon, annual securities report, corporate history section↩
  18. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  19. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  20. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  21. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  22. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  23. Tokai Carbon, annual securities report, corporate history section↩
  24. Tokai Carbon, annual securities report, corporate history section↩
  25. Tokai Carbon, annual securities report, corporate history section↩
  26. Tokai Carbon, annual securities report, corporate history section↩
  27. Tokai Carbon, annual securities report, corporate history section↩
  28. Tokai Carbon, annual securities report, corporate history section↩
  29. Tokai Carbon, annual securities report, corporate history section↩
  30. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩
  31. Tokai Carbon, annual securities report, corporate history section↩
  32. 日本会社史総覧 (A Conspectus of Japanese Company Histories, Toyo Keizai Inc., 1995)↩

References & sources

  1. Corporate Histories: A Century of Meiji, Keizai Shunju-sha (1968), the Tokai Carbon entry.
  2. A Conspectus of Japanese Company Histories, Toyo Keizai Inc. (1995).

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