Japanese suppliers in Western Europe: Responding to advancements in CASE technologies

European acquisitions, and alliances to strengthen manufacturing, sales, and R&D footprints

2020/04/23

Summary

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  According to LMC Automotive, light vehicles sales in 17 Western European countries increased slightly by 0.8% from the previous year to 16.28 million units during the January to December 2019 period. Sales recovered after bottoming out in September 2019, but since entering 2020, that recovery has been adversely impacted due to the spread of new coronavirus (COVID-19) pandemic, with total sales volumes during the January to March period reaching 2.76 million units, reflecting a significant decrease of 27.1% from the same period y/y.

  * Please refer to the following content for details on the impact associated with the coronavirus (COVID-19) pandemic.


  Japanese auto parts suppliers are strengthening their manufacturing, sales and R&D systems to capture the demand associated with environmental regulations in Europe and advancements in the CASE technologies. In particular, Japanese parts suppliers are promoting alliances, collaborations and acquisitions with European companies.

  With regard to electrification activities, Horiba, Ltd. plans to construct a new plant with test equipment for fuel cells and lithium-ion batteries at its German subsidiary. Nidec Corporation started operations at a joint venture plant with the PSA Group for drive motors for vehicles such as EVs. Unipres Corporation introduced hot press equipment at its plant in France to prepare for the expected increased in demand associated with electrified vehicles, etc.

  Regarding activities related to autonomous driving and the prevention of traffic accidents, the UK’s Arm Holdings, a SoftBank Group company, and Japanese, American, and European OEM and parts suppliers have launched a coalition to promote autonomous vehicles, and Mitsubishi Electric announced that it has jointly developed a road hazard alert system with HERE to warn trailing vehicles. Pioneer Corporation has contracted with the UK’s Arm Treasure Data, the data management business unit of Arm Limited, to jointly develop vehicle behavior and accident risk prediction models based on AI technology to reduce traffic accidents. Horiba, Ltd. will open a technical center for autonomous driving cybersecurity in the UK, and will also build a large-scale demonstration test facility for autonomous driving and automated parking.

  In addition, Denso Corporation has taken a stake in the German startup PiNTeam Holding GmbH to accelerate the development of in-vehicle embedded software, and APTJ Co., Ltd. has agreed with Open Synergy GmbH of Germany to develop and sell in-vehicle software platforms. Pioneer Corporation will collaborate with Swiss Re (Swiss Reinsurance Co., Ltd), the world's leading reinsurance provider, in the field of telematics services. Rohm Co., Ltd. signed a long-term supply agreement with STMicroelectronics N.V. for SiC wafers. Nippon Seiki Co., Ltd. started delivering head-up displays for Daimler luxury class vehicles.

  To strengthen its R&D organization, Teijin Ltd. established an R&D subsidiary for automotive composite materials in Germany. And, Toray Industries, Inc. plans to establish a new technical center in Germany for engineering plastics.

  Regarding activities surrounding Brexit, in response to Honda's decision to withdraw from the UK, Nichirin Co., Ltd, Yutaka Giken Co., Ltd., and TS Tech Co., Ltd. have decided to discontinue production and close their plants in the UK.

  Below are the recent trends among Japanese suppliers in Western Europe. (The information contained in this report was gathered from a variety of sources during the 11 month timeframe prior to January 2020)

 

Europe in general
New manufacturing sites and acquisitions ・Toyobo: Shifted supply method from export to consignment manufacturing of automotive plastics to a Japanese kneading supplier
Sumitomo Electric: Acquired powdered metal component in Germany and Switzerland
Strengthened SCM Sanden HD: Decided to adopt next-generation ERP system as its supply chain management (SCM) platform in Europe
Product development and increased development staffing Mitsubishi Electric:  Announced joint development with HERE of a system for notifying trailing vehicles of road abnormalities
Musashi Seimitsu Industry: Announced EV drive module at the Frankfurt Motor Show
Nippon Piston Ring: Increased engineering staff at European sites as part of its strengthening of overseas development functions
Withdrawal Akebono Brake: Announced closure of plants in Slovakia and France and R&D centers in Germany and the UK

Germany
Construction of new plants ・Horiba: German subsidiary to build new test plant for fuel cells and lithium-ion batteries
New orders ・Sankyo Tateyama: Received order from VW for battery frame materials for new EV
・Nippon Seiki: First delivery of head-up display for Daimler's high-end class model
Acquisitions, investments, and collaborations ・APTJ: Collaboration with Germany’s OpenSynergy GmbH on sales and development of in-vehicle software platform
Kasai Kogyo: Acquired German door parts plant and inherited its major European OEM customer base
Denso: Invested in German startup PiNTeam, accelerating in-vehicle embedded software development
・Denso Ten: Collaborating with Germany’s Cinemo GmbH on next-generation infotainment systems
・Tokai Carbon: Acquired German carbon products manufacturer that produces aluminum refining materials
NSK: Reached cooperation agreement with VW on steering business, jointly developing EPS
・Mitsubishi Chemical: Acquired German carbon fiber prepreg manufacturer and strengthened sales to automobile and aircraft manufacturers
・Minebea Mitsumi: Acquired German precision parts manufacturer to expand business in Europe
Patent disputes, and strengthening of product development and research systems ・Kyocera: Settled patent dispute regarding haptic feedback technology with Preh GmbH of Germany
G-TEKT: Aiming to participate in the early stages of OEM development by consulting with a German engineering company
・Teijin: Established automotive composite material research and development subsidiary in Germany for CASE-related technologies
・Toray: Building a new technical center specializing in resin, expanding PPS sales primarily for automobiles
Toyo Tire: Establishing its first European R&D center in Germany and proceeding to operate new plant in the Republic of Serbia
・Mitsubishi Materials:Established a cutting tool technical center to support training to improve customer understanding
Strengthening of sales system ・Asahi Kasei: Relocated European R&D Center near its European headquarters to consolidate operations and increase sales
Ashimori Kogyo: Established a local subsidiary to import and sell products such as seat belts, airbags, and interior parts
・Odawara Engineering: Established a subsidiary for sales and after-sales service of motor winding equipment
Company share transfers Toyoda Gosei: Transferred all shares to its German manufacturing subsidiary and reorganized its European operations

Western Europe (excluding Germany)
Construction of new manufacturing sites, production operations, and facility expansion Nidec: Electric powertrain assembly line started operations at joint venture plant with the PSA Group
・Mitsui Chemicals: New plant in the Netherlands started production PP compound, relocated R&D site close to the plant.
・Mitsubishi Chemical: New carbon fiber composite material manufacturing site to be established in Italy to meet growing demand associated with luxury vehicles
・Unipres: Introduction of hot stamping at plant in France in preparation for increased demand associated with new and electric vehicles
Acquisitions, investments, alliances, and collaborations ・Alps Electric: Increased investment ratio in Italian speaker manufacturer Faital and strengthened production system
・Arm:A consortium of Japan, U.S. and European OEMs, parts suppliers and other industry companies was launched to promote autonomous vehicles
・Ube Industries: Acquires Spanish compound manufacturer to expand nylon business for automobiles
・Konica Minolta: Strengthening of automotive visual inspection business through acquisition of Eines Systems, Spain
・Toray: Acquired Swedish airbag manufacturer
 
・Hitachi Automotive Systems: Acquired Dutch brake-related company, strengthening its automotive safety systems capability
・Hitachi Capital: Acquires Belgian company, strengthens mobility solutions business in Europe
・Bridgestone: Changed company name of TomTom Telematics that it acquired to Webfleet Solutions
New contracts, and strengthening of development and sales systems ・Rohm: ST Microelectronics and SiC agree to long-term wafer supply agreement
・Horiba: Construction of large-scale demonstration test facility for autonomous driving and automated parking in the UK
・Ifuku Seimitsu: Opened a sales office in the Netherlands, aiming to receive orders for parts using metal 3D printers
Plant closures KYB:Closing its hydraulic vane pump factory in Spain, and transferring production to its two plants in the same province
TS Tech: Started labor-management negotiations in preparation to close its UK manufacturing site
Nichirin: Production of UK subsidiary plant suspended in June 2020, leaving EU
Yutaka Giken: Closing UK plant by 2021 in response to Honda's withdrawal from the UK

 

Related reports:  
Western Tier 1 suppliers: Electrification trends, mainly in Europe and China (Dec. 2019)
European OEM Electrification Strategies, Including EV Product Timelines (Nov. 2019)
German OEM Electrification Strategies, Including EV Product Timelines (Oct. 2019)
IAA 2019: European Suppliers at Frankfurt Motor Show (Sep. 2019)


<Japanese Supplier Reports>
  India: Responding to stricter emission regulations and EV policy (Nov. 2019)
  U.S. and Canada: Expanding CASE business and local collaboration (Sep. 2019)
  ASEAN: Components and materials for electrification on the rise (Aug. 2019)
  China: Expanding the supply of parts and materials for NEVs (Jun. 2019)
  East China: Responding to NEV market expansion (May 2019)
  Central and Eastern Europe: Responding to orders from European OEMs (Jun. 2019)
  Western Europe: Meeting increasing demands for electrification and others (May 2019)
  Mexico: Focusing on Changes to NAFTA (Oct. 2018)