Robust U.S. market spurs investment by Japanese suppliers

Several suppliers announce plans to expand production capabilities

2013/07/24

Summary

Annual production units in the U.S.
The production volume of Japanese OEMs in the U.S. increased by 38.8% y/y to 3.315 million units in 2012, a one-million unit increase from the volume in 2011. This steady increase continued in 2013 accomplishing a local production rate of 71% (local production volume/local sales volume) in the U.S. for the January to April period. Expecting the market to expand even further in the medium term, the Japanese suppliers are aggressively enhancing their production capabilities to cope with the OEM movement to increase production volume in North America.



 Japanese Suppliers Related Reports:

Eastern China (Jul. 2013), Mexico and Brazil (Jun. 2013), Thailand (Apr. 2013), South East Asia (Mar. 2013),
Russia and Eastern Europe (Jan. 2013), India (Nov. 2012), Mexico and Brazil (Oct. 2012)




 

 



Introduction

 The Japanese suppliers are strengthening their production capacities in North America. Denso is planning to make large investments of approximately one billion dollars in operations in North America in the next four-year period until FY2016. Of those, 750 million dollars will be spent for the U.S. operations. In FY2013, Koito will expand its production capabilities in the U.S with a ten billion yen capital investment, three times the amount from the previous year.

 Many companies made enhancements to their production capabilities from an increased number of accounts. The companies include: Advics (opened transactions with Chrysler), Shiroki Corporation (GM), FCC (Ford and GM), Toyoda Gosei (GM), NHK Spring (VW), and Taiho Kogyo (GM and Honda).

 Some of the items were added to the production list due to enforcement of more strict fuel consumption regulations in the U.S. (hot stamping, cold-rolled, high-strength steel, and turbochargers for weight reduction).


 Companies like, Sanden (compressor parts) and Tokai Rubber (masticate rubber), corresponded to expansion of local-content ratio requests from their clients.

 There have been some restructuring activities among Japanese suppliers: Akebono Brake (distribution of manufactured items among four plants to improve production efficiencies), establishment of a regional management company (NHK Spring, Nidec, Furukawa Electric, and Sanoh Industrial), the merger of two sales companies (Harada Industry), and establishment of a local repair service company (Alpine). There were also activities related to enhancements to R&D structure.


 There were some M&As among the companies: Mitsui & Co. made an investment in a group of U.S. companies owned by the world's top pressed parts supplier, Gestamp Automocion, S.L., and Mitsubishi Chemical acquired PVC compound department of Comtrex, LLC.

 The following reports the details of the activities of Japanese suppliers in the U.S (including Canada) based on announcements made by respective companies and media reports (the report includes activities up to the beginning of June 2013 in the span of one year).



Establishment and enhancements on production centers

Aisan Industry to strengthen production capacity at Kentucky plant

 Aisan Industry will spend approximately one billion yen on its plant at FRANKLIN PRECISION INDUSTRY, INC. (in Kentucky) to add production lines to increase its production capability by around 10% within FY2013. The enhancement is made to cope with the increased demands at Toyota and Nissan. The plant currently manufactures throttle bodies, its major production item, fuel pump units and canisters.

Aishin Takaoka to focus on promotion of parts made with die-quench method; expands casting capability at Indiana plant

 Aishin Takaoka will ptomote proposals of hot stamping parts to automakers outside Japan. The company will introduce test production facilities of hot stamping parts in the U.S., China, and Thailand within FY2013 to promote production technology for reducing weight of body frame components  to U.S. suppliers as well as Japanese OEMs. The supplier aims to start mass production in 2015. It is also planning to strengthen the production capability of casted parts outside Japan. The company will install an additional casting line with an annual capacity of 30,000 tons at its Indiana plant, increasing its volume to 80,000 tons. There are plans to start operations at the plant within 2013. About JPY two billion will be invested for this project.

Asahi Forge starts operation of hub bearing plant, its second U.S. site, in June 2012

 In June 2012, Asahi Forge held an opening ceremony of its second U.S. site, Asahi Bluegrass Forge corporation in Richmond, Kentucky and also held an igniting ceremony of the forging press line at its hub bearing plant. The company spent 20.3 million dollars for this project. The enhancement was made in response to demands for local procurement from OEMs. Products will be delivered to be used on Toyota Camry,RAV4, and Honda Civic.

Akebono Brake introduces ferritic Nitro-carburizing (FNC) surface treatment facility to its Tennessee plant

 Akebono Brake Corporation, a U.S. subsidiary of Asahi Brake, has completed its development of an FNC surface treated rotor. FNC prevents judders caused by corrosion on rotors. Akebono Brake will be the first brake manufacturer to mass produce FNC-treated rotors. The FNC treatment facility was built at the Clarksville plant in Tennessee and the shipping to its U.S. customers began at the end of 2012. With the introduction of the FNC rotor, its anti-corrosion performance is expected to improve nearly five times over the level of legacy rotor, thus, improving the initial quality performance of the rotor. By processing the FNC treatment in-house, Akebono aims to improve production efficiency as well as profitability.

Advics to continue transactions with Ford; also starts transactions with Chrysler directly

 After confirming continued delivery of parts to Ford, Advics agreed with Chrysler to make transactions directly in the medium term. (Source: reported in January 2013)

Ahresty enhances capacity at its aluminum die-casted parts plant

 Ahresty will increase the production capacity at the aluminum die-casting parts plant at Ahresty Wilmington Corporation in Ohio by 20% by mid-June 2013. The existing building will be expanded to add casting machines and machining lines. The expansion was made to cope with plans to increase production at Honda and Nissan.

H-One to restructure production at its Ohio plant

 Due to increased management costs from varied specifications of parts manufactured in North America, H-One will review its production for optimization including relocations of its facilities from FY2013. The load of the welding process has gotten especially higher at its major plant in Ohio, KTH Parts Industries, Inc., which manufactures body frame components. The company will construct a new welding building  at its sub-plant in Ohio, Kalida Manufacturing, Inc., mainly manufacturing pressed parts, to increase its productivity. A part of the welding procedure from the main plant will be transferred to the sub-plant. Its process will be relocated to optimize production by models to synchronize with two Honda assembly plants.

FCC to cope with Honda's CVT plan; to increase sales to other companies to cover for decreased clutch sales

 FCC is currently working to change its clutch plant CVT-ready in response to Honda's, its major account, plan to replace transmissions with CVTs on vehicles in small to mid-classes. In the U.S., the suppliers have installed one CVT specialized line at FCC (Indiana) , LLC. by January 2013. Because CVTs require only half the volume of clutches compared to ATs, FCC is working to expand its sales of clutches to other OEMs. AT clutch assembly lines will be added to U.S. plants in 2013 to cope with an increased production of clutches for Ford ATs and for the U.S. plant of a German transmissions manufacture, ZF, and start delivery in the latter half of 2013. The company estimates being able to cover the decreased shipments to Honda by the end of 2014.

F-Tech goes into mass production of front sub frame with new technology from 2012

 F-Tech began mass production of front sub frames at F&P America Mfg., Inc. (Ohio) for Honda's new Accord which was launched in September 2012 for the North American market. The front sub frame, developed by Honda, is manufactured using a new friction technology which stir and welds two different materials, steel and aluminum alloy.

Ogura Clutch to increase production of parts for Ford pickup trucks

 From October 2013, Ogura Clutch will increase its annual production volume of differential locks for Ford pickup trucks from the current 150,000 units to 550,000 units. The expansion was made due to the increased sales volume of the F-250, which the supplier has been receiving orders from the OEM, and new orders received for the F-150, a popular second car. Casting and wire winding will be done at its Chinese subsidiary, Ogura Clutch (Dong Guan), then assembled in the U.S. The supplier plans to promote the product to OEMs other than Ford.

Kasai Kogyo to establish new plant for trunk surrounding parts; to automate assembly procedures of interior parts in four locations around the world

 In January 2013, Kasai Kogyo opened its second plant, the Talladega plant, at M-TEK INC. (Alabama). The company will utilize a building previously used by another company installing it with equipment to start operations in March of the same year. Trunk surrounding parts for Honda will be manufactured at the plant. Around one billion yen will be invested for this project. Furthermore, the company received a large amount of additional orders from Nissan in 2012 and added a total of four molding machines at its plants in Tennessee and Mississippi. In FY2013, robot automated assembly, welding, and fastening facilities for door trims, an interior part, will be introduced to more than ten plants in Japan, U.S., China, and U.K. The automation will reduce costs by cutting 30% of human resources while fulfilling the OEMs' request for global universal quality.

KYB introduces general-purpose shock absorber specialized line

 KYB is planning to make intensive global level investments of shock absorbers (SAs) and CVT pumps, an area of growth, in FY2013. One line specialized on manufacturing general-purpose SAs and added SA designing function as well in the U.S. KYB expects to sell 16 million general-purpose SAs for FY2012 and 17.5 million for FY2013 globally.

Koito to expand production structure in North America in mid-term management plan

 In May 2013, Koito announced its mid-term management plan (for FY2013 through FY2015). Koito will seek new orders from Japanese and U.S. OEMs in North America. In the plan, FY2013 investment to U.S facilities will triple y/y to ten billion yen to increase production of lighting equipment delivered to Toyota. Its U.S. subsidiary, North American Lighting, Inc. (NAL), will make expansions at its Alabama and Paris, Illinois plants in January and March 2014, respectively, to increase production capacities of both plants put together by 30% y/y. This is the largest investment Koito has made in the U.S. after the recession caused by the bankruptcy of Lehman Brothers. Moreover, operations at NAL Mexico will begin in July 2014.

Companies including Kobe Steel to double production at existing joint venture; operations start at new joint venture's high-strength steel site

 In January 2013, Kobe Steel, Mitsui & Co, and Toyota Tsusho announced the expansion of aluminum forged suspension arm production capacity at their joint venture, Kobe Aluminum Automotive Products, LLC., in Kentucky. Casting and forging press lines will be expanded by spring of 2014 increasing its monthly production volume from 270,000 units in 2012 to 500,000.

Suncall adds production lines for items including valve springs

 Suncall will add production lines at SUNCALL AMERICA INC. (in Indiana) by March 2014 to cover for the lack of supply capacity for increased orders. One surface treatment equipment will be added to the valve line adding one line to the existing line for engine parts enhancing its monthly production capacity from the current one million pieces to two million. A ring welding machine and a gear machine will be installed to its drive plate line expanding it from five lines to six, increasing its monthly production capacity from 200,000 pieces to 260,000. About JPY 400 million will be invested for this project.

Sanden to increase local procurement rate of A/C compressor parts

 Sanden will increase its local procurement rate of air conditioner compressors, the PX series, one of the major products in the U.S and Europe. With its high level of energy saving performance, the sales volume is showing an increase. The supplier aims to increase the local procurement rate, which was approximately 30%, to 75% by FY2012. Production facilities for component parts will be transferred from Japan to manufacture parts locally. Due to decreased profits from a strong yen, this will prevent impacts from exchange fluctuations and lead to raising profit. The company plans to further increase its local procurement rate to 80% between FY2014 to FY2015.

Shigeru to relocate plant near major client and make expansion

 In 2012, Shigeru's local subsidiary, Heartland Automotive, LLC. (in Indiana), opened its existing second plant on a property adjacent to Fuji Heavy Industries' (FHI) local plant and began operations in the beginning of 2013. The relocation will improve transport efficiency of bulky parts like instrument panels. Manufactured items such as doors and ceiling linings will be split among two locations. Its annual production capacity increased by 20% from the previous volume of approximately 300,000 units. About JPY one billion will be spent for this project.

G-Tekt to relocate welding process of Honda body frames near vehicle manufacturing plant

 As part of its strategies for improving productivity in the U.S., G-Tekt is planning to relocate its production facilities in several phases to move the welding process of frames closer to the vehicle manufacturing plant. The plant manufacturing parts for FHI, Austin Tri-Hawk Automotive, Inc. (in Indiana), is scheduled to restructure the plant to provide welding process for parts delivery to the Honda Indiana plant by FY2015.

Shiroki Corporation to establish two-location production structure to increase manufacturing volume of door sashes

 With first orders received from GM, Shiroki Corporation will make the plant at SHIROKI North America (Tennessee) for manufacturing door sashes for GM and start delivery in September 2013. To secure production capacity for door sashes to cope with increased requests for production of door sashes, the supplier will establish a two-location manufacturing structure in combination with its core U.S. site, SHIRAKI-GA (Georgia).

Central Glass to utilize legacy facilities to increase production to cope with sudden rise in demand for glass

 Central Glass will increase production of glass in the U.S. to cope with a sudden rise in local demand for glass. At the plant acquired and renamed in April 2011, Carlex Glass America, LLC (in Tennessee), the supplier not only introduced new facilities in 2012, but also decided to continue utilizing its old equipment which was schedule to be replaced, in order to fulfill its orders. The company hired an additional few dozen on-site staffs at the plant and also sent technical staff from Japan in order to promptly start full production.

Daido Steel adds large-size high speed precision hot forging machine to strengthen manufacturing capability

 In December 2012, Daido Steel announced the installation of one large-size high speed precision hot forging machine at OHIO STAR FORGE CO. (Ohio), set to start operations in October 2012. The investment was made in response to requests for forging of large-size parts and expansion of its production capability from the U.S. and Japanese automotive, industrial, and bearing manufactures. This enabled the supplier to provide any product from small to medium and large-size forged parts. The company has spent 22 million dollars for this project.

Pacific Industrial to increase production capacity of TPMSs in several phases

 Starting from summer of 2012, Pacific Industrial commenced final assembly of tire pressure monitoring systems (TPMS), its strategic product. The supplier plans to switch to local production of components by FY2013 to secure an annual capacity of three million pieces. It is also planning to expand its TPMS production capacity to six million pieces by FY2014 in several phases. Manufactured products will be supplied to the U.S. market and exported to Europe as well. Pacific Industrial will make an investment of JPY one billion by FY2014.

Taiho Kogyo strengthens production capability at Ohio plant in 2012; further expansion to be made in 2015

 In 2012, Taiho Kogyo increased its bearing production capacity of 1.8 million per month to three million pieces at Taiho Corporation of America, its U.S. plant in Ohio, after receiving new orders for engine bearings from GM and Honda. The supplier is considering making further enhancements to increase its annual production capacity to 4.5 million pieces by FY2015.

Diamond Electric to expand production capability of items including ignition coils

 With favorable performances of its vehicle equipment division from sales of items like ignition coils in the U.S., especially products delivered to FHI, the supplier will add new lines at Diamond Electric Mfg. Corp (Michigan) West Virgina Manufacturing Plant from FY2013 to bump up production.

Tsuda Industries to establish first U.S. plant to start operation in January 2014

 With diminishing trend in production volumes in Japan, Tsuda Industries centered its new five-year medium-term management plan (for FY2013-FY2017) around growth in overseas operations. In October 2012, it established TSUDA USA CORPORATION (in Indiana) in the U.S. A cold-forged parts production plant for transmissions and bodies is to start operation in January 2014. The plant will cope with local procurement at Toyota and will contribute to expanding sales.

Tsuchiya constructs third plastic parts plant; to increase produced items

 In 2012, Tsuchiya established its third plastic parts manufacturing company, Tasus Alabama Corporation in Alabama. The plant will start operations in August 2013 to resolve capacity issues at its existing plants in Indiana and Texas due to increased orders received from OEMs and suppliers located around Alabama. Extrusion and blow-molding machines will also be introduced at the new plant expanding items manufactured. Products will initially be supplied to local Koito and Toyota plants. About JPY 1.5 billion will be invested for this project.

T.Rad invests on equipments to increase EGR cooler production capacity; also begins production of oil coolers

 T.Rad will expand its global production capability of exhaust gas recirculation (ERG) coolers to 1.8 times the volume in FY2013 by FY 2017. In North America, the production capacity of T.RAD North America, Inc. (Kentucky) is scheduled to be increased by more than two times the current volume. Because the increase rate of its annual production volume for EGR coolers in FY2015 was speculated to increase by 60% of the volume from FY2012 (estimate), the company will make even larger investments to increase production. Additionally, production of oil coolers will start by FY2014 in North America to cope with increased demands.

TPR starts operations at second production site for cylinder liner from June 2013

 In June 2013, TPR started production at TPR Federal-Mogul Tennessee, Inc. plant jointly established with Federal-Mogul Powertrain, Inc. in 2012. The new plant will specialize in production of "ASLOCK cylinder liners," which has been specially treated to increase adhesion to engine blocks made of aluminum alloy, growing in the number of orders received from both Japanese and non-Japanese OEMs. Its planned monthly production capacity for 2015 is 1.1 million pieces. The total production capacity of TPR in the U.S. will increase to a monthly production volume of 2.2 million pieces including the volume from its existing plant in Minnesota.

Denso to invest approximately one billion dollars in the next four years to increase production capability in North America

 In January 2013, Denso announced that it will invest about one billion dollars (95 billion yen) for operations in the U.S., Canada, and Mexico in the span of four years until FY2016 ending March. Of the amount invested, 750 million dollars (71.3 billion yen) will be invested on operations in the U.S. In FY2013, the production of head-up displays for U.S. OEMs will begin at a production site in Tennessee, and production of hybrid vehicle inverters will begin by FY2014. Moreover, new production lines for condensers and radiators will be installed at a production facility in Michigan with 100 million dollars (9.5 billion yen) while also updating outdated equipment. In Iowa, a new parts assembly plant for heavy-duty vehicles will be constructed.

Tokai Rubber schedules expansion of local production capacity of masticate rubber

 With the North American market in recovery mode, Tokai Rubber plans to increase the efficiency rate of products delivery to Japanese OEMs. Facilities for manufacturing vibration-insulating rubber and hoses in Ohio, Tennessee, and Mexico are equipped with function to supply masticate rubber and the supplier plans to increase the total production volume at these three sites from 1,000 tons in 2012 to 1,300 tons by 2014 to accelerate localization in the U.S.

Topre goes into mass production of hot stamped frames in June 2013

 Since FY2012, Topre has made an additional 6.5 billion investment to Topre America Corporation (Alabama) to expand its production capability. Of the amount invested, almost four billion yen was spent on hot stamping equipment. In June 2013, Topre became the first Japanese supplier in the U.S. to mass produce body frames using high-strength material made with the hot stamping. The enhancement was made to cope with higher demands for super-strength materials due to reinforcement of the new crash safety act in the U.S. The materials will be provided for production of the new Honda Odyssey. A large-size press was additionally installed at the plant to provide parts for Honda's large-size SUVs. Pressed products used on Nissan's new models and versions will also be manufactured at this plant.

Toyoda Gosei to expand production system for U.S. OEM parts

 With increased orders for GM fuel tubes, Toyoda Gosei leased a new building nearby its TG Fluid Systems USA Corporation's (Michigan) existing site and installed new production lines. Production at the plant began in January 2013. In FY2011, Ford certified Toyoda Gosei as one of its major suppliers. Since then, the company has been expanding its sales to U.S. OEMs.

Nishikawa Rubber starts production of rubber sheet for doors with high sound insulating properties in the U.S.

 Nishikawa Rubber started production of foamed rubber sheet for doors, which reduces exterior noise, starting in the spring of 2013 at its existing plant in the U.S. The sheets used in the U.S. have been imported from plants in China, but with the plant already in full operation, the company spent 200 million yen to add specialized lines at the U.S. plant. Because its client OEMs are showing strong interests in the product, the supplier will develop sealing sheets with even higher sound insulating properties in collaboration with several other companies. The company also aims to avoid being affected by currency fluctuations and stabilize its supply system by manufacturing foamed rubber sheets at three locations in Japan, U.S., and China.

Nittan Valve to enhance production capability of engine valves in U.S. by early 2014

 Nittan Valve will expand its production capability of engine valves by early 2014 from 50 million pieces in early 2013 to 90 million, an 80% increase. The expansion was made due to a sudden rise in demands from Japanese OEMs. First, the company will add one production line at a joint production site, U.S Engine Valve (South Carolina), by September 2013 increasing the annual production volume to 75 million pieces; then, another line will be added to a plant owned by Eaton, its joint venture partner, by early 2014 further increasing the volume to 90 million pieces. Ultimately, depending on the market situation, the supplier will add another line at U.S Engine Valve bringing up its production capability to 100 million pieces. The company will spend JPY 1.7 billion for this project.

NHK Spring starts production of chassis springs for VW from 2013

 NHK Spring received orders for chassis springs used on the current version of the Passat from Volkswagen (VW) and began delivery to VW Tennessee from January 2013. The springs are manufactured at an existing spring plant owned by NHK of American Suspension Components Inc. (Kentucky). This is the first transaction for the supplier  with VW.

Nisshinbo Brake faces difficulties expanding U.S. plant; may utilize plants in Mexico and Brazil

 Nisshinbo Brake's U.S. plant has been in full operation. Because fulfilling increased local procurement requests from its customers simply by expanding its U.S. plant will not suffice, the supplier will contemplate strategies to take in the U.S. with a possibility of utilizing plants in Mexico and Brazil in the future.

NGK Spark Plug to increase production of oxygen sensors exported to Brazil at U.S. existing plant

 NGK Spark Plug will increase its annual production volume of oxygen sensors exported to Brazil by 30% from the volume in 2012 to 3.9 million units by 2017 at its U.S. plant. The expansion is made with expected growth in exports to Japanese, U.S., and European OEMs manufacturing in Brazil. Volume at NGK Spark Plugs Mfg. (U.S.A.), Inc. plant (in West Virginia) will be increased. There will be no enhancement made to its facility to cover for the increased volume; instead, the working shift will be switched from the current two-shift operation to three shifts.

Nippon Piston Ring increases production capacity of valve seats and engine valves

 Nippon Piston Ring will add a production line at NPR of America, Inc. (in Michigan) plant to double the production capacity of engine valves from the volume in FY2011 and triple the volume of valve seats by 2014. The company will invest a total of approximately three billion yen by FY2014. In March 2013, its monthly production capacity of valve seats was increased 1.5 times to three million pieces. Until then, the difference had been covered by imports from Fukushima and Thailand plants. Production for new orders will start by 2014. It has been reported that the company may make further investment depending on orders it will receive in and after FY2015.

Nihon Plast to expand existing plant and add machineries to increase production capability of plastic parts

 Nihon Plast is planning to cut costs by increasing its local-procurement ratio at its foreign production facilities to 70% during FY2013. Moreover, Neaton Rome Inc. (in Georgia), which manufactures interior/exterior plastic parts, handles, airbags, will expand its plant to install seven injection molding units in 2012 and an additional three units in 2013.

Piolax to increase metal parts production capability

 In FY2013, Piolax will invest 800 million yen on equipments in order to increase production capability of metal parts at PIOLAX CORPORATION (in Georgia). Items that can be automated will be consolidated to the U.S. plant to increase productivity at plants in the North American region including Mexico plant.

Hayashi Telempu to construct new plant for Toyota parts scheduled to start operations in 2014

 Hayashi Telempu will construct a new plant in Kentucky in response to new orders for interior parts received from Toyota's Kentucky plant. It will be the sixth plant in North America. Production of interior parts such as floor carpets, one of its major products, will begin from September 2014. The company spent 10.7 million dollars for this project, hiring 103 employees. The company will be given a 1.3 million dollar tax benefit from the government of Kentucky.

Hitachi Chemical to double production capability of powder metallurgy products in North America from 2012

 Hitachi Chemical expanded the production capability of powder metallurgy products, such as engines and bearings, at its U.S. subsidiary, Hitachi Powdered Metals (USA), Inc. (Indiana) plant by 1.5 times. With growth expected in the future, the supplier will make further enhancement on its production facility. A similar facility will be installed to its Mexico group company; both scheduled to start operations in fall 2014. By 2015, the total production capacity at both sites will be doubled from 2012 to double its revenue in North America.

Hitachi Metals to start production of dysprosium magnets with low amount of dysprosium at existing plant

 With expected increase in demands for hybrid vehicles and EVs in the U.S., Hitachi Metals will mass produce dysprosium magnets with low amounts of dysprosium at Hitachi Metals North Carolina, Ltd. (North Carolina), a production facility for ferrite magnets. The dysposium magnet will be supplied to local tier 1 suppliers and OEMs. Dysprosium, material used to manufacture the magnet, will be procured within the U.S. to disperse risks of depending the procurement solely on China. The switch to local production in the U.S will help stabilize its supply chain including prevention of exchange risks.

Fine Sinter to strengthen powder metallurgy parts plant to add transmissions parts to its production

 By fall 2014, Fine Sinter will enhance its powder metallurgy parts plant run by American Fine Sinter Co., Ltd (Ohio). The enhancement is made in response to new orders for transmission oil pump unit parts from Japanese suppliers. The production capacity of the plant will be enhanced by first expanding the building and then adding new production lines. The volume-based production capability of the plant has not been made public. About JPY one billion will be spent on this project. The plant's major production items are parts used on engines, but transmission parts will be added with the enhancement.

Faltech's Georgia plant goes into full operation in FY2013

 Faltech will put its FALTEC AMERICA, INC (in Tennessee) Georgia plant into full operation in FY2013 looking at the market recovery in North American. The company plans to increase its FY2015 revenue by 70% from FY2012 to 4.2 billion yen.

Howa Textile Industry to establish third production site by FY2015

 Howa Textile Industry will construct a third plant by FY2015 in synch with scheduled launching of new models by Japanese OEMs. Because the supplier currently has factories in Kentucky and Ohio, located in the American Midwest, it is considering locating new sites to cover the entire nation. Potential regions are north and south parts of the country. However, Howa Textile Industry is also considering utilizing its Mexico plant as well. It will decide on a detailed schedule with volume increases at Japanese OEMs in mind. Investment amount is expected at 1.5-2 billion yen.

Press Kogyo to strengthen production capability of bearings

 In June 2013, Press Kogyo doubled its annual production capability of bearings for pickup trucks to 440,000 units at PK U.S.A, INC. Indiana. The company only provided parts to Nissan, but having received new orders from a U.S. OEM, bearings for pickup trucks and SUVs will be manufactured in 2013-14. The planned annual production volume is 152,000 units. About JPY 800 million will be spent for this project.

MHI to establish new turbocharger production site in Indiana

 In December 2012, MHI announced that it will establish a production site to manufacture turbochargers in Indiana to start mass production in fall 2014 to cope with increased demands for turbochargers with U.S. OEMs downsizing their engines from the enforcement of more strict fuel consumption regulations. The new production facility will be established as a plant owned by MHI's U.S subsidiary, Mitsubishi Engine North America, Inc. (in Illinois) which sells engines and turbochargers. The manufacturing lines will be constructed within the premises of an air conditioner manufacturing plant in Franklin Indiana, owned by a U.S. cold heat business subsidiary, Mitsubishi Heavy Industries Climate Control, Inc. About JPY one billion  will be spent for this project. Its annual production capability will start from 600,000 units gradually increasing to reach 1.2 million units. Core parts called cartridges will be imported from its Thailand subsidiary and assembled to make a complete product at the plant in the U.S.

Muro Corporation to establish production structure to allow manufacturing various pressed parts

 Muro Corporation will establish a production structure which enables the company to manufacture various pressed parts, including parts with complex forms, at Murotech Ohio Corporation (Ohio). In November 2012, the company installed a thermo treatment facility with approximately 300 million yen. Thermo treatments have been outsourced, but with increased orders for parts used in transmissions (including CVTs) and the number of items manufactured, the company decided to invest in the facility. To fulfill customer needs, the production of sprockets with complex features mostly manufactured in Japan, will also begin.

Univance to start production of transfers by expanding its existing site

 In 2012, Univance doubled its site by constructing a new building adjacent to the existing UNIVANCE INC. plant. Production of transfers for Nissan's FWD-based drive all-wheel drive vehicles started in early 2013 and production of CVT pulleys for Honda will begin at the end of the year. With a giant increase in production volume, the U.S. revenue for FY2015 is expected triple from the level of  FY2012 to six billion yen, the highest amount estimated for an overseas site.

Unipres to install large-size stamping machines to cope with increased orders

 Unipres is planning to strengthen its large-size stamping machine facility in the U.S. One 2500-ton transfer (TRF) press will be introduced to plants at Unipres U.S.A. (in Tennessee) and Unipres Southeast U.S.A. (in Mississippi), respectively, and start operations in FY2013. The investment was made to cope with new orders from its major clients, Nissan, for the C platform vehicles as well as additional orders received from Honda.

Yachiyo Industry to strengthen production capability of resin fuel tanks

 Yachiyo Industry will increase annual production capability of resin fuel tanks at US Yachiyo, Inc. (in Ohio) from 800,000 units in 2012 to one million units by FY2014. The enhancement was made due to an increase in production at Honda as well as new orders for models the supplier has not been able to receive orders for, has been made official.

Yokohama Rubber to construct new tire plant for trucks and buses

 In April 2013, Yokohama Rubber announced the construction of a truck & bus (TB) tire plant in Mississippi. It will be the first tire plant in the U.S. The construction of the plant will start by September 2013, and scheduled to start production from October 2015. Expected annual capacity is one million pieces. Initial facility investment is 300 million dollars, but the supplier is considering expanding the business by four times in the future. The company has been manufacturing tires for the North American market under contract at a joint venture, GTY Tire Company, as well as imports from Japan and Thailand, but required strengthening supply structure in order to cope with increased demands for tires.

 

 



Restructuring, optimization, and enhancement of U.S. operations

Asahi Brake restructures four U.S. plants based on manufactured items

 In the three-year period starting in FY2013, Asahi Brake will spend 14 billion yen to constantly earn a profit from its U.S. operations and accelerate company restructuring. To increase productivity at its four U.S. plants, the company will make the distinction clear between the four plants based on items manufactured: Elizabeth town plant in Kentuckyto manufacture mechanical parts, Glasgow plant in Kentucky to manufacture friction materials, Clarksville plant in Tennessee to manufacture modules, and Colombia plant in  South Carolina to manufacture aluminum parts.
 As part of its strategy, production facilities for brakes and calipers will be replaced from specialized machines to smaller, generic units to easily respond to fluctuations in orders. Also, by starting exports of high-performance brakes using aluminum calipers to European high-class OEMs from the latter half of 2014 and developing ferritic Nitro-carburizing (FNC) rotors into its major technology, the company aims to increase its profit from its U.S. operation to 4.5 billion yen by 2015.

Alpine establishes repairing and customer service local subsidiary

 In April 2013, Alpine established a local subsidiary providing repair and customer services for electronic devices in North America called Alpine Customer Service (USA), Inc. (in Torrance, California). Product repairs have been outsourced until now, but by incorporating the function into its group, the company aims to have a complete investigation to determine the cause and make repairs more swiftly.

Sanoh Industrial adds quality assurance function to U.S. subsidiary; to establish U.S. regional management company in medium term

 Sanoh Industrial is planning to increase its overseas local procurement rate from 30% in 2012 to 80% in a period of two years. To accomplish this goal, the supplier will dispatch several employees from Japan to its sites outside of Japan, including the U.S., to establish a quality assurance function. To provide a higher level of quality assurance for parts used on Honda's Accord, the supplier has already dispatched specialists to the U.S. subsidiary.
 Moreover Sanoh Industrial will establish regional management companies in the U.S., Asia, and Europe by FY2016 to complete a five-country network across the world including exsiting bases in Japan and China. The managing companies will have equal functions as the Japan headquarters from development to procurement, production, and management. The headquarters in Japan will act as a global headquarters controlling regional management companies as its wholly owned subsidiaries.

NHK Spring to establish North American headquarters at R&D site in Michigan

 In April 2013, NHK Spring established a management department within its chassis spring R&D site, NHK International (in Michigan). The site will act as its regional management headquarters. Tasks including financial, purchasing, and human resource management at six plants and sales companies in the U.S. and Mexico will all be managed at the headquarters. This will make smoother communications with Japan headquarters possible and improve its capabilities to respond to the needs of its clients by creating a structure which allows efficient distribution of management resources. NHK Spring is currently promoting its company principle, "globalization of management begins with the globalization of production" (by president Kazumi Tamamura).

Nidec establishes U.S. management company for its motor sector

 In April 2013, Nidec established NIDEC AUTOMOTIVE MOTOR AMERICAS CORPORATION (in Michigan). The company capitalized the subsidiary at 41 million dollars. Nidec has been growing its sales mainly through OEMs and suppliers in Europe and China providing a rich lineup of products including brushless motors and motors with brushes. The company is planning to strengthen production, sales, and development structure under the U.S. management company in the North American market, a market with the highest level of importance, to help increase orders from its clients.

Harada Industry merges two sales companies to strengthen operational infrastructure

 As of January 1, 2013, Harada Industry merged its U.S. consolidated subsidiary of antenna sales, HARADA INDUSTRY OF AMERICA, INC. (in Michigan) and NIPPON ANTENNA (AMERICA), INC., with HARADA INDUSTRY OF AMERICA being the surviving company. By consolidating redundant sales functions and optimizing managerial efficiency, the supplier will strengthen its sales system in the U.S.

Furukawa Electric establishes wire harness North American regional management company

 In its "2015 medium term plant", Furukawa Electric is planning to establish a wire harness regional management company in North America as well. The management company will be responsible for multiple functions to enhance its procurement structure with considerations of sales activities at its clients, speedy designing of products meeting local needs, cost, and quality.

 

 



Enhancements, collaborations, and acquisitions at U.S. R&D sites

Kasai Kogyo to double engineers at its designing site in Michigan

 In FY2013, Kasai Kogyo will establish an R&D center at its major production site, M-TEK INC. (in Tennessee). The company already has a design office in Michigan. Because the scope of tasks covered there is not wide enough, the supplier established a structure to develop new products at an R&D center near its clients (drafting, prototyping, and testing data designed in Japan) and quickly respond to any defects found after the launch of new models locally. Branches of the R&D center will be established at sites such as M-TEK INC. (Michigan Office) and M-TEK INC. (in Ohio). The R&D center in Tennessee will also have a production support function for the Mexican site. The company is planning to hire 50-60 engineers and technology specialists locally. The estimated total investment is around 500 million yen.

Clarion opens branch with development function in Silicon Valley

 In April 2013, Clarion opened the fifth branch of the Clarion Corporation of America (headquartered in Cypress California) in Silicon Valley. The branch will act as the point of contact for cloud businesses adding competitiveness as a car navigation system provider. The supplier decided to open the branch in Silicon Valley because major Japanese OEMs were collaborating with IT companies there. The branch will support OEMs with core developments while also providing products meeting local needs.

KYB establishes new technical center for parts around drivers footings, namely shock absorbers

 In FY2012, KYB introduced an assessment facility to strengthen its development structure in the U.S. In spring of 2013, a new technical center was established at its management company KYB Americas Corporation (Indiana) and went into full operation. These activities are a part of the process to enhance its footing part development structure, including shock absorbers, at the global level. It will aggressively seek new orders from major European and U.S. OEMs and suppliers while accurately grasping market needs for production products to grow its market share.

Sanoh Industrial to establish U.S. development site by 2015

 Sanoh Industrial is planning to increase its sales rate for OEMs such as Europe, U.S., and China located in countries outside of Japan from under 10% in FY2012 to 13% by FY2015 and further expanding to 30% by FY2017. To accomplish this goal, the supplier will establish a new U.S. development site by 2015 to organize a structure allowing the company to develop new products. It will also focus on a development phase of the new models  at GM and Ford when it has better chance of switching its suppliers, and making its way into the client's development department.

Sanko Gosei establishes development site for its Mexican plant in the U.S.

 In December 2012, Sanko Gosei established SANKO GOSEI TECHNOLOGY USA (Ohio) and dispatched two engineers from Japan. The company will hire engineers locally as well. The new site will act as a plastic parts development site for the North American market manufactured at SANKO GOSEI MEXICO, S.A. DE C.V., its Mexican subsidiary scheduled to start operations of a new plant by October 2013.

G-Tekt establishes new company for sales, development, and mass production of hot stamps in North America

 In April 2013, G-Tekt established G-TEKT North America Corporation (in Ohio). The company was capitalized at 22 million dollars. The sales and development function previously executed by an existing U.S. manufacturing company will be split and made independent. By collaborating with its Japanese headquarters, G-Tekt will create a development structure with the ability to analyze body structure of one vehicle within 2013, and make suggestions in a global, 24hours  operation to respond to fast moving development needs by major clients as a result of an increased number of models under development. To meet requests for local procurement of hot stamps which contributes to weight reduction of vehicles, the new company will develop technologies to provide quality, productivity, and stable production relating to the mass production of hot stamps and install a new production line to mass produce hot stamping parts.

Denso invests 4.3 billion yen to R&D center to strengthen development capabilities

 Denso will invest 45 million dollars (4.3 billion yen) to its North America management company, DENSO INTERNATIONAL AMERICA, INC. (in Michigan) to increase its development capability. The R&D site at the management company is currently focused on developing fuel consumption reduction technology for hybrid vehicles and gasoline engines as well as new safety products such as accident prevention features and high output alternators, but the company intends to enhance its development infrastructure by introducing facilities for R&D and testing. By FY2016, it will add a total of about 180 staff including sales personnel increasing its employees to 930.

Nippon Piston Ring to assess performance of engine valves and valve seats in the U.S., a first overseas testing

 Nippon Piston Ring will introduce measuring equipment to a facility for testing engines owned by its German partner, KS Kolbenschmidt, by the summer of 2013 to assess performance using real engines. By localizing the assessment previously conducted in Japan, the company aims to reduce development lead time and fulfill requests from Japanese, U.S., and European OEMs in a timely manner to receive more orders in North America.

Fujitsu Ten opens R&D site in Silicon Valley; strengthens telematics

 In November 2012, Fujitsu Ten U.S. subsidiary, FUJITSU TEN CORP.OF AMERICA, opened an R&D site, Silicon Valley Creative Square (in Sunnyvale California), in Silicon Valley. The company will research, discover, and study the latest technologies and work to develop prototypes of connected systems (on-board devices and services) via alliance promotions with companies under the Fujitsu group and external partners. It will especially focus on expanding its "telematics" business.

Bridgestone establishes new processing lab for natural rubber resource "guayule"

 In May 2013, a Bridgestone U.S. subsidiary, Bridgestone Americas Tire Operations (in Tennessee), held a groundbreaking ceremony of a processing lab for "guayule" (plant containing natural rubber), Biorubber Process Research Center (Mesa Arizona). The construction of the facility is scheduled to complete in 2014. Forty researchers and engineers will be working at the lab to start test production of natural rubber by 2015. Bridgestone is doing research and development into natural rubber resources to replace para rubber tree and the supplier will be researching and developing technologies to breed, grow, and process natural rubber from "guayule".

Honda Elesys to strengthen development function in North America; to aggressively promote products to U.S. OEMs

 In April 2013, Honda Elesys transferred and expanded Elesys North America Ohio Technical Center office (in Dublin Ohio) near the current location to strengthen development and promote sales of electric control units (ECUs) for body frames. The enhancement of the development function will allow the supplier to test vehicles and develop derivative models on-site. The strengthening of sales capability will enhance activities to receive orders by bringing sales functions in Georgia to the R&D center combining sales and development functions. Honda Elesys plans to tighten relationships with Japanese OEMs and suppliers as well as making sales to GM, Ford, and Chrysler more aggressive.

Mitsui & Co. makes investment in group of U.S.-based companies of global leading Spanish pressed parts supplier

 In January 2013, Mitsui & Co. announced that it has signed an agreement to make a 30% investment to the companies of world's top pressed parts supplier, Gestamp Automocion, S.L. (GA) operating in the US. GA's U.S. companies own a total of 15 plants in four countries (the U.S., Mexico, Brazil, and Argentina). The items manufactured at the plants are mainly pressed parts like bodies and chassis for European and U.S. OEMs and boast advanced technologies such as hot stamping. Mitsui & Co places this joint business as a core business in expanding automotive value chains.

Mitsuba opens a development site in Ohio where Honda has plants

 In June 2013, Mitsuba established a development site in Ohio. The site is placed as a branch office of the development site for the American Mitsuba Corp. (in Michigan). The site will start operations with five U.S. national engineers. With Honda accelerating its decision to introduce global standardized products from a European mega-supplier, Mitsuba will exchange information closely with Honda from the beginning of development to strengthen promotional power during development. It also aims to expand product sales through the mega-supplier's channel.

Mitsubishi Chemical acquires resin compound business in North America

 In April 2013, Mitsubishi Chemical announced the acquisition of Comtrex, LLC (in Michigan) resin compound business in order to expand sales of thermoplastic olefinic elastomer and vinyl chloride compound for the automotive industry in North America and to strengthen its infrastructure in the function resin business in North America. The acquisition will allow Mitsubishi Chemical to pursue a synergistic effect through the business and client infrastructure Comtrex owns. The supplier is planning to accelerate globalization of a functional resin business in the future.

 

 



New parts manufacturing plant in Canada by Toyoda Gosei

Toyoda Gosei establishes new internal/external resin parts plant

 In December 2012, Toyoda Gosei announced the establishment of TG Minto Corporation Stratford factory (in Ontario) as a branch plant for TG Minto Corporation (in Ontario). The plant was established due to a shortage of space at the existing plant. It will be the fifth manufacturing site in Canada. About JPY 900 million will be invested for this project. Production of interior/exterior resin parts (e.g. peripheral parts for instrumental panels, pillar garnishes, and column covers) will start in July 2013, and the parts will be supplied to the Toyota Canada plant (in Ontario).

Source: Press Releases from each company or newspapers

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