Alpine Electronics, Inc. Business Report FY2010

Business Highlights

Financial Overview

(in millions of JPY)
  FY2010 FY2009 Rate of Change(%) Factors
Sales 201,257 168,586 (14.3) -
Operating income 11,155 200 - -
Ordinary income 10,771 807 - -
Current net income 6,029 (1,249) - -
Audio systems division
Sales 70,534 71,029


-Sales of the Company’s own-brand products designed for auto makers increased due to the strong recovery in production and sales of new vehicles by major customers in the North American and European markets, and due the strong trend in the volume of products targeted to the Chinese market.

Operating income 3,609 1,096 -
Information/communication systems division
Sales 131,518 98,339 (9.4)

-The Company posted increased sales of its own-brand products due to the rising percentage of the Company’s onboard product content in cabin-interior displays, and due to increased unit-sales. This was in line with the recovery in production and sales in the North American market of luxury and large-sized vehicles, in which the Company’s onboard content ratio of multi-functional devices such as car-navigation systems rose. It was also due to the growing trend of European luxury-car makers enjoying strong sales of new cars in China.

Operating income 12,062 3,833 -

Company Reorganization

- The Company will enhance its business structure in China. The company, which operates production facilities in the country, is going to strengthen its local development function and reorganize its sales and marketing operations to improve the autonomy of its Chinese business. This move will allow the company to better respond to the market needs, as "inquires from Chinese automakers are increasing", says president Toru Usami. Alpine's Chinese operations will start developing car navigation systems in addition to developing and producing car audio systems. Sales at the company's in-vehicle electronic device business currently make up more than 10 percent of its end-market sales. Although a significant increase is seen in the Chinese auto industry in terms of sales volume, the market has yet to grow to the level where high performance navigation systems widely used in Japan become equally popular. By localizing its development function, Alpine intends to develop products that best meet the needs of Chinese customers in a short time at low cost, which, the company expects, will boost its sales volume. (From an article in the Nikkan Jidosha Shimbun on October. 5, 2010)

Outlook for FY2011

(in billions of JPY)
Year-on-year Fluctuation
Sales 190 201.2 (11.2)
Operating income 5 11.1 (6.1)
Ordinary income 5 10.7 (5.7)
Net income 3 6.0 (2.5)


R&D Expenditure

(in millions of JPY)
  FY2010 FY2009 FY2008
Group 16,251
Audio System Division 2,927 3,247
Information/ Communication System Division 13,323 14,944

The Company conducted R&D activities in its OEM Business targeted to Japanese and non-Japanese car makers, developing and introducing AVNC systems that are becoming more popular worldwide; and working to respond to product developments on displays targeted to the expanding North American market.

Licensing of Technology from Other Companies

(As of Mar. 31, 2011)

Contract signed with Country Contract details Contract period
Laboratories Licensing Corporation
U.S.A. Licensing of patent rights on noise reduction devices for DVD players etc.
From Jan. 1, 1977 until the termination of patent period
Koninklijke Philips Electronics N.V. Netherlands Licensing of patent rights on DVD players From Oct. 12, 1999
To Dec. 27, 2012
Thomson S.A. France Licensing of patent rights on DVD players From Oct. 1, 2000
To Sep. 30, 2005
After that, renewed every 5 years automatically.
Toshiba Corporation Japan Licensing of patent rights on DVD players From Dec. 31, 2000
To Dec. 31, 2007
MPEG LA LLC U.S.A. Licensing of patent rights on DVD players From Jan. 1, 2002 until the termination of patent period
Microsoft Corporation U.S.A. Licensing of usage rights to basic software. From Jul. 1, 2003
To Dec. 31, 2012

Investment Activities

Capital Investment

(in millions of JPY)
  FY2010 FY2009 FY2008
Group 4,882
4,378 10,160
Audio System Division 2,011 2,084 5,323
Information/Communication System Division 2,864 2,287 4,830

Capital Investments in FY2010
Audio Systems Division
-The Company invested 448 million JPY for tangible fixed assets, mainly dies; and 203 million JPY to develop software.
-The Company invested 570 million yen in installing additional equipment to manufacture audio systems at Taicang Alpine Electronics Co. Ltd. in China.

Information/Communication Systems Division
-For the purpose of developing new products and increasing production efficiency, the Company invested 1,051 million yen in acquiring tangible, fixed assets; and 476 million yen in developing software.
-The Company invested 155 million yen in installing additional equipment to manufacture information/communication systems at Alpine Electronics Manufacturing of Europe Ltd.

New Facilities

Name Location Activities/Products
Planned investment amount (million JPY) Starting date Planned completion
Alpine Electronics, Inc. Iwaki city,
Fukushima Pref.
Machinery/devices 319 Apr. 2011 Mar. 2012
Industrial tools, equipment, and dies 2,480
Dalian Alpine Electronics Co. Ltd. Dalian, China Machinery/devices 323  Apr. 2011 Mar. 2012
Alcom Electronicos de Mexico, S.A. de C.V. Reynosa,
Machinery/devices 291 Apr. 2011 Mar. 2012