Keihin Corporation Business Report FY ended Mar. 2018

Financial Overview

(IFRS, in millions of JPY)
FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 Rate of Change
Revenue 351,494 325,550 8.0 -Income increased year-on-year (y/y), thanks to higher sales of products for automobiles in Japan and China, which include those for electric vehicles; and due to higher sales of general products for motorcycles in Asia, despite lower sales of auto products in North America. Sales revenue, operating profit, and current profits returned to owners of the parent company all reached record-breaking highs.
-Motorcycle / general-purpose products 96,104 82,869 16.0
-Automobile products 255,390 242,681 5.2
Operating income 28,313 22,954 23.3 -Operating income increased, thanks to greater sales revenues and successful cost-cutting initiatives, despite higher depreciation and R&D expenses.
Pre-tax income 27,145 20,729 31.0 -
Profit for the year attributable to owners of the parent 17,824 11,084 60.8 -Reversed the losses that incurred in the previous year because of negative currency translation.

Business Developments and Performance by Region

-Greater sales of motorcycle products and general products, especially in Indonesia, Thailand, and Japan.
-Greater sales of automobile products, especially in Japan and China.
-In addition, favorable currency translation contributed to further improving sales revenue this year, to JPY 157.16 billion, which is a y/y increase of JPY 20.22 billion.

-Sales of motorcycle products and general products increased in South America.
-Sales of automobile products fell overall in North America and elsewhere.
-Even with favorable currency translation adding to business performance this year, to JPY 99.14 billion in sales revenue, this was a y/y decrease of JPY 9.69 billion.

-Sales of motorcycle and general products increased, especially in India, Indonesia, and Thailand.
-Sales of automobile products fell in Indonesia, Malaysia, and elsewhere.
-Favorable currency translation this year increased sales revenue, to JPY 109.41 billion yen, a y/y increase of JPY 12.53 billion.

-Sales of motorcycle, general, and automobile products increased.
- Favorable currency translation this year contributed to increasing sales revenue this year, to JPY 82.72 billion yen, a y/y increase of JPY 8.79 billion.

Japan Operation

-The Company increased the production capacity of power control-units, from 50,000 units a year to 100, 000 units, further improving its response to the growing demand for electric vehicles.

-As a means to respond to OMEs’ needs for products in the upper stream sector of engine systems, the Company formed a partnership with Progress Technologies Co., Ltd. that has a high level of expertise in control technology, strengthening its collaboration in product development.

-In gearing for the future, the Company is heightening research and strengthening its technological innovations in new areas such as self-driving and connected cars by setting up a new development center in Tokyo’s Odaiba area.

Major Supply Agreements received in FY ended Mar. 2017

OEM Model Products delivered
Honda Japan: StepWGN
China: CR-V
North American EV: Clarity Electric
New type of power control units (PCUs)
North America: Accord Direct-injection engine systems


New climate-control unit
Mazda Japan: CX-8 Power-control unit for the rear power-gate, through Hi-Lex Corporation.


-Suzuki has honored Keihin with an excellent supplier award, given for suppliers that have greatly contributed to Suzuki outside Japan in 2017. The products for natural gas vehicles manufactured by Keihin's subsidiary, Keihin India Manufacturing, and supplied to Moruti Suzuki were appreciated for contributing to cost reduction, quality improvement and stable procurement in India. (From a press release on January 26, 2018)

The 13th mid-term management plan (FY ending Mar. 2018 - FY ending Mar. 2020)

-Strengthen corporate capabilities in electrification
・Establish the xEV section, which oversees business strategies
・Establish the BMS Development Department
・Strengthen production-technology capabilities in the power-module segment
-Advance fuel-injection technology
・Advance developments in the upstream section
-Strengthen business framework to win new customers
・Establish Sales Promotion Department directly overseen by the company president

-Total capital investment amount: JPY 70.0 billion (Total in 12th mid-term plan was JPY 48.0 billion.)
・Invest to migrate to motorcycle fuel-injection systems in India, to advance activities under the xEV Section, and set up testing facilities to develop upstream products
・Increase capital-expenditure ratio, from 5% to 7%, in relation to consolidated revenue

-Total R&D expenses: JPY 67.0 billion (Total in 12th mid-term plan was JPY 57.6 billion.)
・Work to improve efficiencies by revamping flow of R&D activities and allocate R&D resources toward developing new business areas
・Increase R&D-expenditure ratio, from 6% to 7%, in relation to consolidated revenue.

Outlook for FY ending March 31, 2019

(IFRS, in millions of JPY)
FY ending Mar. 31, 2019
FY ending Mar. 31, 2018
(Actual Result)
Rate of Change
Revenue 340,000 351,494 (3.3)
Operating income 20,000 28,313 (29.4)
Pre-tax income 19,000 27,145 (30.0)
Profit for the year attributable to owners of the parent 10,000 17,824 (43.9)

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)

R&D Expenditure

(in millions of JPY)
FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 FY ended Mar. 31, 2016
Overall 22,771 19,404 19,559

-The R&D Expenditure for FY ending March 31, 2019 is planned to be JPY 23,600 million.

R&D Facilities


Daiba R&D Office
(Ome, Koto Ward, Tokyo)

Japan Tochigi R&D Center
(Takanezawa Town, Tochigi Pref.)
Japan Kakuda R&D Center
(Kakuda City, Miyagi Pref.)
U.S. Keihin North America, Ltd.
(Anderson, Indiana)
Thailand Keihin Asia Bangkok Co., Ltd.
India Keihin India Manufacturing Pvt. Ltd.
(Gurgaon, Haryana)
China Dongguan Keihin Engine Management System Co., Ltd.
(Dongguan, Guandong)
China Keihin R&D China Co., Ltd.
Germany Keihin Sales and Development Europe GmbH
(Ismaning, Bayern)

R&D Activities

Automobile Business
-Development/commercialization of fuel-supply systems and exhaust-system products designed for environmentally advanced engines.
-Development/commercialization of injectors for gasoline direct-injection and port-injection systems.
-Development/commercialization of hydraulic-control-system products for transmissions.
- Development/commercialization of alternative-fuel-supply systems and related products.
- Development/commercialization of electronic PCUs for engines and power rear gates.
- Development/commercialization of control units for electric-vehicle motors and batteries.
- Development/commercialization of cell-voltage sensors for lithium ion batteries.
- Development/commercialization of PCUs for electric vehicles.
- Development/commercialization of products for automotive air-conditioning systems.
- Development/commercialization of heat-exchangers for automotive air-conditioning systems
ーDevelopment/commercialization of automotive air-conditioning systems and parts for electric cars.

R&D for Connected Cars
ーDevelopment of designated "Repromaster" units needed for over-the-air (OTA) systems that renew ECU software wirelessly.A Repromaster units are telematics units that send rewritten software data that is received, to various ECUs under secure conditions. The Company is developing these by making use of its expertise in ECU technology, in order to respond to OTA when it becomes mainstream in the early 2020s. (From a January 18, 2018 Nikkan Jidosha article)

Capital Expenditure

(in millions of JPY)
FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 FY ended Mar. 31, 2016
Total 18,873 16,575 14,593
by region: Japan 7,455 6,355 3,519
Americas 3,476 3,973 3,898
Asia 2,038 1,320 2,072
China 1,092 1,720 1,610

Capital investments in the FY that ended March 2018

-By investment type: Production (JPY 14,062 million), R&D (JPY 946 million), and Other (JPY 3,866 million)

Planned Capital Investments(Mar. 2019)

(As of Mar. 31, 2018)
Segments Planned Amount of Investment
(in millions of JPY)
Japan 12,012
Americas 4,409
Asia 22,248
China 3,329
Total 41,998

-Capital investments by category:

  1. Production: JPY 33,300 million
  2. R&D: JPY 1,800 million
  3. Other: JPY 7,198 million

-The Company increased its budget for capital investments in the Asian region, in order to gear up for launching commercial production of fuel-injection systems in India for small-sized motorcycles.

- its subsidiaries in the Czech Republic and China will increase their capacitor (heat exchanger) production capacity to deal with expanding orders from Volkswagen Group. Keihin's global annual capacitor production capacity will be increased by about 10% to 11 million units. The amount of investment has not been disclosed. In the Czech Republic, Keihin Thermal Technology Czech, s.r.o. will introduce an additional production line and boost annual production capacity to 2.85 million units in the summer of 2018. In China, Keihin-Grand Ocean Thermal Technology (Dalian) Co., Ltd. will increase annual production capacity at its Foshan Plant by 300,000 units to boost its total capacity to 3 million units by the summer of 2018. Keihin's capacitors are used in the Volkswagen Group's MQB platform and Audi MLB platform vehicles. (From an article in the Nikkan Jidosha Shimbun on October 12, 2017)