Takata Corporation Business Report FY ended Mar. 2012

Business Highlights

Financial Overview

(in million of JPY)
  FY ended Mar. 31, 2012 FY ended Mar. 31, 2011 Rate of Change
Sales 382,737 390,876 (2.1) 1)
Operating income 13,618 26,818 (49.2) 2)
Ordinary income 13,499 27,008 (50.0)
Net income 11,937 18,237 (34.5) 3)

-Operating revenue decreased year-on-year on two accounts; one was the Great East Japan Earthquake during the first half of the year, and the second was the flooding in Thailand during the second half of the year, which especially affected operations in Asia.
-In the U.S.A., sales to Japanese OEM transplants significantly decreased year-on-year, although sales to OEMs based in the U.S. and Europe, which continued to enjoy brisk sales, remained strong.
- In Europe, strong exports of German vehicles were the key to supporting the Company's performance.

-In addition to the worsening financial results caused by the reduction in operations because of the Great East Japan Earthquake and the flooding in Thailand, the Company was conflicted with a quality-control issue in the third quarter and was forced to post an extraordinary allowance to cover the expenses involved.

-The financial results are mainly because of a liquidation of deferred tax liabilities based on the new Japan-Netherlands Convention to Avoid Double Taxation.

Sales and highlight by geographical region


-Production volume sharply fell during the first half of the year because of the Great East Japan Earthquake, with unit sales of vehicles drastically dropping. After August, however, the production volume of new vehicles had basically returned to normal.

-The volume of vehicle production and sales was robust, going beyond that expected for the degree of economic recovery. As a result, the growth in unit production in all of the U.S.A. increased by two digits compared to that of the previous year. While the decrease in production volume at Japanese OEM transplants was drastic, caused by shortages in parts supplies from Japan because of the Great East Japan Earthquake, US-based OEMs experienced tremendous growth. Sales in Brazil were also robust.

-In Germany, which is seen as the country driving economic activity in Europe, new-vehicle sales were relatively brisk. However, new-vehicles sales stagnated later because of the unstable conditions in southern EU countries. Unit sales in Germany exceeded those of the previous year, while sales throughout the year, which were overall strong, depended upon exports to mainly the U.S.A. and China because of uncertainty over the euro.

-Due to sales incentive programs in China being cut back and the economy in India suddenly stalling, the strong unit sales that had once been the norm in the region were beginning to show signs of weaking. Japanese OEMs expanding into the Asia Region reduced their production volumes, suffering from parts shortages in the first half of the year because of the Great East Japan Earthquake. Then they faced relatively long-term production stoppages because of the flooding in Thailand in October.  As a result, production activities were basically stagnant throughout the year.


-The Company announced on March 6 that it has agreed with the BAE Systems that Takata will acquire two BAE Systems subsidiaries: BAE Systems Safety Products Inc. based in Florida, U.S.A.; and Schroth Safety Products GmbH based in Arnsberg, Germany. The two companies manufacture and sell seatbelts for airplanes, helicopters and racing cars, and passenger safety equipment for military vehicles. Through these acquisitions, Takata aims to step up its business in the motor sport and aircraft safety segments, leveraging technological expertise gained in the automotive safety systems. (From an article in the Nikkan Jidosha Shimbun on March 7, 2012)

-The Company announced that it has signed a basic agreement to purchase U.S.-based BAE Systems Safety Products Inc. and Germany-based Schroth Safety Products GmbH from BAE Systems for approximately 32 million USD. The acquired companies develop and manufacture occupant safety systems that are used in airplanes and racing car. The transaction is expected to close in the first quarter of 2012. (From a press release on December 26, 2011)

Business Partnership

-Hyundai Mobis Co., Ltd. of Korea and The Company of Japan have signed a strategic partnership agreement to develop next-generation safety systems. Their joint projects will include development of an active seatbelt (ASB) system, which will be coupled with other safety technologies, including the adaptive cruise control system and the lane departure warning system, to warn the driver in case of dangerous situations. Hyundai Mobis plans to start supplying the new ASB system to Hyundai and Kia by the end of 2012. (From a press release on November 25, 2011)

-Meritor WABCO Vehicle Control Systems and The Company's U.S. subsidiary, TK Holdings, Inc. have signed a letter of intent to establish a strategic alliance in which the companies will work together to develop new active safety systems products for North American commercial vehicles. Under this agreement, Meritor WABCO will market Takata's SafeTrak lane departure warning systems (From a press release on October 17, 2011)

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


R&D Expenditure

(in million of JPY)
  FY ended Mar. 31, 2012 FY ended Mar. 31, 2011 FY ended Mar. 31, 2010
Japan 5,032 3,924 -
America 6,576 5,567 -
Europe 5,721 6,121 -
Asia 1,297 859 -
Corporate (366) (414) -
Overall 18,261 16,058 14,158

R&D Structure

-The Company has R&D bases in three regions: Japan (Takata Corporation), US (TK Holdings Inc.) and Europe (Takata-Petri AG).
-Commercialization of new technologies are carried out in each region. 


Research and Development Activities

-The Company has announced a new Inkjet Print Seat Belt which uses inkjet print technology. The belt portion of a conventional seat belt (webbing) is produced as a single component in white which is colored by being immersed in dye. While this coloring process is limited to a single color, with inkjet print technology the webbing is printed in the same way as an inkjet printer, enabling the creation of webbing featuring patterns, words or logos in a variety of colors in addition to the conventional black, gray and beige. (From a press release on January 13, 2012)

Investment Activities

Capital Expenditure

(in million of JPY)
  FY ended Mar. 31, 2012 FY ended Mar. 31, 2011 FY ended Mar. 31, 2010
Japan 3,406 1,529 -
America 6,329 6,132 -
Europe 6,069 4,465 -
Asia 3,618 3,584 -
Overall 19,422 15,712 10,221

 Investment in FY ended Mar. 31, 2012

- In Japan, the Company started construction of new collision-testing facilities. In addition, the Company continued investing in plant facilities in India and Russia, which are seen as economies having growth potential.

-The Company either expanded or built new production lines in all regions, creating a global production framework designed to respond the best way possible to the growing needs in each region.

-The Company  announced that its European operating company, TAKATA (Europe) GmbH, held a groundbreaking ceremony for a new safety parts plant of TAKATA-PETRI Rus LLC in Ulyanovsk oblast, Russia. The company's first plant in Russia will produce seat belts, airbags and steering wheels. Investment in the new plant will total approximately 2 billion yen. The land area of the plant is 99,000 square meters. It is scheduled to begin operation by April 2012, and will employ around 300 people. TAKATA (Europe) GmbH already operates 11 manufacturing plants in four European countries (as of March 2011). (From a press release on May 24, 2011)

-The Company announced that it will build its first plant in Indonesia with the establishment of PT. Takata Automotive Safety Systems Indonesia. The approximately 60,000 square meters plant will produce seat belts, airbags and steering wheels for automakers in Indonesia, and is scheduled to begin production in January 2012. Total investment in the plant will be approximately 20 million USD. (From a press release on April 28, 2011)

-The Company announced its establishment of Takata Uruguay S.A., a subsidiary in Uruguay that will construct an automotive airbag plant as a manufacturing base for South America. The new plant marks Takata's first entry into Uruguay and will bolster the company's existing manufacturing framework in South America, which currently comprises three production plants in Brazil. The newly established Takata Uruguay S.A. is scheduled to begin production in November 2011. The total floor area of the plant is 9,000 square meters and the total investment in the plant will be approximately 10 million USD (approximately 800 million yen). (From a press release on April 6, 2011)

Planned capital investments

Plant Name
Equipment to be installed Estimated amount of investment
(in million JPY)
From To
TK Holdings Inc.
(Auburn Hills, MI, USA)
Servo Sled Bump tester 1,979 Jun. 2011 Aug. 2012
Takata India Pvt. Ltd.
(Haryana, India)
Equipment to produce seat belts, airbags and steering systems 4,382 Jan.2008 Mar.
Takata RUS LLC
(Ulyanovsk, Russia)
Equipment to produce seat belts, airbags and steering systems 2,126  Nov.