Imasen Electric Industrial - Business Report FY2006

Business Highlights

Financial Overview
(in million JPY) FY2006 FY2005 Rate of change (%) Factors
Sales 73,323 67,121 9.2 - Sales increased year-on-year, thanks to favorable sales of automotive products. 
Operating income 3,216 2,403 33.8 - Income rose year-on-year supported by greater sales, and by the Company's initiatives to reduce costs in order to cope with the rising prices of steel and other materials.
Ordinary income 3,479 2,766 25.8
Current net income 1,902 892 113.1
Automotive components related business
Sales 68,153 62,406 9.2

- Sales and operating income rose year-on-year because the Company won more business in North America, and posted increased sales at its Chinese and Thai subsidiaries.

Operating income 2,895 2,149 34.7

Domestic business

The Company will increase the output of power seat adjusters supplied to Nissan Motor Co., Ltd. It will position the new seat adjuster plant slated to start operations May, 2007 as a main plant for Nissan and Honda, augmenting the production of power seat adjusters that are expected to receive strong order in the future. By expanding the production of seat adjusters, its mainline products, the supplier's sales ratio to Nissan in its total sales will rise above 10 percent at the end of FY2008 from the present 6-7 percent. (From an article in the Nikkan Jidosha Shimbun on Nov. 15, 2006)

Overseas business
The Company plans to raise its overall local content ratio of its overseas operations to 80% at an early date. It currently produces seat adjusters, its flagship products, in North America, China, Philippines and Thailand, with local content ratios between 35% and 65%. Approx. 40% of parts of seat adjusters produced overseas are manufactured in-house at its local operations, 10% are outsourced locally and the remaining 50% are supplied from Japan in the form of half-finished parts and others. As for new orders received for production starting next year, parts currently supplied from Japan will be acquired locally, except raw materials, to become more competitive. The Company will first raise the local content ratio of the U.S. plant from the current 55% to 80% with the new seat adjuster for a Honda model, whose production is scheduled to begin early in the year 2007. Currently its other local content ratios are 35% in China, 55% in Thailand and 65% in the Philippines. By upgrading each ratio along with new orders received, the Company plans to achieve 80% for its overall local content ratio of its global operations at an early date. (From an article in the Nikkan Jidosha Shimbun on Dec.14, 2006)

The Company has received orders for seat adjusters from Suzuki Motor Corporation in China, starting delivery in 2007. Products will be delivered from the Company's subsidiary producing seat adjusters in China, Guangzhou Imasen Electric Industrial Co., Ltd., located in Huadu, Guangzhou. This will be the first overseas business with Suzuki. The Company, which has smaller transaction volume with Suzuki than with other carmakers, intends to increase sales to Suzuki regarding this order for its mainline product, seat adjuster, as an opportunity to strengthen the business ties with the automaker. Guangzhou Imasen will double the production capacity of power seat adjusters and manual seat adjusters each, bringing to 790,000 units in total in February 2007. Expecting a production increase of Japanese automakers in China, the Company will cope with an expected growth in demand up to FY2009. (From an article in the Nikkan Jidosha Shimbun on Jan. 5, 2007)

The Company announced that it will, with a foreseeable growth in product demand in the Chinese market, will increase the capital of its Chinese subsidiary which manufactures and sells seat adjusters. Following this resolution, the capital of Guangzhou Imasen Electric Industrial Co.,Ltd. will be increased from current 5.15 million USD to 0.35 million USD. (From a press release on Mar. 8, 2007)


R&D Expenditure
R&D expenses for FY2006 were 150 million yen.
(Percentage-of-sales : 0.21%)

Automotive Parts
(1) Structural parts

Seat adjusters:
-The Company shortened product development time by using CAE analysis technology.
-Research and development was aimed at improving functionality, reducing the weight of products, and upgrading slide adjusters for seats.
- The Company is in the process of developing seat adjusters by analyzing their durability and strength and studying the optimum structural design for them by looking into single-unit construction as the ideal structure on which they should be designed. It has developed power seat adjusters with high performance in terms of lower noise and vibration, and is making presentations on this system to carmakers and seat manufactures. The Company has already started joint development activities with some customers on new power seat adjusters.

Window regulators:
The Company is conducting R&D activities on solution-based, smaller and lighter window regulators.

(2)Electronic parts
Electronic units:
The Company developed electronic units which allow complex control of various devices. It already won contracts to supply these products to automakers for use in developing their new car models. The Company has developed and commercialized seat positioning sensors and memory ECUs for seats, which control the inflation of automotive airbags. It has also developed controlling units for adjusting the positions of seats, integrating structural and electronics technology.

The Company has been developing various new lamps such as rear combination lamps and room lamps, etc. using LED elements. It is also working on developing modular overhead consoles.

The Company continues its efforts to develop and market high-quality but small and low-cost horns.

-The Company developed new products based on technology in the areas of mechanisms and electrical operations. Specifically, the Company developed truck motor servos, which control the opening and closing of magnetic valves and air conditioning ducts used in ventilation systems. These servos are more compact and lighter in weight. In addition, it conducted research and development activities to modularize clusters of magnetic valves; and developed and commercialized electrically adjustable windscreens and windshields for large motorcycles.

Licensing Agreements (as of Mar. 2007)
Counter party Details Will expire in:

Intier Automotive Inc. (Canada)

Seat adjusters
4 licensing agreements
4 years from Dec. 2001 or until the last delivery date of mass production
Seat adjusters
10 licensing agreements
4 years from Dec. 2001 or until the last delivery date of mass production
Seat adjusters
6 licensing agreements
4 years from July. 2002 or until the last delivery date of mass production
Seat adjusters
4 licensing agreements
4 years from Aug. 2003 or until the last delivery date of mass production

Investment Activities

Capital Expenditure
Total capital investment in FY 2006 : 6,395 million JPY
Out of the total amount, capital investment for automobile parts related business : 6,331 million JPY

Capital investment in the automotive business
- Capital investment for the automotive business was focused on constructing a new plant in Gifu, and installing additional facilities to manufacture new, round reclining adjusters and seat adjusters in order to cope with increased production volume at its subsidiaries overseas. .

Domestic Investment
The Company announced that it will set up a new plant in Kyushu to manufacture seat adjusters. Operations are scheduled to begin in June 2007 at a monthly production rate of 40,000 units. The Company will invest 350 million yen in this project.(From an article in the Nikkan Jidosha Shimbun on Dec. 4, 2006)

New facilities
(million JPY)
Project period
From To
Imasen Electric Industrial Co., Ltd.
Nagoya plant
(Inuyama, Aichi Pref.)
240 Apr. 2007 Mar. 2008
Imasen Electric Industrial Co., Ltd.
Gifu plant
(Kamo, Gifu Pref.)
5,000 Sep. 2006 Mar. 2008
Imasen Electric Industrial Co., Ltd.
Okayama plant
(Kurashiki, Okayama Pref.)
706 Apr. 2007 Mar. 2008
Kyushu Imasen Co., Ltd.
(Kitakyushu, Hukuoka Pref.)
350 Apr. 2007 Mar. 2008
Imasen Philippines Mfg. Corp.
(Laguna, Philippines)
140 Jan. 2007 Dec. 2007
Imasen Bucyrus Technology Inc.
(Ohio, USA)
430 Jan. 2007 Dec. 2007
Guangzhou Imasen Electric Industrial Co., Ltd.
(Guangdong, China)
1,570 Jan. 2007 Dec. 2007
Imasen Manufacturing (Thailand) Co., Ltd.
(Ayutthaya, Thailand)
460 Jan. 2007 Dec. 2007