NGK Spark Plug Co., Ltd. Business Report FY2008

Business Highlights

Financial Overview (in millions of JPY)

FY2008 FY2007 Rate of
Sales 292,121 345,584 (15.5) -
Operating income (5,222) 35,039 - -
Ordinary income (7,528) 34,938 - -
Current net income (71,669) 22,144 - -
Sales 186,684 209,393 (10.8) -The market for products for new vehicles showed signs of a  slowdown in the first quarter.  The global financial crisis that followed made things worse. It caused a slump in sales of new vehicles and automakers were forced to decrease production volumes substantially. As a result, orders received decreased sharply, which adversely affected the Company's sales and income.  
Operating income 21,535 36,110 (40.4)

Strategy by Product Segment
Spark plugs
-The Company aims to enhance profitability in the market for products for new vehicles through sales promotion of high-value added plugs.

-The Company aims to develop glow plugs to become the third profit pillar of its automotive related business through an increase of its outlets in the diesel engine vehicle market.

The sensor business
-The Company aims to accelerate development speed through cooperation with system manufacturers and to increase its share in the gasoline engine vehicle market, the diesel engine vehicle market and the motor cycle market respectively.


R&D Expenditure (in millions of JPY)
  FY2008 FY2007 FY2006
Overall 17,575 17,444 16,253
R&D expenditures, excluding costs for upgrading current products; and  applied research 2,876 2,972 2,841
Automotive 1,231 1,652 1,629

-The major sections conducting research and development activities are the multidiscipline laboratory, which is a part of the head office, and the technical divisions at each department. R&D personnel participate also in academic conferences as well as associations in both Japan and overseas, in addition to conducting joint research with universities and national research institutes.

R&D Activities
-In the spark plug segment, the Company further enhanced high-temperature tolerance and high ignition performance. It also developed smaller and wider-ranging products.

-In the segment of glow plugs for diesel engines, the Company developed plugs with a longer life and superior temperature rise characteristics. It also developed a temperature control system for plugs.

-In the sensor segment, the following products were developed in response to new exhaust emission regulations:

繝サVarious types of exhaust emission sensors including the oxygen sensor and full-range air-fuel ratio sensor.
繝サVarious types of temperature sensors including a wide-range temperature sensor.
繝サSensors that sense the level and concentration of urea water used in the SCR system that is effective in reducing NOx emissions in diesel engines.
繝サHydrogen gas concentration sensors for fuel cells
繝サSensors for detecting hydrogen leakage and other sensors
繝サAir quality sensors for automotive air-conditioning systems utilizing MEMS technology, which consume less electricity and have higher durability than conventional products.

-The Company not only developed plugs and sensors themselves, but also developed and commercialized ignition units for improving the durability of plugs for gasoline engines. 

-The Company is developing the next generation ASIC (Application Specific Integrated Circuit) for full-range air-fuel ratio sensors that have an interface function with an engine control circuit in automobiles.

Investment Activities

Capital Investment (in millions of JPY)
  FY2008 FY2007 FY2006
Overall 24,173 63,231 29,271
Automotive 16,154 24,840 17,667

Domestic Investment
-The Company introduced new production facilities to the spark plug insulator plant in Miyanojo, Kagoshima prefecture. 

Overseas Investment
-The Company constructed a new plant for producing spark plugs.

Installation of New Equipment (As of Mar. 2009) (in millions of JPY)
  Planned amount of investment
Automotive business 11,300
Total 7,326
Domestic automobile-related business 155
Overseas automobile-related business  1,308