Hanon Systems (Formerly Halla Visteon Climate Control) Business Report FY ended Dec. 2018
Financial Overview (Consolidated) |
(in million KRW) |
| FY ended Dec. 31, 2018 | FY ended Dec. 31, 2017 | Rate of change (%) |
|
| Sales | 5,937,585 | 5,585,673 | 106.30% |
| Operating income | 433,776 | 468,437 | 92.60% |
| Net income | 283,697 | 298,403 | 95.07% |
Acquisition
-Magna International announced that its Powertrain unit has signed an agreement to sell its global Fluid Pressure & Controls (FP&C) business to the Company. The sale price is approximately USD 1.23 billion, before the assumption of net debt and pension liabilities, with the transaction expected to close in the first quarter of 2019. Magna's global FP&C business, which specializes in mechanical and electronic pumps, electronic cooling fans, and other components, had USD 1.4 billion in sales in 2017. Approximately 4,200 employees across 10 facilities in North America, Europe and Asia will transition to the Company. Magna's powertrain business will continue to perform as a full-system supplier of transmission and other driveline-related systems, including electrified versions. (From a press release on September 20, 2018)
Joint Venture
-On January 26, 2018, Fawer Automotive Parts Limited Company signed a contract with the Company on share transfer and creation of a new joint company. According to the deal, the Company is going to transfer 5% shares in their joint venture, Fawer Hanon Automotive Thermal System (Changchun) Co., Ltd., to Fawer Automotive Parts. It also says the two companies are going to set up a new joint electric compressor manufacturer named Fawer Hanon Automotive Component (Changchun) Co., Ltd. After the share transfer, Fawer Hanon Automotive Thermal System will be owned 55% by Fawer Automotive Parts and 45% by the Company. As for the new joint company, its registered capital will be CNY 150 million, paid 45% or CNY 67.50 million by Fawer Automotive Parts and 55% or CNY 82.50 million by the Company. The new joint venture is going to work on the development, production, and sales of variable capacity compressors, fixed capacity compressors, and electric compressors as well as their components. It also delivers exhaust heat management solutions and fluid delivery parts. (From a corporate announcement on January 26, 2018)
Business Partnership
-The Company is to invest in Solid Power Inc. in partnership with Volta Energy Technologies LLC, a US company specialized in the investment in new energy storage technologies. Solid Power is a developer of all-solid-state batteries based in Colorado, the U.S. Through the investment, the Company aims to secure technical advantages in the area of the electric vehicle battery temperature management system. (From a press release on October 24, 2018)
Award
-According to the announcement of the Company on May 15, 2018, the US automaker Ford Motor Company named the Korean company to its Aligned Business Framework (ABF) network of strategic suppliers. Hanon Systems won the Ford Quality Excellence Award at the 20th annual Ford World Excellence Awards event in May 2017. (From a press release on June 4, 2018)
R&D Expenditure |
(in million KRW) |
| FY ended Dec. 31, 2018 | FY ended Dec. 31, 2017 | FY ended Dec. 31, 2016 | |
| Amount | 298,333 | 256,529 | 237,550 |
| % of sales | 5.0% | 4.6% | 4.2% |
R&D Structure
-The Company has a total of 1,400 researchers at its technical research center and electronic component as of December 31, 2018.
Recent Achievements in R&D
| Product | Achievements |
| Electric water pumps | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Compact carriers | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Compressors with air foil bearings for FCVs | -Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Air-conditioning load reduction system using CO2 sensors | -Air circulation control systems using CO2 sensors -Improved fuel efficiency; and enhanced cooling, heating, dehumidification and ventilation performances -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Compact HVAC | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Air delivery system for fuel cell vehicle | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Front end module with pedestrian protection |
-Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Design of high voltage fan and inverter for fuel cell vehicle | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Heat pump system for EV | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Metal seal fitting | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Magnesium alloy pulley | -Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Air mix door for electric vehicles | -Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Cold storage evaporator | -Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Hybrid heater core | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Composite air conditioning system | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| 3 Zone control HVAC system | -Has been in mass-production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
| Deodorizing air conditioning technology using UV LED photocatalyst | -Plans to start mass production -The company has been acquiring and currently is applying for a number of patents in and outside Korea |
Investment in Korea
-Held a ceremony to mark the opening of three new anechoic rooms at its research and development center in Daejeon, South Korea. The company so far had five anechoic rooms. These rooms are equipped with facilities to lower the room temperature down to 10 degrees below zero. It also has dynamometers, wind tunnels, solar isolation equipment. The company now has a building of 1,989 square meters in total for the anechoic rooms. (From a press release on June 27, 2018)
Investment outside Korea
<Hungary>
-Hungarian Investment Promotion Agency informed that it is engaging in comprehensive development in Hungary. In the value exceeding EUR 117 million, the Company is extending its current capacities in Szekesfehervar, moreover, it is establishing new plants in Retsag and Pecs. In addition to increasing the production volume, the investment will feature the extension of the scope of activities by aluminium founding, as well as the creation of 516 new jobs over the three locations. The manufacturing of non-compressor production product families will be relocated to the newly constructed plant in Pecs, and aluminium founding will appear as a new activity in Retsag. (HIPA press release on November 29, 2018)