Johnson Controls Inc. Business Report FY2011
|(in million USD)|
|FY2011||FY2010||Rate of change (%)||Factors|
-In fiscal 2011, sales increased 19% year-on-year primarily due to the result of increased industry production volumes in the automotive markets and the impact of acquisitions.
-The increase in North America was primarily due to higher industry production volumes by the Company's major OEM customers, incremental sales due to business acquisitions, and net favorable commercial settlements and pricing, partially offset by the negative impact of the Japan earthquake and related events.
-The increase in Europe was primarily due to higher production volumes and new customer awards, incremental sales due to business acquisitions, and the favorable impact of foreign currency translation, partially offset by the net unfavorable commercial settlements and pricing.
-The increase in Asia was primarily due to higher production volumes and new customer awards, the favorable impact of foreign currency translation, and incremental sales due to business acquisitions, partially offset by unfavorable commercial settlements and pricing.
-Net sales increased primarily due to the impact of higher lead costs on pricing, higher sales volumes, sales associated with a prior year business acquisition, favorable price/product mix, and the favorable impact of foreign currency translation.
Acquisitions-In 2012, A123 Systems, Inc. announced that it has entered into an asset purchase agreement with Johnson Controls, Inc. in a transaction valued at 125 million USD. Under the terms of the agreement, Johnson Controls plans to acquire A123's automotive business assets, including all of its automotive technology, products and customer contracts; its facilities in Livonia and Romulus, Michigan, the U.S.; its cathode powder manufacturing facilities in China, and A123's equity interest in Shanghai Advanced Traction Battery Systems Co., A123's joint venture with Shanghai Automotive. To facilitate the transaction process, A123 and all of its U.S. subsidiaries today filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. (From a press release on October 16, 2012)
-In September 2011, the Company announced that following the acquisition of the seating business of Recaro Automotive and Keiper, the product business unit (PBU) Recaro Automotive Seating was carved out to offer complete seats for passenger cars and commercial vehicles under its new brand name Recaro. The Kirchheim/Teck, Germany, location will be responsible for the design, development and production of passenger car seats. The Kaiserslautern, Germany, location will develop, produce and market commercial vehicle seats. The Technical Center in Kaiserslautern – where research, development, prototyping, testing and pilot production is conducted – will also serve as a key interface in designing future Recaro seats. (From a press release on September 13, 2011)
-In July 2011, the Company recently completed the acquisition of German automotive suppliers C. Rob. Hammerstein (CRH), Keiper and Recaro Automotive. The acquired companies will be integrated into two new Johnson Controls product business units, Special Seats and Metals and Mechanisms. The Special Seats business unit, comprised of the Recaro Automotive seat business and the Keiper commercial vehicle seat business, focuses on complete automotive and commercial vehicle seats. In the Metals and Mechanisms, the company will combine all competencies of Johnson Controls, CRH and Keiper related to metal seating components and structures as well as mechanisms for front and rear seat systems. (From a press release on July 13, 2011)
-In June 2011, the Company announced that it has completed the acquisition of Keiper Recaro Automotive. The transaction was closed on 20 June, 2011. The acquisition includes 4,750 employees at 13 locations. Recaro Aircraft Seating, Recaro Child Safety and Recaro Home in Germany are not part of this acquisition. Also excluded are Keiper's operations, business and entity in Brazil. (From a press release on June 20, 2011)
-In December 2010, the Company announced that it has signed a purchase agreement to acquire Keiper Recaro Group's automotive business. This includes Keiper, which develops and manufactures components for vehicle seats, metal seat structures and complete seats for commercial vehicles, as well as the Recaro automotive seat division. Keiper's headquarters and engineering center are located in Kaiserslautern, Germany. The acquisition will include approximately 4,750 employees globally in seven countries. Excluded from the transaction are Keiper's operations, business and entity in Brazil. Completion of the acquisition is expected during the first half of calendar year 2011. Financial details regarding the transaction were not disclosed. (From a press release on December 30, 2010)
-In December 2010, the Company signed a purchase agreement to acquire the C. Rob. Hammerstein Group (CRH). CRH, headquartered in Solingen, Germany, develops and manufactures seat structures, seat adjusters, steering column adjusters, and other products. It employs approximately 3,600 people in nine countries. The combined manufacturing footprint will facilitate growth particularly in China, Mexico, Turkey, Hungary, and Romania. Completion of the acquisition is expected by the end of January 2011. Financial details regarding the transaction were not disclosed. (From a press release on December 1, 2010)
-In October 2010, the Company signed a purchase agreement for the acquisition of Michel Thierry S.A., a supplier of fabrics and leathers to the automotive industry. Michel Thierry's headquarters and main facility are based in Laroque d'Olmes, France. Completion of the acquisition is expected by the end of November 2010. (From a press release on October 13, 2010)
-The Company and Saft have closed on the agreement to end their joint venture, Johnson Controls-Saft to develop and manufacture Li-ion vehicle batteries. Under the terms of the agreement, Johnson Controls has acquired Saft's share of the company for 145 million USD. Beginning Oct. 1, 2011, Johnson Controls will operate the company under the Johnson Controls name. (From a press release on September 30, 2011)
-The Company and Saft have reached an agreement to end their joint venture, Johnson Controls-Saft, which was formed in 2006 to develop and manufacture Li-ion vehicle batteries. Under the terms of the agreement, Johnson Controls will acquire Saft's share of the company for 145 million USD. All assets of the joint venture will be retained by Johnson Controls, with the exception of a facility in Nersac, France, which will be transferred to Saft at the end of 2012. The transaction could close as early as September 30, 2011. (From a press release on September 2, 2011)
-The Company and MAC S.A. have launched their joint venture in Colombia to produce and sell lead-acid batteries in the Central and South American regions. MAC S.A., based in Colombia, manufactures and sells automotive batteries for automakers and aftermarket. The companies announced their plan to join forces in October 2010. The two companies, through the new joint venture, intend to increase their exports from Colombia, mainly to the countries in the Andean Region. Johnson Controls sells several brands of batteries in Latin America, including Heliar(R), VARTA(R), LTH(R) and OPTIMA(R). (From a press release on June 13, 2011)
-The Company and MAC S.A. announced that they have signed an agreement to form a joint venture in Colombia to produce and sell automotive lead-acid batteries in the Central and South American regions. MAC S.A. is an automotive battery supplier based in Yumbo, Colombia. (From a press release on October 8, 2010)
-Hitachi, Ltd. announced on October 18 that the company and Johnson Controls, Inc. (JCI), a U.S. corporation, have signed a memorandum of understanding to work together in the area of advanced energy storage. The two companies have agreed on their long-term vision and approach to the advanced energy storage technology. They will henceforth study opportunities for collaboration in the fields of advanced energy storage products and systems, including lithium-ion batteries, encompassing a wide range of research and development, purchasing, production, marketing, sales and international standardization. Hitachi intends to expand application of the technology of a lithium-ion battery combined with its power control to such areas as automobiles, railways, construction equipment, industry machinery and power storage devices. Through partnership with JCI, which is a major global supplier of lead-acid automotive batteries as well as a provider of energy management system of buildings, Hitachi aims to expand business opportunities in the energy storage industry. (From an article in the Nikkan Jidosha Shimbun on October. 19, 2010)
Recent Developments Outside USA
-The Company announced that its plant in Rockenhausen, Germany has produced 500 million Taumel 2000 seat recliners since the product's launch in 1996. The Rockenhausen plant specializes in the manufacture of metal seat mechanisms, tracks and structures and has 1,700 employees. The Taumel 3000, a successor product to the Taumel 2000, was introduced at the Internationale Automobil-Ausstellung (IAA). (From a press release on September 29, 2011)
Contracts-The Company is increasingly using leatherwrapped surfaces for high-quality vehicle interiors. The company also designs and manufactures structural and safety components such as instrument panels featuring leather-wrapping. The Company is supplying the instrument panel including complete leather-wrapping in real leather for the Mercedes E-Class Coupe. (From a press release on September 13, 2011)
-The Company announced that its subsidiary Johnson Controls-Saft will supply the complete battery system for two electric vehicles, which will be launched by the Beijing Electric Vehicle Company (BJEV), a subsidiary of Beijing Automotive Industry Company (BAIC). Johnson Controls-Saft will power the C30 and M30, which can travel more than 100 km on a single charge. BJEV and BAIC have plans to manufacture 150,000 hybrid electric vehicles (HEVs) and battery electric vehicles (BEVs) by 2015. (From a press release on April 19, 2011)
Awards-Johnson Controls Power Solutions received the 2010 Supplier of the Year Award from General Motors Corporation. This is the third consecutive Supplier of the Year award Johnson Controls Power Solutions has received from General Motors. Johnson Controls Power Solutions is a supplier of lithium-ion batteries for hybrid and electric vehicles. (From a press release on April 7, 2011)
-Johnson Controls Power Solutions has received the 2010 Award for Quality and Shipping Performance from Honda de Mexico. The award was given in recognition of the quality and shipping performance provided by the company's automotive battery plant in Torreon, Mexico. This is the fifth consecutive year the Torreon plant received this award and the tenth Honda award received since the plant opened in 1999. Johnson Controls Power Solutions has supplied automotive batteries to Honda de Mexico since the start of Honda's vehicle production in Jalisco, Mexico in 1995. (From a press release on March 31, 2011)
Outlook for FY2011Overall sales
-In fiscal 2012, the Company anticipates that net sales will grow to approximately $44.2 billion, an increase of 8% from fiscal 2011 net sales. The Company expects higher 2012 automotive production in North America and China, with relatively flat European production versus fiscal 2011.
Automotive experience business
-The Company forecasts approximately 6% revenue growth in fiscal 2012 by its automotive experience business, reflecting higher global production volumes and approximately $1.4 billion in new program launches, partially offset by the negative impact of a weaker euro.
-In China, inclusive of non-consolidated joint ventures, the Company expects total revenues to increase by 21% to approximately $4.8 billion.
-Segment margins are expected to improve to 5.3% - 5.5% in fiscal 2012 as a result of the higher volumes and the full year benefit of acquisitions completed in fiscal 2011.
-In Europe, margins are expected to improve significantly as the Company continues to reduce operational and launch related inefficiencies.
Power solutions business
-Power solutions fiscal 2012 revenues are expected to increase 11% - 13% due to higher volumes across all regions resulting from market share gains and the full year impact of production at the Changxing plant in China.roduction capacity in China.
-Segment margins are expected to increase to 13.5% - 13.9% reflecting the benefits of vertical integration for the recycling of lead and the start of a product mix shift toward absorbent glass mat (AGM) battery technology.
|(in million USD)|
|Sponsored by customers||366||315||431|
R&D FacilitiesTechnology Centers for Automotive Experience
-Plymouth, Michigan, USA
-Holland, Michigan, USA
Battery Technology Centers for Power Solutions
-Plymouth, Michigan, USA
-Milwaukee, Wisconsin, USA
-The Company announced that it has opened its newly renovated Battery Technology Center (BTC) and Battery Test Facility at its Power Solutions headquarters in Glendale, Wisconsin, U.S. BTC was redesigned to enhance labs to support mass battery production. The Battery Test Facility, which was built in 2007, was also re-designed. Its size increased by 50 percent to 9,000 square feet. The renovation was supported in part by the 299 million USD American Recovery and Reinvestment Act matching grant Johnson Controls received in 2009. (From a press release on July 26, 2011)
-The Company announced that it is endowing research labs and graduate studies in energy storage at the University of Wisconsin-Madison and the University of Wisconsin-Milwaukee. Part of the funding will support the creation of The Johnson Controls Energy Storage Research Lab at UW-Madison. The lab will be housed in the new Wisconsin Energy Institute under construction on the UW-Madison campus. (From a press release on June 30, 2011)
R&D Activities-The Company announced that it has launched a cooperative project called CAMISMA (Carbon fiber- / Amide- /Metallic structural interior component using a multi-material approach). The project, which is supported by the German Federal Ministry of Education and Research, has an initial timeline of three years. The CAMISMA funds research that seeks to replace steel and light alloys with fiber-reinforced composites (FRC), including carbon fiber, in automotive designs. An automotive seat, which uses carbon fiber-reinforced materials, is being developed, manufactured and tested. The objective is to achieve more than a 40 percent weight reduction compared to conventional metal-based designs. (From a press release on May 31, 2011)
-The Company will display its ie:3 demonstrator vehicle for the first time in Europe at the IAA. The fully electric ie:3 features Johnson Controls-Saft's next-generation, low-profile lithium-ion battery pack. The demonstrator vehicle features four instrument clusters from Johnson Controls: a Virtual Instrument Cluster, a Combiner Head-Up Display, an integrated Multi-Touch Display and a Multi-Controller. (From a press release on August 29, 2011)
-The Company developed the new HomeLink V Wireless Control System. The conventional HomeLink Wireless Control System enables drivers to remotely activate garage door openers, entry door locks, home lighting, security systems, entry gates, and other radio frequency convenience products. The HomeLink V provides the ability to not only transmit, but also receive information, allowing the system to provide feedback regarding previous commands, such as when a garage door was last opened or confirm whether it has been closed. It is lighter in weight and more compact in size (65 by 50 millimeters) than previous generations of the product. The HomeLink V is available for 2013 model year vehicles and has been sold to two domestic automakers. (From a press release on August 18, 2011)
-The Company developed a new design for second row seats in pickup trucks. When stowed, the Slim Stow Seat takes up 33 percent less space, and is lighter weight compared to traditional rear truck seats. It also improves visibility when stowed since the seat back is lowered 100 millimeters. The seat features the child seat attachment points and side-bolsters. (From a press release on March 28, 2011)
-The Company developed a technology for lightweight rear seat systems. Steel and aluminum are combined to create a modular multi-material rear seat structure which uses a new adhesive technology. With this new technology, the company succeeded in reducing the weight of the rear seat structure by 34 percent while maintaining all safety requirements. In order to reduce weight of the rear seat backframe, the upper and lower side members consist of aluminum, which resulted in a 30 percent weight reduction. (From a press release on February 24, 2011)
-The Company unveiled the Connected Center Stack at the 2011 North American International Auto Show in Detroit, U.S. The features of this product include natural language speech recognition, hands-free phone usage, music playback using USB connectivity or Bluetooth streaming audio, ability to access popular phone applications such as Pandora Internet Music. The Connected Center Stack product will be available for integration into 2014 model-year vehicles. (From a press release on January 13, 2011)
|(in million USD)|
Investment in USAPower Solutions
-The Company announced plans to invest 138.5 million USD to convert its battery plant near Toledo, Ohio, U.S. into an Absorbent Glass Mat (AGM) battery facility for Start-Stop and other high efficiency vehicles. The facility will be the company's first such plant in U.S.. Johnson Controls' investment will add 6 million in AGM battery capacity to the company's North American AGM footprint by 2013. The expansion will create 50 new jobs and retain 400 existing jobs. Construction is scheduled to begin this summer and the first line will launch production in spring 2012. In 2010 the company supplied 3 million VARTA Start-Stop batteries in Europe, and is adding capacity there to reach 11.2 million batteries by 2015. (From a press release on June 27, 2011)
-The Company broke ground on a lead-acid battery recycling facility in Florence, South Carolina, U.S.. The Florence Recycling Center, slated for completion during 2012 and to be operated by the Company's Power Solutions business, represents a capital investment of more than 150 million USD. (From a press release on January 18, 2011)
Investment outside USAPower Solutions
-The Company announced that it is investing 100 million USD to build a Start-Stop vehicle battery plant in China. The plan is expected to start production in early 2013. Johnson Controls plans to produce an annual capacity of 2.4 million Start-Stop batteries by 2015. The company is investing 520 million USD worldwide over the next four years in additional production capacity for Start-Stop batteries: 280 million USD in Germany, an additional 140 million USD in U.S., and 100 million USD in China. In Germany, the company's plants in Hanover and Zwickau produce more than 11 million Start-Stop batteries annually. The company is also adding 6.8 million units of capacity in U.S. (From a press release on September 14, 2011)
-The Company announced that it is investing 100 million USD to build a Start-Stop vehicle battery plant in China. The plan is expected to start production in early 2013. Johnson Controls plans to produce an annual capacity of 2.4 million Start-Stop batteries by 2015. (From a press release on September 14, 2011)
-The Company announced it is investing 118 million USD to build a third automotive battery plant in China, to be located in Chongqing. The plant complements the company's existing plants located in Shanghai and Changxing. The plant will have capacity to produce 6 million batteries annually. Ground breaking for the plant will take place in January 2011, with production slated to ramp up beginning in January 2012. In addition to the new Chongqing plant, The Company' previously announced Changxing automotive battery plant will launch production in early 2011 with an expected capacity of 8 million batteries annually. These 3 plants will produce more than 18 million automotive batteries annually. The company will later this year begin locating its fourth plant, with a capacity of 6 million batteries, in the northern region of China. These plants support their plan to install capacity for 30 million batteries annually in China by 2015. (From a press release on October 6, 2010)
-The Company announced plans to invest more than 70 million USD in its automotive battery recycling center in Cienega de Flores, Nuevo Leon, Mexico. The investment will fund the replacement of the Cienega facility's existing rotary furnaces with larger and more efficient rotary furnaces. In addition to its investments in Mexico, Johnson Controls Power Solutions is also investing in the United States, where it has recently announced the addition of more than 1,000 jobs through its investments in lead-acid and lithium-ion batteries, and lead-acid battery recycling. (From a press release on August 30, 2011)