TACHI-S Co., Ltd. Business Report FY ended Mar. 2017
Financial Overview |
(in millions of JPY) |
| FY ended Mar. 31, 2017 | FY ended Mar. 31, 2016 | Rate of Change (%) | Factors | |
| Sales | 282,525 | 283,662 | (0.4) | -Sales were lower due to the effect of negative currency translation due to the high valuation of the yen, even though sales in Japan and other countries remained firm. |
| Operating income | 8,859 | 6,883 | 28.7 | -Operating income increased due to higher production volumes and the benefits of effective streamlining initiatives implemented outside Japan. |
| Ordinary income | 12,337 | 7,752 | 59.1 | - |
| Net income | 7,262 | 1,685 | 330.9 | - |
| Sales by segment | ||||
| -Japan | 128,672 | 116,276 | 10.7 | -Sales increased because of the benefits from production launches of new vehicle models and higher content on vehicle models designed for markets outside Japan. |
| -North America | 46,664 | 51,733 | (9.8) | -Lower sales were posted because of the effect of negative currency translation due to the high valuation of the yen, in spite of higher sales on a local-currency basis. |
| -Central and South America | 58,799 | 65,875 | (10.7) | -Lower sales were posted because of the effect of negative currency translation due to the high valuation of the yen, in spite of higher sales on a local-currency basis. |
| -Europe | 2,220 | 919 | 141.6 | - |
| -China | 43,571 | 45,428 | (4.1) | -Lower sales were posted because of negative currency translation due to the high valuation of the yen, in spite of higher sales on a local-currency basis. |
| -Southeast Asia | 2,596 | 3,428 | (24.3) | - |
Recent Development Outside Japan
-APM Automotive Holdings Berhad announced that APM via its indirect wholly-owned subsidiary, APM Automotive IndoChina Ltd (AAIL) entered into a joint venture agreement with Tachi-S (Thailand) Co., Ltd, a wholly-owned subsidiary of Tachi-S Co. Ltd., to carry on the business of developing, manufacturing, assembling and sale of automotive seats in Vietnam for the original equipment manufacturers and other manufacturers. The new joint venture company will be incorporated in Vietnam under the proposed name "APM Tachi-S Seating Systems Vietnam Co., Ltd." with an investment capital and charter capital of USD 2.5 million. The new company will be owned 49% by AAIL and 51% by Tachi-S. (From a press release on August 12, 2016)
Mid-term Management Plan: Global Teamwork 2020
-The Company’s aim is to become the world’s preferred global seat-system creator by providing seats that meet and exceed customer expectations and needs. This is being achieved by responding to the rapid advancements being made in autonomous-driving technology, creating diverse technological innovations, responding to huge transformations taking place in the automotive industry, enhancing competitive advantages, and pursuing new technologies and product creation worldwide based on staying ahead of anticipated, future requirements.
-3 targets
- Number 1 Quality
- Operating margin: 7%
- Global manufacturing share: 7%
-Global activities
- Setting up R&D function in major regions
- Reorganize and expand production facilities
- Expand parts operations at production plants
-Enhance competitive strengths
- Strengthen product proposals
- Strengthen product manufacturing
- Strengthen ability to respond to change
Outlook for FY ending Mar. 31, 2018 |
(in millions of JPY) |
| FY ending Mar. 31, 2018 (Forecast) |
FY ended Mar. 31, 2017 (Actual Results) |
Rate of Change (%) |
|
| Sales | 281,000 | 282,525 | (0.5) |
| Operating income | 7,500 | 8,859 | (15.3) |
| Ordinary income | 10,000 | 12,337 | (18.9) |
| Net income | 5,200 | 7,262 | (28.4) |
>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)
R&D Expenditure |
(in millions of JPY) |
| FY ended Mar. 31, 2017 | FY ended Mar. 31, 2016 | FY ended Mar. 31, 2015 | |
| Overall | 4,130 | 4,274 | 4,252 |
R&D Facilities
| Tachi-S Technical Monozukuri Center | Oume City, Tokyo |
| Advanced Technology Center | Oume City, Tokyo |
| Tachi-S Technical Center Aichi | Anjo City, Aichi Pref. |
| Tachi-S Engineering U.S.A. Inc. | Michigan, USA |
| Tachi-S Engineering Europe S.A.R.L. | Velizy-Villacoublay, France |
| Tachi-S Engineering China Co., Ltd. | Fuzhou, China |
| Tachi-S Engineering Latin America S.A. de C.V. | Aguascalientes, Mexico |
| Tachi-S Engineering Vietnam Co., Ltd. | Ho Chi Minh, Vietnam |
R&D Structure
-The Company, in order to conduct effective and efficient R&D activities, has positioned its technical center in Japan as the main function accountable for product development and fundamental technology. In addition, however, the Company works with its operations in the U.S.A. and Europe, and with technical-licensing and partner companies, in order to gather information on the latest technologies and peripheral technologies. Also, the Company makes sales presentations to global OEMs and parts suppliers about its wealth of technology on new products and new production methods. Currently, some of these technologies are being used by customers.
-The Company formed two commercial alliances, the first one with Fuji Kiko (in August 1999) and the second with Kasai Kogyo (in November 2006). These alliances are designed to improve its R&D capabilities in the areas of structural products and plastic molded parts, with the idea of jointly using each other R&D functions outside Japan.
-Based on its decision to consolidate all the functions directly involved with product creation, namely development, production, and purchasing, the Company opened its R&D/Product Creation Center in August 2012 in Oume City, Tokyo.
-In China, after establishing Tachi-S Engineering China Co., Ltd. in Fuzhou in Aug. 2008, the Company opened 3 more technical centers, namely in Guangzhou, Zhejiang, and Zhengzhou.
R&D Activities
Development of seats and original mechanism parts
-The Company is developing the following products for automobiles and other vehicles: seats, seat reclining devices, slide rails, heavy-duty/capacity lifters, underfloor devices, and long slide-rails for RVs; in addition to peripheral mechanisms and rotary units as seat systems, delivering them to OEMs.
Development of technology to improve safety
-The Company is developing the following as seat systems to improve safety: seats equipped with side-airbags, seats compatible with smart airbags with occupant detection feature, and systems to reduce neck injuries, delivering them to OEMs. Also, the Company is conducting R&D activities on seat safety so as to enable seats to respond to frontal, rear, and lateral collisions.
Development of environmentally friendly technology
-The Company is developing materials that will totally eliminate environmentally harmful impact and substances while improving fuel efficiency; and ultra lightweight seats loaded with new technological mechanisms. The Company is making product presentations to OEMs.
Development of products for special needs vehicles for social work
-The Company is developing seats for physically challenged occupants in terms of making them super easy to operate and get in and out of; for special needs vehicles. The Company is making product presentations to OEMs.
Development of low-cost products
-The Company is developing low-cost, next-generation seats based on standardizing and using common parts, making presentations to OEMs both in and outside Japan.
Development of production technology
-The Company is developing technology to improve adhesion-molded seats, technology to foam-mold single-unit headrests and arm rests, technology to automate and reduce energy and labor involved with assembling seats, and technology to manufacture and form-mold based on CAD and CAM; working to increase the models its delivers products to and its product lineup.
Research on seats
-Under the aim of developing seats that are even more comfortable, the Company evaluates "seating comfort" and conducts its own research on what seat architecture and design should be, studying seat mechanisms. In addition, the Company is using CAE in order to shorten development time and reduce costs so as to design seats in less amount of time, which are balanced in terms of performance, quality, and cost.
Development of seat designs
-The Company is working independently to develop designs for various fields in which the Company is engaged, such as future seat concepts, new-product designs, and corporate designs. The Company is making product presentations to OEMs as well as delivering them.
Standard frame
-The Company is developing standard seat frames with general design elements that can be used in common on various types of vehicle models. The Company is making product presentations to OEMs as well as delivering them.
Capital Expenditure |
(in millions of JPY) |
| FY ended Mar. 31, 2017 | FY ended Mar. 31, 2016 | FY ended Mar. 31, 2015 | |
| Overall | 5,064 | 4,440 | 6,067 |
-Contents of the investment by region for FY ended Mar. 2017 are as follows:
| Region | Major items | Investment amount (in millions of JPY) |
| Japan | -Preparing production equipment to deal with new orders and model changes. -Change of IT system |
2,451 |
| North America | -Preparing production equipment to deal with model changes. | 636 |
| Central and South America | -Investment in new plant as well as production equipment to deal with new orders and model changes. | 1,229 |
| Europe | -Preparing production equipment to deal with new orders. | 280 |
| China | -Preparing production equipment to deal with new orders. | 334 |
| Southeast Asia | -Renewal production equipment | 131 |
-The Company expects capital expenditure for FY ending Mar. 31, 2017 to be JPY 5,077 million.
Planned Capital Investment |
(As of Mar. 31, 2017) |
| Company/plant | Facilities & Activities | Total investment (millions of JPY) |
Start date | Completion |
| Musashi Plant | New plant building | 446 | Apr. 2016 | Dec. 2017 |
| Suzuka Plant | Equipment for manufacturing automotive seats | 818 | Jun. 2017 | Mar. 2018 |
| Suzuka Plant | Equipment for manufacturing automotive seats | 740 | Apr. 2016 | Oct. 2017 |
| Technical Monzukuri Center | Establishment of business administration system | 728 | Apr. 2016 | Mar. 2018 |
| Industria de Asiento Superior S.A. de C.V. | Equipment for manufacturing automotive seats | 1,968 | Apr. 2016 | Dec. 2017 |
| TACHI-S Engineering Latin America, S.A. de C.V. | Development office and testing equipment | 1,195 | Apr. 2016 | Nov. 2017 |