Yorozu Corp. Business Report FY ended Mar. 2014
Business Highlights
Financial Overview |
(in millions of JPY) |
FY ended Mar. 31, 2014 | FY ended Mar. 31, 2013 | Rate of change (%) | Factors | |
Sales | 138,340 | 110,550 | 25.1 | 1) |
Operating Profit | 8,025 | 7,107 | 12.9 | - |
Ordinary profit | 9,425 | 8,403 | 12.2 | - |
Current net profit | 5,139 | 5,301 | (3.1) |
Factors
1) Sales
Japan
-Sales increased by 2.1% year-on-year, up to JPY 51,525 million. Although sales to the biggest customer Nissan decreased, sales to Honda increased.
North America
-Sales in North America increased 38.0% year-on-year, up to JPY 52,205 million, thanks to greater production volumes in the U.S.A., in addition to favorable currency translation due to weakened yen.
China
-Sales in China increased 38.2% year-on-year, up to JPY 48,657 million, thanks to greater sales because of increased production in China, and to favorable currency translation due to weakened yen.
Major Contracts
-In February 2014, the Company has received a new contract to supply suspension parts for Toyota's next-generation models under the Innovative International Multi-purpose Vehicle (IMV) series, which include minivans, SUVs, and pickups. These parts will be manufactured at the Company's factories in India and Thailand, and will be supplied to Toyota's plants in respective countries. This is the first time that the Company will deliver its products to Toyota in India. The Company expects the IMV program will significantly increase Its sales to Toyota, which aims to sell 1 million IMV vehicles annually. The Company has been setting up new facilities rapidly in emerging countries, in order to meet the demand from its largest customer Nissan Motor Co., Ltd. that is expanding its global manufacturing footprint. By expanding business also with Japanese automakers other than Nissan, the Company hopes to stabilize its plants' operating rate and improve profitability in the emerging market.-Major contracts concluded in FY ended March 2014
OEM | Model | Products | Start of Delivery |
Japan | |||
Nissan | X-Trail | -Front suspension member -Rear suspension member |
- |
Skyline | -Brake pedal -Clutch pedal |
- | |
Honda | Vezel | -Front suspension member -Rear axle beam |
- |
USA | |||
Nissan | X-Trail | -Front suspension member -Rear suspension member |
- |
Mexico | |||
Mazda | Axela (Mazda 3) |
-Dust cover -Engine bracket |
Jan. 2014 |
Honda | Vezel | -Front suspension member -Front lower arms -Rear beam |
Nov. 2014 |
Thailand | |||
Suzuki | Celerio | -Body parts -Front lower arms |
May. 2014 |
Honda | Vezel | -Front suspension member -Front lower arms -Rear beam |
Jan. 2015 |
Indonesia | |||
Honda | Brio | -Front suspension member -Front lower arms |
- |
Suzuki | WagonR | -Rear axle | - |
Nissan | Datsun GO Datsun GO+ |
-Front suspension member -Lower arms -Transverse link -Rear axle beam |
Apr. 2014 |
Honda | Vezel | -Front suspension member -Front lower arms -Rear beam |
May 2015 |
India | |||
Nissan | Datsun GO Datsun GO+ |
-Front suspension member -Lower arms -Transverse link -Rear axle beam |
Jan. 2014 |
China | |||
Nissan | X-Trail | -Front suspension member -Rear suspension member |
- |
Honda | Vezel | -Front suspension member -Front lower arms -Rear beam |
Nov. 2014 |
Awards
-Major awards given in FY ended March 31, 2014Award given by | Awarded location | Contents |
Honda | Yorozu Corporation | Honda Development Award (for excellence in R&D field) |
Honda | Yorozu Mexicana SA. de C.V. | HDM Reconocimient a la Exelencia |
Honda | Yorozu Automotive Tennessee, Inc. | HMMU Quality Excellence Award |
Nissan | Yorozu Corporation | Nissan Global Quality Award |
Nissan | Yorozu Corporation | Nissan Japan Regional Quality Award |
Nissan | Yorozu Bao Mie Automotive Co.,Ltd. | Nissan China Regional Quality Award |
Nissan | Yorozu Automotive Tennessee, Inc. | NNA Regional Supplier Quality Award Finalist |
Nissan | Yorozu Automotive Tennessee, Inc. | NNA Regional Supplier Zero Defect Certificate Winner |
Nissan | Yorozu Mexicana SA. de C.V. | NNA Regional Supplier Quality Award Finalist |
Nissan | Yorozu Mexicana SA. de C.V. | NNA Regional Supplier Quality Master Certificate Winner |
Nissan | Yorozu Mexicana SA. de C.V. | NNA Regional Supplier Zero Defect Certificate Winner |
Outlook for FY ending Mar. 31, 2015 |
(in million JPY) |
FY ending Mar. 31, 2015 (Forecast) |
FY ended Mar. 31, 2014 (Actual Results) |
Rate of Change (%) |
|
Sales | 149,000 | 138,340 | 7.7 |
Operating income | 7,000 | 8,025 | (12.8) |
Ordinary income | 6,800 | 9,425 | (27.9) |
Net income | 3,500 | 5,139 | (31.9) |
>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)
R&D
R&D Expenditure |
(in millions of JPY) |
FY ended Mar. 31, 2014 | FY ended Mar. 31, 2013 | FY ended Mar. 31, 2012 | |
Overall | 1,603 | 1,404 | 1,354 |
R&D Structure
-The R&D Division's and Production Technology Division's R&D activities are mainly involved in developing new products and new production technology.-The Company will increase the number of its engineers to 300 by March 2018, which will be a 70% gain from 180 in March 2013. It will expand its R&D workforce by 40%, while doubling the number of its production engineering staff during FY ending March 2018. With this enhancement, the Company hopes to respond to increasing requests from Its customers, especially Nissan Motor Co., Ltd. that is planning global releases of new models. Demand from OEMs other than Nissan is also growing. By adding new engineers to both the development and production divisions, the Company hopes to boost its capacity to design and test new products for the global market and to manage new production lines in emerging markets.
-The Company will build a new research and development (R&D) building on a premises of Yorozu Tochigi Corporation, its production subsidiary in Oyama city, Tochigi prefecture. The new building will start up in April 2014. R&D operations are currently conducted in a plant, but will be shifted to the new building. The Company will also hire more engineers for R&D work. Nissan Motor Co., Ltd., Its major customer, is currently working to expand its global sales by FY ending in March 2017. The new R&D building will address an expected increase in development work for the parts which will be supplied to Nissan.
Product Development
Front Suspension Member with Side Rail Construction-Design in which the front suspension member is divided into the center part and the extremely rigid side-rails. Lowering the plate thickness of the center portion reduced weight by 17%. Used on Honda "FIT (4WD)" and "Vezel".
Brake pedal with single-unit frontal plate
-Single-unit frontal plate reduced weight by 27%. Costs were lowered by 38% due to the use of fewer parts. Adopted by Nissan "Altima".
Technology Licensing Agreements |
(As of Mar. 31, 2014) |
Name | Country | Contract coverage | Period |
Auto chassis International S.N.C. (ACI) | France | The Contract covers various business activities for rear beams for a passenger car (the YN5) manufactured by Suzuki in China. ACI is in charge of design and development of the relevant part and the Company in charge of production engineering, preparatory work for mass-production and production activities in China (G-YBM). ACI has given Yorozu a non-exclusive license. | May 1, 2005 -Until production of the relevant passenger car is terminated |
Jay Bharat Maruti Ltd. | India | To license out non-exclusive rights to produce rear beams the Company designed and developed for the Suzuki YV4. To sell related production equipment to manufacture these products and dispatch engineers to give technical assistance. | March 2, 2009 -Until production of the relevant vehicle is terminated |
DK Austech Co., Ltd | Korea | The non-exclusive licensing agreement involves the provision of technical information and support for preparing and manufacturing samples of curling pipe that will be used on the rear axle-beam and tray-ring arm of the Renault Samsung L38. | December 1, 2012 -Until production of the relevant component is terminated |
JBM Auto Limited (JBM) |
India | To license out non-exclusive rights to produce rear beams, subframes and lower arms the Company designed and developed for the Honda "Brio" (TG2/T6E/T4Z). To sell related production equipment to manufacture these products and dispatch engineers to give technical assistance. | September 1, 2012 - For 7 years |
JBM Auto Limited (JBM) |
India | To license out non-exclusive rights to produce subframes and lower arms the Company designed and developed for the Honda "Jazz" and "City" (2WF/2CT). To sell related production equipment to manufacture these products and dispatch engineers to give technical assistance. | July 22, 2013 - For 7 years |
Investment Activities
Capital Investment |
(in millions of JPY) |
FY ended Mar. 31, 2014 | FY ended Mar. 31, 2013 | FY ended Mar. 31, 2012 | |
Overall | 21,588 | 17,057 | 11,737 |
Capital investments in FY ended Mar. 31, 2014
-The Company made capital investments as follows:
- Japan: JPY 3,357 million to build Yorozu Technical Center (YGTC), and to launches of new-model vehicles
- North America: JPY 9,857 million to install 1,000 ton press machine in one of the US plant (YAT), to start operation in the 2nd plant in Mexico (YAGM) and the new plant in Brazil (YAB), and to launches of new-model vehicles.
- Asia: JPY 8,374 million to start operation in the 2nd plant in Thailand (Y-OAT) and a new plant in Indonesia (YAI), and to launches of new-model vehicles.
- Oct. 2011: At the 2nd plant in China
- Nov. 2011: At the new plant in India
- Jun. 2013: At the 2nd plant in Thailand
- Aug. 2013: At the new plant in Indonesia
- Oct. 2013: At the 2nd plant in Mexico
- Jul. 2014: At the new plant in Brazil
Investments Outside Japan
<China>-In February 2013, the Company announced that It will increase production capacities at Its two plants in Guangzhou (Guangdong Province) and Wuhan (Hubei Province) by 50% each by the middle of 2015. In total, JPY 3.5 billion will be invested in building expansions and equipment additions at both plants. The Company has resumed its investment plans in China as Japanese car sales are gradually recovering. As Nissan and Honda are planning to boost production in China, the Company is poised to expand the number of suspension parts supplied to Japanese automakers. The Company will use the plant in Wuhan to supply parts to Nissan's facility in Dalian (Liaoning Province), which is scheduled to become operational in 2014.
New Facilities |
(As of Mar. 31, 2014) |
Business establishment | Purpose | Planned investment (thousand yen) |
Start | Planned completion |
Lend-lease contract (Yorozu Tochigi Corp.) | Renewing 3000 ton FB control renewal | 70 | Dec. 2014 | Jan. 2015 |
Installing facilities for new vehicle models | 79 | Jun. 2014 | Oct. 2014 | |
Lend-lease contract (Yorozu Oita Corp.) | Installing facilities for new vehicle models | 305 | Oct. 2013 | Feb. 2015 |
Lend-lease contract (Yorozu Aichi Corp.) | Installing facilities for new vehicle models | 329 | Jun. 2014 | Dec. 2014 |
Yorozu Automotive Tennessee, Inc. | Installing facilities for new vehicle models | 1,630 | Feb. 2014 | Sep. 2014 |
Yorozu Mexicana SA. de C.V. | Installing facilities for new vehicle models | 907 | Apr. 2013 | Jul. 2014 |
Yorozu Automotive Guanajuato de Mexico, S.A. de C.V. | Stamping machinery | 496 | Feb. 2014 | Dec. 2014 |
Installing facilities for new vehicle models | 338 | Jan. 2014 | Aug. 2014 | |
Yorozu Automotive Do Brasil Ltda. | Plant building | 2,623 | Nov. 2012 | Sep. 2014 |
Installing stamping machines and other equipment | 1,408 | Apr. 2014 | Sep. 2014 | |
Yorozu (Thailand) Co.,Ltd. | Installing facilities for new vehicle models | 2,553 | Jan. 2014 | Dec. 2014 |
Y-Ogura Automotive (Thailand) Co., Ltd. | Stamping machinery | 426 | Oct. 2013 | Dec. 2014 |
Yorozu Bao Mie Automotive Co.,Ltd. | Installing facilities for new vehicle models | 1,843 | Nov. 2013 | Nov. 2014 |
Whuhan Yorozu Bao Mit Automotive Co., Ltd. | Installing facilities for new vehicle models | 1,143 | Jul. 2013 | Jul. 2015 |
Stamping machinery | 813 | Mar. 2014 | Mar. 2015 | |
Yorozu JBM Automotive Tamil Nadu Pvt Ltd. | Installing facilities for new vehicle models | 467 | Apr. 2014 | Mar. 2015 |
Assembly machines and other machines | 442 | Apr. 2014 | Mar. 2015 | |
PT. Yorozu Automotive Indonesia | Stamping machine and other machines | 686 | Apr. 2014 | Mar. 2015 |