Nidec Corporation Business Report FY ended Mar. 2018

Financial Overview

(in millions of JPY)
FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 Rate of Change
Sales 1,488,090 1,199,311 1.8 -Reported record-breaking sales, achieving a year-on-year (y/y) increase of JPY 39.0 billion, which resulted from favorable currency translation.
Operating income 167,637 140,331 19.3 -The Company reported record-breaking profits, which increased by JPY 4.1 billion due to favorable currency translation. This was in spite of the Company’s incurring expenses to (1) reorganize its operations by consolidating its production facilities in and outside Japan in revising its business portfolio, (2) increase human resources in planning for future business growth, and (3) conduct M&As that temporarily increased expenses.
Current net income before income taxes 164,460 142,278 21.4 -Broke all previous sales records
Current net income attributable to the Company's stockholders 131,434 111,721 24.2
Sales 222,689 218,648 (4.9)

-Favorable currency translation because of the weak yen against the USD and euro helped improve profits, in spite of lower demand for HDD motors.

Operating income 25,381 16,556 6.3
Nidec Sankyo
Sales 150,282 136,161 5.3

-Increased demand for small motors and robots used for transporting LCD glass panels.

Operating income 21,661 19,408 29.0
Nidec Motor
Sales 435,586 249,419 10.7 -Became a new consolidated company after the acquisition was completed
Operating income 31,129 20,251 35.9
Nidec Motors & Actuators
Sales 302,824 266,091 (1.5) -Increased demand for onboard motors such as those used in electric power-steering systems, and for control valves sold to Nidec Tosok. In addition, favorable currency translation that resulted from the weak yen against the euro also helped business performance.
Operating income 34,932 29,572 14.2

Business Acquisitions

ーOn December 1 Nidec Corporation (Nidec) announced that it has acquired driveXpert GmbH, a company specializing in design and development of automotive electronic control units (ECUs). The acquisition is aimed at gaining sophisticated technologies for controlling Nidec Group's high-performance motors to supply next-generation products. driveXpert was established in 2010 with capital of EUR 25,000 and is located in Ilmenau, Thuringen, Germany. It has 23 employees and its sales for the fiscal year ending in December 2016 stood at EUR 1.2 million. Nidec has acquired a 100% stake in driveXpert through its German subsidiary. The transaction value has not been disclosed. (From an article in the Nikkan Jidosha Shimbun on December 2, 2017)

-Nidec Corporation announced that its subsidiary Nidec Sankyo Corporation (Nidec Sankyo) will take over the business of Tokyo Maruzen Industry Co., Ltd., an electric contact material maker, through its newly established subsidiary. The new subsidiary is also called Tokyo Maruzen Industry Co., Ltd. Electric contacts are used in electric and plug-in hybrid vehicle parts like relays and switches. Nidec Sankyo and the new subsidiary aim to strengthen their technology development capability and supply high-quality electric contacts to the automotive markets. (From an article in the Nikkan Jidosha Shimbun on October 21, 2017)


-The Company announced that Nidec and Groupe PSA, through Nidec Leroy-Somer Holding, intend to work together in the field of electric traction motor. For this purpose, Nidec Leroy-Somer and Groupe PSA entered into a joint venture agreement. The joint venture will be headquartered in Carrieres sous Poissy, Paris region, France and will be established in Spring 2018. Both companies each hold a 50% stake in the joint venture and capitalized at EUR 15 million. It will carry on the business of development, manufacturing and sale of automotive electric traction motor. Nidec Leroy-Somer, acquired by Nidec in February 2017, is a motor company in France and renowned for its products in industrial area as well as various other areas. (From a press release on December 4, 2017)

New mid-term strategic objectives for FY 2020

-Constant pursuit of high growth to sustain profits:

  • Consolidated sales target: JPY 2 trillion (includes JPY 500.0 billion based on new M&As)
  • Automotive sales alone: JPY 700 billion – 1 trillion
  • Consolidated profit margin target: 15% or higher
  • ROE (return on equity): 18% or higher (based on target of 60% shareholders' equity ratio)
  • 5-region based operations: Japan, China, Asia, the Americas, and EMEA (Europe, Middle East, and Africa)

-Estimated market scale and targeted global market share of automotive products in 2020:

  • Electric power steering motors: 70 million units/50% share
  • Electric dual-clutch motors: 10 million units/70% share
  • Electric oil pumps: 11 million units/30% share
  • Electric water pumps: 34 million units/20% share


  • Electric power steering power-packs (Nidec motor with Nidec Elesys ECU)
  • Electric oil pump power-pack (Nidec motor, Nidec Elesys invertor, Nidec Tosoku/Nidec GPM pump and case)

-Expanded powertrain business:

  • Shifting from hydraulics to electrification. Aiming to launch powertrain business.
  • Example: SR motor with built in SiC inverter, which is smaller, lighter, and more energy efficient than existing ones.

-Received orders for components used in the drive systems for low-speed electric vehicles (LSEVs) in China

  • Motor, Gear box, Controller, Battery charger
  • Focus on products for automobiles in China, and tri-wheel vehicles in India and Southeast Asia

-In-house production of following operations: stamping, plastic-molding, die-casting, shaft machining, housing machining.

-Expanding the use of LiDAR (Laser imaging Detection & Ranging) in the automotive sector (autonomous driving, etc.)

Outlook for FY ending March 2019

(in millions of JPY)
FY ended Mar. 31, 2019
FY ended Mar. 31, 2018
(Actual Results)
Rate of Change
Sales 1,575,000 1,488,090 5.8
Operating income 190,000 167,637 13.3
Current net income before income taxes 185,000 164,460 12.5
Current net income attributable to the Company's stockholders 145,000 131,434 10.3

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)

R&D Expenditure

(in millions of JPY)
FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 FY ended Mar. 31, 2016
Overall 55,438 52,807 51,978
-Nidec 20,829 21,459 22,523
-Nidec Sankyo 5,509 5,137 4,689
-Nidec Motor 5,722 5,945 6,020
-Nidec Motors & Actuators 7,959 7,311 7,336

-Overall, R&D expenses are forecasted to be JPY 63,000 million in the fiscal year ending March 2019.

R&D Structure

-Nidec Research and Development Center in Japan, Nidec Research and Development Center in Singapore, and Nidec Research and Development Center in Taiwan conduct research on basic technologies related to motors in general that are expected to become a core part of the Company's global R&D strategy.

-Shiga Technical Center engages in research and development activities aimed at new product development, mass production of new models, and improvement of product quality related to small precision DC motors and fan motors, excluding those used for HDDs.

R&D Activities

-Nidec Corporation is strengthening its development of new products targeting emerging markets such as China, India and Brazil as well as developed markets.
-The Company is developing next-generation of;

  • small and high-performance power steering motors,
  • motors for applications other than power steering such as seats, brakes and sunroofs, and ancillary electronic control units (ECUs),
  • Dual Clutch Transmissions
  • brushless motors used for hydraulic and electric power systems
  • package products that combine motors with sensors and control units

-Automotive motors: R&D activities in Germany, Spain, and Japan on motors, to increase product life and make them smaller and lighter.

  • Seat and sunroof motors: commercialization of compact, brush motor not requiring rare-earth metals
  • Engine cooling motors: development of compact and light brush fan motors

-Chassis control: (brakes and steering system):

  • Brakes: Commercialization (development/production) of ECU for regenerative braking system, and ECU for electronic stability control systems.
  • Electric power steering system: Developed ECU for both brush and brushless motors. Conducting advanced development of ECU for brushless motors designed to provide functional safety

ーAdvanced safety systems/devices (cameras, millimeter-wave radar systems)

  • Advanced product development and commercialization (mass production)

-Other R&D activities:

  • Highly functional/high-performance control-valve assembly for automatic transmissions and constant-variable transmissions
  • Electric oil pumps: Combining technologies of group companies in optimal manner.
  • Electric hydraulic actuator for transmissions
  • Traction Motor / Traction Motor System : Development of E-Axle

-With respect to stepping motors, in an effort to expand the range of their applications to automobiles, Nidec Sankyo has been downsizing products, enhancing product performance and improving cost-performance.

-With respect to vehicle traction motors, Nidec Motor engages in modularization of motors with encoders based upon its rare earth-free SR motor technology, and in development activities aimed at hybridization and electrification of large-sized vehicles such as construction and agricultural machinery.

-This company is engaged in developing products and elemental technology on system devices such as automotive lenses, automotive motors, etc. at the Tokyo R&D Center.

  • Optical products: Switch from developing products for digital cameras, to products for automotive lenses and mobiles.
  • Motors: Switch from developing products for digital cameras, to products for mobiles, vehicles, and medical.

Capital Expenditure

(in millions of JPY)
FY ended Mar. 31, 2018 FY ended Mar. 31, 2017 FY ended Mar. 31, 2016
Overall 90,841 68,718 81,918
-Nidec 75 427 735
-Nidec Sankyo 9,303 5,386 7,949
-Nidec Motor 18,222 12,328 9,321
-Nidec Motors & Actuators 22,515 15,505 17,637

-Overall, capital expensiture is forecasted to be JPY 150,000 million in the fiscal year ending March 2019.

-At a Nidec Corporation (Nidec) financial settlement briefing in Tokyo, Shigenobu Nagamori, Chairman of the Board and President, stated that the company intends to establish drive motor plants for electrified vehicles (EVs) in Poland and Mexico. It aims to secure orders from automakers and then decide the details of the plan. Nidec plans to start mass production of drive motors in China in May 2019 and establish a global production system. The company will invest JPY 200 billion in plants and equipment for its automotive business through the end of March 2021, including JPY 100 billion for drive motors. The company expects that as the commoditization of EVs progresses, automakers will not stick to in-house production of hardware, and aims to expand its business by acquiring new orders in the automotive business. (From an article in the Nikkan Jidosha Shimbun on April 26, 2018)

-The Company announced that it has completed the first phase construction of "Nidec Institute for Industrial Science" in Kyoto, Japan, and will start operations from February 20. The six-story building has a floor area of 23,642 square meters. The company plans to invest approximately JPY 30 billion in land, a building and equipment, including a second phase construction. Initially, 350 employees will work at the center, with the headcount increasing to 1,000 after completion of the second phase. (From a press release on February 1, 2018)

-The Company announced that it will invest over JPY 150 billion in plants and equipment in the fiscal year that ends in March 2019 (FY 2018) in order to strengthen its electric vehicle, robot, and home appliance businesses. The company's investment will reach a record high. Nidec is building new plants in and outside Japan, with locations including Ueda City, Nagano Prefecture, and Hanoi, Vietnam. The company will increase its human resources and replace existing plant facilities with the state-of-the-art equipment. (From an article in the Nikkan Jidosha Shimbun on January 11, 2018)

-The Company will expand its in-vehicle motor business. The company will commercialize new products in such new fields as traction motors for use in the drive unit of EVs and next-generation brake systems. Nidec intends to more than double shipments of in-vehicle motors to over 100 million in the fiscal year 2020 (ends in March 2021) from FY 2016 by winning more orders for electric power steering (EPS) motors, its major product. To achieve this goal the company will hire more engineers and boost its production capacity. Also, it will continue advancing its merger and acquisition strategy in its in-vehicle motor business. Nidec's total shipment of motors used in vehicles for FY 2016 slightly increased year-over-year to between 45 million and 46 million units. Under its mid-term business plan "Vision 2020" that ends in FY 2020 the company plans to increase shipments to over 100 million units. The driving force to achieve this goal will be motors for EPS, for which the company is planning to increase shipments from slightly over 15 million units in FY 2016 to a little below 30 million in FY 2020. (From an article in the Nikkan Jidosha Shimbun on April 27, 2017)

Planned Capital Investments

(As of Mar. 31, 2017)
Name Location Type of facility and activities Planned investing amount
(in millions of JPY)
Start Finish
Nidec Tosok (Zhejiang) Corporation Pinghu , Zhejiang Province, China Production plant manufacturing automotive parts 1,663 Feb. 2018 Dec. 2018
Nidec Sankyo, Ina Office Ina, Nagano Prefecture, Japan Construction of Plant No. 5 and improvements to Plant No. 1 1,448 Jan. 2018 Aug. 2018
Nidec Seimitsu Motor Technology (Dongguan) Co., Ltd. Dongguan, Guangdong Province, China Production plant manufacturing small, precision motors 1,597 Sep. 2017 May. 2019
Vietnam Nidec Sankyo Ho Chi Minh, Vietnam Production plant manufacturing home appliances 998 Dec. 2016 Jun. 2018
Thailand Nidec Co., Ltd. Pattani Province, Thailand Production facilities to manufacture small, precision motors 13,550 Apr. 2018 Mar. 2019