North America

North America Regional Headquarters
DENSO INTERNATIONAL AMERICA, INC.

Fiscal 2012 Results

The U.S. auto market was marked by firm vehicle sales and production thanks to a gradual recovery in the U.S. economy.

Results for fiscal year under review

Despite increased and robust vehicle production and favorable sales centered on General Motors, Ford, and Chrysler due to market recovery, the effect of the Great East Japan Earthquake in the first half of the fiscal year led to sales of ¥512.1 billion, a decrease of 4.5%, or ¥23.9 billion, over the previous year.

Operating income was ¥8.8 billion, a decrease of 65.4%, or ¥16.6 billion, due to capacity utilization losses resulting from lower sales, and currency exchange losses caused by the yen appreciation.

Topics
Construction of New Plant at Mexican Production Site

A new plant will be constructed for DENSO Mexico S.A. de C.V. in Silao, Guanajuato in central Mexico to accommodate increased production by automakers with production facilities in Mexico.

Establishing a new facility in central Mexico will enable DENSO to produce and supply products from a location in close proximity to customers with manufacturing sites in the region. New plant is scheduled to begin production in October 2013.

North America:
Priority Activities Under Medium-Term Plan

In North America, we will pursue business expansion greater than the increase in automotive production by working to achieve 7% annual sales growth through 2015. Focus will also be on developing world-first products originating in North America, further promoting local procurement, and increasing market share in the aftermarket business.

Developing World-First Products

DENSO is taking on the challenge of developing new businesses originating in North America in powertrain products, components for hybrid and electric vehicles, and human-machine interfaces (HMI) by bolstering R&D and local design capacities in the region. The initiative will seek to increase future sales by proposing system products to customers rather than just individual components.?

Promoting Local Procurement

DENSO plans to reduce imports from Japan of complete knock-down (CKD) components* by half and substantially increase the ratio of equipment procured locally to reduce costs and thereby bolster competiveness while also reducing risks associated with yen appreciation and currency rate fluctuations in general.

*Method of assembling and selling products in which the product's main components are produced in another country or at another site and then imported.

Increasing Market Share in Aftermarket Business

The Aftermarket Americans Committee spearheaded by DENSO Sales California (DSCA) was established to accelerate growth in the aftermarket business and non-automotive businesses.

This has enabled DENSO to fully enter the general aftermarket market through development of the parts business for North American majors, sales expansion to the Canadian and Mexican markets, and the launch of new products. Moreover, we intend to establish an aftermarket business system by horizontally expanding aftermarket strategies for sales channels, product lineups and other areas in the North American region.

Net Sales

Operating Income


DENSO Mexico S.A. de C.V.

Sales Target

Hikaru Sugi

In charge of the Engineering Research & Development Center, North
America Region, DENSO INTERNATIONAL AMERICA, INC.
Senior Executive Director

Growth Strategy for North America

The North American automobile market is projected to grow steadily through 2015, supported by a recovery in economic conditions. To capitalize on this growing market, we believe that it is particularly crucial for DENSO to win the trust of North American customers as a true global partner. It is also important for us to maintain strong relationships with our Japanese customers as a matter of course.

In addition, we aim to achieve further growth through two main initiatives. The first is to expand the aftermarket business. We have been strengthening our hand in this field by developing a business promotion framework since the previous year. The second initiative is to explore non-automotive businesses mainly on the U.S. West Coast.

In other fields, we have three priorities. The first is to "obtain the capability to execute the North American business locally in North America," through the localization of design operations and procurement of parts and equipment. The second is to "develop technologies that enable us to ship products that are the world's first in class from North America." The third is to "establish a position as the No.1 supplier in terms of quality." By achieving these priorities, we aim to take on the challenge of driving further growth in our business based on the trust of customers and society at large.