1. Start of DENSO Korea by merging DENSO Korea Automotive Corporation, DENSO Korea Electronics Corporation, and DENSO International Korea Corporation

(1) Background and process of the DENSO Korea merger

As various environmental regulations and the importance of carbon reduction have become increasingly important in society, such as the “Euro 6” emission regulations for diesel vehicles introduced by the European Union in 2014, the automotive industry has been required to change its paradigm from the conventional internal combustion engine to the eco-friendly car.

With the emergence of a new field called “CASE” (connected, autonomous, shared, and electric), the technology applied to cars began to be recognized as a spatial concept that reflects the lifestyle of each individual, rather than a simple means of transportation.

As a result of these trends, since 2015, DENSO Korea’s three group companies have envisioned “integrated operations” as a new strategy to secure future competitiveness and further growth. In order to strengthen the business structure by more efficiently managing human and other resources, the group decided that the optimum method was to create a Synergistic effect by integrating resources dispersed throughout the companies. Ultimately, the target of the merger was to create a single company, “DENSO Korea”, to enhance the position and competitiveness of the DENSO brand in South Korea.

DENSO Korea began consolidating some of its sections in 2016, and since January 2017 all of its organizations have been under the DENSO Korea system. In this way, corporate integration did not take place in the blink of an eye, but was gradually promoted as an earnestly wished-for business.

In January 2018, DENSO Korea established a system with one representative director and announced a management innovation declaration. The company also declared plans for corporate integration to every member and announced important issues such as “reform of the management system”, “technical development and Monozukuri (manufacturing) reform”, and the “establishment of core group companies for DENSO Korea.”

In April, a Senior Executive Directors’ Board Meeting at DENSO Headquarters gave final approval for the merger of DENSO’s Korean group companies, and a merger contract was signed in May. July 1 was designated as the merger date, the merger registration was completed on July 2, and the integrated corporation DENSO Korea started.

Kim Kyung Seop, former president of DENSO Korea Electronics (2011-2015) and DENSO Korea Automotive (2015-2018), was appointed as the first representative director.

“Everyone, our company is in the throes of fierce competition at a time when conditions in the automobile market have never been more difficult. If we cannot beat the current competition, we cannot expect much more development. Consequently, we would like to build a ‘powerful DENSO Korea’ by combining three South Korean companies. In order to become a ‘powerful DENSO Korea’, each and every one of our employees must have the utmost determination and conviction. What we must create going forward is our own future and the future of DENSO Korea. We dream of DENSO Korea as a company that can quickly and flexibly compete against changes in the environment. In order to realize our dream, we need to reinvent ourselves by thoroughly improving into a structure that differs from what we had previously.”

- Excerpted from the speech of Kim Kyung Seop, former representative director of DENSO Korea

Representative Director Kim Kyung Seop stressed that every member should have the determination and conviction to win against fierce competition by taking advantage of DENSO Korea’s unique strong points to be reborn as a “powerful DENSO Korea.” In addition, he stated his ambition as the first representative director that DENSO Korea would respond to changes in the market environment quickly and flexibly through corporate integration and aggressive development of new technologies, in cooperation with DENSO Headquarters in the rapidly changing automobile market that has witnessed the advent of the Fourth Industrial Revolution, and that DENSO Korea would take on the challenge of the development of overseas markets as well as domestic markets.

On the other hand, the merger absorbed DENSO Korea Automotive and DENSO International Korea, led by DENSO Korea Electronics. The company was named “DENSO Korea Corporation”, a name indicating unity of manufacturing, sales, and technology as an enterprise; having comprehensive capabilities; and representing its group companies without emphasizing specific functions.