2. Commencement of Operations
1949-
(1) Bold Implementation of Equipment Modernization
- 1952
- As the company began its operations, it faced a significant shortage of production equipment. The management made bold decisions to undertake massive investments, far exceeding their immediate financial capacity. In 1952, executives were sent to the United States to swiftly acquire a substantial amount of the latest and most advanced equipment.
Having just managed to resolve labor disputes, the company still had pressing issues to address, particularly concerning “production equipment.” The challenge was how to expand and strengthen the production facilities to meet future demands. In response, President Torao Hayashi made a series of decisive, large-scale investments to secure the company's future growth.
Initially, he decided to acquire machinery designated for compensation preservation. In 1952, foreign-made precision machines, which were under compensation preservation, were to be released. The company promptly proceeded with the necessary procedures and succeeded in acquiring all the available machines.
- Deep DiveAcquisition of Compensation-Designated Machinery
- In 1950, the company was permitted a temporary loan of foreign-made precision machines that had been designated for compensation preservation. By 1952, the temporary loan transitioned into a full acquisition of these machines. The estimated value of these machines was around 40 million yen.
At that time, the company had just increased its capital to 45 million yen. Despite the fact that this investment was nearly equivalent to the company's total capital, the company promptly proceeded with the necessary steps to acquire all the available machinery.
The proactive approach taken by Director Takaichi Suzuki and others was crucial. They were able to obtain information from financial authorities ahead of competitors, allowing the company to act quickly and secure the best machines. It was said that Nippondenso managed to acquire most of the high-quality machinery, outpacing other companies in the process.
Next, the focus shifted to obtaining state-of-the-art production machinery. The production equipment of a factory forms the foundation of manufacturing and is the source of competitive strength. The company was not satisfied with just the compensation-designated machines; it had a strong desire to introduce the latest equipment with a global perspective. The founding philosophy was that Nippondenso should not remain confined to a single region or country but should always aim for significant leaps forward. This mindset instilled a strong commitment to innovation within the company.
President Hayashi resolved, “Let's seize this opportunity to introduce the latest machines and prepare for the future. Let's go to America, conduct a thorough investigation of the available machinery, and acquire the ones we deem excellent.” Once the decision was made, the management acted swiftly. There were still strict regulations on foreign travel. And due to the Korean War, the company had just begun to breathe a financial sigh of relief. Nevertheless, in May 1952, Directors Takaichi Suzuki and Takeaki Shirai were dispatched to the United States.
- Deep DiveU.S. Business Trip of Directors Suzuki and Shirai
- In 1952, with the aim of introducing the latest machinery for the production of electrical components, as well as to conduct a comprehensive survey of the automotive and electrical component industries, Directors Takaichi Suzuki and Takeaki Shirai embarked on a business trip to the United States. Over the course of two and a half months, they visited and inspected a wide range of facilities, including major factories such as GM's Delco Remy plant, American Bosch's factory, Autolite's factory, and Ford's Ypsilanti plant, as well as various small and medium-sized enterprises.
During their trip, they investigated the realities of management and research laboratories, methods to improve productivity, and conducted a thorough examination of various machines for potential acquisition.
At the board meeting held in September, the purchase of various state-of-the-art machines, amounting to a total of 160 million yen, was promptly discussed and approved. At that time, the company's capital had just increased to 90 million yen after several rounds of capital increases, but this purchase order far exceeded the total capital amount.