Toyota hands over electronics production to Denso

June 04, 2018 // By Christoph Hammerschmidt
In order to increase its competitiveness, the Japanese vehicle manufacturer Toyota has decided on a series of restructuring measures with the Tier One supplier Denso. The focus is on the areas of electrification and automation. The measure is part of the transformation of Toyota's business model: in the future, the car manufacturer sees itself less as a supplier of vehicles and more as a provider of mobility.

Toyota and Denso's electronic components activities will be consolidated within Denso. The two companies want to establish a fast and powerful development and production structure in the field of automotive electronics. Part of the agreement is the transfer of production of electronic components from the Toyota Hirose plant to Denso; this should be completed by the end of 2019. The development and entrepreneurial responsibility of the electronic components remains with Toyota; only the production is assigned to Denso, a Toyota spokesperson explained. The company declined to elaborate on the financial volume of the relocated production. The spokesperson pointed out that Denso is part of the Toyota Group. The vehicle manufacturer owns almost 25 percent of Denso's shares.

In addition, all of Toyota's sales and marketing activities in the African market are planned to be taken over by Toyota Tsusho from January 2019. Toyota Tsusho has more than 10,000 employees in 53 of 54 African countries and regions. Africa is considered a promising growth region, especially for the automotive industry.   

"We are in a phase of change that only happens every hundred years," said Toyota President Akio Toyoda. "While we sell more than ten million vehicles a year and maintain and develop our current activities, we are also facing the challenge of becoming a mobility company. In this environment, it is important how effectively we use our limited resources and to what extent we can increase the competitiveness of the entire Toyota Group".    

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