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January 7, 2021

The road to the rise of the auto parts giant Denso: Follow the pace of Toyota Motor to achieve global expansion

latest company news about The road to the rise of the auto parts giant Denso: Follow the pace of Toyota Motor to achieve global expansion  0



Recently, Berylls Strategy Advisors, the most authoritative automotive information strategy analysis company in Germany,

released the latest list of the world's top 100 auto parts system suppliers. Germany has a clear advantage, accounting for 3

of the top five places. Germany's Bosch continues to lead the first place with 47.6 billion euros, while Continental Tire's 44.4

billion euros and Denso's 42.6 billion euros rank second and third. Magna of Canada and ZF ZF of Germany are fourth and fifth.



latest company news about The road to the rise of the auto parts giant Denso: Follow the pace of Toyota Motor to achieve global expansion  1



一. Introduction

In 1949, Denso (DENSO) became independent from Toyota Motor. After three stages of development, it has grown into one of the world's leading auto parts. The first stage was the 1949-60s. During this stage, Denso laid the foundation for its development by improving manufacturing technology and product quality, as well as domestic expansion; the second stage was the 1970s-80s, Denso set the main goal of building a global company , Set up manufacturing and sales bases around the world; the third stage is from 1990 to now, Denso Corporation changed its name to Denso Corporation, continued to strengthen research and development, and pay attention to product environmental protection. Through continuous expansion of product areas, Denso has now become a leader in the auto parts industry with seven major sectors including thermal management systems, powertrain systems, information and security systems, electrification systems, electronic systems, small motors and non-automotive sectors.


latest company news about The road to the rise of the auto parts giant Denso: Follow the pace of Toyota Motor to achieve global expansion  2




The development trajectory of Denso is worth studying. We believe that its successful experience can be summarized in three points. First, at the beginning of its establishment, it cooperated with German Robert Bosch and other advanced foreign companies to learn technology and apply it to lay the foundation for its development; second, follow the downstream OEM Toyota Motor, take Toyota to expand overseas, and establish manufacturing and sales globally Base, grow into a global company; third, focus on product development and product field expansion, and maintain the core competitiveness of high-end auto parts. We believe that Denso's development history can bring inspiration to the global business expansion of domestic component manufacturers. We selected Huayu Automobile, Tuopu Group, Fuyao Glass, and Daimei to illustrate.

Huayu Automobile has a certain similarity with Denso. Denso is spun off from Japan's Toyota Group, and Huayu Automobile is spun off from SAIC. Huayu Automobile has adopted the path of joint ventures and then acquisitions and reorganizations, and its interior and automotive lighting businesses have become globally competitive. Huayu Automobile relies on Yanfeng's interiors to deploy in North America, and globalization has achieved initial results. In addition, SAIC has accelerated its international operations and established new plants in Thailand, India and Indonesia. Huayu closely follows SAIC and is expected to further expand its business in new overseas markets. At the same time, the company copied Yanfeng Road in the field of automotive lighting, acquired foreign shares in Shanghai Koito, and renamed it Huayu Vision, which is expected to accelerate its expansion in the field of automotive lighting. In addition, Huayu has deployed ADAS system, millimeter wave radar business and electric drive for new energy vehicles, keeping up with industry development trends. We believe that with a more comprehensive business layout, R&D strength and supporting advantages, Huayu's future domestic business share and global layout are expected to achieve further expansion.

Tuopu, Fuyao, Daimei and other companies, after gaining the trust of joint venture customers with their excellent products, gradually supply customers with overseas factory production. As the leader in the domestic NVH field, Tuopu Group initially supplied supplies to Shanghai General Motors, and later obtained global project orders from General Motors, gradually realizing overseas expansion. Fuyao Glass focuses on improving product quality, becoming the domestic leader and following vehicle customers for global expansion. In 2002, it began to supply Hyundai in South Korea and officially entered the global supply chain. Since 2013, Fuyao has established factories in Russia and the United States to cooperate with customers for overseas production. , And gradually expand its business overseas, and its overseas business volume growth can be expected. Daimei shares supply foreign high-end vehicle manufacturers and mainstream first-level component manufacturers, and at the same time completed the acquisition of Motus, the second largest sun visor manufacturer in Europe and the United States, to achieve overseas high-end customer coverage and accelerate globalization.

2. Research on the development path of Denso Corporation

According to the 2017 annual revenue ranking, Denso's revenue ranks second in the world's parts suppliers. According to the company's official website and the 2017 fiscal year report, as of March 31, 2018, Denso had approximately 200 subsidiaries, 170,000 employees, and 38,000 patents worldwide, and its 2017 fiscal year revenue reached US$48.1 billion. According to Gasgoo data, in terms of revenue, Denso ranked second in the world in the global automotive supplier ranking in 2017.


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