[Company analysis] JTEKT Corporation (ジェイテクト)

「JTEKT Corporation (ジェイテクト)」is a manufacturer of large machinery and automobile parts that belongs to the「Toyota Group」. Their overseas sales account for 62.3%, and they mainly manufacture automobile steering drive system products, machine tools, mechatronics products, and home-related equipment such as home elevators. Together with「Okuma Holdings, Inc. (オークマ)」,「Yamazaki Mazak Corporation(ヤマザキマザック)」,「DMG Mori Seiki Co.(DMG森精機)」,「JTEKT Corporation(ジェイテクト)」, it is one of the four major processing machine manufacturers in Japan. It is also one of the three major bearing manufacturing companies in Japan, 「NSK Ltd.(日本精工)」,「JTEKT Corporation(ジェイテクト)」,「NTN Corporation」. The number of consolidated employees is approximately 49,693.

 

1. Company Profile

2. Summary and Features

3. Major Business

4. Financial Information

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	JTEKT Corp.
Company name (Japanese)	ジェイテクト
Date of establishment	Friday, January 18, 1935
Headquarters location	大阪市中央区南船場3丁目5番8号
Capital	45,591
Consolidated sales	1,520,893
Consolidated operating profit	66,608
Consolidated total assets	1,267,819
Consolidated capital	571,080
Capital adequacy ratio	45.0%
Consolidated number of employees	49,693

 

 

 

2. Summary and Features

 
On January 1, 2006,「JTEKT」, one of the 13 major subsidiaries of the Toyota Group, was established by the merger between「Koyo Seiko Co.(光洋精工)」and「Toyoda Machine Works, Ltd.(豊田工機)」. This company is one of the  four major processing machine manufacturers(「JTEKT」,「Yamazaki mazak(ヤマザキマザック)」,「DMG Mori Seiki(DMG森精機)」and「Okuma(オークマ)」) that are headquartered in Aichi Prefecture. Besides, it is also one of the three major Japanese bearing manufacturers(「NSK Ltd.(日本精工)」,「JTEKT Corporation(ジェイテクト)」,「NTN Corporation」).

The core product of JTEKT's automobile parts business is the steering system(the part that transmits the movement of the steering wheel operation to the tire). 「JTEKT」specializes in the electric power steering field, which is essential for autonomous driving, and has a lineup of various steering-related products for improving fuel efficiency and functionality of automobiles. Currently, they got the world's top share in this steering system field.

However,「JTEKT」has a high leve of dependence on the automobile industry as described above, which can be said to be a weak point. More than half of the total sales are for automobiles, and transactions with「Toyota Motor Corporation(トヨタ自動車)」account for 15.9% of the total sales. As for machine tools, most of the orders are from the automobile industry.

The problem is that with the expansion of vehicle sharing services, the production volume of cars may decrease. So, 「JTEKT」has recently been working on a new business and has developed a high heat resistance lithium ion capacitor that can be expected to be used in various fields. It's mass production started in October 2019. In addition they are also trying to start medical device business by developing "J-Walker Techtec", a medical surpporting device for walking.

 

 

 

3. Major Business

 

■ Steering system business

■ Drive system parts business

■ Bearing business

■ Processing machine business

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		1,318,310	1,441,170	1,520,893
Consolidated operating profit		77,442	81,391	66,608
Consolidated total assets		1,117,851	1,277,066	1,267,819
Consolidated net assets		512,906	572,592	571,080
Breakdown of sales	Machinery components business	1,176,049	1,279,572	1,345,822
	Processing machine business	142,260	161,597	175,070