[Company analysis] Denso Corporation (デンソー)

「Denso Corporation (デンソー)」is an automobile parts manufacturer headquartered in Aichi Prefecture, and currently holds the largest share of the global automobile parts market. The predecessor of this company was the electrical equipment division from「Toyota Motor Corporation」and it still belongs to the Toyota Group. The annual sales have exceeded the 5 trillion yen for 2018, and they are ranked 229th on the 2018 Fortune Global 500 list. The number of consolidated employees is approximately 171,992.

 

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	Denso Corporation
Company name (Japanese)	デンソー
Date of establishment	Friday, December 16, 1949
Headquarters location	〒448-8661 愛知県刈谷市昭和町1-1
Capital	187,500
Consolidated sales	5,362,772
Consolidated operating profit	316,196
Consolidated total assets	5,792,414
Consolidated capital	3,770,366
Capital adequacy ratio	65.1%
Consolidated number of employees	171,992

 

 

 

2. Summary and Features

 
At present,「Denso」has many subsidiaries in Japan(63 companies), USA(34 companies), Europe(34 companies), Asia / Oceania(58 companies), and is one of the world's largest automobile parts manufacturers. . Despite it is a member of the Toyota Group, the sales to the Toyota Group account for only 50% of the total, and the remaining 50% is covered by other automobile manufacturers and other businesses. Also, the number of overseas employees is the second largest in Japan after「Toyota Motor Coporation」, which is more than general trading companies such as「Marubeni Corporation(丸紅)」and「Mitsubishi Corporation(三菱商社)」.

Considering the current status of「Denso」, it is a bit hard to imagine the situation when it was established. In reality, 「Denso」is a company that was independently established from the electrical equipment department, which was a troublemaker of「Toyota Motor」in 1949. At that time, the electrical equipment division of Toyota Motor Corporation was in the red, and it had a cumulative deficit of 140 million yen. Immediately after independence,「Denso」laid off 30% of all employees, and in 1953 entered a technical tie-up with German automobile parts manufacturer,「Bosch」and actively introduced the advanced technology through them. In 1954, they established a technician training center and worked hard to improve their technical capabilities.

As a result, the technological capabilities of「Denso」have greatly increased, and in addition to electrical components for「Toyota Motor」, they became one of the world's leading component manufacturers that deliver products to major automobile manufacturers around the world. However, automobile parts are not the only business of Denso. In the 1970s, they also produced amateur radio equipment, and supplied mobile phone terminals to「KDDI Corporation」, even though It was not that so huge volume. But until 2007, it manufactured car phones for 「NTT DoCoMo, Inc.」. Recently, by utilizing sensor technology, they started the drone business.

In addition to the facts mentioned above, it is also「DENSO」that developed the "QR Code" used in various situations in the world. The QR code itself is a registered trademark of「Denso Wave」, a subsidiary of 「Denso」. Since「Denso Wave」does not enforce its patent rights, we all use QR Code for free.

 

 

 

3. Major Business

 

■ Industrial equipment field
They handle products mainly related to factories, offices, stores, such as FA devices such as programming computers for industrial robots, bar codes, and QR codes.

■ Life-related equipment field
Natural refrigerant CO2 Household heat pump water heater for home use, air conditioning for the entire house, and home energy management system (HEMS).

■ Automotive related fields
Denso's main business is not only the development of automotive components such as powertrain, electronics business, thermal business, information security business, and small motors, but also automobile-related systems. They are also actively working on the development of artificial intelligence for the development of automated driving systems.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		4,527,148	5,108,291	5,362,772
Consolidated operating profit		330,551	412,656	316,196
Consolidated total assets		5,150,762	5,764,417	5,792,414
Consolidated net assets		3,447,082	3,774,293	3,770,366
Breakdown of sales	Japan	1,871,838	2,140,729	2,284,190
	America	1,050,460	1,122,847	1,182,012
	Europe	550,244	620,193	609,417
	Asia	989,505	1,146,037	1,215,115
	Others	65,101	78,485	72,038