Nidec is sharpening its focus on robots and electric vehicles, new technologies rapidly reshaping the industry landscape.
“We have entered a new stage in automotive-related operations,” says Chairman and CEO Shigenobu Nagamori. “Orders for automotive motors are being received from European and Chinese manufacturers as electronic components are widely adopted by cars, while demand tied to home appliances has been brisk in Asia and elsewhere. These sales have compensated for sluggishness in precision motors for personal computers and other equipment.”
Sharp growth of products for the automotive, home electronics, commercial and industrial sectors symbolises a change in Nidec’s business structure. This business’ operating profit for April-September jumped 38% on the year to 38.6 billion yen, driving the company’s overall 19.8% increase to 82.6 billion yen and surpassing profit from the precision motor segment for the first time ever.
The company began making motors for hard disk drives in 1979. The rapid proliferation of PCs and the era of digitization supported Nidec’s strong growth over the years.
But the landscape has been changing. To ease dependence on HDDs, Nidec accelerated acquisitions over the past decade or so, announcing 56 purchases. Examples include Honda Elesys, a major producer of electronic control units for cars, and the motors and drives business from from US manufacturer Emerson Electric, including Control Techniques!
“Europe and China are trying to wean themselves off gasoline cars,” adds Nagamori. “The accelerated shift to electric vehicles is spurring a major change.”
Nidec’s automotive business mainly supplied parts for power steering and seat control systems. But now the company has developed motors for drive systems in electric vehicles, with plans to begin mass production as early as next year to supply automakers in emerging markets. The company aims to generate more than 100 billion yen in sales from drive system motors in fiscal 2025.
In robotics, Nidec plans to increase output with a focus on reducers, which control joints. The company targets robotics-related sales of 500 billion yen in fiscal 2025.
The company has an ambitious sales target of 10 trillion yen in fiscal 2030, nearly seven times the forecast for fiscal 2017. Nagamori says the biggest risk lies in securing necessary personnel including engineers.