Denso, the second largest global mobility supplier, and powertrain supplier Aisan Industry Co, Japan, have reached a basic agreement, based on the board of directors meeting on May 20, 2019, to begin studying the possibility of increasing Denso’s stake in Aisan, and also transferring part of Denso’s powertrain business to Aisan. This initiative would help strengthen the companies’ competitiveness in powertrain and future growth areas.
Aisan makes a number of products including the EGR valve, which recirculates exhaust gas such as NOx and contributes to improving fuel efficiency and purification of exhaust gas.
The Japan-based Aisan makes a variety of powertrain components including fuel pump, fuel pump module, throttle body, EGR valve, intake manifold, positive crankcase ventilation valve, charcoal canister and engine valves for passenger vehicles. For green motoring, it makes hydrogen injectors and gas fuel system for LPG and CNG.
On the two-wheeler front, it makes fuel injection systems for small motorcycles, titanium alloy engine valves and charcoal canisters.
The two companies will start studying the possibility of transferring the entire business of developing, manufacturing, and selling some products such as fuel pump module in Denso’s powertrain business to Aisan. Powertrain products will continue to be developed and manufactured while increasing the production efficiency and cutting costs.
Denso likely to acquire Toyota Motor's 24.81% stake
The two suppliers are also studying the possibility of increasing Denso’s stake in Aisan, in the form of acquisition of all Aisan shares owned by Toyota Motor Corporation, to strengthen mutual cooperation to improve competitiveness in future growth areas. As per the data on the Aisan website, of the top 10 major investors in Aisan, Denso is the third largest with 4.81 percent, after Toyota Industries Corporation's 7.68 percent and Toyota Motor Corporation's 24.81 percent.
According to Denso, given that the global auto industry is facing a once-in-a-century paradigm shift and while there are growing global expectations for electrified vehicles, it remains important to reduce the CO2 emissions and increase the fuel efficiency of conventional internal combustion engines. Denso and Aisan plan to integrate similar operations in the powertrain businesses of the two companies to improve competitiveness in this area. Limited resources will be shifted to new growth areas to strengthen cooperation and contribute to the future of mobility.
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