Toyota and DENSO Fusing Electronic Component Operations

In the latest turn on the ruinously expensive toll road to autonomous vehicles, Toyota Motor Corporation and DENSO Corporation say they have concluded a contract to transfer core electronic component operations to DENSO. In June 2018, both companies reached a basic agreement to consolidate the core electronic component operations of both within DENSO and began studies.

Currently, Toyota’s electronic component operations are conducted by both Toyota and DENSO. In the future, these development functions and production operations will be consolidated within DENSO.

Initial discussions focused on consolidation of production operations by the end of 2019, and development functions from 2022, but in order to ensure a smooth transfer and to create the new structure faster, both companies agreed to consolidate both development and production in April 2020.

By consolidating these operations within DENSO, which has expertise in the field of electronic components, a speedy and competitive development and production structure will be established it’s claimed. In doing so, the aim is to also maximize resource utilization, such as by shifting resources created by eliminating duplicate operations within the Toyota Group to new domains that will increase the value of future mobility, thus strengthening the competitiveness of the Toyota Group overall.

Main Initiatives

1. Consolidation of production operations for electronic components. On April 1, 2020, production of electronic components at Toyota’s Hirose Plant will be consolidated within DENSO. The land, production infrastructure (including buildings, equipment, and software), and other items at Hirose Plant will be transferred to DENSO.
2. Consolidation of development for electronic components. On April 1, 2020, the development functions for electronic components will be consolidated within DENSO. Relevant drawings, development equipment, and other items will be transferred to DENSO.