Furukawa Electric Launches Auto Parts Production JV in India

Furukawa Electric announced on Wednesday the firm established a joint venture in India with Minda Group, Indian auto parts maker group, to produce and supply automotive parts to Japanese automakers in the country. The JV will supply automotive wiring harness at first to Japanese automakers’ local subsidiaries, mainly to Suzuki Motor Corporation’s subsidiary Maruti Udyog. The JV targets annual sales of 5 billion yen in fiscal 2010 ending March 2011. The JV also plans to start production of other auto parts such as steering roll connectors (SRC) applied to air bags in future.

The JV, named Minda Furukawa Electric Private LTD., was established with capital of 385 million Indian rupees or approximately 1.16 billion yen, 51% controlled by Furukawa Electric and 49% by Minda Group. The JV is located in an industrial estate of Haryana State, India and will start commercial production in September 2008.The JV is Furukawa Electric’s first plant of automotive parts in India. The JV will start production of auto wiring harnesses at first mainly for Suzuki Motor which holds the top share in Indian auto market currently. However, there exist other auto part makers including Yazaki Corporation and Sumitomo Electric Industries which are world top 2 makers of auto wiring harnesses and entered Indian auto market earlier than Furukawa Electric.

Furukawa Electric aims to establish a presence in Indian auto market with other auto parts such as SRC in future. Furukawa Electric is the world top supplier of SRC. Indian government seems to prepare for legal obligation to equip air bags on all vehicles in the country. SRC demand is expected to grow widely in India then.

Furukawa Electric holds 10% share in Japanese auto wiring harness market and 3% share in world auto wiring harness market, while 70% share in Japanese SRC market and 40% in world SRC market.