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Calsonic Kansei: Supply-Side Economics

 

Sep. 19 – Saitama City – A race car speeding down a straight, a Nissan X-Trail heading off road, an electric vehicle silently cruising a city street; they may appear to have little in common, but their components come from the same maker: Calsonic Kansei.

The 10 millionth radiator, gold-plated, on display at Calsonic Kansei

Located outside of Tokyo, Calsonic Kansei’s R&D center and headquarters produces designs for a variety of components, including front-end and cockpit modular systems across a range of models.

Calsonic systems cut assembly costs for major auto manufacturers, including Honda, Mazda, BMW and Renault.

But some 80% of Calsonic Kansei revenues come from Nissan, which sees the supplier as integral to its cost-leadership targets.

Nissan CEO Carlos Ghosn met Calsonic Kansei President and CEO Bunsei Kure Tuesday to reinforce ties and cost reduction efforts.

For parts makers and auto-manufacturers alike, keeping Japanese production costs affordable is key. As Nissan CEO Carlos Ghosn said today, Calsonic Kansei is doing the right thing by focusing on the global market and making sure that business expansion overseas reaches a diverse client base.

That relationship, Ghosn says, is growing in parallel.

“Calsonic also has an effort into trying to get from LCC a lot of components,” says Ghosn. “And, frankly, even though there are a lot of efforts from Nissan to get less dependence on the yen, this is not about Japan, this is about a currency in Japan – which is the yen. Calsonic and the suppliers in general are doing the same thing. So, they are, in a certain way, doing in parallel what we are doing and so far they’ve been growing.”

 

Ghosn says Calsonic Kansei is more than a Nissan supplier — it’s a partner.

“We want a strong partner. Responsible of their company, challenging and accepting to be challenged for the win-win situation, obviously  of your customers, of which Nissan is the main one, but also of the company,” the Nissan CEO said.

Calsonic Kansei became a subsidiary of Nissan in 2005, and Ghosn was confident that it would hit a 7% operating margin, as well as reach more than 1 trillion yen – or $12.7 billion – in sales.

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