Aisin's North American growth drives more investment, new HQ

Aisin employs about 700 people at five Michigan operations, including the new headquarters in Northville, Mich., west of Detroit.
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Aisin World Corp. of America opened a new North American headquarters in suburban Detroit in July as part of the foreign subsidiary's growth stateside.

Aisin bought and renovated the 200,000-square-foot building in Northville, Mich. -- a $13 million development to house its U.S. headquarters and Aisin Technical Center of America after outgrowing its offices nearby.

The subsidiary of Japanese conglomerate Aisin Seiki Co. has invested a total of $3 billion in North America and more than $250 million in Michigan since 1984 as it continues to win new contracts with domestic and foreign automakers.

Aisin employs more than 700 at its five Michigan sites in Northville Township, Ann Arbor, Plymouth Township and Fowlerville.

Parent company Aisin Seiki ranks No. 5 on the Automotive News list of the top 100 global suppliers with estimated worldwide sales to automakers of $27.1 billion in its 2013 fiscal year.

Crain's Detroit Business reporter Dustin Walsh spoke with Aisin World Corp.'s top local executive, John Koenig, president of sales and marketing, about foreign investment and the transmission and engine parts supplier's growth in the region. Crain's Detroit Business is an affiliate of Automotive News.

Why invest in a new technical center and headquarters?

The expanded Aisin Technical Center of America enables us to add equipment, i.e., the first in-house engine dynamometer for Aisin in the U.S. -- and engineering resources. This will help us grow our regional capabilities, lead local product development, bring new technology to the industry and handle a larger share of design duties for the North American market, all under one roof. We plan to continue to grow by adding new facilities and investing in current plants in order to provide ongoing support to our customers.

What customers do you support from those offices?

Chrysler, General Motors, Honda, Nissan, Subaru, Toyota and others.

Do you see potential for M&A activity?

In order to stay competitive in a market that is constantly evolving, we explore all opportunities for growth of our business capabilities.

Why has the region seen so much foreign investment?

Michigan is home to 63 of the top 100 suppliers in North America, and ranks first in the country in concentration of engineers, designers, r&d professionals and skill-trade workers. We're here because our customers are here -- hence the location of our sales and marketing headquarters, our technical center and our proving ground in Fowlerville. Being near our customers enables us to take advantage of the great automotive human resources in the area, as well as proximity to major universities.

John Koenig: "The attention that recent recalls has brought to the industry reminds us of the importance of examining and re-examining everything we do."

What automotive technology is most exciting to you and Aisin? 

Through Aisin's systems solutions, we're able to help our customers satisfy many of their objectives, including (vehicle) weight reduction, fuel efficiency, safety, and comfort and convenience.

How has the influx of recalls changed or affected business at Aisin? 

The attention that recent recalls has brought to the industry reminds us of the importance of examining and re-examining everything we do. Our company is based on the fundamental principles of "quality first," which means we consider safety as a primary aspect of quality.

Is government regulation playing to Aisin's benefit? 

We have ongoing development in (intelligent transportation systems), such as distracted driving technology, sensors, navigation systems, camera systems, as well as technologies for fuel efficiency, light weighting efforts and improved transmission capabilities. We believe we have a huge advantage in the fuel efficiency arena because of our engine components, heat management systems, body components designs, etc. This product leadership will continue to help our customers reach their objectives.

Are the domestic automakers improving relationships with suppliers? 

Yes, we see that trend via (automakers), whether it's town hall meetings or simply improved communications. Aisin is confident that the trend will continue because the more we know about each other's needs and requirements, the better opportunity we'll all have to make good decisions.

Has pricing pressure changed in recent years? 

Cost competition pressure is always increasing, and even though pricing pressure has taken different forms over the years, it hasn't really changed. There's always pressure.

What keeps you up at night? 

Retaining and developing our most important assets. Human resources and rising health care costs.

You can reach Dustin Walsh at dwalsh@crain.com.


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