TOKYO - Although Textron Automotive Co. is expanding in Japan, it is not seeking to sell to Japanese carmakers in their home market. Yet Textron would 'clearly love' to have a manufacturing presence in Japan, Textron Automotive Chairman Sam Licavoli said.
That apparent inconsistency is because of Textron's differing immediate and medium-term goals.
Textron Automotive, a unit of Textron Inc., sold $2.4 billion in parts to the auto industry worldwide in 1998, ranking 34th among global suppliers. Of that, about $120 million was sold to Japanese carmakers, mainly in North America and Europe. Textron Automotive wants to raise that to more than $300 million by 2004.
To do so, Textron realizes it will have to offer engineering support and 'design-in' capability to Japanese carmakers closer to their head-office engineering centers. And eventually, it will have to be able to sell parts in Japan.
So it is expanding in Japan by adding a 12-person sales and engineering services facility in Yokohama to what had been a one-person office in Nagoya responsible for overseeing guest engineers flown into Japan on short-term assignments.
Licavoli knows, though, that the Yokohama office is not enough to support sales of parts in Japan.
'To provide the Japanese carmakers with our products anywhere in the world now, a manufacturing presence in Japan is mandatory for us,' he said.
Because it would be difficult and expensive for Textron to establish a Japanese manufacturing operation on its own, 'our first preference would be to partner or align with another Japanese supplier,' he said. 'Acquisition is also of course a possibility.'
Although he would like to cement such a connection as soon as possible, 'we will proceed with caution, and not try to rush the process,' he added.
Denying that his plans for Japan were pegged to Nissan Motor Co.'s radical dismantling of its supplier keiretsu, Licavoli said: 'There's a procurement revolution going on around the world, not just at Nissan.'