Denso Corp.'s bold plan to transform itself over the next decade will result in products and services it currently doesn't sell. But an equal challenge awaits Japan's biggest supplier: what to do with all of its old products.
Denso produces a bulging catalog of auto parts, including many that are not part of the industry vision of electrified, autonomous vehicles — such as spark plugs, oil filters, starters, oxygen sensors, fuel pumps and crankshaft sensors.
The company realizes that many of those will decline in significance or slowly disappear in the coming world of electric vehicles.
Kenichiro Ito, CEO of Denso International America, says the company must be prepared to shift its product-development spending away from the old products, based on customer needs, but at the same time find ways to make some of Denso's core 20th-century parts more important to 21st-century vehicles.
"Our question is how we can transform our commodity products by adding value," Ito told Automotive News. "For example, the air conditioner. As it is today, it could become simply a commodity. But in the future, instead, it could be combined with safety functions to add value, or combined with the functions of autonomous driving.
"We are focused on finding new value."