Investing in Japan
Success Stories Tenneco Japan Ltd.
Tenneco Japan Ltd., the Japanese subsidiary of American global supplier of auto parts Tenneco, began full-scale operations of its Yokohama Technical Center in April 2016. By expanding its own engineering and product development capabilities in Japan with the installation of two new engine dynamos, Tenneco Japan supports the development and design capabilities of Japanese corporations operating globally, and is strengthening its support system for customers’ domestic and overseas production. In addition to the automotive sector, it aims to expand its presence in the Japanese market in the ships, vessels, agricultural machinery and construction machinery sectors.
The US-based company Tenneco has achieved solid growth through developing, manufacturing and selling automotive parts.
The company supplies products to automotive manufacturers around the world, with current annual sales of about $8.2 billion (approximately ¥924 billion). The company employs about 30,000 people throughout the whole group, owns more than 90 manufacturing facilities and 15 engineering and technical centers around the world and is thriving as a global supplier of automotive parts.
Global supplier of automotive parts
Tenneco, as a tier 1 supplier of auto parts specializing in clean air and ride performance products, supplies automotive OE (original equipment) parts to automobile manufacturers around the world and is also engaged in a wide variety of business activities, which include supplying aftermarket products for vehicle repair. It owns a large number of global brands including Monroe and Rancho.
In the field of automobile shock absorbers for attenuating vibrations, which are among its flagship products, the company is said to be “one of the top companies competing for the largest share in the world’s market.”
In the field of clean air products for exhaust gas treatment, another of the Tenneco’s trademark series of products, in view of stricter exhaust gas regulations expected to be enforced in the next few years in the world’s major markets in developed countries such as those in Europe, Japan and the United States, the company is consolidating its business platform for developing new technologies meeting the requirements of automotive exhaust gas regulations and setting supply systems. It has also set its sights on China and India, which are expected to become huge markets due to exhaust gas regulations.
Tenneco products (for exhibition)
Establishment and expansion of Yokohama Technical Center
Tenneco’s Japanese subsidiary was established in Tokyo in order to import and sell the products of its predecessor Monroe Inc. in 1973.
The head office was then transferred to Yokohama, in Kanagawa Prefecture, to allow more convenient access to customers. In 2011, following the acquisition by Tenneco, the name was changed to Tenneco Japan Ltd.
As a result of years of marketing efforts toward Japanese companies, Tenneco won a considerable amount of business in the overseas production of its Japanese customers. Furthermore, with its Osaka plant becoming operational in 2012, production started on products for Japanese manufactures of construction equipment and agricultural machinery. That resulted in the expansion of its business volume in the Japanese market. In spite of the temporary suspension of investment plans following the collapse of Lehman Brothers, further business expansion for its Japanese customers made it necessary to enhance the company’s engineering capacities in Japan, leading in 2014 to the opening of the Yokohama Technical Center.
In April 2016, just two years after its opening, the Technical Center was further expanded and additional capital investment was made. Behind this decision, says General Manager, Tenneco Japan & Global Japan OEM Business, Yasuharu Shimonishi, was the realization that “enhancing our engineering capabilities in Japan has been essential to the expansion of our company's business. A reason was to support Japanese customers globally as well as to increase our share in the Japanese market. In the automobile industry, in many cases products are designed and developed in Japan but manufactured and delivered overseas. So, it was necessary to improve our engineering capabilities in Japan for stronger competitiveness abroad. Furthermore, in Japan itself there are many existing and potential customers of Tenneco’s products, from automobiles to construction equipment, agricultural machinery, and shipping, and we regard this as a very attractive, strategic market. We are directing our energies in what we refer to as J-OEM (Japan OEM), a product supply and support system for Japanese manufacturers expanding overseas, so it was essential to expand our Yokohama Technical Center, competing with other excellent Japanese suppliers,” explains Mr. Shimonishi.
For the center’s opening, Tenneco took advantage of the “Subsidy Program for Projects Promoting Asian Sites” in 2012, and for the center’s expansion in 2016, of the “Support by Yokohama’s Business Location Incentive Ordinance” program. “We are extremely grateful that subsidies were made available for our investment plans. It supported our decision to engage in new business activities in Japan,” says Mr. Shimonishi.
Overview of Technical Center (Kanazawa ward, Yokohama City, Kanagawa Prefecture)
Future business development in Japan
“We also want to focus on strengthening our sales, research and development capabilities” said Mr. Shimonishi, thrilled at the prospect of future expansion. In order to familiarize customers with products developed by Tenneco, sales and marketing activities need to be reinforced. Personnel with skills across all business sectors, such as a program management for supporting all stages, from engineering and product development to the integration for mass production, are required,” says Mr. Shimonishi. The recently completed center, while receiving support from Tenneco’s overseas research and development centers, is also going to strengthen its own support system in order to function as a point of contact for supporting Japanese OEMs globally. To that end, acquisition of human resources is an important issue, and the company is planning on hiring and training new graduates in Japan in the future in addition to its current practice of recruiting experienced personnel. The company is also considering bringing in highly-skilled foreign professionals in order to further increase the current number of approximately 160 employees.
JETRO has been providing information on various types of incentives including the FY2012 Subsidy Program for Projects Promoting Asian Sites. With regard to JETRO’s support, Mr. Shimonishi says: “If we had tried to apply on our own, we would have faced many hurdles and it would have been a difficult proposition. We are extremely grateful for their continued support on so many different occasions. I hope we’ll continue to have a good relationship, starting from their participation in the opening ceremony for the expanded technical center.”
(July 2016 interview)
|1973||Established in Ebisu, Tokyo, as Monroe Japan Ltd.|
|1986||Moved headquarters to Shin-Yokohama in Yokohama City|
|1987||Changed company’s name to Tenneco Automotive Japan Ltd.|
|1988||Moved headquarters to Hiradai in Yokohama City|
|2011||Changed company’s name to Tenneco Japan Ltd.|
|2012||Osaka plant in operation|
|2013||Moved headquarters to Sakuragi-cho in Yokohama City|
|2014||Technical Center started operation in Fukuura, Kanazawa-ku, Yokohama|
|2016 April,||Expanded Technical Center|
Tenneco Japan Ltd.
Development, manufacturing and sales of clean air and ride performance projects to J-OEM
Development, import and sales of shock absorbers to the aftermarket
|Parent company||Tenneco Inc.|
|Address||1-1-8 Sakuragi-cho, Naka-ku, Yokohama, Kanagawa Prefecture 231-0062|
- Provision of information on incentives