Delphi Automotive, NSK Announce Alliance, Form Brazilian Joint Venture
23 October 1997
Delphi Automotive, NSK Announce Alliance, Form Brazilian Joint Venture
TOKYO, Oct. 23 -- Delphi Automotive Systems and NSK Ltd.
today announced the signing of a Memorandum of Understanding to jointly pursue
automotive wheel bearing business on a global basis. Also announced was the
creation of a manufacturing joint venture in Brazil as the first outgrowth of
this alliance.
The focus of the alliance is on a product line called "The Third
Generation Wheel Bearing Unit" or "Hub III," and the emerging markets such as
South America, ASEAN, China and Central Europe.
Hub III is a double-row angular contact ball bearing with integral inner
and outer mounting flanges for automotive wheel bearing applications. Bearing
preload is preset with this design enabling easier assembly onto a vehicle.
Integral ABS speed sensing may be added to the bearing, enhancing reliability
of the sensing function and reducing overall ABS cost. Hub III was first
adopted by GM, and now is being used by other OEM's in North America, Europe
and Japan. Tremendous growth is expected.
Delphi Chassis Division of Delphi Automotive Systems is the world's
largest producer of Hub III and supplies GM and others. NSK, being the second
largest bearing manufacturer, has a broad product line ranging from a
conventional bearing to the Hub III design. With a synergy effect of both
companies' strength, the alliance aims to further increase the global share of
Hub III.
As a first step, a joint venture agreement was recently signed to
establish a new company in Brazil to manufacture, market and distribute
Hub III. Delphi and NSK will each own 50% of the venture which will be
established in an existing NSK production facility located near Sao Paulo,
Brazil. The company will initially manufacture Delphi designed Hub III for
vehicles produced by GM do Brazil. Production is expected to begin early
1999, with an anticipated workforce of about 40 people. The venture will be
named Delco Chassis NSK do Brasil Ltda.
The two companies will conduct feasibility studies for establishing joint
venture companies in other emerging markets to manufacture Hub III wheel
bearings.
"NSK is known world-wide as a leader in automotive wheel bearing
technology and we are pleased to be entering into this relationship with
them," said Delphi Automotive President J.T. Battenberg III. "We believe the
combination of advanced Hub III technology and a global manufacturing base
provides us with the opportunity to together become the dominant supplier of
advanced-technology wheel bearings around the world."
"Our mission is to provide high quality services to our customers in a
timely manner on a global basis," said NSK President Tetsuo Sekiya. "Being a
pioneer, Delphi has accumulated tremendous expertise of Hub III. By combining
the manufacturing, technological and marketing strengths of our companies, we
hope to better satisfy customer needs and jointly expand the sale of Hub III."
Delphi Chassis General Manager Alan S. Dawes said, "Today, our customers
have truly global requirements. As the international automotive market
continues to expand, automotive OEM's are interested in working with a
supplier that can meet their requirements wherever they choose to locate their
assembly plants. NSK's manufacturing presence in growing and emerging markets
around the world will greatly enhance our ability to supply high quality,
advanced technology bearings to global customers."
NSK Ltd., headquartered in Tokyo, Japan, is one of the world's largest
manufacturers of rolling element bearings and automotive components, as well
as precision machine parts. It employs over 19,000 people at 10 manufacturing
plants located in Japan and other operations in the USA, Europe, Brazil and
Indonesia. It also has joint ventures in Japan, USA, Britain, Korea,
Malaysia, Thailand and China, as well as sales offices throughout the world.
Delphi Automotive Systems, with headquarters in Troy, Mich., USA, is the
world's largest and most diversified supplier of automotive components and
systems. Delphi operates 198 manufacturing facilities, 46 ventures and 17
technical centers in 35 countries. Regional headquarters are located in
Paris, Tokyo and Sao Paulo. Delphi can be found on the Internet at
http://www.delphiauto.com.
SOURCE Delphi Chassis Systems