Visteon becomes a global player in auto interior electronics

AUTOMOTIVE NEWS

Published: January 29, 2014 11:18 am ET
Updated: January 29, 2014 11:22 am ET

Related to this story

Topics Automotive, Mergers & Acquisitions, Automotive parts
Companies & Associations Johnson Controls Inc., Visteon Corp.

Visteon Corp., once known for its grab bag of low-margin products, has transformed itself into a major supplier of cockpit electronics.

With the $265 million acquisition of Johnson Controls Inc.'s electronics unit — which makes instrument clusters, infotainment displays and body electronics — Visteon estimates that its electronics operation will generate annual sales of $3 billion.

According to consultant IHS Automotive Inc., Visteon now is the third-largest global supplier of cockpit electronics, behind Denso Corp. and Continental AG. Harman International Industries Inc. and Alpine Electronics Inc. are fourth and fifth.

"It's really becoming a Denso, Continental and Visteon story," Visteon CEO Tim Leuliette said in a Jan. 15 interview. "We have nine of the top 10 automakers in the world [as customers], and we are gaining market share."

The deal comes at a time when suppliers are investing heavily to develop head-up displays, gesture control devices, reconfigurable instrument clusters and voice-activated controls.

The JCI acquisition "gives us capability in areas that we needed," Leuliette told investors at a Jan. 15 presentation sponsored by Deutsche Bank AG. "We didn't have strong expertise in head-up displays. They do."

Companies that can't — or won't — invest in cockpit technology are bailing out. Beda Bolzenius, chief of Johnson Controls' seating division, said his company decided to invest in its core product, seats, rather than electronics.

"It was clear that the electronics [sector] was going to change in a dramatic way," Bolzenius said in a Jan. 15 interview. "We knew we'd have to throw a couple of billion dollars at it to get in the ballpark with suppliers like Denso, Continental and Bosch. It would have been a real serious investment."

In the wake of the acquisition, Visteon is introducing a new generation of instrument clusters and infotainment controls.

At the International Consumer Electronics Show this month in Las Vegas, the company introduced a reconfigurable instrument cluster that reproduces high-resolution 3-D graphics on a 12.3-inch screen.

The instrument cluster, dubbed LightScape, will be produced for a European automaker in 2016.

Visteon also displayed a concept cockpit in which the motorist could control various infotainment functions using hand gestures and eye gaze.

The company designed these systems with the help of engineers recruited from the video game industry.

In the wake of the Johnson Controls deal, Visteon is preparing to sell its interiors operation this year.

That would leave the company with two core products, electronics and climate controls, in which it is an industry leader.

Visteon has a 13 percent share of global climate control sales, trailing only Denso, which has a 23 percent share.

What's next? The company has $1.7 billion in cash. Leuliette says he might use some of that money for more acquisitions.

He said: "We are generating lots of cash, and if there is an opportunity, we would consider it."


Comments

Visteon becomes a global player in auto interior electronics

AUTOMOTIVE NEWS

Published: January 29, 2014 11:18 am ET
Updated: January 29, 2014 11:22 am ET

Post Your Comments


Back to story


More stories

Image

Canadian mold maker Thibault adding to new operation in Mexico

August 27, 2014 3:19 pm ET

Canadian mold maker I Thibault Inc has purchased an established Mexican company, Tecnimoldes SA de CV, for a seven-figure-dollar-sum and renamed it...    More

Image

Megadyne buying Belt Corp. of America

August 26, 2014 10:35 am ET

In a move aimed at building its specialty belting manufacturing and fabrication operations, Jason Industrial Inc. — Megadyne SpA's wholly owned ...    More

Image

Sonoco buys Germany's Weidenhammer, plans for thin-walled packaging growth

August 25, 2014 1:41 pm ET

Sonoco Products Co.'s acquisition of Weidenhammer Packaging Group GmbH of Germany includes plastic packaging technology that the company is targeting ...    More

Image

Deceuninck buys PVC window maker Pimas, adds capacity in Turkey, Russia

August 25, 2014 2:26 pm ET

European building products manufacturer Deceuninck Group has acquired 81.2 percent of Pimas Plastik Insaat Malzemeleri AS, the leading PVC window...    More

Image

New contract for JCI workers heads off potential strike in Ontario

August 25, 2014 3:17 pm ET

About 300 unionized workers at a Johnson Controls Inc. interiors plant in Ontario ratified a new three-year contract, heading off a potential strike a...    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events