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

Haitian builds system for Renault's new China auto assembly plant

April 24, 2015 11:10 am ET

A late-comer to the world's largest auto market, French carmaker Renault SA is currently building its first factory in China.    More

Image

Eriks NV buys two US polymer companies

April 24, 2015 10:38 am ET

Dutch company Eriks NV is expanding its reach in the North American plastics sector with two acquisitions: Dallas-based Seals and Packings Inc. and...    More

Image

Jeco adds Ferry rotational molder to handle increase in business

April 23, 2015 12:27 pm ET

Jeco Plastics Products LLC is ramping up for more work, adding a new Ferry 2600 rotational molder that will provide more capabilities.    More

Image

Engel, VW working on joint research into high volume composites in auto

April 23, 2015 9:40 am ET

Engel, the Austria-based manufacturer of injection molding machines, is building one of its largest machines for a research center looking into...    More

Image

Federal-Mogul building auto wiper blade plant in Romania

April 22, 2015 12:28 pm ET

U.S. car parts maker Federal-Mogul Holdings Corp. has unveiled plans to establish a new production facility in Ploiesti, Romania, reports local news m...    More

Market Reports

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Injection Molding Market Analysis & Processor Rankings

Plastics News BUNDLED package contains our in-depth Market Analysis of the Injection Molding segment. You will gain keen insight on current trends and our economic outlook.

As a BONUS this includes PN's updated 2014 database of North American Injection Molders RANKED by sales volume. Sort, merge, mail & prospect by end market, materials processed, region, # of plants and more.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Upcoming Plastics News Events

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 15, 2015 - September 17, 2015Plastics Caps & Closures - September 2015

More Events