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

Spain's Cristian Lay Group buys two materials units of bankrupt LSB

April 17, 2014 11:11 am ET

Spanish industrial conglomerate Cristian Lay Group has purchased two of the bankrupt Spanish PET packaging group La Seda de Barcelona.    More

Negri Bossi's new owners may 'bring significant manufacturing' to US

April 16, 2014 1:09 pm ET

Italian plastics equipment major Negri Bossi may “bring significant manufacturing of injection molding machines back to the United...    More

Huntingdon Fiberglass launching second line

April 16, 2014 2:18 pm ET

Huntingdon Fiberglass Products LLC is getting set to start up a second production line later this year and hire 15-20 new employees as it sees demand ...    More

New Tigre, ADS JV aims to open more doors for Tigre in US

April 16, 2014 12:15 pm ET

A new joint venture between Tigre S.A. Brazil, a leading PVC pipe maker, and Advanced Drainage Systems Inc., the world's largest high-density...    More

Indorama's purchase of Sasa to give wider access to multiple markets

April 16, 2014 10:07 am ET

PET maker Indorama Ventures Public Co. Ltd. is expanding in Turkey with the acquisition of a majority of Sasa Polyester Sanayi.    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report provides analysis and discussions of economic and political conditions, market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as strategies being implemented by thermoformed packaging companies. In addition, there are reviews of 25 leading thermoformers in the packaging segment, assessing their growth initiatives and performance metrics over 10 years.

Learn more

Automotive Market Review and Outlook 2014 The Americas

This 75-page report features in-depth analysis of the automotive industry for the Americas. It includes discussions of market trends, legislative/regulatory activity impacting production and threats as well as design strategies being implemented by the major automakers. Detailed charts and data tables outline North American automotive production over the last five years.

Learn more

Plastics Building & Construction Market Review and Outlook 2014 with MS Excel chart data

This report provides in-depth analysis of the plastic building and construction market for North America, including discussions of trends, opportunities, threats and the latest developments in construction trends that impact plastics processors.

Learn more

Upcoming Plastics News Events

May 6, 2014 - May 8, 2014Plastics in Medical Devices 2014

May 12, 2014 - May 12, 2014Plastics News Brazil Pharma Summit

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

February 3, 2015 - February 7, 2015Plastics News Executive Forum 2015

More Events