German automotive supplier Hella KG Hueck & Co. has sold its stake in a U.S.-based lighting-parts company to its Japanese partner.
Meanwhile, several industry sources say that Hella is considering opening its own lighting plants that could compete with the company it is selling, North American Lighting Inc.
That unusual scenario has meant a major ownership shift for North American Lighting, one of the largest injection molders of automotive headlamps and taillamps on this continent.
The joint-venture company, which runs plants in Flora and Salem, Ill., primarily molds polycarbonate front-signal lenses and acrylic taillamp lenses. The plastic lenses are then painted, vacuum plated and assembled with glass optical systems that are outsourced from other suppliers.
Until now, Hella has owned half the company, which recorded about $280 million in sales last year. Japanese lighting producer Koito Manufacturing Co. Ltd. of Yokohama owned 40 percent, while the remaining 10 percent share was held by Tokyo-based auto supplier Ichikoh Industries Ltd.
However, Hella had asked out of the partnership, established in 1983, said James Coonan, a Chicago-based lawyer representing Koito. Koito agreed Sept. 29 to buy Hella's share for an undisclosed amount. Ichikoh will retain its minority ownership.
In departing the partnership, Hella officials said the venture restricted the company from growing in North America and shipping lighting parts globally, Coonan said.
North American Lighting's largest customer is Toyota Motor Corp. Toyota also owns 20 percent of Koito, Coonan said.
When the venture began, North American Lighting served German automaker Volkswagen AG. But the market changed when Japanese carmakers began moving into the United States in the early 1980s, Coonan said.
Hella, a major maker of lighting and automotive electronics in Germany, has talked about opening its own U.S. plants, Coonan said.
``They want to control their ability to serve their primary customers,'' he said. ``North America is a big market, and it was somewhat awkward for them to service customers from the joint venture. I'm not sure what plans they have, but from that standpoint, [the reason for the sale] is crystal clear.''
Michael Buford, president of Hella North America Inc., declined to comment on the sale. In past interviews, he stated plans to open new manufacturing sites in the United States.
In April, Hella opened a $22 million North American headquarters, sales and engineering hub in Plymouth, Mich.
Including Toyota, the firm ships parts to every automaker with a plant in North America except Daimler-Benz AG, said Catherine Clark, marketing specialist for sales and engineering.
The firm's two plants, 25 miles apart, together have more than 400,000 square feet and employ about 2,000.
The plants will maintain their current management and customer base after the ownership change, Clark said.
The shift in majority ownership could help the firm expand in the future, Clark said. Koito, one of Japan's largest auto parts suppliers, recorded about $1.8 billion in 1997 sales.
``We should have strong support from [Koito] for our operations,'' Clark said. ``It will be to our benefit in the future.''
Clark said the venture lasted longer than anyone expected. In the auto industry, most ventures are lucky to last four years, she said. Hella's ownership stake lasted 15 years.
The sale is should be final by the end of October.