Corporate cultures meld in the Midwest for Joyson Safety Systems

Last year, when Ningbo Joyson Electronic Corp. used a U.S. company to buy out the assets of global airbag supplier Takata Corp. of Japan, it illustrated many things.

First, it showed that Chinese investment could play a significant role in the U.S. auto supplier industry, despite the plummet in activity this year amid rising U.S.-China trade tensions.

And second, it provided a glimpse of how a strategic Chinese investment might be structured for a major auto supplier with worldwide ambitions.

For Guido Durrer, who last year was named CEO of the company that emerged from the union of three companies — China's Joyson, Japan's Takata and Detroit's Key Safety Systems, the Joyson-owned company through which it acquired Takata — the investment has launched a mission of global company-building, with Detroit at its center.

"We're really creating a new company," Durrer told Automotive News. "And people like to build a company."

Doing that, he said, means instilling a new corporate culture around the world. Not a Chinese culture adopted from Joyson's roots in Ningbo, China. Not a Japanese culture retained from Takata. And not an American culture adopted from Detroit, where the executives reside. But a culture that grows from the organization that is coming together, with new executives, new mission statements and a new outlook.

"A culture doesn't happen overnight," Durrer said. "It takes time to align people and targets."

Durrer and the man who hired him — Chinese billionaire Wang Jianfeng — are already transforming the company.

"In the beginning, this was a Japanese company, run in Japanese management style," Durrer said of Takata.

"It was a company where people did not speak much English. It had a regional approach to business, where the regions invented their own product and machinery.

"We're changing to a matrix organization with a strong product approach."

Each of the company's 103 locations is undergoing training programs to improve quality and safety, establish procedures and create standard audits from plant to plant.

Joyson will be a Detroit-headquartered company, with r&d largely coming out of the U.S. and Europe, with sales and marketing in both Detroit and Tokyo and with China providing a large part of the manufacturing.

The business, now called Joyson Safety Systems, is doing about $7 billion in annual sales and estimates it controls roughly a 30 percent market share of the world airbag and airbag-related interior parts segment, including seat belts, steering wheels and related interior trim parts. By 2023, the CEO anticipates, Joyson will claim a 40 percent share of that segment and be on track for $9 billion in annual sales.

The safety operations include plastics for housings and other components.

But getting to that point is requiring a global reorganization. The company has gone from a combined work force of 72,000 people down to about 56,000, and the task is not finished. And those 103 operating locations around the world? Durrer wants to cut the number to about 60.

"We just don't need that many," he said. "We have double the manufacturing we need."

Durrer, a Swiss-born executive with 30 years of auto industry experience, including CEO of Thyssenkrupp's global chassis business, acknowledges that Ningbo Joyson is not exactly a household name. The company was launched by Wang in 2004 to supply air-intake parts and windshield- washer systems to Volkswagen, Ford and General Motors. Since then, Joyson has grown steadily into new technologies and industry segments.

While at Thyssenkrupp, Durrer saw one of his top executives recruited to Key Safety after it was acquired by the Chinese company. Wang — who goes by the name Jeff Wang in Western business circles — soon invited Durrer to discuss a job possibility.

"He told me, you should come to China. We have a bigger deal we're working on," Durrer, now 64, recalled of his conversation with Wang. Wang asked him to be an adviser and later asked him to become CEO of the new company about 30 miles north of Detroit in Auburn Hills, Mich.

"What was attractive was that it would be a company that has four equally strong regions — North America, Europe, China and Japan," Durrer said of the Takata acquisition. "That's something you rarely find in automotive. A Bosch or a Conti has strong regions, of course. But this was an opportunity to bring together what is truly a global company."

Takata had been the world's largest airbag supplier until a period of potentially deadly product defects brought down the company. More than 100 million of its inflators were being recalled and blamed for 22 deaths worldwide.

But there remained enormous value in Takata, with its global manufacturing engineering and manufacturing footprint and its longstanding customer relationships, especially in the Japanese industry.

Wang believed the way to acquire Takata was through a third company. His plan was to buy Key Safety, the company once run by the American entrepreneur and airbag pioneer Allen Breed.

Wang paid $920 million for Key Safety in 2016. Through Key Safety, it competed for the chance to buy Takata, which entered Chapter 11 bankruptcy in 2017. Last year, Key paid $1.6 billion for most of Takata's global assets.

The combined new company has drawn together an international management team.

Joyson recruited Donald James as president of the Americas region, after he spent more than 14 years with Continental. It brought in Jean-Luc Hemmert, also from Thyssenkrupp, as COO. Raad Konja, named chief technical officer, came with 27 years of experience with ZF Friedrichshafen.

A veteran of both Continental and Thyssenkrupp, Michael Orzinski was recruited as Joyson's chief purchasing officer. CFO Karen Hong was brought in from an automotive background that included 16 years with Chrysler.

Marcus Warrelmann, a 16-year veteran from the German electronics supplier Flex, was named executive vice president and chief sales officer. Iwamitsu Hisayoshi, named president of Joyson's Japan region business, was recruited from roles at Sensata Technologies, TI Automotive and Johnson Controls.

"I've had to change a lot of people," Durrer said. "But the opportunity is to create a new company from scratch."