To survive as an operating company in the automotive industry, which is currently ongoing transformational phase, our group is tackling the following challenges.
Evolve into a vehicle system supplier (“Tier 0.5”)
The electrification of automobiles is progressing at a slower pace than initially anticipated, but it is expected to continue advancing in the long term. Automotive manufacturers are allocating resources to developing competitive electric vehicles and new technologies such as batteries and motors, while simultaneously building new global supply chains. To support these initiatives, it is anticipated that automotive manufacturers will expand their use of external suppliers. We view this as a business opportunity and will fully leverage the body in white analysis and production technologies that it has developed to date, while actively exploring and utilizing external partnerships. Through these efforts, we aim to evolve from its current position as a Tier 1 supplier into a Tier 0.5 supplier—one level higher—by establishing a business model in which it serves as a “system supplier,” receiving orders from automotive manufacturers from the development phase through to mass production.
We are currently forming alliances with external partners in areas such as development collaboration, procurement of materials and equipment, and the reinforcement of production capacity—activities that collectively constitute the G-TEKT network—and is establishing the systems necessary to support them. For example, we are working with specialist external manufacturers and engineering service providers to further strengthen its technological and development capabilities. Leveraging the additional capabilities gained through these initiatives, we are demonstrating multiple EV-related technologies on a pilot line at its Tokyo site. In addition, through collaboration with materials manufacturers and aluminum die-casting companies, we are significantly enhancing its development efficiency for the “large-scale integrated components” that constitute a strategic product for us.
We will continue to reinforce its external partnerships while advancing efforts toward the early commercialization of these technologies.
Transforming our manufacturing model through smart factory implementation
The electrification of automobiles has the potential to profoundly change the structure of our vehicle body components, which are our core products, and to bring about transformations in production methods and, ultimately, in the very form of the factory itself. In next-generation factories, highly advanced and precise management, which offer greater productivity and reliability than ever before, will be required, making the use of digital technologies indispensable. Moreover, as the manufacturing sector faces a declining workforce due to factors such as younger generations moving away from factory work and the impacts of population decline, the shift toward unmanned production sites has become increasingly urgent. To address these challenges, we are promoting factory automation through initiatives such as automated production lines, the introduction of automated inspection systems, and the utilization of big data collected from production sites, while simultaneously pursuing substantial improvements in quality and productivity, which lie at the core of manufacturing.
As leading examples, the newly commissioned the Chubu Plant (Gifu Prefecture, Japan) and the Nansha Plant (Guangdong Province, China) have introduced state-of-the-art technologies designed with DX (Digital Transformation) as a fundamental premise. These facilities are pursuing unmanned production lines and are also working to unmanned their in-plant logistics through the use of AGVs (Automated Guided Vehicles) and AGFs (Automated Guided Forklifts) in combination with automated warehouse systems.
Although our efforts toward realizing smart factories are still in progress, we will continue to drive further organizational transformation by centrally managing the vast amount of data generated through automated production and inspection processes in the cloud and using it to optimize our production operations. For example, we aim to build a system that enables us to maintain an optimal production state by monitoring production conditions in real time, keeping inventory at appropriate levels, and flexibly adjusting production plans in response to changes in delivery instructions from customers.
Looking further ahead, we aim to realize an “ultimate smart factory” in which AI analyzes and optimizes the vast volume of big data generated within our operations—identifying process bottlenecks and enhancing production efficiency—and to deploy this model horizontally across our global group companies. Through these efforts, we seek to improve quality and profitability across the entire Group.
Investing in human capital
Based on our corporate philosophy of “Respect human dignity," we recognizes that employees are an asset that is essential for its evolution to tier 0.5. It has formulated human capital policies aimed at providing all employees with opportunities for growth and assisting in their voluntary upskilling efforts, and nurturing human resources that generate new value in preparation for the next era, with the objective of achieving both personal development for employees and growth for us.
To address urgent challenges such as our evolution into a Vehicle System Supplier (Tier 0.5) and the realization of smart factories, it is essential that we not only inherit and further develop our existing technologies but also actively adopt digital technologies, while fostering a diverse workforce capable of leveraging these technologies to drive global transformation.
We have established various metrics for enhancing workforce diversity and are diligently managing actuals versus targets to achieve our goals.
To further expand and enhance the capabilities of our diverse workforce, we have established three key themes to support employee growth and new challenges: the “Management Development Program,” “Enhancement of Operational Skills,” and “Support for Voluntary and Ongoing Learning.” Under these themes, we provide a wide range of training and learning support programs tailored to the needs of individual employees. In addition, to develop the next generation of management, we plan to offer a structured development program based on our succession plan. This program will provide selected candidates not only with job assignments at the time of development but also with education on the knowledge required of corporate officers.
In response to the recent increase in workforce mobility, we have been working to enhance “workplace comfort” by strengthening HR systems designed to support employee retention, expanding employee benefits, and advancing and broadening our initiatives in health and productivity management. In addition, we recognize the importance of ensuring that each employee can genuinely feel a sense of purpose, and the unique advantages of working at G-TEKT. To enhance employee engagement, we are strengthening initiatives such as improving communication between management and employees, expanding training programs for managers, and conducting interviews with younger employees to improve role matching.