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TGNA starts work at Ky. site, buys JV
By: Sherri Begin
TROY, Mich. -- March 17, 2003
Toyoda Gosei North America Corporation, which last November bought out its body sealing joint venture in California, has launched production at its new Kentucky plant.
Because of the sluggish economy, however, the Japanese-owned automotive supplier has revised its goal of reaching total annual sales of more than $1 billion. It's now on track to do so by 2006, rather than 2005, the firm said.
In November, TGNA paid an undisclosed amount to buy its 16-year-old joint venture operation, California Automotive Sealing Inc., from parent company Toyoda Gosei Co. Ltd. and Metzeler Automotive Profile Systems North America Inc. Each firm held a 50-percent share in the Haywood, Calif.-based business.
TGNA since has rechristened the company TG California Automotive Sealing Inc. The operation employs 195 at a 50,000-sq.-ft. plant that solely supplies New United Motor Manufacturing Inc., the car-making joint venture of General Motors Corp. and Toyota Motor Corp.
Body sealing will play a sizeable role in the firm's billion-dollar sales goal, said Sylvain Dube, general manager of Japanese original equipment manufacturer sales for TGNA. The company's body sealing sales represented about 40 percent of TGNA's total 2002 revenue of $516 million and should double to more than $412 million in 2006 from about $206 million in 2002.
The company began producing the complete body sealing system for the 2004 Toyota Sienna minivan at its Kentucky plant in January. With one line operational, the Hopkinsville, Ky., factory has the capacity to produce complete sealing systems for 150,000 vehicles per year, said Kim R. Moore, vice president of administration and corporate planning.
But by year-end, TGNA will add 55,000 square feet to the 120,000-sq.-ft. plant and two more extrusion lines to phase in new production for Nissan Motor Co. Ltd. and Honda of America Manufacturing Inc. during the next few years. The expansion is part of a $9 million investment at the site.
TGNA's sealing plants overall should have sufficient capacity following the Hopkinsville expansion to handle a doubling in body sealing sales by 2006, Moore said.
"We are consistently increasing in the weatherstrip plants because of our (sales) growth," Dube said. ``Our body sealing sales have been doubling every four to five years since 1995."
Most of TGNA's sales increases have come through new business with Japanese transplant auto makers as they build new plants and begin new vehicle production, but some of it also is conquest sales, Dube said.
"You see the transplants announcing new plants, and we're winning the business by being competitive on cost, quality and delivery," he said.
Still, TGNA's sales are split evenly between domestic and Japanese transplant car makers, Dube said.
On top of good pricing, warranty hasn't been a big issue for TGNA, and the company has managed to develop easy-to-install products for its customers, Moore said.
"It's just a way of life (at TGNA) to figure out how to make it better, smarter and quicker," he said.
At the recent Society of Automotive Engineers 2003 World Congress in Detroit, TGNA marketed itself as Toyoda Gosei Worldwide. The manufacturer has 47 plants, sales locations and technical sites in 12 countries. It operates in North America, Japan, eastern Asia, Europe and China.
With the global locations come various different operational names. As such, customers often don't realize the connection between the operations and the breadth of Toyoda Gosei's reach, Moore said.
To make the connection clearer, Toyoda Gosei plans to define itself better in the North American market by emphasizing its ``history of manufacturing expertise" as something that brings value to car makers and by searching for a new corporate identity to play up the links between its global businesses.
"We're going to be working very closely with our headquarters to `commonize' the total corporate image," and stress the idea the company has the ability to serve the customer wherever it is, Moore said. ``We want to make sure our customers know we have common standards at all of our plants and can meet their requirements anywhere in the world."
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