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Posts Tagged ‘JCI’

Auto Interior Behemoths Merge in Joint Venture

Johnson Controls spins off business to Chinese-owned company.

by on May.19, 2014

Alex Molinaroli, left, Johnson Controls chairman and chief executive officer, and Shen Jianhua, Yanfeng chairman, seal the deal on their new joint venture.

In a deal that is emblematic of how the rapid growth of the auto industry in China is changing the landscape, Johnson Controls is spinning off part of its collection of automotive assets to form a new joint venture with an expanding Chinese company that will focus on automotive interiors.

JCI and Yanfeng Automotive Trim Systems Co. Ltd., a wholly owned subsidiary of Huayu Automotive Systems Co., Ltd. (HASCO), the component group of Shanghai Automotive Industry Corp. (SAIC), announced they had signed a definitive agreement forming the new venture where Yanfeng will hold a 70% stake and JCI the remaining 30%.

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The noncash transaction creates the largest automotive interiors company in the world with annual revenues of approximately $7.5 billion. (more…)

JCI Buys Bankrupt Battery Maker A123

Maker rejects Chinese rescue bid.

by on Oct.17, 2012

A123 fell victim to slow battery car demand - and manufacturing problems.

A123 Systems Inc., the Waltham, Massachusetts firm that had promised to revolutionize the car business with its batter technology, has filed for bankruptcy protection and announced it was selling all of its automotive assets to Johnson Controls Inc. for approximately $125 million.

That move came as the fast-faltering A123 elected to nix an alternative deal with a Shanghai-based battery company, Shanghai Advanced Traction Battery Co., which was supposed to ease A123′s cash flow crisis – but which also created a political stir considering the U.S. firm’s outstanding government loans.

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The sale to JCI, one of the auto industry’s largest suppliers, should permit the now bankrupt battery maker to maintain deliveries to an assortment of automakers that includes the California start-up Fisker Automotive.

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Johnson Controls Buys Recaro

Recaro best known for performance seating.

by on Dec.31, 2010

A pair of Recaro seats.

Johnson Controls Inc., one of the world’s top automotive suppliers, has swooped in to acquire one of the top names in automobile seating – Recaro.

JCI has signed a purchase agreement to acquire the German automotive  supplier Keiper and the Recaro-brand specialty seat business. Financial details regarding the transaction were not disclosed.

“This acquisition further strengthens our metal components and mechanisms business through the addition of the Keiper and Recaro brands which are synonymous with quality, technical expertise and innovation,” said Beda Bolzenius, Vice President, Johnson Controls and President, Automotive Experience. ”

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“It provides leading technologies that we can leverage across our current seat component portfolio, and expand in China and North America,” he said.

Keiper, based in Kaiserslautern, Germany, is a leader in recliner system technology and is renowned for its engineering and manufacturing expertise in metal components and mechanisms. The acquisition will include approximately 4,750 employees globally in seven countries.

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Johnson Controls Still Pursuing Visteon

Former Ford Motor parts maker rejects JCI proposal. Ford claims neutrality; likely working behind scenes to protect itself.

by on Jun.07, 2010

Johnson loses nothing by buying the parts operations or delaying Visteon's eventual bankruptcy emergence.

Johnson Controls (NYSE: JCI) has confirmed that it sent Visteon Corporation (OTC: VSTNQ) a letter late last week that said it remains interested in pursuing its rejected proposal to buy some of the bankrupt company’s assets. It gave no further details on how it would enhance the $1.25 billion cash bid for Visteon’s electronic and interior businesses, leaving the climate control operation behind.

The businesses JCI wants generated more than $4 billion in sales during 2009, the worst automotive market in decades. In 2009, Visteon had product sales of $6.42 billion – down $2.7 billion from the prior year. There clearly is upside potential for the eventual owner.

The latest development complicates what is already a long running bankruptcy that was filed under Chapter 11 in May of 2009. Shareholders and bondholders are currently vying to see who will control the plan that will let Visteon emerge from receivership. At stake is ownership of the assets, including the ones that JCI wants to buy – or steal, depending on your point of view.

It also could be a business tactic since Johnson Controls is a direct competitor that stands to benefit by introducing delay or complexity into the Visteon reorganization process.

Visteon, the former Ford Motor Company parts maker, has used bankruptcy to improve its balance sheet, and its first-quarter profit rose to $233 million from $2 million a year earlier. The businesses in question are largely based in China, now the world’s largest auto market.

A Ford spokesperson declined to comment specifically on the JCI Visteon issue.

“JCI is a strong company and one of our long-term suppliers. At the same time, Visteon and Ford have a long business relationship. We have been, and remain, supportive of Visteon as it works through its bankruptcy restructuring process,” the spokesperson said.

“Whatever happens, Ford is going to want to make sure that Visteon remains viable, and at some point will make its views known to the court,” said Joe Phillippi of the AutoTrends consultancy.

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UK Proposes First EV Subsidies for Businesses

Both businesses and consumers, if they can afford electric vehicles, stand to benefit from the costly subvention.

by on Dec.10, 2009

That would be taxpayer money, lots of it, at the other end of the cord.

That would be taxpayer money, lots of it, at the other end of the charging cord.

Since batteries for electric vehicles can cost as much as the car itself, and much more for larger ones, automakers are asking for huge taxpayer subsidies to aid EV sales.

The United Kingdom is the latest government to propose EV financial assistance.

In an historic announcement for the island nation, Chancellor Alastair Darling in his pre-budget report proposed that consumer incentives worth £2,000 to £5,000 ($8,100) would be available starting in 2011 to reduce the purchase price of electric and plug-in hybrid vehicles.

Substantial assistance for businesses buying EVs is also part of the budget; and it appears that the UK is the first government to do so.

“To help boost the number of electric cars on our streets, I have decided to exempt them from company car tax for 5 years. And I can also announce a 100% first year capital allowance for electric vans,” Darling said.

The latest announcement follows a £30 million “Plugged in Places” program launched last month to support the development of charging infrastructure in several UK cities.

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The European Union is moving ahead — over automakers’ protests — with new CO2 standards for passenger cars that dictate a reduction in average CO2 emissions from new cars to 120 g/km. Fewer than 9% of the cars sold in the EU in 2006 met this level of emissions. The costs of are estimated at about €3,600 ($5,108) on average per car.

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Johnson Controls Says Hybrids Not Competitive

Largest global producer of batteries is challenged by their cost.

by on Oct.13, 2009

Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG, Head of Mercedes-Benz Cars presenting the new S 400 BlueHybrid at the 2008 Paris Motor Show

“The industry has done a good job of making people comfortable with hybrid technology, but the economic equation is not there.”

The largest maker of automotive batteries in the world said today that without government subsidies, the batteries used in electric vehicles and hybrids will not allow for commercialization on a large scale.

The analysis is significant since Johnson Controls launched the industry’s first mass production lithium-ion battery plant in France, and is a leader in battery technology.

In a presentation to analysts today, MaryAnn Wright, Vice President and Managing Director Business Accelerator for Advanced Energy Storage Solutions at Johnson said that a positive economic equation is not possible without subsidies of at least $7,500.

“We can achieve — with subsidies  — a total cost of ownership that is competitive with internal combustion engines,” Wright said. She was using a three-year analysis of a vehicle, which included an above average retention residual value.

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However, even with Johnson’s goal of reducing costs of advanced Li-ion batteries by 50% during the next five years, taxpayer grants are still needed for mass production.

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