Where once small auto parts manufacturers could count on steady orders from Toyota Motor Corp., many have been forced to diversify into everything from mosquito zappers to vegetable farming as auto production has shifted overseas.
Aichi Prefecture can be compared to Toyota's "castle town" because its major plants and headquarters once allowed small businesses to thrive off the automobile industry.
Aichi has topped the list of prefectures in the shipment value of manufactured products over the past 34 years due largely to about 1,750 parts makers that support the automobile industry.
However, Toyota has been accelerating shifting production abroad, and large suppliers with deep pockets, such as Denso Corp. and Aisin Seiki Co., have followed.
That shift is forcing small and midsize companies with limited financial resources to seek outside revenue sources.
In Kariya, Takeda Co., a small auto parts maker, is developing a modern mosquito trap for the Malaysian market to prevent dengue fever.
Dengue, originally a tropical disease, is claiming the lives of children and elderly people in temperate zones as mosquitoes that carry viruses spread due to global warming.
Akitoshi Takeda, chairman of the company, learned about the growing threat of dengue when the company was looking for new business during the global financial crisis that started in 2008.
Once the company decided to develop a mosquito trap, employees worked on every process with Toyota’s “kaizen” continuous improvement approach, which was hammered into them through transactions with the auto giant.
Employees have devoured literature on the disease, bred wild mosquitoes and repeated experiments in Malaysia.
The device, which kills mosquitoes with an electrical discharge, is 85 cm tall because the company found that the insects often fly at a height of 20 to 80 cm.
Steel sheets on which electricity is applied are set up to create shade because mosquitoes gather in dark areas.
The company plans to begin marketing the trap to schools and hospitals in Malaysia, probably later this year.
In the city of Toyota, Meishin Kosan, an auto leasing company, has branched off into vegetable farming for a new revenue source.
The company has been growing lettuce in a 15-square-meter container since spring 2011. It can be harvested in five to six weeks, about half the time of normal farming methods.
The company now ships its products only to local customers but is working on ways to improve production efficiency.
In Ichinomiya, parts maker Torigoe Plastic Industry Co. is a pioneer in diversification and is reaping the benefits today.
The company began developing health and beauty products after orders for prototype parts dried up as computerization of automotive designs started in the late 1990s.
A cushion designed to help women straighten out their twisted pelvises became a major hit.
Torigoe's lineup of health and beauty products has grown to 30 or so, and those products account for more than half of the company’s overall sales in some years.
“We were driven into a corner a long time ago, and it has turned out to be an advantage for our company,” President Yutaka Torigoe said.
Despite these diversification efforts, successful examples are still few and far between.
Motonari Yamada, an associate professor of production management at Nagoya University, said parts makers in Aichi Prefecture used to be in an “enviable business.”
He said the companies were guaranteed work for four to five years once they won a contract, and they hardly thought they needed to allocate manpower and funds to a new business.
The industry ministry’s regional bureau that covers Aichi and neighboring prefectures has proposed development of potential core sectors comparable to the automobile industry for the past two years.
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