Toyoda Gosei will acquire a 30% stake in Pecval Industria, a plastic automotive component manufacturer based in São Paulo (Brazil), according to a company press release. Pecval is a wholly owned subsidiary of Shimizu Industry Company Limited, a Japanese-based producer of plastic components and metal moulds for car air-conditioning systems. Pecval manufactures plastic interior and exterior parts such as instrument panel components, radiator grilles, and other plastic parts for vehicles. The capital investment required to acquire the 30% stake, the amount of which has not been disclosed, is scheduled for October 2015. Toyoda Gosei will acquire equity in Pecval from Shimizu Industry after completing the necessary procedures.
Significance: The strategic move is part of Toyoda Gosei's intention to better establish its operations in Brazil. The company will now be able to supply automakers from two production locations in Brazil: Pecval and GDBR Industria e Comercio de Componentes Quimicos e de Borracha, located in Itapetininga, São Paulo, a Toyoda Gosei subsidiary that began production in December 2014. Toyoda Gosei, which makes chassis and drivetrain components, safety system products, and interior and exterior parts for the automotive industry, is expanding its presence in key markets. In December 2014, the company teamed up with Toyota Tsusho and Indian-based Uno Minda to form a joint venture to produce brake, fuel, and other rubber hoses for the local automotive market. It also established a new manufacturing subsidiary in Mexico, another key market, to produce radiator grilles, console boxes and other plastic parts for automakers in North America. The company hopes to gain from an increase in demand for replacement airbags, triggered by the recall of millions of vehicles equipped with airbags supplied by Takata. In January, Honda decided to source airbags for the North American-bound Accord sedan from Toyoda Gosei, replacing Takata. Shimizu Industry is a subsidiary of Denso Corporation, which owns an equity stake of 54% in the company.
