DENSO Eyes 60 Percent Sales Increase in Driver-Assist Systems

DENSO foresees that revenue for its safety and automated driving systems will climb by 60 percent by 2020 as the Japanese company mulls focusing more on driver-assist functions.

The second-largest parts manufacturer in the world, which generates roughly 50 percent of its revenue from Toyota Motor Corp., recently announced its anticipation for active safety systems to hit whopping trillion yen ($8.30 billion) five years from now, from approximately 630 billion yen in the fiscal year that ended in March. Safety functions generated approximately 15 percent of the company’s total revenue.

Leading automakers and technology companies are contending to get ahead in the competition to develop self-driving cars, with Nissan, Toyota, Google and other companies intending to have cars with different levels of self-driving functions on the roads five years from now.

Reports say that Ford and Google are currently in talks about forming a collaboration to develop autonomous car technology.

The escalating demand for driver-assist functions has raised the role of software and technology in automotive manufacturing, an area which had long been ruled by mechanical engineering.

In a statement, Denso executive vice president Yasushi Yamanaka, said that they are not anticipating self-driving functions to be a huge area for revenue growth in 2020, but they are expecting that safety features such as automatic braking, lane keeping and other safety features like the ones they developed for the new Toyota Prius would drive huge growth through 2020.

Due to DENSO’s more intense overseas competition from suppliers Continental AG and Bosch, the company has pushed further into software development. In order to compete more effectively with global parts manufacturers and an increasing number of venture technology companies, DENSO revealed that it was establishing a section within the company that specializes in advanced driver assistance systems, based in Tokyo.