The JVC Kenwood Group positions the Car Electronics business as the profitable one with the largest sales among the four business segments. It is the business segment in which both JVC and Kenwood participate and the segment expected to be most affected by the management integration. In line with this view, the Group integrated both companies’ functions for car audio and car navigation systems. These functions include product planning and marketing, technological development, design, procurement and production. The Group integrated them into J&K Car Electronics Corporation, a joint venture of both companies, and manages it as a virtually independent operating company.

In the consumer segment that boasts a large sales ratio, the aggregate market share of the Kenwood brand and the JVC brand ranked first in Europe and the U.S. This is thanks to the integration effects resulting from a rise in sales. The sales increased by leveraging the strengths of both brands that have different product features and sales networks. As seen in this case, in major regions, the market share for and sales of car audios and car navigation systems increased. Besides, there were other integration effects resulting from a cost reduction that was brought by the adoption of common platforms, joint procurement of parts and mutual use of intellectual property. This led to a further improvement in product competitiveness and reconstruction of a highly profitable structure.

In the OEM segment, sales of car navigation systems remained brisk due to the recovery of automobile sales as a result of measures for stimulating new car purchases executed by various countries. In addition, the shipment volume of CD/DVD drive mechanisms to be mounted in vehicles sharply increased because of large orders received. These favorable factors, together with the effects of previous structural reforms, contributed to making this segment profitable.

In future, the consumer segment that enjoys large market shares in the European and American markets will actively explore and advance into emerging markets such as Latin America, Middle and Near East, Russia, India and China. We are already enhancing our business structure in those areas, and the segment will advance by making the most of such large shares. Furthermore, we will focus on new car navigation systems, which we expect to create a new market between the markets for conventional car navigation systems and portable navigation devices. Thus, we will aim to expand our business in the domestic market and solidify our No. 1 position in the world in the consumer segment. Meanwhile, in the OEM segment, we will strive to expand our business by increasing orders received in each of the dealer option goods segment and the genuine goods segment. We will also develop new media and services for the next generation. Further, we will also develop car electronics to be used, for example, in driving support systems so that the Car Electronics business will be able to drive the Group’s profitable growth.