The Car Electronics business handles products such as car audio systems, car AV systems, car navigation systems as well as optical disk drive mechanisms and optical pickups for carmounted equipment for the after-market and OEM segments.
Car electronics must be of a high quality and reliable to cope with the special temperature and vibration conditions inside vehicles. They are therefore one of the business domains in which Japanese corporations can exercise their strengths. We at JVCKENWOOD have positioned the Car Electronics business, in which both JVC and Kenwood participated, as the largest business of the JVCKENWOOD Group. We expect the effects of integration will be greatest in this business. In this business, we have also pushed forward with efforts to integrate the technological development, production, procurement, product planning, and marketing functions since October 2007. The two companies had fostered over many years acoustic, video and car-mounting technologies, and product planning capabilities. We have focused on developing new products by combining these with cutting-edge data compression and extension technologies and user interface technologies. In addition, we have developed marketing and sales strategies by making the most of the KENWOOD and JVC brands, which have different features, respectively. At the same time, we have further enhanced our cost competitiveness by integrating production and procurement.
As a result, in the after-market segment, which has a large sales composition ratio, car audio and car navigation systems realized the largest share in the European and U.S. consumer markets. In Japan, a market shift from audio systems to car navigation systems is advancing. And in that market, we are rapidly increasing our market share by commercializing Saisoku-Navi, a memory car navigation system with the industry’s highest level response as well as clear images, by integrating the technologies of the two companies.
With our eye on the shift from the after-market market to the genuine product market, we are increasing orders received for dealer-option products for automobile dealers and genuine products for automobile manufacturers. We are doing this by strengthening the OEM segment and forming alliances with partner corporations. We are also quickly expanding the business scale of CD and DVD drive mechanisms for carmounted equipment by winning large orders from not only Japanese but also European and U.S. car accessory manufacturers. These orders are backed by our top-level product quality, merchandise capability and cost performance.
From now on, we will strive to further increase the orders we receive in the OEM segment, where there is ample room for growth, by leveraging our strength in the after-market market and cooperation with partners. In the domestic after-market market, where the shift from HDD-type car navigation systems to memory car navigation systems is advancing, we will expand our market share by enhancing our lineup of Saisoku-Navi and diverting this lineup to dealer-option products. In emerging markets, where we have already started establishing sales systems, we will accelerate sales expansion by launching exclusive strategic products suited to each region.
Moreover, focusing on establishing a car-mounted network environment, we will develop new products that provide real-time information and various content linked together with mobile terminals, including smartphones and tablet devices as well as external networks and servers. We will achieve this by making the most of our communication and network technologies. We will also strive to develop products that address concerns about safety, security and ecology and that combine cutting-edge image pickup, video, acoustic and communication technologies. These technologies are the forte of the Professional Systems business as well as the Home & Mobile Electronics business. In this way, we will expand our business domains from “excitement” to “peace of mind.”
