Siemens Automotive and Yazaki Corp. of Japan plan to combine some of their global business with Ford Motor Co., Renault and BMW into three joint ventures.
The combination of Yazaki's vehicle wiring harnesses and Siemens' electronics to create electrical/electronic distribution systems would supply 2.3 million vehicles in its first year. The volume could grow to as many as 7 million within five years, officials with both suppliers said.
John Sanderson, CEO of US subsidiary Siemens Automotive Corp., said the Yazaki-Siemens combination will serve as a driving force in advanced vehicle electrical and electronic distribution systems.
Automakers are demanding more complex electrical systems than the basic vehicle wiring harness. Telematics, vehicle entertainment systems, smart airbags and other systems require a more sophisticated harness with electronics to control the switching of electrical power.
Yazaki is a global leader in wiring harnesses but not in electronics. Siemens is a major electronics supplier, but its wiring business last year generated less than $500 million in sales.
Siemens and Yazaki will share 50-50 ownership in two joint ventures, one based in Germany and the other in the USA.
Most of the 500 employees for these ventures will come from Yazaki's operations in Detroit and in Europe, and from Siemens' operations in Detroit, in Regensburg, Germany, and in Toulouse, France.
The third joint venture will make vehicle-wiring harnesses. Yazaki is expected to have 75 percent ownership and Siemens 25 percent. The company will include Siemens manufacturing plants in Slovakia, the Czech Republic, Lithuania, India, Turkey and Brazil.
Yazaki said the joint ventures would give it an increased presence in Europe. The company said the joint ventures could be operating by July.