Merging Koyo Seiko and Toyoda Machine Works into JTEKT (2005)

A merger to remove duplication, and a company that never fully mixed

The logic of this merger was clear. Two companies were making the same products on separate equipment and delivering them to customers through separate overseas sites — erase that duplication and development, purchasing and production could all be unified. Sharing a single parent in the Toyota group can be seen as having accelerated the decision. In fact the top position worldwide in steering continued, and the ¥1 trillion revenue target was reached ahead of its deadline. Measured in numbers, the effect of integration appeared in a form that can be explained.

But a company becoming one and businesses mixing into one were different things. It took sixteen years for the domestic business brands to be unified and fifteen for the head office to move to Kariya, and even after that the fusion of the three businesses remains a theme of the management plan. The difference in origin between a 1921 Osaka bearing specialist and a 1941 machine tool maker directly descended from Toyota does not appear to have vanished merely by aligning the corporate name. Removing duplication is complete on the day of the merger; the question of how to run different businesses as one body may be the thing that begins that day.