Nidec - Company History

Nidec — then Nippon Densan — began in July 1973, when the twenty-seven-year-old Shigenobu Nagamori set up shop in Kyoto’s Nishikyo ward with capital of $7,299 (¥2m). He had meant to strike out on his own at thirty-five, but read the turmoil of the Japan-remodelling boom as a moment thick with opportunity and went independent seven years ahead of plan. He hawked his prized precision micro-motors to one Japanese maker after another and was turned away almost everywhere as too young, without credit. So he wrote off domestic sales, flew to the United States, found 3M in a telephone directory, and pitched that he could halve the size of its motors — winning a $1.8M (¥500m) order. From the first months the template was set: use an overseas track record as the lever to pry open trust at home.

That American reference did its work, and the very Japanese makers who had shut their doors began placing orders. Nagamori built out an overseas footprint early — a US arm in Saint Paul in 1976, plants across Asia and Europe through the 1980s — riding a broad tailwind as the miniaturisation and precision of motors matched the whole of Japanese manufacturing turning “lighter, thinner, shorter, smaller.” In 1979 he committed to spindle motors for the hard-disk drive, and the concentration paid off: in 1985, with a groundless rumour circulating that “Nidec is in trouble,” he answered the strength of inquiries from major customers by sinking $18.9M (¥5bn) into a third Shiga plant and pushing for volume. The company listed on the Kyoto and Osaka exchanges in 1988.

By 1989 Nidec held 72.2% of the world market for HDD spindle motors, far ahead of the number two. That March, Nagamori bought the ailing Shinano Tokki from Teac, lifting the combined share to about 88.7% — a giant of a small market. The antitrust review cleared on his pledge to preserve the acquired workforce, and the monopoly locked in. The profits it threw off, as PC demand swelled shipments, became the war chest that would fund everything Nidec did next.

The monopoly’s very concentration was the danger. In the year ended March 1995 a temporary slump in PC demand cut HDD-motor orders sharply and Nidec fell to a $26.6M (¥3bn) net loss — with the hard disk still about 60% of sales as late as 1997, the risk of leaning on a single market had come due. Nagamori drew the lesson out loud: “the only way to win is to use time well — if a rival takes a month, we take fifteen days.” In-house development was too slow for the pace he wanted, so he pivoted to diversification led by mergers and acquisitions, aiming by around 1997 to push the HDD share of sales below a third. Listings on the Tokyo Stock Exchange’s First Section in 1998 and on the New York Stock Exchange in 2001 built the institutional base for buying without pause.

The selection rule broke with industry convention. Nagamori preferred targets that were “a dirty factory, a poor work ethic, high procurement cost” and roughly breaking even — the more correctable inefficiency a firm carried, the more that discipline alone could turn it to high profit. He signed no-layoff agreements with the unions, then ran the same three-part fix everywhere: scour the factory, rebuild work discipline, and renegotiate suppliers. Companies came in at better than two a year.

Around 2000 the HDD’s bearing was shifting from the ball bearing to the fluid dynamic bearing (FDB). Sensing that a firm which missed the transition could be finished, Nagamori went looking for the technology and bought his way onto the new curve: in 2003 he acquired the rival Sankyo Seiki, rode the FDB shift to the top of the world market, and still held about 76% of the HDD motor market in 2007.

From the mid-2000s the acquisitions went global and moved beyond the hard disk. In 2006 Nidec bought Valeo’s motor-and-actuator business to form Nidec Motors & Actuators; in 2010 it took Emerson Electric’s motor-control business to create Nippon Densan Motor; in 2012 it swept up Italy’s Ansaldo Sistemi Industriali and America’s Kinetek; and in 2014 it acquired Honda Elesys, widening its base in automotive technology. Cumulatively more than sixty deals turned a one-legged HDD structure into a comprehensive motor maker spanning automotive, home-appliance and industrial demand.

Nagamori had said the quiet part early: in a 2006 interview he forecast that by around 2014–15 automotive would become the largest core business — that the “HDD Nidec” would become the “automotive Nidec.” A 2015–16 buying spree across Europe, the Americas and Asia carried the firm into new fields, including elevators. Not that the ride was smooth: in the year to March 2013 a peak in digital-appliance demand and the Thai floods’ disruption of HDD makers cut profit hard. But that was the point of the design — to keep swapping the portfolio through M&A so that no single market could sink the whole. His pledge to “grow sales tenfold in ten years” was becoming real one acquisition at a time.

In 2017 Nidec unified the group’s corporate logo under the single Nidec brand and folded in Emerson Electric’s motor-drive and generator business. The next year it made its decisive turn into EV traction motors: the 2018 joint venture Nidec PSA emotors, with France’s PSA, took the company from small precision motors into the drive motors that move electric vehicles. In 2019 it bought Whirlpool’s Embraco compressor business for $1.1B (¥122bn) and took over Omron’s automotive-electronics operations to form Nidec Mobility. Nagamori was blunt about why: in cars, unlike IT, quality alone does not open the door — you need a track record, so acquisition was the way to buy both a business channel and the engineers to fill it.

The reach kept extending around the motor, vertically and horizontally: Mitsubishi Heavy Industries’ machine tools became Nidec Machine Tool in 2021, followed by a stake in OKK; a 2022 battery venture with Norway’s Freyr became Nidec Energy; a 2023 venture with Brazil’s Embraer became Nidec Aerospace. In April 2023 the parent itself was renamed from Nippon Densan to Nidec, its domestic subsidiaries relabelled in step — and even then the offensive did not let up, with a tender-offer takeover of TAKISAWA that November.

The unresolved question was the founder himself. Nagamori had sat at the centre for fifty years, the culture and the decisions inseparable from him, and a succession of hand-picked outside presidents had each left quickly — the market’s single greatest worry. In February 2024 the ex-Sony executive Mitsuya Kishida became president while Nagamori stayed on as Global Group Representative, a collective leadership meant to carry the culture forward. Consolidated sales for the year to March 2024 reached $15.5B (¥2.35tn) — a half-century’s climb from a micro-motor workshop to a comprehensive motor maker binding together automotive, home-appliance, industrial and electronic-optical businesses. Then, in 2025, an accounting fraud surfaced: the “hit-the-number” discipline that had powered the growth had become its seedbed, and Nagamori resigned his representative directorship — the strength of his centripetal pull and the weakness of the company’s governance revealed as two sides of one coin.