NHK SPRING CO., LTD. Supplier exits China!
Recently, Japanese automotive parts manufacturer NHK SPRING CO., LTD. (commonly known as “Japan Spring”) announced two strategic decisions: First, it will dissolve and liquidate its two automotive seat business subsidiaries in China; second, it will invest in establishing a new motor core production line in India.
NHK Seating (Hubei) Co., Ltd. (Hubei Nihon Futo Automotive Parts Co., Ltd.) and FNK China Co., Ltd. (Guangzhou Fenkai Auto Parts Co., Ltd.), located in Xiangyang, Hubei and Guangzhou, Guangdong respectively, were established in 2010 and 2011. Both are wholly owned subsidiaries of Nippon Seiki, established to expand its customer base among Japanese automakers in the Chinese market and develop its automotive seat business.
The company stated that the core reason for liquidation is the deteriorating business environment. With recent sales growth slowing among Japanese automakers and uncertainty surrounding future recovery prospects, the company decided to liquidate this consolidated subsidiary and equity-method affiliate. This decision was made in response to changes in the operating environment and from a strategic perspective of selecting and concentrating business resources.
Although the statement claims the impact on this fiscal year's performance is “negligible,” this very assertion underscores how its China operations have been marginalized to a long-tail position. Decisively divesting these assets would instead stem losses and enhance financial reporting quality. According to the announcement, the liquidation will proceed in accordance with Chinese law, though the specific timeline remains undetermined.
However, Japan Spring will retain three companies in China: Guangzhou Nichiko Electromechanical Co., Ltd. (100% ownership), Guangzhou Nichisei Spring Co., Ltd. (60% ownership), and Chongqing Qingling Nichifa Seat Co., Ltd. (30% ownership) to ensure the production and supply of components.
While scaling back its China operations, Nippon Spring disclosed investment plans targeting the Indian market. The company will invest approximately ¥1.5 billion to upgrade its production base in Chotrapati Sambhaji Nagar, Maharashtra, establishing a core stamping production line for drive motors. The project is scheduled for completion in July 2026.
An additional investment of approximately 5 billion yen will be allocated for factory expansion and equipment upgrades. By 2030, the total investment in related projects is projected to reach approximately 10 billion yen (equivalent to about 450 million yuan).
The company noted that India's demand for automotive electrification is projected to grow year by year, driving a corresponding increase in core motor demand. This investment aims to strengthen its global production system, with the goal of achieving global sales exceeding ¥30 billion for its core motor business by 2030.
Data shows that Nippon Seiki is a globally leading automotive parts manufacturer. Founded in Japan in 1936, it relocated its headquarters to Yokohama in 1940 and listed on the Tokyo Stock Exchange in 1954. The company accelerated its overseas expansion starting in the 1990s and entered the electric vehicle parts sector after the year 2000.
The company's primary business encompasses suspension springs, automotive seats, precision components, and more. Its core operations are as follows:
Suspension Springs: Manufacture leaf springs, coil springs, stabilizer bars, and other components for automotive suspension systems.
Automotive Seats: Providing seat structural components, interior trim parts, and smart seat technologies (such as heating and cooling functions);
Precision components: including motor cores, thin-plate springs, precision stamped parts, etc., serving electric vehicles and traditional automobiles.