Nidec plans to dissolve its e-axle joint ventures (JVs) as it shifts its focus to structural reform, Nikkei Asia reported.
The Japanese motor manufacturer runs its e-axle operations through two JVs, one in China and one in Europe, in a business closely tied to founder Shigenobu Nagamori.
President and CEO Mitsuya Kishida told the publication: “We want to withdraw from the e-axle business, which has become a red ocean”.
Nidec has begun talks with Guangzhou Automobile Group on dissolving the China venture.
The company has also confirmed plans to wind down its European joint venture, but discussions with its partner there, Stellantis, have not yet begun.
Commenting on the timing, Kishida said: “Although the specific approach has not been decided, we will dissolve both joint ventures.”
The e-axle business, described as an integrated motor, decelerator and inverter system functionally equivalent to a combustion engine, had been a key part of Nidec's growth strategy.
Nidec expanded in the segment through its 2014 acquisition of a Honda electronic component control subsidiary and its 2019 takeover of Omron's automotive electric business for approximately Y100bn ($629m).
For the fiscal half ending September, the company recorded a loss of Y87.7bn in its e-axle business, including provisions for contract losses and impairment losses on production equipment.
Last month, Nidec announced personnel changes affecting senior vice president and vice president duties across compliance, human resource, group performance, supply chain, accounting and sales.
Several executives also took on additional roles or were transferred, including assignments at Nidec Shanghai and in automotive-related business units.
Earlier this month, Nidec issued a notice flagging potential quality issues across its manufacturing operations.
The company said a comprehensive inspection — involving staff interviews at all production sites, cross-referencing of records relating to process and design changes, and a newly established whistleblower hotline — had uncovered instances where changes to materials, processes and designs had been made without customer approval.
