DETROIT SHOW: US debt measures providing auto stability: Denso

By Simon Warburton | 9 January 2012

Resolution by the US Congress of ways to tackle the country's massive debt has provided a more stable environment in which the auto industry can grow, says Tier One supplier Denso.

Reports in the US media today (9 January) indicate the American debt burden to be around USD15tn - equal to that of the country's output - but a stormy summer in 2011 threatened to derail means to reduce it as Congress and President tried to reach agreement.

"The debt issue stabilised things from a jobs [perspective], but did not have a negative impact on the car market," Denso International SVP sales & marketing Terry Helgesen told just-auto at this year's North American International Auto Show in Detroit.

"October, November, December, car sales have been increasing, that has been pretty strong. We have seen the last couple of months, that consumer confidence is picking up. We are seeing a lot more new vehicles in the next couple of years - that will increase the market and bring it back to what it was before 2008."

This year sees a US Presidential election, with the auto sector certain to feature highly among the candidates' priorities, representing as it does around 10%-12% of American industry.

"Manufacturing is helping lead the recovery, particularly in jobs and I think it is a positive thing,"said Helgesen. "There is still a big pent-up demand in the auto industry, as well as the fact that there is a focus on product, which is much better than it has ever been. "

Some of Denso's main initiatives are its drive to achieve an average fuel consumption of 54.5mpg by 2025 and to reduce battery size by 20%, while also examining what it refers to as the 'human machine interface,' as rapid advances in technology provide motorists with an ever-greater array of motoring aids.

Helgesen said Denso had also now recovered from the effects of Japan's huge earthquake last year, as well as the recent floods in Thailand, although he added it was more of an issue for the supplier base.

"Some of our Japanese customers lost production, but from Denso, none of our facilities were impacted," he said. "Our fiscal year will be pretty close overall to what we thought.

"It will be down just a little bit, considering the devastation and the way the industry has responded has been very positive."

Helgesen also highlighted the need to work with regulators, insisting he did not view vehicle legislation as irritating.

"We need to minimise the impact of vehicles overall and how do we make vehicles safer?" he said. "Regulations help that and as a technology [company], we invest to address those concerns for society."