NTN: “Ensure the customer continues to use premium parts”

We operate according to a Japanese fiscal year that ends in March. Our 2022 will mark an increase in volumes, which is good, and growth in turnover linked to inflation. The effects are cumulative. But there has been a lot of tension over raw materials such as steel, plastics, rubbers, and transport. The increase in energy prices had direct consequences for us as a manufacturer, and it disrupted the supply chain, which the war in Ukraine only amplified. Overall, the performance of NTN Europe is consistent across all European countries. New vehicle registrations remain lower than before Covid, but the consequences are positive in the business aftermarket, as the fleet is aging. Generalised inflation, however, has an impact on the frequency of vehicle maintenance, as motorists are more careful about their expenses.

We tried to contain increases as much as possible, even if we had to pass on some to the market. We have therefore made adjustments in stages so that it is not too violent for the end user. There is an acceptable limit that should not be exceeded. Nevertheless, there is a risk that inflation will become counterproductive in terms of sales growth. I hope that all the players in the supply chain, starting with the suppliers of raw materials, will act reasonably. Some indices are optimistic, but others raise fears of a difficult 2023. We want the customer to continue using premium parts even if their vehicle is old, to keep it running for as long as possible with a good level of performance, safety and residual value.

There will always be big moves such as the takeover of PHE by D’Ieteren. But that was the logical continuation of years spent in the hands of an investment fund. Overall, over the past three years, consolidation has noticeably calmed. What is happening today is the result of groups wanting to better deploy in Europe and make their mark on certain markets, such as PHE in Spain. Spain and Italy operate with fragmented and not very concentrated distribution structures, so it would be logical to see further movements in these countries. There were also some in Eastern Europe.