TOKYO -- Japanese electronics maker JVC Kenwood is scrambling to increase production of dashcams as, fueled by strong sales at home, it seeks to expand overseas.
The move is part of the Yokohama-based company's drive to make automotive cameras, including dashboard cameras, a new engine of growth.
Dashcams, known as "drive recorders" in Japan, record the view through a vehicle's windshield. They can provide a visual record of accidents and demand in Japan has surged since media reports last autumn about a fatal road accident caused by reckless driving. The highly publicized accident occurred in Kanagawa Prefecture in June last year and a man was indicted in October on charges of dangerous driving resulting in deaths and injuries.
JVC Kenwood's dashcam sales doubled in fiscal 2017, which ended on March 31, from the previous year, and the company boosted production at its plant in Thailand in January.
The plant, which is in Nakhon Ratchasima Province, continues to operate at full bore and JVC Kenwood plans to make an additional investment in fiscal 2018 to further boost output capacity. This is expected to nearly double by fiscal 2020 from fiscal 2017.
JVC Kenwood is now seeking to build on its domestic success and increase its presence in overseas markets, including the U.S., Europe, China and Southeast Asia. It is also in talks to supply dashcams to automakers under original equipment manufacturer agreements. If the deals go through, the company's dashcam shipments are expected to rise further in around 2020.
According to market research company GfK Japan, sales of dashcams in Japan rose 38% year on year to 1.09 million units in 2017, exceeding the 1 million mark for the first time.
Shoichiro Eguchi, JVC Kenwood's president, is confident of global growth. "The market penetration rate of drive recorders is still low. There are so many automobiles running in the world," he said.
JVC Kenwood started selling dashcams in Europe and the U.S. last summer. In the U.K., demand has been rising since insurance companies started offering discounts to drivers who use the cameras.
Eguchi has high hopes for China, as well as other overseas markets. "In China, there is growing awareness of security and safety and people have become more willing to pay," he said. Local consumers and carmakers are "aggressive about adopting advanced technologies," he added.
For JVC Kenwood, dashcams are more profitable than car navigation systems because they contain fewer parts. A car navigation system typically has about 3,000 parts, while a dashcam has about 300.
The company has manufactured video cameras since the era of its predecessor Victor Co. of Japan, or JVC.
JVC and Kenwood integrated their management through the establishment of a joint holding company, JVC Kenwood Holdings, in 2008. The company changed its name to JVC Kenwood and completed the merger of its three key subsidiaries in 2011.
The automotive equipment business accounted for only around 30% of JVC Kenwood's consolidated sales in fiscal 2012. But the percentage rose to about 40% in fiscal 2014 and likely climbed to around 60% in fiscal 2017 -- and has now become JVC Kenwood's flagship business. "We have completed post-merger structural reforms. We will now aim for expansion," Eguchi said.
However, the company is not alone among electronics makers in taking strides to strengthen.
Acquisitions are becoming more frequent as many companies expect the global markets for self-driving and connected cars to expand.
Major information technology companies are also beefing up their automotive camera businesses. For example, U.S.-based Intel acquired Mobileye, an Israeli image processing chip maker.