Though Dynax has been developing friction components for the automotive industry for almost 50 years, and in-wheel motor technology for the last decade, its plan to become an EV manufacturing specialist is only just beginning.
Price competition is getting tougher globally, but Japanese companies have a large share of niche markets thanks to their multi-product, multi-functional production. What is your interpretation of monozukuri and why do you think Japanese companies are making great strides in niche markets?
This is our management policy: we aim to be the best company in the world at creating one-of-a-kind value and inspiring our customers. One-of-a-kind value means pursuing unique manufacturing that only we can do. In the clutch field, that would be friction materials. A Dynax product means that it is made by Dynax. It is important that the same products are produced wherever they are made.
In terms of human resources, I think it is important that we have global human resources and that we have a wealth of people who have experienced manufacturing around the world. As a matter of fact, I have also had manufacturing experience in the USA and China.
In addition, all material development, laboratory testing, evaluation testing, paper mill and saturation are all done in-house to meet the needs of our customers. In the past, we used to buy friction materials, but now we manufacture everything in-house and supply our customers with our own one-of-a-kind products.
One of Japan's social issues is the falling birthrate and aging population. How does your company perceive this demographic change?
The first challenge is the increasing competition for young people and then the increasing cost of recruitment. On the other hand, opportunities for this will include the need to improve overall organizational capacity with a view to future changes in the workforce.
Then there is the need for an education system, which means creating a work environment where a diverse workforce can flourish. At present, we have a job rotation system that allows people to do a variety of jobs, even if they are not specialists.
Another challenge is the change in production shifts due to the aging of the workforce and the decline in production efficiency. An opportunity arising from this challenge is to promote manpower saving and unmanned operations throughout the plant through increased automation.
Then there is the need to increase added value and profitability through the use of digital technology. In practice, this is the DX (Digital Transformation) that is now so popularly referred to. As part of this initiative, we are now introducing RPA (robotic process automation), which has already generated 19,000 hours of added value in the last fiscal year.
The second is to develop the local townships through social contribution to the community by recruiting people, and to attract people and promote recruitment activities from there. Specifically, we are trying to attract people by creating a wine business and have already grown 110 grapevines in Hokkaido.
The transition from petrol to electric vehicles is a major topic of discussion, but as a manufacturer involved in automotive components, where do you see the role of Japanese manufacturers?
Countries are aiming to become carbon-neutral, and in order to achieve this, the trend towards electrification is inevitable. For our part, we have to develop friction materials so that they can be used in electric vehicles, and we intend to develop motors that can enter the electric market.
The Japanese automobile industry has traditionally had a pyramid structure, and suppliers are often assigned to specific suppliers, but looking at global trends, I think that Japanese companies will have to move away from this model in the future. What measures does your company plan to take in response to this trend?
I know that recently, suppliers that were traditionally intrinsically linked to car manufacturers and having them as subsidiaries have started to spread horizontally. However, Dynax has not always been operating alongside one particular customer. We are equally committed to all manufacturers in Japan, the US and Europe. We originally took an equal stance, so we rather consider the current situation where the Pilapid model is about to break down to be an advantageous situation.
Weight reduction is a hot topic in the automotive industry, with a move away from ferrous materials to new materials such as aluminum and even resins like CFRP. Has your company developed any new materials in response to this trend?
With regard to weight reduction, our conventional clutches used to contain five or six clutch discs in a clutch assembly, but recently there has been a development trend towards clutches of just one or two. As you say, we have been aware of this trend for some time, as we are trying to increase the fuel efficiency of the vehicle in relation to weight reduction.
In the EV industry, petrol motors are being replaced by electric motors. How are you adapting to this change?
One is in terms of electrification, where a motor is a motor but the mechanism is divided into two parts: e-Axle and in-wheel motors. Nowadays, almost 100% of car manufacturers, including Tesla, have gone for e-Axle. Our in-wheel motors are superior in that they are extremely low-cost and fuel-efficient, but they have not yet been adopted by customers because they do not have a good track record yet.
For those reasons, from the point of view of major car manufacturers, we believe that it will be difficult for it to be adopted now. However, venture companies that make EV vehicles are springing up all over the world. Including these venture companies, we have received enquiries from about 16 companies. We are currently at various stages of development there, and we would rather start from there, and if we have a good track record, we will enter car manufacturers from there. Normally we start from the car manufacturers, but we are going the other way.
We have already arranged for an advanced development line to produce the motors so that venture companies can be confident that Dynax will supply them with motors. The idea is to build a production line before the business is finalized. We want to show our customers that this in-wheel motor is a motor that we have developed, a production line that we can build it on, and that we can launch it with certainty.
Am I right in understanding that an in-wheel motor would improve the driving experience? And where are the advantages compared to the E-axle?
For one thing, you don't need any extra parts in terms of gears. And in the case of in-wheel motors, the advantage is that they fit directly into the wheels, so they are very compact in terms of vehicle construction.
It will take time to fully convert to EVs, and in countries where EVs are lagging behind, hybrid vehicles are the norm. Can you talk a little about your cone clutch products for hybrids that are catering to this continued demand for hybrids?
The gearshift of Dynax D-CCM (Disconnect-Cone Clutch Module) is made by a synchronizer ring. Compared to a conventional clutch it has the advantage of lower agitation resistance which is a feature that improves fuel efficiency. It is not mass-produced yet but is in the development stage.
Japanese companies are known to invest a lot of money in R&D. What new products are you currently focusing on?
In order to move towards electrification in the future, new research and development is inevitably required. We have been developing in-wheel motors for 10 years, but to be honest, handing over those motors to customers is not enough to complete the project. So the next step is inverter control, and we are now working together with universities to develop this control as well. We are developing solutions where we combine the motor and inverter and sell the function from a single product.
The other thing is that, as I mentioned earlier, Dynax entered the market with in-wheel motors while most car manufacturers have adopted the e-Axle. However, the motor market is still dominated by e-Axle, so Dynax is also developing e-Axle. The main difference from other companies is that it is thin and compact. Current e-Axle motors inevitably take up space in a vehicle. Dynax is therefore developing a thin e-Axle using in-wheel motor technology.
We are also developing a small wind power generator using this motor technology. This combines the issue of carbon neutrality in the future with the perspective of infrastructure development to create a small emergency power source, and we are developing a small, rather than large generator, which will hopefully be launched in 2023.
Normally, the blades need wind speeds of roughly 7.8 to 13.6 knots to rotate, but Dynax's small wind turbine has special vertical blades that can rotate at a wind speed of only 3.9 knots. That is how it generates electricity.
It is about 7 meters high and can be installed here and there, rather like a street lamp, and used for multi-purposes, for example, to charge smartphones, or in case you need lights in times of an earthquake.
To survive in today's globalized world, there seems to be an increased need for open innovation and joint development with overseas companies. Is your company looking for global co-development partners?
What I feel these days is that it is difficult to continue doing the one thing we have been doing in the past in the future. So, I agree with this opinion, as I believe that our already existing products can create value by being together with other companies' products.
If you were looking for a new international partner, which country would be ideal?
There is no particular one. In our business, we have so far produced everything we wanted in-house. So, on the surface, we don't dare to work with any of the sources we are developing at the moment. However, something completely different from manufacturing may emerge in the future where we make components and a company brings services to us, then we can do something with them. But at the moment we don't think about which type.
You have a global network of manufacturing and sales offices in the USA, Mexico, China and Hungary, as well as a sales office in Germany. Which regions do you think have the highest potential growth?
In Europe, Hungary and China. In China, cheap electric cars are coming out rapidly, and most of our European customers have told us that they are planning to switch to full EVs by 2030. Taking this into account, I believe that Europe will be one of the first regions to go electric, and that it will grow. In other countries, Japan is slowly moving towards electrification, but it is still not as active as Europe and China.
What goals do you want to achieve before you reach your 55th anniversary?
One is sustainability as a company. We feel that we have to sustain ourselves, and although the existence of clutches will not disappear, we will push ahead in line with the move towards EVs. We will launch in-wheel motors whether we have a concrete plan or not. In addition to that, we will also develop the wine business as a town development project. In 2025, we will build a winery and have finished planting 28,000 grape saplings on 20 hectares. The other issue is how to secure human resources. The very place where the Hokkaido earthquake happened, the town is in complete decline.