In 2025, Japanese companies executed 21 cross‑border M&A transactions in the automotive and transportation equipment sector across the Asia–Pacific region. Activity spanned automotive components, resin parts, tires, and dealership networks. Across China, Thailand, India, and Indonesia, companies advanced practical initiatives including optimisation of production footprints, acquisition of sales networks, and selective withdrawal from non‑core or unprofitable operations. The year highlighted a sector undergoing structural realignment as electrification, lightweighting, and supply‑chain variability continue to reshape competitive dynamics.
China: Divestitures and Structural Reorganisation in Tires and Components
China recorded several divestitures and structural adjustments, driven by intensifying competition and the rising dominance of local manufacturers. TOYO TIRE transferred part of its stake in its Chinese tire‑production subsidiary, TOYO TIRE Zhangjiagang, reflecting pressure from local competitors, margin compression, and the need to recalibrate profitability by region. While China remains the world’s largest automotive components market, the high competitiveness of local players has led Japanese manufacturers to pursue selective optimisation—combining targeted reinvestment with strategic withdrawal.
Indonesia: Full Integration of Local Subsidiaries in the Automotive Components Sector
Indonesia saw increased emphasis on strengthening operational control within local subsidiaries. Mitsuba fully acquired PT Mitsuba Indonesia, consolidating its position in electrical components production and enhancing alignment between development, manufacturing, and sales. With strong growth across both two‑wheel and four‑wheel segments, Indonesia remains a central market. For Japanese suppliers, the dual objectives of improving localisation accuracy and deepening ties with local OEMs have become core investment themes.
India: Divestiture of Body‑Parts Subsidiaries Amid Portfolio Redesign
India continued to grow as an automotive market; however, profitability varied widely by segment. H‑ONE divested all shares in H‑ONE India to Belrise Industries, restructuring its portfolio in response to rising labour costs, evolving OEM procurement strategies, and changing cost competitiveness. India has entered a phase where selective withdrawal coexists with deeper investment in targeted areas, illustrating that market scale alone does not guarantee continued strategic fit.
Thailand: Strategic Strengthening in Resin and Module Manufacturing
Thailand remained a core production cluster for Japanese OEMs, fostering downstream opportunities for component suppliers. DaikyoNishikawa acquired full ownership of its Thai subsidiary DMS Tech to enhance capabilities in resin components, addressing increased demand for lightweight, high‑quality resin parts. Thailand continues to be the region’s largest automotive manufacturing hub, with advancing sophistication in resin, interior, and exterior components. Japanese suppliers responded by consolidating control over high‑value segments aligned with electrification and efficiency requirements.
Australia: Acquisition of Dealer Networks to Strengthen Downstream Capabilities
In Australia, Japanese companies expanded downstream by acquiring dealership businesses. Optimus Group acquired the dealer operations of McCarroll Motors Mudgee to strengthen its sales channels and after‑sales platform. The transaction reflects a broader shift in strategy: Japanese automotive companies increasingly complement manufacturing capabilities with enhanced control over distribution, service, and customer‑touchpoint operations, especially in mature consumption markets.
Notable Transactions（2025）
- TOYO TIRE (China): Divested part of its stake in TOYO TIRE Zhangjiagang, adjusting its China portfolio amid intensified competition.
- Mitsuba (Indonesia): Fully acquired PT Mitsuba Indonesia to reinforce production control in electrical components.
- H‑ONE (India): Divested all shares in H‑ONE India to Belrise Industries to redesign its regional portfolio.
- DaikyoNishikawa (Thailand): Made DMS Tech a wholly‑owned subsidiary to strengthen capabilities in lightweight resin components.
- Optimus Group (Australia): Acquired an automotive dealership business to expand sales and after‑sales infrastructure.
Structural Insights from 2025: Key Automotive & Transport Equipment Themes
Four structural themes defined Japanese corporate activity in 2025.
First, production‑footprint optimisation emerged as a central imperative. China, India, and ASEAN each required different strategies—withdrawal, consolidation, or ownership strengthening—based on the economics of individual segments.
Second, lightweighting and electrification accelerated component integration. Full consolidation in resin and high‑function parts increased as suppliers prepared for EV‑driven demand shifts.
Third, markets experiencing competitive intensification—particularly China and India—saw increased selective withdrawal. Divestitures and business transfers reflected the need to prioritise profitability over sheer presence.
Fourth, downstream integration gained renewed importance. Acquiring dealerships and reinforcing after‑sales capabilities in Australia and ASEAN provided Japanese companies with end‑to‑end control from manufacturing to customer interface, enhancing overall strategic resilience.
Related Links
[Full Report] APAC Cross-Border M&A Review 2025–2026: The Definitive Edition (All Sectors & Regions)