Industrial Equipment / RoboticsJapan
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JOURNEY · DETAIL
Nidec: Founded by 4 in Kyoto in 1973, rising to become the world's top precision motor manufacturer through 70+ acquisitions
Founded: Shigenobu Nagamori · Nidec Corporation (formerly Nippon Densan)
JOURNEY
Key Fields
FIELD STAMPSIndustryIndustrial Equipment / Robotics
RegionJapan
ScaleGiant
ChannelOther
Origin
In 1973, the oil crisis devastated Japan, a resource-poor island nation. Shigenobu Nagamori, an electrical engineering graduate and former engineer at two prominent companies, felt the fragility of a resource-dependent development model and became determined to achieve technological self-reliance. At 28, he resigned and, with three partners, pooled approximately 850,000 yen (with a registered capital of 20 million yen) to found Nippon Densan in a simple prefabricated hut in Kyoto, setting the goal of creating the world's best micro-motor. In the early days, he balanced R&D with sales, eventually winning an order from 3M by offering smaller, high-performance precision motors, which opened the door to overseas markets.
Milestones
1973
Origin Turning Point
In 1973, 28-year-old Shigenobu Nagamori resigned from his engineering job and founded Nidec Corporation with 3 partners in a simple prefabricated hut in Kyoto. With a registered capital of 20 million yen, the company focused on the production and sale of precision small AC motors, driven by the conviction to become the world's best. Early efforts involved balancing R&D with market expansion, securing an order from 3M for smaller, high-performance motors, paving a path for resource-scarce Japan to export technology-driven products after the oil crisis.
1979
Growth Surge Growth
In 1979, the company capitalized on the PC boom to enter the HDD spindle motor market, growing alongside clients like IBM. It listed on the Osaka and Kyoto Stock Exchanges in 1988. In 1989, it acquired competitor Shinano Tokki, pushing its global HDD motor market share to approximately 90%. By monopolizing the demand for the largest rotating component in computers at the time, the company saw both revenue and market share soar, establishing its position as the world leader in precision motors, a phase that lasted from 1979 to 1989.
2010
M&A Expansion Inflection Point
Starting in 1984, Nidec launched an aggressive M&A expansion, acquiring over 70 companies by 2010, mostly struggling motor, component, and machine tool firms. Adhering to the creed that 'deficits are a sin,' the company implemented thorough cost-cutting and mindset reforms, publicly promising no layoffs after acquisitions. Notable cases include the 2003 acquisition of Sankyo Seiki, as well as Embraco's compressor business and Valeo's motor business. Almost all acquired companies turned profitable, transforming Nidec from a single-product motor manufacturer into a comprehensive electrical machinery group.
2023
Strategic Pivot Failure
To reduce reliance on HDD motors, the group invested heavily in the e-Axle EV drive system, rebranding as Nidec in 2023 and setting a 2030 revenue target of 10 trillion yen. However, the e-Axle business incurred massive losses, and the 2023 public tender offer (TOB) for Makino Milling Machine failed. This signaled that the 'acquisition-king' model faced bottlenecks in unfamiliar large-scale machine tool and EV sectors, leading to a severe imbalance between investment and returns, which laid the groundwork for subsequent financial pressure and scandals.
2025
Scandal Outbreak Failure
In 2025, improper accounting practices were exposed, involving tens of billions of yen in losses due to inflated profits, deferred expenses, and legacy liabilities. Simultaneously, over 1,000 cases of quality misconduct were revealed, including 844 quality incidents and 60 cases of suspected serious illegality (such as data tampering and unauthorized component changes). An independent committee identified the root cause as a corporate culture of 'short-term profit first' and 'zero tolerance for failure' driven by Nagamori's excessive pressure. The company was placed on the TSE's 'Securities under Supervision' list, facing delisting risks.
2026
Governance Reconstruction Turning Point
In December 2025, Shigenobu Nagamori resigned as Representative Director, and in February 2026, he stepped down as Honorary Chairman, exiting management entirely. New CEO Mitsuya Kishida immediately launched 'post-Nagamori' reforms: pausing M&A, committing 130 billion yen over 5 years to strengthen anti-misconduct measures, removing Nagamori's three spiritual slogans, and establishing a new bottom-up 'Purpose.' The company is also considering divesting certain businesses, shifting growth focus to liquid cooling for data centers, AI servers, and humanoid robots, entering a period of defending its listing status and rebuilding trust.
Turning Points
- Entering the HDD spindle motor market in 1979 allowed the startup to capture the biggest dividend of the PC era, transitioning from survival to world-class status.
- The 1989 acquisition of Shinano Tokki secured ~90% of the global HDD motor market, validating the 'buy-time' M&A model, which became the logic for 70+ subsequent acquisitions.
- Betting on the e-Axle in the 2010s with a 10 trillion yen target marked Nidec's shift from following clients to creating its own market, but also planted the seeds for crisis.
- The 2025 accounting and quality scandals forced the founder's total exit, compelling the company to hit the 'pause' button on M&A and shift governance logic from Nagamori's high-pressure style to compliance and bottom-up management.
Failures & Pitfalls
- The e-Axle EV drive business suffered massive losses; new CEO Mitsuya Kishida publicly admitted that while the technology has value, the business was a failure.
- The 2023 public tender offer (TOB) for Makino Milling Machine failed, marking the first time the 'acquisition king's' record was broken in the large-scale machine tool sector.
- The company was embroiled in an improper accounting scandal involving tens of billions of yen in losses, leading to its designation as 'Securities under Supervision' by the TSE.
- Over 1,000 cases of quality misconduct were exposed, including 844 quality incidents and 60 cases of serious illegality, rooted in the founder's high-pressure culture, directly leading to Nagamori's departure.
关键成功要素
- Targeting the world's top spot by focusing on a single point—micro AC motors—and winning the first 3M order through product differentiation (smaller size, equal performance).
- Buying time with money: Since 1984, acquiring 70+ companies, focusing on struggling firms and applying the 'deficits are a sin' principle for thorough cost-cutting and mindset reform.
- Aligning with structural waves: From HDD motors in the PC era to home appliances, automobiles, and now EVs and AI data centers, betting on the next major 'rotating' market.
- High-speed growth driven by the founder's strong personal will, which created governance risks; the culture of 'short-term profit first' and 'zero tolerance for failure' led to a massive collapse in 2025.
Lessons
- M&A-driven growth can reach the top quickly, but high-pressure integration without layoffs becomes uncontrollable once the scale expands if it relies solely on the founder's authority.
- The monopoly dividend of a single product (HDD motors) must be supplemented by a second growth curve; Nidec attempted this with EVs but was nearly derailed by its own failed transition.
- Once performance pressure solidifies into a culture that forbids failure, the ultimate cost is paid in the form of accounting fraud and quality scandals.
- The founder's exit is not the end but the start of reconstruction; under the 10 trillion yen target, the balance between governance and growth will determine Nidec's next chapter.
Core Data
- FY2025 Revenue：2.61 trillion yen (approx. 175-177 billion USD), up 11.1% YoY, a record high (Company disclosure, as of 2026, unaudited)
- Global Employee Count：Approx. 100,000-120,000, covering 300+ subsidiaries in 47 countries (Company disclosure, as of 2026, unaudited)
- Market Cap：Approx. 3.3 trillion yen (approx. 20.8 billion USD) (Company disclosure, as of 2026, unaudited)
- Global HDD Motor Market Share：Rose to approx. 90% after the 1989 acquisition of Shinano Tokki (Company disclosure, as of 2026, unaudited)
- Cumulative Acquisitions：70+ since 1984 (Company disclosure, as of 2026, unaudited)
- 1973 Initial Capital：20 million yen (started with approx. 850,000 yen pooled by the founding team) (Company disclosure, as of 2026, unaudited)
- Investment in Anti-Misconduct Measures：130 billion yen over 5 years (Company disclosure, as of 2026, unaudited)
- Number of Quality Incidents：844 (Company disclosure, as of 2026, unaudited)
Competitors / Peers
Nidec is the world leader in precision small motors. Key competitors include Denso and Aisin (direct competition in EV drives and automotive motors), Bosch and Continental (automotive motors and drive systems), as well as Yaskawa Electric, FANUC (industrial servos and machine tool motors), and Mitsubishi Electric (large motors and FA). In the EV drive sector, China's Inovance Technology, JEE, and Tesla's in-house motors are rapidly squeezing the market. During the HDD motor era, Nidec competed fiercely with Japanese precision component makers like MinebeaMitsumi. Nidec's strengths lie in scale and M&A integration, while its weaknesses are the governance and quality reputation damage following the 2025 scandal.