Denso Corp. is nearing completion of its long-planned divestiture of spark plug operations to market leader Niterra Co., a transaction that would cement the latter’s dominance in the global ignition components sector.
According to Nikkei, the Toyota Group supplier appears close to finalizing negotiations that began with a memorandum of understanding signed in July 2023, according to people familiar with the matter. Niterra, formerly known as NGK Spark Plug, would control approximately 60% of the worldwide spark plug market upon completion.
The transaction represents a strategic retreat by Denso from traditional internal combustion engine components as automakers accelerate electrification efforts. The Kariya-based company, which generated ¥6.4 trillion ($42 billion) in revenue last fiscal year, is redirecting resources toward electric vehicle technologies and energy management systems.
Niterra’s acquisition consolidates an industry segment facing uncertain long-term prospects despite near-term growth projections. The global spark plug market, valued at $3.5 billion in 2024, is expected to reach $5.7 billion by 2034, driven primarily by hybrid vehicle adoption and continued internal combustion engine demand in developing markets.
The deal also includes Denso’s exhaust gas sensor operations, encompassing oxygen and air-fuel ratio sensors. Financial terms weren’t disclosed, though the transaction requires approval from competition authorities across multiple jurisdictions.
For Niterra, the acquisition strengthens its position in a market where technological advancement has slowed. The Nagoya-based company, with annual revenue of ¥543 billion ($3.6 billion), already supplies major automakers globally and maintains manufacturing facilities across six continents.
The consolidation reflects broader industry restructuring as suppliers balance electric vehicle investments with sustained demand for hybrid and gasoline powertrains, particularly in markets where charging infrastructure remains limited.
