Hitachi Ltd. completed a long-planned goal in January, transferring 26 percent of its Hitachi Construction Machinery stocks to Itochu Corp and investment fund Japan Industrial Partners.
The announcement follows other strategic corporate moves.
In August 2021, Hitachi Construction Machinery and John Deere dissolved their 33-year joint venture agreement for the manufacturing and distribution of excavators in North, Central and South America. Following the announcement, Hitachi Ltd. received several sales inquiries from trading companies, large-scale mining distributors and small and medium-sized construction distributors in the Americas.
In October 2021, the company announced a corporate name change from Hitachi Construction Machinery Loaders America to Hitachi Construction Machinery Americas (HCMA) to reflect its organizational changes and plans for growth. HCMA is focused on the sales and service sectors, as the regional headquarters handling all construction machinery products, including wheel loaders, compact and large hydraulic excavators, ultra-large mining excavators, and mining dump trucks.
In November 2021, the company shipped its first hydraulic excavator built in Japan after the Deere split for the North American market.
And starting in March, Hitachi Construction Machinery Americas will manufacture all of its construction and mining equipment in Japan and then import the products to North and South America, selling them through its own distribution network.
Hitachi Ltd. will maintain a relationship and retain its shares with the construction equipment unit, as there are synergies with the group’s Internet of Things platform, Lumada.
In addition, Hitachi Ltd. will continue to contribute to the Hitachi Group vision of achieving net-zero emissions in the mining market by providing engineless, fully electric dump trucks, which are jointly under development with ABB Ltd.
For Itochu, the deal means an expansion of its overseas sales network. The Japanese trading house sells construction equipment in the U.S., Japan and Indonesia, as well as other markets. It also has a joint venture agreement with Hitachi Construction Machinery in Indonesia to oversee sales and offer financial services.
For Hitachi Construction Machinery (HCM) and Hitachi Construction Machinery Americas Inc. (HCMA), the announcement offers unprecedented opportunities.
“This shareholder announcement is part of HCM’s long-range plans to support HCM growth in North America and Latin America,” says Al Quinn, CEO, Hitachi Construction Machinery Americas Inc. “It will not impact HCM’s working relationship with Hitachi Limited. But, by adding a solid financial partner in the capital-intensive equipment industry, HCM will have greater independence to chart its own future, including supporting our growth initiatives in the United States, Canada and Latin America region.”
Quinn noted the JIP Consortium SPC understands Hitachi Construction Machinery Americas Inc. (HCMA) markets and the needs of dealers and customers. Itochu has distribution networks including land and sea transportation spanning between Japan and the United States, and warehouses, logistics and materials centers in North America. In addition, Itochu and its group company each own companies providing financial services in the United States.
“Over the past several months, our HCMA team has been diligently preparing for March 1st, when Hitachi branded excavator and mining product lines will be consolidated and sold through HCMA’s dealer partners,” Quinn says. “It’s been an exciting process with several major announcements, like this one, along the way. We are staffing up and finalizing our dealer network. We look forward to presenting new Hitachi products and services to the North America and Latin America markets.”
From Execution to Implementation
Hitachi Construction Machinery Americas now manufactures all of its construction and mining equipment for import to the North America and Latin America markets, where the equipment is sold through the company’s own distribution network
The company ships the first hydraulic excavator – the ZX210LC-6 – built in Japan for the North American market
The company announces a corporate name change to Hitachi Construction Machinery Americas to reflect plans for growth, as well as a focus on sales and service sectors
Hitachi Construction Machinery and John Deere dissolve 33-year joint venture agreement for the manufacturing and distribution of Hitachi excavators in the North America and Latin America markets