Urban
The Urban domain is composed of the four businesses of: Building systems (elevators and escalators) andRailway systems from the Social Infrastructure & Industrial Systems segment, Automotive systems(automotive products and car information systems), and Smart Life & Ecofriendly systems (home applianceand air-conditioning equipment). In this domain, our aim is to improve the Quality of Life for people worldwide by providing products and services that are essential for daily living.

Future Growth Drivers of the Business
Building Services for Advanced Lifestyle Support
Hitachi provides building services including round-the-clock remote monitoring of elevators and other equipment. We
offer advanced IoT-based services that use collected operational data to formulate plans for parts replacement andother maintenance, and to predict when a breakdown might occur without
needing an inspection by a service engineer. Going forward, in addition toaccelerating the global development of the high-quality maintenance services
that we have developed over many years, we plan to fine-tune building
services by utilizing Lumada to collect and analyze a range of data, including
operational data from building equipment and data on the flow of people
inside buildings. These services include providing buildings guidance support
using service robots, and enhancing the value of building facilities based on
Building equipment is monitored remotely from acall center
the analysis of those entering the building.

Railway Systems/Solutions for High Quality and Reliability
Hitachi is developing systems and solutions globally to support rail services of high quality and reliability as a providerof rolling stock and traffic management systems, along with fully integrated solutions that include project management.
In the UK, we are applying advanced IoT-based maintenance services for the rolling stock of the Intercity ExpressProgramme. With the Copenhagen Metro, we are testing a Dynamic Headway solution to adjust the frequency of train
services automatically to the degree of crowding inside stations. Going forward, we will leverage Lumada technology
to develop railway systems/solutions that deliver added value to our customers in innovative ways.

Executive Vice President’s Message
Market-related Issues
In the Urban domain over which I preside, Hitachi isdeveloping global businesses based on products thatare highly familiar in daily life, including elevators, railways,automobiles, and home appliances. For consumers,
these businesses form the public face of Hitachi.
Given the continued advance of urbanization
around the world today, notably in Asia, we expect
markets to continue expanding within the Urban domain.
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Greater urbanization also brings with it a set of emerging
issues that we will need to address proactively, including
the demographic aging, energy supplies, and ensuring
the safety and security of people in the face of growing
threats from disasters and crime.
The common trends affecting the four major
businesses within the Urban domain of elevators andescalators, railway systems, automotive products, andhome appliances are captured in the acronym CASE*.

Feature: Four Focus Business Domains

First, we are seeing a significant move away fromproduct ownership to usage models based on sharing.
Second, there is a shift to autonomous operation—not
only in automobiles, but also in many other products—that also places significant emphasis on the use ofelectronics as manufacturers focus on energy-efficient,
low-carbon products. In addition, these products areincreasingly connected using digital technology, whichis enabling the development of new solutions for solving
customer issues. While engaging with these trends
directly, we are working to address various lifestylerelated issues in collaborative creation with customers.
*CASE: Connected, Autonomous, Shared, Electric

Where Hitachi Is Focusing
It goes without saying that digital technologies such as
AI and IoT will hold the key to our addressing customer
issues through the Social Innovation Business. At thesame time, to expand the business globally in a
cost-competitive way, we will also need to utilize digitaltechnology to improve the efficiency of processes suchas design and maintenance. For these reasons, I think
digital technologies will be the most important growth
driver in the Urban domain. Monitoring whatever istroubling customers in real time and providing appropriate
solutions will require always-on connections to digitaltechnology platforms. By collecting and analyzing thedata from monitoring operations, we can determine
where any problems exist in products and systems, andwork out how to make improvements. For example, weare undertaking round-the-clock remote monitoring ofelevators and other building equipment to collectoperational data. Analysis of these data not only
facilitates smart maintenance, but also allows us toprovide services to help customers achieve goals suchas optimizing the building power consumption.
Hitachi can also provide one-stop solutions toaddress customer challenges because we not only handle
product design and manufacture as well as systems
operation and control, but also build IT systems. For
example, in the Railway systems business, Hitachi byitself can supply a fully integrated solution, from themanufacture of rolling stock and building traffic management and signaling systems, to maintenance services
and the construction of ticketing systems. This can offer
customers major advantages in terms of simplicity andefficiency compared with the complicated process ofengaging multiple suppliers to build the system. In thisway, our ability to combine OT (Operational Technology),
IT, and products to connect customers to digital technology means we can create solutions that were neverpossible before. This is the original value Hitachi canKeiji Kojima
Executive Vice President and Executive Officerprovide as an Innovation Partner for the IoT Era via
collaborative creation with customers.

Our Future Mission and RoleThe Urban domain enables us to evolve into a well-known
global enterprise as a leader in the development of bold
new technologies that are a fine testament to Pioneering
Spirit, one part of the Hitachi Founding Spirit. With ahigh proportion of overseas revenues and an array of
global talent in positions of leadership, ours is the domain
spearheading Hitachi’s globalization. My mission is toutilize Lumada and other digital technologies to radicallyreinforce the competitiveness of our product range,
while also further developing global markets that areexpanding as urbanization progresses. Another criticalpart of my mission is to optimize our investment in theUrban domain and ensure that we make timely investments to generate synergies at the consolidated level.
The Creation of Social Value
The Corporate Credo of Hitachi since its inception has
been “Contribute to society through the development ofsuperior, original technology and products.” As a company,
we pursue not only financial targets, but also socialcontributions. In the Urban domain, based on our vision
for next-generation urbanization, we will leverage digitaltechnology to help achieve the SDG11 goal of sustainable
cities and communities.

SDG Focus

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