Japan-Europe Forum 2022

International trade & economic system ;How we apply this when doing business between Europe and Japan
Yasuo Hirano
Executive General Manager
Government Relations Office (Brussels Office)Hitachi Europe GmbH
21st October 2022
© Hitachi Europe 2022. All rights reserved.

1. Introduction of Hitachi© Hitachi Europe 2022. All rights reserved.

11-1. Corporate Foundation
 Founded in 1910 as a machine repair shop at Kuhara Mining Company in Hitachi City,
Ibaraki Pref.
 Mission: Contribute to society through the development of superior, originaltechnology and products
 Values (Hitachi Founding Spirit) : Harmony, Sincerity, Pioneering Spirit

Initial shop in Ibaraki(1910)© Hitachi Europe 2022. All rights reserved.

21-2. Diversified Business for Social Innovation Business (FY2021)
OthersHitachi Metals*
4%
Hitachi Construction Machinery*

9%

20%

Digital Systems & Services

9%
Automotive Systems

15%

Revenues
10,264.6
Billion yen(FY2021)

18%

25%
Connective Industries••The figures are based on the new segment classifications effective from FY2022
Hitachi Construction Machinery and Hitachi Metals are scheduled to be deconsolidated in FY2022

Green Energy & Mobility© Hitachi Europe 2022. All rights reserved.

3

2. Hitachi’s Globalization© Hitachi Europe 2022. All rights reserved.

4

2-1. Transformation for Global Social Innovation Business
Sold / Withdraw
2022⚫ Hitachi Metals⚫ Hitachi Construction Machinery⚫ Diagnostic Imaging-related Business⚫ Home Appliance (JV with Arçelik)⚫ Thermal Power Plant Business⚫ Hitachi Chemicals⚫ Clarion (Vehicle Information Sys.)⚫ Hitachi Kokusai Electric⚫ Hitachi Power Tools⚫ Hitachi Capital⚫ Hitachi Transport Systems⚫ Air Conditioning Equipment(JV with Johnson Controls)⚫ Hitachi Maxell2012⚫ Flat Panel TV⚫ LCD⚫ Hard Disk Drive

Enhance capability (Acquisition)⚫ Thales Ground Transportation Systems Business(France)⚫ GlobalLogic (digital engineering) (US)⚫ Hitachi Astemo (JV with Honda)⚫ Chassis Brakes International (Netherlands)⚫ ABB Power Grid Business (Swiss)⚫ Hitachi High-Tech (100% subsidiary)⚫ JR Automation (robot SI) (US)⚫ Sullair (air compressor) (US)⚫ Ansaldo Breda / STS (Italy)⚫ Pentaho (data analytics) (US)⚫ Newton Aycliffe Train Factory (UK)

© Hitachi Europe 2022. All rights reserved.

5

2-2. Progress of Globalization (FY2011 ~ FY2021)
Consolidated Revenue (B¥)

Japan

No. of Consolidated

No. of Employees

Subsidiaries

120,000
12,000100,000
10,000Outside Japan

1000

9,666

10,265400,000

350,000

368k
324k

43%

59%

60,0006,000

250,000

853

900

800

300,000

80,000
8,000

939

700

34%

57%

600

64%

82%

1
FY2011

2
FY2021500

200,000400
150,000

40,0004,000

300
100,000
200

20,0002,000
50,000012FY2011
FY2021Japan
Outside Japan

0100

FY2011
1

FY202120© Hitachi Europe 2022. All rights reserved.

62-3. Big Growth Outside Japan© Hitachi Europe 2022. All rights reserved.

7

2-4. Strong Governance for Globalization (Independent Directors)

including 3 Japanese Directors(Not independent)© Hitachi Europe 2022. All rights reserved.

8

3. Growth in Europe© Hitachi Europe 2022. All rights reserved.

93-1. Investing Green & Digital Business in Europe
Sold / Withdraw
2022⚫ Hitachi Metals⚫ Hitachi Construction Machinery⚫ Diagnostic Imaging-related Business⚫ Home Appliance (JV with Arçelik)⚫ Thermal Power Plant Business⚫ Hitachi Chemicals⚫ Clarion (Vehicle Information Sys.)⚫ Hitachi Kokusai Electric⚫ Hitachi Power Tools⚫ Hitachi Capital⚫ Hitachi Transport Systems⚫ Air Conditioning Equipment(JV with Johnson Controls)⚫ Hitachi Maxell2012⚫ Flat Panel TV⚫ LCD⚫ Hard Disk Drive

Enhance capability (Acquisition)⚫ Thales Ground Transportation Systems Business (France)⚫ GlobalLogic (digital engineering) (US)⚫ Hitachi Astemo (JV with Honda)⚫ Chassis Brakes International (Netherlands)⚫ ABB Power Grid Business (Swiss)⚫ Hitachi High-Tech (100% subsidiary)⚫ JR Automation (robot SI) (US)⚫ Sullair (air compressor) (US)⚫ Ansaldo Breda / STS (Italy)⚫ Pentaho (data analytics) (US)⚫ Newton Aycliffe Train Factory (UK)

© Hitachi Europe 2022. All rights reserved.

103-2. Growth of Digital & Green Business in Europe

Screen Only

Screen Only

© Hitachi Europe 2022. All rights reserved.

11

3-3. Contribute to the European society (No. of employees)
40,00033,00035,40030,00020,00016,517

16,800FY2017FY201817,80010,0000FY2019FY2020

FY2021© Hitachi Europe 2022. All rights reserved.

123-4. Europeans lead green business globally

Claudio Facchin

Senior Vice President and Executive Officer,
CEO of Power Grids Business Unit, Hitachi, Ltd.
CEO of Hitachi Energy Ltd.

Andrew BarrVice President and Executive Officer,
CEO of Railway Systems Business Unit, Hitachi, Ltd.
Director of Hitachi Rail Ltd.

Lorena Dellagiovanna

Vice President and Executive Officer,
Chief Sustainability Officer, General Manager of Sustainability Gr.,
Head of Global Environment Division, and CDEIO
Hitachi, Ltd.
© Hitachi Europe 2022. All rights reserved.

13

3-5. Developing World Leading Technologies in Europe
LONDON

European R&D Centre Headquarters
Sustainability Lab (Energy, Carbon management, Environment)
Mobility System Lab (Mobility solution, Rail)
Digital & Data Innovation Lab (AI, Optimisation, Security & trust)
Design Lab (Design thinking, Systems thinking, Futures design)

CAMBRIDGE

Cambridge Lab (Quantum computing, Synthetic biology)

PISTOIA

Mobility System Lab (Mobility solution, Rail)

COPENHAGAN

Digital & Data Innovation Lab (AI, Optimisation, Security & trust)

MUNICH

Autonomy & Circularity Lab (Autonomy for transport, Circularindustry, Data-driven services)
Digital & Data Innovation Lab (AI, Optimisation, Security & trust)

HEILBRONN

Hitachi Astemo Brake Business (Customer engineering - Designand Test)

SOPHIAANTIPOLIS

Autonomy & Circularity Lab (Autonomy for transport, Circularindustry, Data-driven services)

PARIS/DRANCYHitachi Astemo Brake Business (Global R&D - Design and Test,Innovation and Customer engineering)

ZURICH

Swiss Branch (Since 2022, Energy strategy)© Hitachi Europe 2022. All rights reserved.

1414

4. Risk Management© Hitachi Europe 2022. All rights reserved.

15

4-1. Ukraine Crisis (Abstract of the Press Release on 10th March, 2022)© Hitachi Europe 2022. All rights reserved.

16

4-2. Disclosing the Impacts of Global Risks© Hitachi Europe 2022. All rights reserved.

17

4-3. Risk Management Structure© Hitachi Europe 2022. All rights reserved.

184-4. Establishing Economic Security Office
The Major Role of the “Economic Security Office”

1.

Responding to global economic security laws and regulations
in major countries- Supply chain resilience, core technologies,
data transfer, human rights, foreign direct investments, etc.

2. Managing project risks in global business operations- Reviewing the economic security risks associated with project
managements and coordinations- Mitigating potential risks
3. Strengthening internal capacity for economic security- Enhancing company-wide response capabilities© Hitachi Europe 2022. All rights reserved.

19

Summary

1. Promotion of globalization and diversity is essential for
Hitachi's growth.
2. While rule-based free trade is desirable, currently
economic security is the priority.
3. Global companies need to enhance their ability to respondto various risks, including geopolitics.

© Hitachi Europe 2022. All rights reserved.

20