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Hitachi to ramp up Southeast Asia operations
December 14, 2017 News AI analytics big data IoT

 

Hitachi plans to foster Southeast Asia into a key market by developing infrastructure and logistics operations, as well as new products and services for the region’s burgeoning middle class.

The Japanese conglomerate seeks to raise sales in Southeast Asia to 700 billion yen ($6.19 billion) in fiscal 2021, 40% higher than fiscal 2016’s tally, according to its business strategy decided at a board meeting held Wednesday in Singapore.

The company currently employs about 28,000 workers in the region, mainly in railroads, elevators and industrial machinery. It aims to strengthen a variety of businesses involved in information technology and improving peoples’ lives.

Hitachi’s Southeast Asian expansion will center on services using “internet of things” technology. In addition to seeking more orders for train cars and operation systems, the company will provide such new services as analyzing human traffic with sensors and cameras to develop more efficient stations. It will also push urban development projects to efficiently manage high-rise buildings and clear traffic.

Hitachi will also offer new services that use artificial intelligence to help automakers, electronics makers and other manufacturers run factories more efficiently. Development support will come from U.S. subsidiary Hitachi Vantara, the conglomerate’s global hub for internet of things operations.

The Hitachi brand is well-known in Southeast Asia, owing to the home electronics segment’s relatively large presence in the region. Building on this base, Hitachi will offer smart appliances, electronic money and funds settlement, as well as other products and services aimed at the middle class. The company also expects demand to grow for equipment to treat cancer among wealthy urban consumers.

Hitachi has determined that there are significant merits to horizontal expansion as negotiations for free-trade agreements proceed in Southeast Asia, including the 16-nation Regional Comprehensive Economic Partnership.

Although Hitach entered the Southeast Asian market in 1963, the region’s earnings contribution has been limited by a lack of major projects, compared with North America, Europe and China.

This article was originally published on asia.nikkei.com and can be viewed in full

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