Newly developed communication terminal system for mini excavators will help reduce customer lifecycle costs

Tokyo, Japan December 12, 2019 —- Hitachi Construction Machinery Co., Ltd. (TSE: 6305; “Hitachi Construction Machinery”) today announced that the company plans to standard equip the “ConSite^® ” service solution for protecting construction machinery through remote monitoring, which until now has been equipped on medium to large-sized hydraulic excavators and wheel loaders, on three-ton and larger mini excavators starting in FY2020. Developing and equipping the communication terminal system for mini excavators will enable Hitachi Construction Machinery to provide high value-added service solutions through “ConSite^®.”

Based on the Global e-Service^® which accumulates big data such as construction machinery operation and location information, Hitachi Construction Machinery has utilized IoT to continuously protect construction machinery through remote monitoring, provide the “ConSite^®” service solution to deliver data reports, and help customers reduce lifecycle costs.

Thus far, “ConSite^®” has been equipped on medium to large-sized hydraulic excavators and wheel loaders, and the number of data report service contracts has exceeded the original plan to reach 139,000 contracts*¹. The service has received a high level of support from customers with a contract ratio of approximately 73%*² of total unit sales.

Because mini excavators tended to be products designed with simple features to keep costs lower than medium to large-sized hydraulic excavators, Global e-Service^® was previously provided as an option to enable customers to view information about the operation and location of construction machinery.

However, customers who own both mini excavators and medium to large-sized hydraulic excavators strongly urged Hitachi Construction Machinery to also equip “ConSite^®” on mini excavators as well. Moreover, these customers also had a deeply-rooted need to track the location of multiple pieces of equipment due to the fact that mini excavators are frequently used in road construction and other urban civil engineering and customers operate and move them to various locations over a short period of time.

In addition, rental company customers with a large number of mini excavators have recently reported that the operation and location information concerning the construction machinery which make up their assets and the service which delivers data reports about problems detected in operational construction machinery is highly convenient for managing multiple pieces of rental equipment and from the perspective of reducing lifecycle costs.

To meet such demands, Hitachi Construction Machinery Tierra Co., Ltd., a 100% wholly-owned subsidiary which develops, manufactures, and sells mini excavators and mini wheel loaders, developed a communication terminal system for mini excavators to enable the Hitachi Construction Machinery Group to provide high value-added service solutions through “ConSite^®.”

As the construction machinery industry experiences sharp fluctuations in the global demand for new machinery, the market for mini excavators, mini wheel loaders, and other compact equipment used on narrow construction sites and agriculture and forestry projects has been resistant to such demand fluctuations in contrast to medium and large-sized excavators used in social infrastructure and other civil engineering works, and the demand has consistently expanded worldwide until now. Due to increasing labor costs in previously core markets, advanced nations such as Japan, Europe, and North America are trying to improve operating efficiency through mechanization. However, as labor costs continue to rise together with economic development going forward, urbanization is advancing, and urban civil engineering projects on narrow sites for which large-sized machinery is poorly suited are expected to increase in China and the developing nations and regions of Asia.

Hitachi Construction Machinery is currently advancing various initiatives in order to deepen value chain businesses such as parts and service, used machinery, rental, and other businesses which are being promoted as the most important item within the “CONNECT TOGETHER 2019” Mid-term Management Plan that is being carried out.

Hitachi Construction Machinery will transition to a new Mid-term Management Plan starting in FY2020 but will continue striving to deepen the value chain businesses and reduce lifecycle costs for customers. Equipping “ConSite^®” as a standard feature on mini excavators will provide new forms of value to customers in the growing compact machinery market and is part of efforts to stabilize the management foundation through additional business expansion.

The Hitachi Construction Machinery Group has been involved with providing “Reliable solutions” to stand out against social issues as both a close and reliable partner. Going forward, we will continue to expand the compact machinery business and help resolve customer issues around the world.

*1, *2: as of the end of September 2019.

■Trademark notice

・“Global e-Service” and “ConSite” are registered trademarks of Hitachi Construction Machinery Co., Ltd.