Consolidate Domestic Remanufacturing Operations at Banshu Works, Strengthen as Mother Plant for Global Remanufacturing Business

Tokyo, October 14, 2022 –Hitachi Construction Machinery Co., Ltd. (TSE: 6305; "Hitachi Construction Machinery") today announced that the company has decided to consolidate the domestic remanufacturing operations at Banshu Works (Kako, Hyogo Prefecture) which had been dispersed to Tsuchiura Works (Tsuchiura City, Ibaraki Prefecture) and Hitachinaka Works (Hitachinaka City, Ibaraki Prefecture) from fiscal 2024 to expand and develop the remanufacturing business on a global scale in the future. This consolidation of remanufacturing operations will allow us to utilize the facilities and space in two current remanufacturing plants to further increase the production capacity of new machinery and components.

Since the days of the former KCM Corporation, Banshu Works has been supplying products and components to the Americas market and other parts of the world as a production and development plant for ultra-large to compact wheel loaders.

Under the policy of the radical business restructuring of domestic bases announced in 2018 to consolidate development bases and production facilities by product size and to optimally allocate components domestically and internationally according to market conditions,　Banshu Works has been progressively relocating its functions as the main component production base for compact machinery. Meanwhile, Tsuchiura Works, the development and production base for medium to large hydraulic excavators, and Hitachinaka Works, the production base for the main components of mining products, have been reorganizing their functions and increasing production capacity, respectively. The challenge is to further improve production efficiency to correspond to the increasing global demand for construction machinery and mining products.

The Hitachi Construction Machinery Group is strengthening its efforts to contribute to the realization of a circular economy. In particular, the parts remanufacturing business in Japan, Australia, Africa, and other regions actively promotes the recycling and reuse of used parts in each region where construction machinery and mining products are used, achieving a significant reduction in CO₂ emissions compared to the production of new parts.

Recently, we have been working on innovative measures to reduce CO₂ emissions by refurbishing used equipment such as mining products and medium hydraulic excavators in Japan and overseas, and selling them as remanufactured equipment with guaranteed functionality equivalent to new machinery.

We are also considering strengthening the remanufacturing business in the Americas, where we started full-scale independent business in March 2022, and in the future, we believe it is essential to coordinate parts and used equipment remanufacturing business on a global scale.

By consolidating the regeneration business at the Banshu Works, we aim to expand the remanufacturing business and improve efficiency. We plan to strengthen collaboration with overseas remanufacturing bases and advance a variety of initiatives as the mother plant for the global remanufacturing business.

We will consider increasing capacity at Tsuchiura Works and Hitachinaka Works by utilizing the space of the current remanufacturing plants to improve the production efficiency of new machinery and components for mining and construction equipment.

The Hitachi Construction Machinery Group has been providing "Reliable solutions," solutions that solve customers' problems as a familiar and reliable partner.

Going forward, under the Hitachi Construction Machinery group’s mission of "To pass on a productive environment and prosperous cities to future generations,” we believe that our mission as a construction machinery manufacturer is the realization of the circular economy. And we will establish a sustainable resource-recycling business model to solve the social and environmental issues together with our customers through our value chain business and make group-wide efforts to achieve this goal.

*Circular economy: A social system that goes beyond a reuse-based economy for the purpose of resource recycling and environmental conservation, and also takes economic development into consideration.

Information contained in this news release is current as of the date of the press announcement, but may be subject to change without prior notice.