January 5, 2023

Kotaro Hirano
President and Executive Officer, CEO

Happy New Year and all good wishes for 2023!

With the exception of China, Russia and the CIS, the market for construction machinery continued to show robust demand last year, and customers continued to show willingness to invest in the mining market on the back of high resource prices. At the same time, however, the continued impact of COVID-19 along with disruption of the supply chain due to the lockdown in Shanghai, China, and the grim situation in Russia and Ukraine, as well as rising material and distribution costs, rising interest rates and accelerating inflation made for an economic environment that was difficult to navigate.

Amid these circumstances, Hitachi Construction Machinery implemented two major changes, firstly, becoming independent from the Hitachi Group by transfer of the top shareholder and welcoming Japan Industrial Partners and ITOCHU Corporation as the new joint shareholder, and secondly, terminating our joint venture with Deere and launching our own business expansion in the Americas in earnest. Our business launch in the Americas is progressing even more favorably than we anticipated. Going forward, we will work with all Hitachi Construction Machinery Group companies to make a success of our independent expansion in the Americas based on the new capital structure.

With only three months left of the final year of our current medium-term management plan, Realizing Tomorrow’s Opportunities 2022, we aim to accomplish the current plan by continuing to promote measures to enhance profits, revolving around four corporate strategies, namely “strengthening value chain business,” “providing enhanced solutions at every customer engagement,” “executing throughout North, Central and South America” and “developing a highly flexible corporate structure.”

Various specific content of the next medium-term management plan (FY2023-FY2025) is currently under consideration. We must respond flexibly to customers’ problems, changes in the demand structure toward the realization of carbon neutrality, and other rapid changes affecting our customers and the world. We will maintain close communication not only within the group but with our suppliers and customers, and create solutions that exceed our customers’ expectations.

We are now at a turning point in our 70-year history worthy of being called our “second start-up.” Keeping in mind our corporate vision, “to pass on a productive environment and prosperous cities to future generations,” we aim to make further strides by linking this turning point to certain success.

In closing, I would like to wish you and your families a happy, healthy and prosperous year in 2023.