Hitachi Limited: Construction Machinery

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Case

Reference no. W35323

Subject category: Strategy and General Management

Authors: Derek Lehmberg (College of Business, North Dakota State University)

Published by: Ivey Publishing

Originally published in: 2024

Version: 2024-01-25

Length: 20 pages

Data source: Published sources

Topics: Corporate strategy; Diversification; Strategic reorientation; General management

Share a link: https://casecent.re/p/196582

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Abstract

In 2021, Hitachi Limited was reconsidering its ownership of Hitachi Construction Machinery (HCM). The decision about HCM's future was one of the last steps in a more than decade-long effort to reorient Hitachi from a manufacturing conglomerate to a service-oriented company. HCM was a global player in the construction and mining equipment business, and although it no longer relied on Hitachi for product technology, Hitachi's technological capabilities might once again become more valuable to HCM as automation and electrification of construction and mining equipment gained importance. Would there be greater synergies from more closely integrating HCM with Hitachi's other businesses, or would both sides be better off if HCM was completely independent?