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January 18, 2005
Business Strategy of Urban Planning and Development Systems
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
Yoshito Tsunoda, President and Chief Executive Officer,
Urban Planning and Development Systems,Hitachi, Ltd.
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
2. Reinforcing the Elevator and Escalator Business
3. Deployment of the Solutions Business
4. Summary
Contents
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
3. Deployment of the Solutions Business
4. Summary
Contents
2. Reinforcing the Elevator and Escalator Business
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 4
Demand
Entrepreneur
Investing activities
Environment
Growth in scale
Government/public organization
Investment growth
Sustain damage
Pursuit of quality
Private company/local government
Use of asset
Sustainable society
1. Socio-economic Structural Changes
The demand of society todayImproving the ability of cities and communities to function as
the foundation for a society centered on knowledge-based industries
Industrial society Knowledge-industrial society
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 5
Our mission is reinforcing the elevator and escalator business anddeploying the solutions business that support new lifelines for
cities in a society centered on knowledge-industries
1. Targeted Businesses in “i.e. HITACHI Plan II”
Urban Planning and Development Systems (established in April 2003)
Global Products IncorporatingAdvanced Technology
Convergence of technology and knowledge
HDD business HDD business
Automotive productsbusiness
Automotive productsbusiness
Semiconductor productionequipment business
Semiconductor productionequipment business
etc. など
Battery business Battery business
New Era Lifeline Support Solutions
Urban redevelopment business
Urban redevelopment business
SAN/NAS Storage solutions business
SAN/NAS Storage solutions business
Strategic outsourcingbusiness
Strategic outsourcingbusiness
etc.
Biomedical businessBiomedical business
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 6
Urban service infrastructure
Informationinfrastructure
a half century of experience
Social infrastructure
a century of experience
Improve safety, comfort and convenience
Mainframe Gigabit router Storage system
5HP motor 50MW generator Nuclear plant Computer control Railwaysystems
1. Hitachi’s Contributions to Economic Growth in Japan
Enhance urban functions and facilitate truly enriching lifestyles through the “urban service infrastructure”
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 7
1. The Urban Service Infrastructure Provides a TQOL
Safety
Comfort
Convenience
Total Quality of Life… Improving safety, comfort and convenience
Provide hospitality while maintaining sustainability
Address a variety of needs by ubiquitous IT and our service networks
Provide exclusive security and safety to our users with less burdensome
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 8
1. Business of Urban Planning and Development Systems
Manufacturing of elevators and escalators
Installation, maintenance and renovation
Elevator and Escalator Business
Solutions Business
Building management solutions
Urban development solutions
Asset management solutions
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 9
1. Major Group Companies
Subsidiaries
Affiliated companies
Hitachi Building Systems Co., Ltd.
Seishin Service Co., Ltd.
Hitachi Brain Co., Ltd.
Hitachi-Mito Engineering Co., Ltd.
Guangzhou Hitachi Elevator Co., Ltd.
Hitachi Elevator Engineering Co., (Hong Kong) Ltd.
Hitachi Elevator Engineering (Singapore) Pte. Ltd.
Mitsubishi Hitachi Home Elevator Corporation Manufacture, sales and installation
Siam-Hitachi Elevator Co., Ltd. Manufacture, sales, installation and maintenance
Equipment sales, installation, maintenance and renovations; comprehensive building management
Building maintenance
Marketing
Engineering and manufacturing
Manufacture, sales, installation and maintenance
Sales, installation and maintenance
Manufacture, sales, installation and maintenance
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 10
1. Key Points of Our Strategies
Goal: Sales of ¥500 billion and achieve a 10% operating profit marginby fiscal 2010 *
Focusing on the two businesses;elevators and escalators business and solutions business(Building management, Urban development and asset management), and securing high profitability
Reinforce the elevator and escalator business by focusing on ASIAN REGIONS
Deploy the solutions business
Establish superiority through up-front investments; use this as a new operating base to generate higher earnings
Enlarge business scale (Building management solutions,Urban development solutions and asset management solutions).
Aim for the No.1 market share in ASIAN REGIONS(Japan, China and Southeast Asia) by concentrating on our resources in this regions
Enlarge our business and enhance the profit margins
* Including the sales and operating profit of the “property sector” of Chuo Shoji Ltd. and Hitachi Life Ltd.Therefore, the definition is different to that in the segment information of Hitachi’s consolidated accounting.
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 11
1. Our Advantages
Advantages of Hitachi Group
Leading-edge core technologies for movement detection and sophisticated sensingComprehensive support for customers’ business operation for real estatedevelopment, financing and many other categories of services
Powerful brand based on technology and trust
365-day/24-hour Hitachi’s Customer Center and 350 service center in Japan
Elevator and Escalator Business
Utilization of elevator and escalator service network
Development of leading edge products and systems
Solutions Business
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 12
1. Goals
400
300
Sales (billion yen)
100
200
500
(FY) 2003 2010(goal)
Asset managementsolutions
Urban developmentSolutions
Building management solutions
Elevator and escalator
65
200
475 70
230
48100
270
60
70
15
270
317 * 315
363 *
440
500 *
Fiscal 2010 sales of ¥500 billion, operating profit margin of 10%*
2005(plan)
* Including the sales and operating profit of the “property sector” of Chuo Shoji Ltd. and Hitachi Life Ltd. Therefore, the definition isdifferent that to in the segment information of Hitachi’s consolidatedaccounting.
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
3. Deployment of the Solutions Business
4. Summary
Contents
2. Reinforcing the Elevator and Escalator Business2-1. The Elevator and Escalator Market2-2. Market Analysis and Basic Strategies2-3. Goal for Elevator/Escalator Business2-4. Key Initiatives
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 14
2-1. The Elevator and Escalator Market
Market Forecast(new equipment, Hitachi estimates)
Market Share in Unit Volume(2003, new equipment, Hitachi estimates)
Demand (10,000 units)
(FY)2003 2005 2010
China
Southeast Asia/India/
Middle East
Japan
Europe,North America,
others
3.2
14.5
2.8
7.8
3.3
2.8
8.9
14.5
3.7
2.8
14.5
28.3 29.532.0
11.0
Strong growth in China leading up tothe Beijing Olympics and Shanghai Expo
Japan① Company A 28% ② Hitachi 25%③ Company B 17%
China① Company C 22%② Company A 20%③ Hitachi 13%
Worldwide
① Company C 20%② Company D 16%③ Company A 11%
⑥ Hitachi 7%
Southeast Asia/India/Middle East
① Company C 30%② Company A 15%③ Company D 11%
⑥ Hitachi 4%
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
3. Deployment of the Solutions Business
4. Summary
Contents
2. Reinforcing the Elevator and Escalator Business2-1. The Elevator and Escalator Market2-2. Market Analysis and Basic Strategies2-3. Goal for Elevator/Escalator Business2-4. Key Initiatives
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 16
2-2. Market Analysis and Business Strategies
Strong growth in China leading up to the 2008 Beijing Olympics and 2010 Shanghai ExpoSteady growth in Southeast Asia, India and Middle East
Flat Demand in Japan, Europe and North America
Intense price competition in market for new installations and maintenanceIn maintenance market, fierce competition between manufacturer-affiliated firms and independent firms
Market analysis
Concentrate on our resources in ASIAN REGIONS
Enhance business framework focused on China, the world’s largest market
Upgrade profitability by product cost reduction and maintenance serviceefficiency
Business strategies
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
3. Deployment of the Solutions Business
4. Summary
Contents
2. Reinforcing the Elevator and Escalator Business2-1. The Elevator and Escalator Market2-2. Market Analysis and Basic Strategies2-3. Goal for Elevator/Escalator Business2-4. Key Initiatives
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 18
2-3. Goal for Elevator/Escalator Business
Sales (billion yen)300
100
200
(FY)2003 2010(goal)
China
Japan
Southeast Asia
200230
270
Share of newequipment
in ASIAN REGIONS 13%25%
Fiscal 2010 aim for No.1 market share in ASIAN REGIONS
2005(plan)
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
3. Deployment of the Solutions Business
4. Summary
Contents
2. Reinforcing the Elevator and Escalator Business2-1. The Elevator and Escalator Market2-2. Market Analysis and Basic Strategies2-3. Goal for Elevator/Escalator Business2-4. Key Initiatives
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 20
2-4. Key Initiatives
Deepen ties among development bases in the ASIAN REGIONS Develop globally competitive products Development
Build a manufacturing network in the ASIAN REGIONS withGuangzhou, China, as the hub
Cut manufacturing costsManufacturing
Strengthen sales activities through sales force automation (SFA), e-sales* and other means * estimation and specification decision
system using the webExpand the Chinese sales network to cover major cities
Sales
Upgrade quality and efficiency of maintenance services Build maintenance network covering ASIAN REGIONS Maintenance
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 21
2-4. Key Initiatives: Development (1)
Southeast Asia Engineering Centre
(established Sep. 2004, Singapore)
Hitachi ElevatorDevelopment Centre of ASIA
(established Oct. 2004, Guangzhou)
Hitachi, Ltd.Research & Development
Group (Japan)
Hitachi (China), Ltd. Research &
Development Center (Beijing)
Japan
China
Southeast Asia
・ Develop advanced technology and products
・ Develop global products
・ Develop advanced technology and premium products
・ Develop mainstream products for the ASIAN REGIONS
・ Modify products for Southeast Asian markets
・ Develop products to meet Chinese needs
・ Develop products for Southeast Asia
Development base Current missions Future missions
Deepen ties among development bases in the three ASIAN REGIONS
Urban Development Systems,Elevator Development Center
(Japan)
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 22
Upgrade product performance and enhance functions
Improve user-friendliness
Enhance energy saving and space minimization
Develop the global products which lead ASIAN REGIONS
2-4. Key Initiatives: Development (2)
〔1〕
〔2〕
〔3〕
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 23
(1) Upgrade product performance and enhance functions
Prioritize needs in high-demand zone(high speed and large capacity)
LargerSmaller
Slower
Faster
Elevator with the world’s largest capacityHitachi development target Hitachi secured Hitachi developed
Hitachi sellingOther company secured Other company developed
High speed and
large capacity
High capacity
Higher speed
Focus on developing elevator with the world’s largest capacity
Substantial demand
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 24
Handrail of traction drive
system
(2) Enhance energy saving and space minimization
Relaytype
Traction elevator with machine room
Helical gearPermanent magnet motorgearless
Hydraulic elevator with machine room
Machineroomlesselevator
Microcomputer
controlled inverterHigh efficient drivesystem
Shaft space saving
Handrail of liner drive system
Worm gear Helical gear
Slim type of balustrade
Truss frame
Helical gear/handrail of liner drive systemThe limitof slim type and thin type
1980 1990 2000 2010Less energy Less space
Less energy Less space
Power converter
Thin type drive system
Slim type drive system
Flexibility to adapt to building layouts, environmental sensitivity, cost savings
Elevators
Escalators
High efficient drivesystem
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 25
(3) Improve user-friendliness
High-contrast, raised buttons
Feedback from a panel of typical users
Extend the use of
universal designs
From elevator to the entire spatial movement domain
“Urban Ace” elevator received universal designprize of Good Design Special Award in fiscal 2002
Recognized for outstanding ease of operation and clean, sinceredesign
First universal design prize in the elevator industry
Pursuit universal design
* “Urban Ace” is the trademarks of Hitachi, Ltd. in Japan.
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 26
Japan
Tianjin
Guangzhou Guangzhou
Bangkok
Singapore Existing factories (January 2005)
New factory (October 2005)
2-4. Key Initiatives: Manufacturing
Expand operations in Southeast Asia
Enhance production capacity
Expand operations in the rapidly growing Chinese market
Open new factory in Tianjin for northern, eastern and northeastern China
2005
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 27
Japan
Tianjin
Existing factories (January 2005)
New factory (October 2005)
New factories
Build a a more efficient and lower cost manufacturing network in the ASIAN REGIONS with Guangzhou, China, as the hub
Product cost reduction
2008
Eastern China
Western China
(Details are undecided) (2005 through 2008)
Expand operations in Southeast Asia
Enhance production capacity
Expand operations in the rapidly growing Chinese market
Open new factory in Tianjin for northern, eastern and northeastern China
2005
2-4. Key Initiatives: Manufacturing
Bangkok
Guangzhou Guangzhou
Singapore
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 28
2-4. Key Initiatives: Sales
Use IT to raise efficiency of sales activities (already started in Japan)
Strengthen sales activities through sales force automation (SFA)Apply SFA: Hitachi sales force since 2000
Sales agents since 2005
Use e-sales system to enhance the approach to our customers (since 2004)
Expand sales network to cover major Chinese cities
Increase number of sales base (branch offices, sales companies, and sales agents) by 40% (2003 through 2005)
Expanding sales network to cover local cities
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 29
Upgrade quality and efficiency of maintenance services
Improve service quality through use of remote maintenance technology (HERIOS)
Upgrade service efficiency through development and use of advanced maintenance tools
Customize maintenance menu to meet customer demands- Utilization of the maintenance plans improve the transparency of maintenance
service- Become a more trusted partner for customers
Enhance the customers service- Visit customers more often to respond effectively to our customers' needs
2-4. Key Initiatives: Maintenance (1)
* HERIOS is the trademarks of Hitachi Building Systems Co., Ltd. in Japan.
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 30
HERIOS : elevator remote maintenance system
2-4. Key Initiatives: Maintenance (2)
Future evolution of remote maintenance technology
HERIOS : Hitachi Equipment Remote and Intelligent Observation System365-day/24-hour remote monitoring provide the Security & Safety・・・ 1994 Developed and introduced the industry’s first system of this type・・・ 1999 Received Ishikawa Award from Union of Japanese Scientists
and Engineers
Minimize maintenance time by remote automatic diagnostic system
Quick recovery by remote diagnostic and analysis
Reduce break downs with preventing maintenance
* HERIOS is the trademarks of Hitachi Building Systems Co., Ltd. in Japan.
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 31
2-4. Key Initiatives: Maintenance (3)
アジア3極保全ネットワークの構築Build maintenance network covering ASIAN REGIONS
2005
Offer high quality, efficiency maintenance services in China and Southeast Asia Reinforce the maintenance business in China ・Expand the maintenance service order
・Build a maintenance service network
Reinforce the maintenance business in Southeast Asia ・Optimizing the maintenance menu for each region
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 32
2008
Build a maintenance network in Asia ・Standardized service level throughout Asia
・Strengthen support collaboration in ASIAN REGIONS
2-4. Key Initiatives: Strengthen the Maintenance Business (4)
2005
アジア3極保全ネットワークの構築Build maintenance network covering ASIAN REGIONS
Offer high quality, efficiency maintenance services in China and Southeast Asia Reinforce the maintenance business in China ・Expand the maintenance service order
・Build a maintenance service network
Reinforce the maintenance business in Southeast Asia ・Optimizing the maintenance menu for each region
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
2. Reinforcing the Elevator and Escalator Business
3. Deployment of the Solutions Business
4. Summary
Contents
3-1. Outline of Solutions Business 3-2. Building Management Solutions3-3. Urban Development Solutions3-4. Asset Management Solutions3-5. Key Advanced Technology to Support Solution Business:
Sensor Networks
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 34
Propose the future needs of Urban Development Solutions Market, ahead of the trend
3-1. Outline of Solutions Business: Basic Stance
Apply the advanced technologies in IT, energy facility and security fields to enhance safety, comfort and convenience
Create and promote new business value by collaboration with business partners
Market pull
Technology push
“Collaborative Value Creation”
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 35
3-1. Outline of Solutions Business: Strategies and Key Initiatives
Building Management Solutions: enhance one-stop service menu and quantifythe service value
Urban Development Solutions: take-off ahead of competitors with advanced Technologies
Asset Management Solutions: accelerate business by establishing the asset Management Solutions task force
Key initiatives
Stimulate the Building Management Solutions market
Establish superior position ahead of competitors in the Urban Development Solutionsmarket, where rapid growth is foreseen Enhance Solutions menu by using Hitachi Group’s advanced technologies and asset
Conduct highly profitable B-to-B service businesses
Strategies
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 36
Real estate owners/Developers/Construction contractors/Government and public organizations/Universities, etc.
Hitachi Group
3-1. Outline of Solutions Business: Business Model
IT Power and IndustrialSystems Financial services Services
Living SpacesCondominiums, houses
Work Spaces Buildings, offices
Public Spaces Towns, public facilities
Urban Services Infrastructure
Sensor networks, micro-grid energy management,total security management, etc.
<Hardware >Advanced technology/Specific technology
Hitachi’s Customer Centers/Service center established in elevator/escalator business
<Services>Highly effective network
Services/Solutions
Conduct highly profitable B-to-B service business
Value-added services Service fees
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 37
3-1. Outline of Solutions Business: Goals
Building Management Solutions
Asset Management Solutions
Urban Development Solutions
Sales (billion yen)
100
200
(FY)2003 2010(goal)
65
47
5
70
48
15
100
60
70
85
〔133〕*
170
〔230〕*
70
〔117〕*
* Including the sales of the “property sector” of Chuo Shoji Ltd. and Hitachi Life Ltd.Therefore, the definition is different to that in the segment information of Hitachi’s Consolidated accounting.
2005(plan)
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
2. Reinforcing the Elevator and Escalator Business3. Deployment of the Solutions Business
4. Summary
Contents
3-1. Outline of Solutions Business3-2. Building Management Solutions3-3. Urban Development Solutions3-4. Asset Management Solutions3-5. Key Advanced Technology to Support Solution Business:
Sensor Networks
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 39
3-2. Building Management Solutions: Market Analysis
4,000
1203,000
100
802,000
60
Sales (billion yen)
Overall market(billion yen)
00
20
401,000
5,000
(FY)2003 2005 2010
100
4,000
70
4,200
4,640
Hitachisales goal
market size
市場の特徴
65
Market Forecast (Hitachi estimates)
Falling prices are reducing the marketscale of conventional building maintenance services, such as management equipment and cleaning
Annual growth of about 2% in totalmarket due to inclusion of peripheral activities, such as security services
Top 50 companies have only about 30%market share; the market is currently divided by a large number of small andmedium-size service providers
Market Analysis
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 40
3-2. Building Management Solutions: Key Initiatives
Consulting based on comprehensive
engineering skills
Report on problems
365-day/24-hour remote monitoring
Daily maintenance
365-day/24-hour emergency response
Directive to visit site
HitachiBuilding SystemsCo., Ltd.
Building equipment (elevators,escalators
/HVAC)
Security
Buildings/Offices
Cleaning/Hygiene management
Building and equipment maintenance
Others
Strengthen one-stop service capability
Provide safe and secure environments ・Machinery security system・Remote monitoring control system, etc
Maintain high-level reliability
Consulting to improve thevalue of customer asset
(Energy saving proposals, etc.)
Hitachi’sCustomer Centers
350 nationwide service centers
Quantification of service value
Ensure transparency of services
Improve service quality
HVAC: heating, ventilation, and air-conditioning
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
2. Reinforcing the Elevator and Escalator Business3. Deployment of the Solutions Business
4. Summary
Contents
3-1. Outline of Solutions Business3-2. Building Management Solutions3-3. Urban Development Solutions3-4. Asset Management Solutions3-5. Key Advanced Technology to Support Solution Business:
Sensor Networks
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 42
3-3. Urban Development Solutions: Market Analysis
40200
600
500
80400
00
20100
60300
700
300market size
460
700
5
15
70
Hitachisales goal
Market Forecast(Hitachi estimates)
(FY)2003 2005 2010
A market where rapid growth is expected. Full-scale expansion has started due to entry of companies from many fields (electric machinery, electronics, security, etc.)
More than 60% is dominated by services segment
Alliances spanning industries are being formed because no single company can cover all needs
Market AnalysisOverall market
(billion yen)Sales
(billion yen)
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 43
Work Spaces Buildings, offices
Public SpacesTowns, public facilities
Living SpacesCondominiums, houses
Security Ubiquitous IT
Energy/Environment
3-3. Urban Development Solutions: Business Map
Home security
Video on demand(VOD)
Home healthcare
Home energymanagement
Room access Control
Building information System integration
ESCO *1
BEMS *2
Town security Digital Media
Communication Interpretation service
Private finance initiative (PFI)
ESCOMicro-grid
Energy Networks
Business Map of Hardware and Services
*1 ESCO : Energy Service Company*2 BEMS : Building and Energy Management Service
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 44
3-3. Urban Development Solutions: Pioneering New Businesses
Market trends Key initiatives
Establish superiority by pioneering the IT condominium marketsExpand the services menu
Security service demand is growingahead of others
Rapid growth is expected in home healthcare, VOD, etc. from 2005
LivingSpaces
Condominiums,
Houses
Enhance one-stop service capability extending from equipment supplyto maintenance management services
Enhance service quality and efficiency,utilizing Hitachi’s customer centers
Keep the balance between energy saving and comfort
More sophisticated security systemwith reduced burden of operations
WorkSpacesBuildings,
Offices
Launch new services such as townsecurity services ahead of othersEstablish superiority in regionalenergy systems using Hitachi’scontrol technology Concentrate on PFI for governmentoffices and schools
Improve convenience through “intelligent functions” at commercial facilities, railway stations, hospitals and other facilities
Optimal energy control for districts and facilities
Full-scale launch of PFI projects by national and local governments
PublicSpacesTowns,
Public facilities
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 45
3-3. Urban Development Solutions: Condominiums and Houses (1)
Living Spaces: Hospitality spaces creating a subtle atmosphere of peace
Home security system
Home video on demand service
Home health care service
Community information service
IT condominium system
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 46
3-3. Urban Development Solutions: Condominiums and Houses (2)
Providing security, comfort and convenience in common areas, living areas and when away from home
・Triple security: main entrance, elevators, home door ・Remote lock system using cell phone ・Visual confirmation of visitors when away from home ・e-mail notification using cell phone when family memberreturns or when an emergency occurs
Cell phone
Internet
Emergencyresponse
Security team call out
Hitachi service network,Partner security company
Datacenter
Contact center
Control center
Hitachi’s Customer Centers
IT condominium system
Home server, Condominium controller
Door/Intercom
PC
Main entrance/Intercom
Elevators
Home appliance
Condominium
Living Spaces: Hospitality spaces creating a subtle atmosphere of peace
Mobile solutions
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 47
3-3. Urban Development Solutions: Buildings and Offices (1)
Building management services
Physical/cyber security management system
“Unconscious security” management system
Office communication support system
Optimized control system for HVAC and lighting
Emergency response system
Work Spaces: adjustable business spaces offering greater comfort and flexibility
Intelligent elevator system
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 48
3-3. Urban Development Solutions: Buildings and Offices (2)
Building management services
Optimal integrated management for HVAC, lighting and security in many buildings
●Building energy saving service ・Easy attainment of energy saving targets without sacrificing comfort ofbuilding occupants ・Maximize operating efficiency of HVAC equipment both centralized heatsources and package-type units
Hitachi’sCustomer Centers
Use of energy consumption forecast upon an energy saving plan
Turn off HVAC for unseated office room
Use of centralized heatsource to achieveoverall optimization
BEMS BEMS
Area-specific HVAC adjustments to match personal preferences
Optimal PAC* operation to raise efficiency
Optimal output control based on changes in ventilation needs
Work Spaces: adjustable business spaces offering greater comfort and flexibility
* PAC : Packaged air conditioners
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 49
3-3. Urban Development Solutions: Buildings and Offices (3)
Physical/cyber security systemsOffers security and convenience to match specific client needs through the integration of biological verification, smartcards and internet technology
● Building management system using smartcards・A single smartcard unifies building entry/exit managementand data security management ・PC log-in management linked to building entry/exit records ・Replicate personal desktop environment on shared company PCs
Recognition
Building entry gate
DB
PC
Entry/exit Log in for server
Management server
Work Spaces: adjustable business spaces offering greater comfort and flexibility
Common recognition method
Room entry/exit information access
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 50
3-3. Urban Development Solutions: Towns and Public Facilities (1)
Area navigation services
Community support services
Town security services
Service support system for retail stores
Service support system for hotels
Private Finance Initiative
Public Spaces: Cross-field for people and communities that create pleasant and memorable experiences
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 51
3-3. Urban Development Solutions: Towns and Public Facilities (2)
Community support services
Supports easy and convenient interaction with community people
●TV Telephone Interpretation Service・Support the multi-language communication・Interpreters appear on screen by IP telephone ・Offer low-cost services covering multiple languages
Service spots Hitachi Interpreting Service Management Center
Interpreter
Interpreter
Interpreter
Public Spaces: Cross-field for people and communities that create pleasant and memorable experiences
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 52
3-3. Urban Development Solutions: Towns and Public Facilities (3)
Town security services
A new type of town security that preserves a community’s safety and security in agreement with the surroundings
● Low-profile Street and Security Lighting System・Bright illumination for walkways prevents crime・Built-in security camera and emergencyreporting device ・Images are recorded over the network
Low-profile street and security lighting system
Images of sites withsecurity services
Public Spaces: Cross-field for people and communities that create pleasant and memorable experiences
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 53
3-3. Urban Development Solutions: Towns and Public Facilities (4)
Hitachi Group can offer best solutions for the public sector
●Key points of Hitachi’s Private Finance Initiative Business・Adequate equipment plans and maintenance management aiming for optimal life cycle cost ・Centralized management based on Hitachi Group-wide strengths ・The optimal operations based on the research laboratories’ management methods
Private Finance Initiative
Customer Institute of Basic Medical Science & Laboratory installation : Animal Resource Center, University of Tsukuba
Hitachi’s proposal received high marks for energy saving, through the use of natural energy and other means, and for its reduced level of maintenance management due to a long-term support system.
Business contract signed in March 2004
Public Spaces: Cross-field for people and communities that create pleasant and memorable experiences
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
2. Reinforcing the Elevator and Escalator Business3. Deployment of the Solutions Business
4. Summary
Contents
3-1. Outline of Solutions Business3-2. Building Management Solutions3-3. Urban Development Solutions3-4. Asset Management Solutions3-5. Key Advanced Technology to Support Solution Business:
Sensor Networks
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 55
Hitachi GroupCompanies
3-4. Asset Management Solutions
Create and promote development business valuethrough collaboration with business partners
Real estate developmentRenovations/conversions
Related equipment (including elevators
and escalators)
Services (cleaning and hygiene management,
security, food services,etc.)
Equipment maintenance management Property management
Partners
Developers
ConstructionContractors
・・・
■Nikkyo Create ■Seishin Service ■Hitachi Security Services ■Hitachi Building Systems, etc.
■Chuo Shoji ■Hitachi Architects & Engineers ■Hitachi Building Systems
■Chuo Shoji ■Hitachi Life ■Hitachi Building Systems
■Chuo Shoji ■Hitachi Life■Hitachi Architects & Engineers ■Hitachi Building Systems
■Hitachi Plant Engineering ■Hitachi Air Conditioning Systems■Hitachi Industrial Equipment Systems■Hitachi Building Systems,etc.
Maximizing the customer’s asset value
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3-4. Asset Management Solutions
Aim to generate more earnings from Hitachi Group’s and customers’asset
Create and promote value through collaboration with developers
Conduct highly profitable maintenance business
Accelerate business by establishing the Asset Management Solutions task force
Concentrate staff from Hitachi Group companies
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
2. Reinforcing the Elevator and Escalator Business3. Deployment of the Solutions Business
4. Summary
Contents
3-1. Outline of Solutions Business3-2. Building Management Solutions3-3. Urban Development Solutions3-4. Asset Management Solutions3-5. Key Advanced Technology to Support Solution Business:
Sensor Networks
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3-5. Key Advanced Technology: Sensor Networks (1)
Sensor board
Communication + CPU board
Power supply board
Temperature/Humidity sensor
Infrared sensor
Acceleration sensor
Light intensity sensor
Connector for external sensors (distortion, pulse wave, switch, etc.)
25mm
Sensor network management server
Sensor database
Application system
LAN
Stationary node
Name-tag-type node
Relay node Gateway
Wristband-type node
1) Compact
2) Wireless
3) Low powerconsumption
4) Locationmonitoring
Key technology for the ubiquitous information society: Sensor nodes automatically collect information and transmit it wirelessly to application systems
Sensor node The sensor node in its case
System configurationFeatures
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Carry out the new business launch quickly with a focuson urban development solutions, such as IT condominiums, building internal environment control and social infrastructure monitoring
Make substantial investments for the rapid launch of these businesses
Establish Hitachi Group-wide promotion task force, combing Hitachi Group’s human resources
Develop new business
Prioritized investments
Establishbusiness promotion
task force
3-5. Key Advanced Technology: Sensor Networks (2)
Key initiatives to commercialize sensor networks
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Health information database
Healthmanagement
Security device
Wristband-type node
Cell phone
Hitachi’sCustomer Centers
Network TV
Home facilities
Health monitor Blood
pressure gauge scale
server
Responds to emergencies
Service provider
Health statusand emergency
information
24-hour monitoring of seniors’ daily activities via wristband-type node
Allows family members to constantly confirm a senior’s health status from a distance
Provides daily data records to allow monitoring trends in an individual’s health
3-5. Key Advanced Technology: Sensor Networks (3)
Home Healthcare system
Family members
Home
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LAN
Security camera
Sensor networkBase station
Energy saving control (HVAC*, lighting)
Internet
Buildings
Temperature sensor node
Environmental monitoring (comfort, energy saving)
24-hour centralized management
HVAC*
Centralized management of building equipment, IT devices and other items to monitor operating status
Provision of diverse systems and services covering comfort, security, disaster prevention, etc.
Offices/IT Environment
Name-tag-type node
Computer rack
Smoke sensor node
IT devices access control
Detection of accidents/emergency notification
Sensor networks base station
Security (crime/disaster prevention)
PCCrime preventionsensor node
3-5. Key Advanced Technology: Sensor Networks (4)
IP network-based building management
* HVAC: heating, ventilation, and air-conditioning
Lighting
Hitachi’s Customer Centers
Notification
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 62
Sensor network (wireless)
Structural monitoring (deterioration, bolt loosing)
Control center Construction site (stress, warping)
Sensor node
Wireless sensing using an ultra-compact, low-cost distortion sensor
Regular monitoring of structures for lowering life cycle costs
3-5. Key Advanced Technology: Sensor Networks (5)
Social infrastructure (structural) monitoring
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
1. Positioning and Strategy of Urban Planning and Development Systems
2. Reinforcing the Elevator and Escalator Business
3. Deployment of the Solutions Business
4. Summary
Contents
All Rights Reserved, Copyright 2005 Hitachi, Ltd. 64
4. Summary
Sales of ¥500 billion and achieve a 10%operating profit margin by fiscal 2010 *Goal
Elevator and Escalator Business・ Aim for the No.1 market share in ASIAN REGIONS(Japan, China and
Southeast Asia) by concentrating on our resources in this regions
Solutions Business (Building management,Urban development and asset management)
・ Establish superiority through up-front investments; use this as a newoperating base to generate higher earnings
・ Enlarge business scale
* Including the sales and operating profit of the “property sector” of Chuo Shoji Ltd. and Hitachi Life Ltd.Therefore, the definition is different to that in the segment information of Hitachi’s consolidated accounting.
All Rights Reserved, Copyright 2005 Hitachi, Ltd.
Cautionary Statement
Certain statements found in this document may constitute "forward-looking statements" as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such "forward-looking statements" reflect management's current views with respect to certain future events and financial performance and include any statement that does not directly relate to any historical or current fact. Words such as "anticipate," "believe," "expect," "estimate," "forecast," "intend," "plan," "project" and similar expressions which indicate future events and trends may identify "forward-looking statements." Such statements are based on currently available information and are subject to various risks and uncertainties that could cause actual results to differ materially from those projected or implied in the "forward-looking statements" and from historical trends. Certain "forward-looking statements" are based upon current assumptions of future events which may not prove to be accurate. Undue reliance should not be placed on "forward-looking statements," as such statements speak only as of the date of this document.
Factors that could cause actual results to differ materially from those projected or implied in any "forward-looking statement" and from historical trends include, but are not limited to:
-rapid technological change, particularly in the Information & Telecommunication Systems segment and Electronic Devices segment;
-uncertainty as to Hitachi's ability to continue to develop and market products that incorporate new technology on a timely and cost-effective basis and to achieve market acceptance for such products;
-fluctuations in product demand and industry capacity, particularly in the Information & Telecommunication Systems segment, Electronic Devices segment and Digital Media & Consumer Products segment;
-increasing commoditization of information technology products, and intensifying price competition in the market for such products;
-fluctuations in rates of exchange for the yen and other currencies in which Hitachi makes significant sales or in which Hitachi's assets and liabilities are denominated, particularly between the yen and the U.S. dollar;
-uncertainty as to Hitachi's ability to access, or access on favorable terms, liquidity or long-term financing;-uncertainty as to Hitachi's ability to implement measures to reduce the potential negative impact of fluctuations in product demand and/or exchange rates;
-general economic conditions and the regulatory and trade environment of Hitachi's major markets, particularly, the United States, Japan and elsewhere in Asia, including, without limitation, a return to stagnation or deterioration of the Japanese economy, or direct or indirect restriction by other nations on imports;
-uncertainty as to Hitachi's access to, or ability to protect, certain intellectual property rights, particularly those related to electronics and data processing technologies;
-uncertainty as to the success of alliances upon which Hitachi depends, some of which Hitachi may not control, with other corporations in the design and development of certain key products; and
-uncertainty as to general market price levels for equity securities in Japan, declines in which may require Hitachi to write-down equity securities it holds.
The factors listed above are not all-inclusive and are in addition to other factors contained in Hitachi's periodic filings with the U.S. Securities and Exchange Commission and in other materials published by Hitachi.