Hitachi Air Conditioning Systems and Hitachi Home & Life Solutions to Merge and Strengthen Sales Capabilities; Business Reorganization Aimed at Reinforcing the ''Lifestyle Zone Solutions Business''.TOKYO -- Hitachi Hitachi (hētä`chē), city (1990 pop. 202,141), Ibaraki prefecture, E central Honshu, Japan, on the Kashima Sea. The city is a leading producer of Japan's electrical equipment. , Ltd. (NYSE NYSE See: New York Stock Exchange :HIT) (TOKYO:6501), Hitachi Air Conditioning air conditioning, mechanical process for controlling the humidity, temperature, cleanliness, and circulation of air in buildings and rooms. Indoor air is conditioned and regulated to maintain the temperature-humidity ratio that is most comfortable and healthful. Systems Co., Ltd. (HACS HACS Hawaii Aviation Contract Services HACS Hazard Assessment Computer System HACS Humanities and Cultural Studies HACS Have A Cool Summer (band) HACS Helicopter Armored Crashworthy Seat ) and Hitachi Home & Life Solutions, Inc. (Hitachi H&L) today announced the agreement to reorganize re·or·gan·ize v. re·or·gan·ized, re·or·gan·iz·ing, re·or·gan·iz·es v.tr. To organize again or anew. v.intr. To undergo or effect changes in organization. their operating frameworks with the aim of developing and reinforcing their "lifestyle zone solutions business." Underpinned by existing consumer-focused businesses, the new organization will extend sophisticated support for lifestyle infrastructures in the home, office, stores and other locations with a particular focus on comprehensive air conditioning, all-electric homes and digital home electronics. Highlights of the reorganization are as follows. 1. HACS and Hitachi H&L will merge on April 1, 2006. 2. Hitachi's Consumer Business Group will assume responsibility for overseeing all marketing and sales activities involving comprehensive air conditioning systems, all-electric home products, digital home electronics and related products. It will be responsible for sales activities in these business sectors on a global scale. 3. The Consumer Business Group will establish a specialist division devoted exclusively to comprehensive sales activities, which will primarily target large customers such as high-volume retailers and companies operating large chains of stores. This division will offer comprehensive solutions that make use of digital home electronics, comprehensive air conditioning systems, products for all-electric homes and other products. Work is underway on setting up an organization and business strategy to prepare for the start of operations under this new framework. Although details have not been finalized See finalization. , the new framework will concentrate on the following initiatives. 1. Use the merger of HACS and Hitachi H&L to reinforce the comprehensive air conditioning and all-electric homes businesses The new company to be formed through the integration of HACS and Hitachi H&L intends to grow by conducting a comprehensive air conditioning business extending from home air conditioning systems to large freezing systems. In addition to the washing machines (storage) washing machine - An old-style 14-inch hard disk in a floor-standing cabinet. So called because of the size of the cabinet and the "top-loading" access to the media packs - and, of course, they were always set on "spin cycle". , vacuum cleaners vacuum cleaner, mechanical device using a draft of air to remove dust, loose dirt, or other particulate matter from dry surfaces. It is especially useful on highly textured surfaces, such as carpets and upholstery, that are difficult to clean by wiping or brushing. , refrigerators and other products in the home appliance A stand-alone hardware device or software environment dedicated to a specific task. See hardware appliance and software appliance. business, an all-electric home business will include hot water supply systems, kitchen appliances and other future core products. 1-1. Use the integration of air conditioning operations to strengthen the comprehensive air conditioning business, offering products ranging from home to commercial systems on a global scale. (1) Expand the global air conditioning business with a stronger line-up line-up Noun 1. people or things assembled for a particular purpose: Christmas TV line-up 2. of products With the integration of Hitachi H&L, responsible for the room air conditioning business, and HACS, responsible for the large-scale air conditioning business including packaged air conditioning systems, chiller chill·er n. 1. One that chills. 2. A frightening story, especially one involving violence, evil, or the supernatural; a thriller. chiller Noun 1. units and other products, the new company will offer a line-up extending from home-use products to large air conditioning equipment for commercial and other applications. This will enable the company to offer comprehensive solutions to customers. The new company will also carry out operations on a global scale, covering markets such as Brazil, Russia, India and China (BRICs), other parts of Asia, and Europe. (2) Upgrade new product development activities New product development activities will be upgraded by combining the design and development resources of the two companies. Consolidating design and development personnel will allow the new company to develop products in a timely manner that accurately reflect market needs. The new company will be able to supply products that are economical by consuming less energy, easier to use, have a lower environmental impact, and that offer other features. (3) Become more cost competitive The new company will combine compact compressor compressor, machine that decreases the volume of air or other gas by the application of pressure. Compressor types range from the simple hand pump and the piston-equipped compressor used to inflate tires to machines that use a rotating, bladed element to achieve technology derived from the manufacture of room air conditioning products with multicycle freezer freezer the compartment in which meat and offal are stored at freezing temperatures of 10 to 16°F (-12 to -9°C) although there is a trend to lower temperatures of 0 to -22°F (-18 to -30°C). technology gained from the manufacture of commercial air conditioning systems. This will allow the company to supply products that are more compact and cost competitive. The new company also expects to cut procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. expenses by producing products in larger quantities and purchasing parts and materials in greater volumes. These benefits are expected to make the entire air conditioning business more cost competitive. (4) Leverage synergies between operating sites The domestic and overseas manufacturing and sales bases of HACS and Hitachi H&L will be realigned to create a single framework. Comprehensive air conditioning business strategies for each region will also be formulated for·mu·late tr.v. for·mu·lat·ed, for·mu·lat·ing, for·mu·lates 1. a. To state as or reduce to a formula. b. To express in systematic terms or concepts. c. and implemented. 1-2. Reinforce the all-electric home business The new company will aim to reinforce the all-electric home business by combining the various Hitachi H&L product groups with the sales capabilities of HACS, which is strong in commercial air conditioning system sales System sales is a business term used in the franchising industry. Franchisors provide supplies, marketing and administration services to franchisees in return for a part of the franchisees' revenues. Some franchisors also operate some outlets directly. channels. The company-wide capabilities of Hitachi, Ltd. will also be utilized. (1) Enhanced sales proposal capabilities based on an integrated all-electric home business By combining the separate all-electric home businesses operated by Hitachi H&L and HACS, the new company will handle an integrated and wide-ranging line-up of products such as "EcoCute" hot-water storage and instantaneous in·stan·ta·ne·ous adj. 1. Occurring or completed without perceptible delay: Relief was instantaneous. 2. hot-water supply systems, induction induction, in electricity and magnetism induction, in electricity and magnetism, common name for three distinct phenomena. Electromagnetic induction cooking heaters, dishwashers and microwave ovens. This will result in enhanced sales proposal capabilities that can be targeted at home builders, condominium condominium In modern property law, individual ownership of one dwelling unit within a multidwelling building. Unit owners have undivided ownership interest in the land and those portions of the building shared in common. developers, electric power companies and other clients promoting all-electric homes. (2) Faster product creation through stronger technology development capabilities By bringing together the development capabilities of Hitachi H&L and HACS, and combining them with Hitachi's R&D strengths in all-electric homes -- a core domain for the company -- the new company will be able to drive the development of Excellent products that satisfy customer needs. 2. More powerful sales activities by integrating sales management Sales Management Role and Goal Importance of sales management is critical for any commercial organization. Expanding business in not possible without increasing sales volumes, and effective sales management goal is to organize sales team work in such a manner that ensures a functions and adding new sales channels (1) Centralize cen·tral·ize v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es v.tr. 1. To draw into or toward a center; consolidate. 2. all sales management functions at the Consumer Business Group To speed the shift to a market-oriented business strategy, all consumer product marketing and sales management functions in Japan and overseas will be centralized cen·tral·ize v. cen·tral·ized, cen·tral·iz·ing, cen·tral·iz·es v.tr. 1. To draw into or toward a center; consolidate. 2. . Additionally, in order to reinforce integrated operations, eight domestic and overseas sales companies that are currently subsidiaries of Hitachi H&L, including Hitachi Consumer Marketing, Inc., will become Hitachi subsidiaries. This will create a structure in which customer feedback received by sales units can be reflected more directly in how operations are managed. (2) Strengthen sales in Japan A specialist division in the Consumer Business Group will work to strengthen comprehensive sales activities that primarily target large customers such as high-volume retailers and companies operating large chains of stores. Efforts to expand sales will also be supported by the creation of an integrated management system that links the Consumer Business Group with Hitachi Consumer Marketing, which operates a nationwide sales network. (3) Strengthen the global sales network Hitachi, HACS and Hitachi H&L will consolidate their overseas sales bases and make strategic use of each other's bases in order to create a sales network that covers almost all areas of the world. Continued growth is foreseen fore·see tr.v. fore·saw , fore·seen , fore·see·ing, fore·sees To see or know beforehand: foresaw the rapid increase in unemployment. worldwide for air conditioning systems, digital home electronics and other products sold by HACS and Hitachi H&L. Particularly strong growth is projected in the BRICs areas. All three companies already have sales networks in China. In addition, there is an HACS office in Brazil, a Hitachi office in Russia and a Hitachi H&L office in India. The three companies plan to use these bases to expand their operations rapidly in these countries. The Hitachi Group Hitachi Group (Hitachi Gurupu) is a group of companies that uses the Hitachi name, which includes Hitachi Ltd. Hitachi Heavy Industries, etc. See also
A[micro] 3. Profiles of Companies to Merge
HACS
Name: Hitachi Air Conditioning Systems Co., Ltd.
Business: Manufacture, sales, installation and services
for freezer, air conditioning and environmental
systems
Establishment: November 26, 1998
Head office: 16-1, Kaigan 1-chome, Minato-ku, Tokyo
President: Takazumi Ishizu
Number of employees: 5,910
Revenues: 176.3 billion yen (forecast for fiscal 2005)
Ordinary income 7.0 billion yen (forecast for fiscal 2005)
Principal shareholder: Hitachi, Ltd. (100%)
Hitachi H&L
Name: Hitachi Home & Life Solutions, Inc.
Business: Development, manufacture and sales of home
appliances, and marketing of consumer
electronics
Establishment: April 1, 2002
Head office: Hitachi Atago Annex, 15-12, Nishi-shimbashi
2-chome, Minato-ku, Tokyo
President: Tadahiko Ishigaki
Number of employees: 15,350
Revenues: 456.2 billion yen (forecast for fiscal 2005)
Ordinary income 0.5 billion yen (forecast for fiscal 2005)
Principal shareholder: Hitachi, Ltd. (100%)
A[micro] 4. Profile of New Company
Name: Pending
Business: Development, manufacture and sales of freezer,
air conditioning and environmental systems,
electrical home appliances and related systems
Establishment: April 1, 2006
Head office: Minato-ku, Tokyo
President: Pending
Business plan: Fiscal 2006: 450 billion yen in net sales, 10
billion yen in operating income
A[micro] 5. Companies to Become Affiliates of Hitachi's Consumer Business
Group, as of April 1, 2006
( ) shows shareholder and holding as of December 22, 2005
Hitachi Consumer Marketing, Inc. (Hitachi H&L 100%)
Hitachi (Hong Kong), Ltd. (Hitachi H&L 100%)
Hitachi Sales (Macau) Ltd. (Hitachi (Hong Kong) 100%)
Hitachi Sales (Thailand) Ltd. (Hitachi H&L 100%)
Hitachi Sales Corporation of Taiwan (Hitachi H&L 100%)
Hitachi Sales (Malaysia) Ltd. (Hitachi H&L 100%)
Hitachi Home Electronics Asia (S) Pte, Ltd. (Hitachi Asia 100%)
OOO Hitachi Home Electronics (RUS) (Hitachi 100%)
Hitachi Living Systems, Ltd. (Hitachi H&L 100%)
Hitachi Lighting, Ltd. (Hitachi H&L 100%)
Ome Sangyo (Hitachi H&L 100%)
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