Hitachi Announces Its Corporate Strategy.

TOKYO -- Hitachi, Ltd. (NYSE:HIT)(TOKYO:6501) today announced that it has formulated a corporate strategy to promote collaborative creation and profits. With a rigorous focus on a market-oriented approach and profit creation as the basic policy, the aim is to establish a structure that stably generates high profits by the use of key initiatives such as the implementation of fully FIV(a) (Future Inspiration Value) based management, the creation of a business portfolio with higher profitability, moving forward with group management, and innovation in collaboration with partners and group companies.

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In line with this management policy, in order to improve earnings, businesses within the Hitachi Group are to be rigorously managed based on FIV criteria, and subject to restructuring and reappraisal accordingly, with no area of operations being regarded as exempt from such scrutiny. To build a business portfolio for stable, high profits, Hitachi will strengthen its social innovation business, which consists of its social infrastructure, industrial infrastructure, life infrastructure and information infrastructure businesses, and will endeavor to maximize the synergies with the infrastructure technology/products business that underpins social innovation business operations. Corporate governance is being systematically strengthened, efficient group company management implemented and equity relationships reviewed, in order to raise earnings throughout the corporate group. With the emphasis on collaborations with partners and group companies, in the Hitachi Group diverse partnerships are being used to strengthen collaborative innovation business undertakings in various areas of operations. The focus is also on producing innovations in which the priority is on profitability, such as by expanding businesses that provide innovative products and services that are market leaders, and strengthening R&D capabilities that are directly linked to the generation of profits.

The aim is to use these initiatives to achieve an operating margin of 5% by fiscal 2009. Hitachi is also focusing on strengthening its financial structure and maintaining a D/E ratio (including minority interests) of 0.8 or below.

Details of the key initiatives are set out below.

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Hitachi, Ltd., (NYSE:HIT)(TOKYO:6501), headquartered in Tokyo, Japan, is a leading global electronics company with approximately 356,000 employees worldwide. Fiscal 2005 (ended March 31, 2006) consolidated sales totaled 9,464 billion yen ($80.9 billion). The company offers a wide range of systems, products and services in market sectors including information systems, electronic devices, power and industrial systems, consumer products, materials and financial services. For more information on Hitachi, please visit the company's website at http://www.hitachi.com.

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 managementeIUs 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:

- fluctuations in product demand and industry capacity, particularly in the Information & Telecommunication Systems segment, Electronic Devices segment and Digital Media & Consumer Products segment;

- uncertainty as to HitachieIUs 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;

- rapid technological change, 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, particularly in the Information & Telecommunication Systems segment, Electronic Devices segment and Digital Media & Consumer Products segment;

- fluctuations in rates of exchange for the yen and other currencies in which Hitachi makes significant sales or in which HitachieIUs assets and liabilities are denominated, particularly between the yen and the U.S. dollar;

- uncertainty as to HitachieIUs ability to implement measures to reduce the potential negative impact of fluctuations in product demand and/or exchange rates;

- general socio-economic and political conditions and the regulatory and trade environment of HitachieIUs 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 HitachieIUs access to, or ability to protect, certain intellectual property rights, particularly those related to electronics and data processing technologies;

- uncertainty as to the results of litigation and legal proceedings of which the Company, its subsidiaries or its equity method affiliates have become or may become parties;

- possibility of incurring expenses resulting from any defects in products or services of Hitachi;

- uncertainty as to the success of restructuring efforts to improve management efficiency and to strengthen competitiveness;

- 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;

- uncertainty as to HitachieIUs ability to access, or access on favorable terms, liquidity or long-term financing; 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 HitachieIUs periodic filings with the U.S. Securities and Exchange Commission and in other materials published by Hitachi.