In a major change in how Hitachi mining machines will be supplied to American markets, John Deere’s marketing arrangement for Hitachi-branded construction excavators and mining equipment in the Americas that has been in place since 1988 is set to end effective March 2022; Hitachi will now assume distribution and support for these products covering the whole mining range up to the largest models – hydraulic excavators up to the EX8000 and mining trucks up to the EH5000.
The main driver behind the move is to be able to provide the mining industry in the Americas with the latest digital, automation and future powertrain solutions directly plus leverage better in the region the expertise Hitachi-owned companies like Wenco, Bradken and H-E Parts. It also comes ahead of Hitachi’s plans to roll out its comprehensive ConSite® Mine digital solution to support the operation of an entire mine.
Hitachi in Japan stated: “Upon the dissolution of the alliance and starting from March 2022, Hitachi Construction Machinery will be able to provide the newest products, technologies, and services directly to our customers through our independent dealer network, as part of the integrated Hitachi Construction Machinery Group activities throughout the North, Central and South American markets.”
It added: “Hitachi Construction Machinery Group will offer direct sales and services of compact to construction–sized hydraulic excavators, ultra–large mining machines, and, in addition, wheel loaders, all of which are recognised globally for their excellence in performance and quality, in these markets.”
Going forward, Hitachi Construction Machinery will have Hitachi Construction Machinery Loaders America Inc (with headquarters in Georgia, and Chairman of the Board Masaaki Hirose, which currently serves as the production and distribution base for Hitachi branded wheel loaders) function as the hub of its activities in the Americas. Hitachi Construction Machinery will coordinate with the group companies in the region to build a new business structure.
Hitachi added: “While utilising and strengthening the existing network of Hitachi branded wheel loader dealers, Hitachi Construction Machinery Group will build an optimal network throughout the entire North, Central and South American markets for marketing and servicing of its equipment. Hitachi Construction Machinery and Deere have entered into a new Supply Agreement under which Hitachi Construction Machinery will provide Deere with OEM supply of Deere branded excavators, as well as components and service parts to Deere’s manufacturing and distribution bases in the United States and in Brazil for the time being. Furthermore, we are placing our utmost priority on providing uninterrupted services after the dissolution of the joint venture to our customers who own products manufactured or sold through the joint venture business.”
Since 1988, when Hitachi Construction Machinery and Deere established Deere–Hitachi Construction Machinery Corporation, a joint venture for manufacturing and sales in North Carolina, US, the two groups have built significant relationships as partners throughout North, Central and South America. “Hitachi Construction Machinery has promoted local production in earnest by providing excavator technology, which is world–class technology. Marketing has been carried out through collaboration throughout the Americas by Deere, which has a strong presence in the region in agricultural equipment. On the other hand, in recent years, as global SDGs and other trends have increased, construction, civil engineering and mining customers have an increasing demand from construction machinery manufacturers for the three basic objectives of improved safety, improved productivity, and reduced lifecycle costs.”
In order to respond to customers’ needs, Hitachi Construction Machinery says it has been making group-wide, full-fledged efforts to expand and deepen businesses beyond new machinery sales (value chain business: parts and service, rental, used equipment, parts remanufacturing, finance, etc), starting with its previous medium-term management plan which became implemented from FY2017. “Beginning in March 2022, we will be able to provide direct, cutting-edge solutions that address the challenges of customers throughout North, Central and South America for not only compact and construction-size wheel loaders but also compact and construction-size excavators, mining excavators and mining dump trucks.“
Hitachi Construction Machinery Loaders America will work to build a nationwide network to procure machinery manufactured in Japan as the regional headquarters, sell them under Hitachi brand, and provide services. At present, Hitachi Construction Machinery Loaders America has established a dealer network for wheel loaders in North America. “With respect to compact and construction size excavators, we will introduce the newest models to meet the demands of the North American market for advanced workability, safety, and services. These include the state–of–the–art hydraulic systems which realise high efficiency, Aerial Angle® which improves safety of work sites, and ConSite®, a service solution that is highly regarded worldwide. We will reorganise and strengthen our marketing system in the region. In the mining business, we will collaborate with mining–related companies in the Hitachi Construction Machinery Group to further develop our distribution network in North, Central and South America.”
With the end of the agreement with Deere, Hitachi Construction Machinery will become able to work with existing dealers in North, Central and South America to strengthen and expand its network in the future and to proactively develop business for customers involved in mining operations across the American continents. “Specifically, the Hitachi Construction Machinery Group’s activities, including the efforts we recently agreed to conduct with the ABB Group to achieve net zero emissions” (referring to their joint battery electric trolley assist mining truck project) “plus dump truck autonomous haulage system (AHS) for automated driving at mines, and autonomous operating technologies for ultra large mining excavators” are drawing considerable attention from customers in the global mining market.
In addition to reducing CO2 emissions, more sophisticated and complex mine–wide management is also a major challenge to its mining customers. Hitachi Construction Machinery is also scheduled to begin offering ConSite® Mine on which it is working closely with Wenco International Mining Systems Ltd headquartered in Vancouver, Canada and headed up by President & CEO Andrew Pyne, a subsidiary “which is one of the world’s leading engineering companies for the operation and management of increasingly complex mining trucks, to develop new and expanded customer service.”
In addition, it gives mining customers in the Americas better access to the technologies from Hitachi-owned Bradken Pty Ltd (headquarters New South Wales, Australia; CEO: Sean Winstone), which manufactures wear parts and related components for mining equipment, as well as H–E Parts International LLC (headquarters: Atlanta, Georgia, USA; CEO: Simon Pelletier), which provides advanced maintenance services for mining, crushing, and construction machinery as well as being in the business of development, processing, and sales of components for mining equipment, both of which have a proven track record throughout the Americas markets. “We will work with these group companies and the ABB Group to develop and cultivate markets together.”
Since 2000, Hitachi Construction Machinery has been equipping excavators with communication terminals as an option. In 2006, Hitachi Construction Machinery began to install them as a standard item for all models. Using IoT, we continue to accumulate and analyse big data, such as construction machinery operation and location information, through Global e–Service®. “Since 2013, we have been contributing to the reduction of life cycle costs, among other customer issues, by providing a service solution called ConSite® that identifies failure risks through remote monitoring and distributes data reports on the status of construction machines, based on the data accumulated through Global e–Service®.”
Currently, customers have signed up for ConSite® data reporting services for 158,000 units in 113 countries, with high acceptance by the customers in a short period of time, with a contract rate of approximately 75% of total unit sales. “By actively incorporating AI and analytical techniques, we have increased the failure prediction rate through remote monitoring to 75%. As a future goal, we aim to increase the failure prediction rate to approximately 90%.” The ConSite® contract rate for wheel loaders under development under Hitachi brand is 85%, showing high acceptance in the North American market.
“In the future, we will introduce new hydraulic systems, Aerial Angle® to improve on–site safety, and the newest construction excavators equipped with ConSite® and
ConSite® OIL in the North American market to meet customer expectations. ConSite® is positioned as a use case in Lumada® business, which the Hitachi Group is focusing on. We will also be able to provide these state–of–the–art services of Hitachi Construction Machinery to customers throughout North, Central and South America, and contribute to resolving customer issues.”
Wajax taking over direct Hitachi mining equipment supply in Canada
Wajax Corporation and Hitachi Construction Machinery Loaders America Inc have announced that, effective March 1, 2022, the companies plan to expand their current Canadian direct distribution relationship to include construction excavators, mining equipment and related aftermarket parts. Since 2001, these products have been supplied to Wajax via the John Deere third–party joint venture partner to Hitachi Construction Machinery (HCM).
The expansion of the direct relationship between Wajax and Hitachi is expected to strengthen the competitive positioning of both companies in the Canadian construction and mining markets. Commenting on the change, Wajax’s President and CEO, Mark Foote, stated “Hitachi is Wajax’s largest manufacturing business partner and a very important contributor to our strategy. We are very pleased that our direct relationship will be significantly strengthened. Working directly with our partners at Hitachi will provide Wajax with enhanced access to product development and improved market responsiveness. We look forward to building on this already strong partnership in the core markets of construction and mining, as well as in additional areas in the future.”
On behalf of Hitachi, Simon Wilson, Vice President of Sales, stated “Wajax is one of Hitachi’s largest and most successful independent distributors globally and has been a valued partner for over two decades. The Canadian market is key to Hitachi’s strategy, and we look forward to the benefits of an expanded direct relationship with Wajax as our national construction and mining partner. We believe this change will increase our market share by providing customers with products that lead the market in terms of value, performance and reliability.”