Features
4 Aug 21

Japanese supply chain joins the EV bandwagon

Toyota might continue preaching the word of hybrid and hydrogen, some Japanese manufacturers are keen to benefit from the global EV trend. Nissan and Honda already have made their point; now Hitachi, one of Japan’s leading technology groups, is joining them with a clear statement.

ASIA’s EV ambitions in the news

In recent months, especially Indonesia has been on the radar. The country owns one of the largest nickel reserves & has opened the extraction market. Chinese and Korean companies seized the opportunity; especially Hyundai and Kia, convinced by the argument of a short supply chain, are investing in mining, battery manufacturing and vehicle production, all concentrated in Indonesia.

Remarkable has been the (relative) absence of the Japanese OEMs (parts and vehicles) in the recent news coverage. This is now changing although it’s, again, not Toyota that is headlining.

Hitachi

The Tokyo-based company is best known in Europe for its electronics, construction equipment and power tools. Although the company was indeed founded by an electric engineer in the early 1900s, its activities have significantly evolved and Hitachi (which means “sunrise”) is now active in automotive, construction, defense, digital media, electronic systems, advanced materials, ITC, power and much more. The company is part of Fortune 50 and ranks 133rd in Forbes. Roughly 300.000 people work for Hitachi globally.

Strategy and Importance

Hitachi is strategically investing in 3 locations: invertor plants will open Japan and China, an EV motor plant will go online in Kentucky, a strategic location close to the top manufacturing states of Michigan and Ohio and US’ third automotive job providing state. Short term, the company will be investing $2.7 billion in the new plants.

Hitachi is currently the global leader of EV motor production (at roughly 10% of the global production) and occupies the third place in inverter production. The new investments are meant to increase the company’s capacity sixfold to keep its leadership position moving forward.

Timing

And the global need for EV components is increasing indeed. China will be registering 5 million new energy vehicles in 2025, GM plans to spend $35 billion in EVs whilst Ford has announced dedicating $30 billion. Hitachi is close to Honda Motor and can count on a 40% uptake of its production by the car brand.

For the Fleet Manager

Besides the Chinese and Korean manufacturers, it seems now that the Japanese OEMs have made up their minds. When a major player in the automotive supply chain, such as Hitachi, confirms its belief in EV technology, the effects will be visible rapidly. A bit more patience is required probably, but Japan is finally on its way to electrification.

Picture Credit: Shutterstock

Authored by: Yves Helven