Company history

Hitachi was born inside a mine. In 1908 Odaira Namihei, works manager at the Hitachi copper mine run by Kuhara Fusanosuke’s Kuhara Mining, set up a small shop — 130 square metres, five workers — to repair and build for itself the electrical machinery Japan otherwise imported. Odaira’s conviction was blunt: rather than pay royalties on foreign motors and generators, put the same money into your own research. Refusing technical tie-ups with foreign firms, in 1910 the shop completed a 5-horsepower induction motor of its own design, and Odaira named the new works Hitachi. Self-reliant, all-domestic engineering — a creed unusual in prewar Japan’s electrical industry — was set here, at the origin.

The shop grew from supplying the mine to taking outside orders, and in February 1920 it was incorporated as Hitachi, Ltd. and spun off from Kuhara Mining — over the founder-owner’s reluctance, at Odaira’s insistence. In 1921 it took over the ailing Kasado shipyard from Nippon Kisen and, unusually for an electrical maker, moved into railway rolling stock; by the 1930s motors, generators, transformers and rolling stock together made it a full-line “general-electric” maker. Against the zaibatsu capital and foreign technology that backed its rivals, Hitachi flew the flag of home-grown technology — a “wet,” in-house culture that the trade set against the Mitsui-and-GE rationalism of Toshiba.

War swelled it and defeat nearly broke it. Absorbing Kokusan Kogyo in 1937 and buying up electrical makers across the country for the war economy, Hitachi built eighteen plants and a nationwide web of factories and research labs. When military orders vanished in 1945, some 8,500 of its 44,000 workers were judged surplus and the equity ratio fell to 14%. President Kurata Chikara halted production across every plant for about sixty days rather than yield, then pushed through the largest workforce cut in private-sector Japan; a ¥400 million syndicated loan led by the Industrial Bank averted a cash collapse, and in 1949 Hitachi listed on the Tokyo Stock Exchange.

The postwar recovery reversed the founder’s creed. Behind on thermal-power technology and trailing Toshiba and Mitsubishi Heavy, Hitachi signed foreign technology alliances three years running — RCA for television tubes in 1952, GE for steam turbines and generators in 1953, Western Electric for transistors in 1954 — abandoning in practice the self-reliant, all-domestic line Odaira had held for more than forty years. Komai Kenichiro, who ran the power business, put it plainly: he wanted to tie up quickly with a first-rate foreign maker and fight on equal terms. Television, power generation and semiconductors were secured at once, and the turbine and generator technology became the backbone of what is today the social-infrastructure business.

Through the high-growth years Hitachi spun its non-electrical businesses out as separately listed subsidiaries — Hitachi Metals and Hitachi Cable in 1956, Hitachi Chemical in 1963, Hitachi Construction Machinery in 1969 — while keeping more than 50% of each. This “parent-child listing,” which reconciled operating independence with parent control, would hold as the group’s basic form for more than sixty years. By 1959 the trade reckoned Hitachi had overtaken Toshiba in heavy electrical machinery: the company that had made “catch and pass Toshiba” its motto had, it was said, finally done so not only in overall scale but in heavy electric itself.

Expansion outran profit. Hitachi pushed deeper into electronics — a software works in 1969, mass production of 256-kilobit DRAM in 1984 — and in 1999 merged its memory operations into a joint venture with NEC to chase scale. But price war with US and Korean makers and the weight of fab investment, compounded by the silicon cycle, tipped it to a net loss in the year to March 2002 and a group-wide cut of some 20,000 jobs; the semiconductor business was hived off in 2003 into Renesas, a joint venture with Mitsubishi Electric, and left the core.

The portfolio kept swelling and shrinking at once. In 2003 Hitachi bought IBM’s hard-disk business for about $2 billion and split off displays, communications and consumer units in parallel; the same year it moved early among big Japanese manufacturers to a committee-based board. But heavy-electric orders turned zero-sum, big customers cut their capital spending, and the earning power of a conglomerate spanning heavy electric to home appliances kept sliding — in 2007 its market value was passed by Mitsubishi Electric.

Then the Lehman shock. In the year to March 2009 Hitachi booked a net loss of about $8.4B (¥788bn) — the largest ever by a Japanese manufacturer — driven largely by a ¥390 billion write-down of deferred tax assets, and the equity ratio fell to 11%. It was a level, insiders later said, at which another shock of that size would have meant bankruptcy. President Furukawa Kazuo resigned to take responsibility, and the nominating committee reached back to Kawamura Takashi — moved out to chair a subsidiary — and recalled him to run the parent, an almost unheard-of return.

Kawamura used the crisis to dismantle sanctuaries. He forced through a ~¥349 billion public share offering that diluted existing holders by about 13%, putting a fast repair of the balance sheet above their objections; in 2012 he sold the hard-disk business to Western Digital for about $4.8 billion, lifting the equity ratio back above 18%, and Hitachi walked away from the flat-panel TVs it had built in-house since 1956. The businesses that had been the face of Hitachi — appliances, information gear, semiconductors — were cut from the parent, and the “general-electric” signboard came down. Elder Hitachi executives protested at selling off businesses they had sweated to build; Kawamura, having decided as president, would not reverse course.

His successors made the cut permanent. Nakanishi Hiroaki, then Higashihara Toshiaki, turned “selection and concentration” from a one-off rescue into a standing discipline, and bought growth wholesale: ABB’s power-grid business in 2020 for about $6.7B (¥720bn), folded into Hitachi Energy; the US digital-engineering firm GlobalLogic in 2021 for roughly $9.1B (¥1tn) — a price of ten times revenue that split the board before it was approved; and Thales’s railway-signalling business in 2022. In parallel it quit its founding-lineage thermal-power business, taking a $3.4B (¥376bn) settlement loss with Mitsubishi Heavy over a South African plant, and handed the joint venture back.

Most radical was undoing the parent-child listing itself. Over sixty years Hitachi had held its listed subsidiaries; now it sold them one after another — Hitachi Logistics, Hitachi Chemical, Hitachi Construction Machinery, and in 2023 Hitachi Metals (renamed Proterial) — switching the group from a holder of listed affiliates into an operating company. Astemo, an auto-parts arm it had built up only in 2019, was deconsolidated within four years. In April 2025 Hitachi fixed, for the first time in numbers, where all this was heading: “Lumada 80-20,” to earn 80% of revenue and 20% of operating profit from its Lumada digital businesses under the Inspire 2027 plan, embedding generative AI and leaning the whole company toward social infrastructure and digital.