Company history

Yaskawa Electric was not founded by an engineer looking for capital but by capital looking for a place to go. Yasukawa Keiichiro, who had made a fortune in the Chikuho coalfields of northern Kyushu, urged his sons Seizaburo and Daigoro to start something of their own and told them, in effect, that he would put up the money but not interfere. The brothers chose electrical machinery — a field where the important equipment was still imported and domestic production lagged. Yasukawa Daigoro, a graduate of the electrical engineering department at Tokyo Imperial University who had worked on the floor at Hitachi and at Westinghouse, bought some ten thousand tsubo of paddy land at Kurosaki in Fukuoka Prefecture and set up Yaskawa Electric Manufacturing as a limited partnership with capital of ¥250,000.

He brought Sakai Yasujiro, the man who had written his letter of introduction at Westinghouse, down to Kyushu as chief engineer, and gave him everything from the choice of machine tools to the design of the first products. The Kurosaki head-office plant was completed in November 1916; a separate joint-stock company followed in 1919, and the two were merged in 1920. The plan was a full-line heavy-electrical maker — generators, motors, rotary converters, transformers, all of it.

That plan was the mistake. Hitachi and Shibaura Seisakusho (later Toshiba) already held the market and beat the newcomer on both technology and cost, and Daigoro’s belief that a good product sells itself never connected to a working business. For the seventeen years to 1932 Yaskawa ran at a loss and paid no dividend. It survived only because Meiji Mining, the core company of the Yasukawa zaibatsu, kept absorbing the damage through successive capital reductions and injections. A latecomer with no technology of its own had challenged the incumbents across every product line at once, and the bill came in year after year.

In December 1930 the Showa depression forced Yaskawa to let go about half of its roughly four hundred employees. Two years later came the decision that made the company: it stopped trying to be a general heavy-electrical maker, withdrew from switchboards and transformers — the lines that made no money — and kept only motors and controllers. Skilled engineers and craftsmen had to be released to narrow the product range, and Daigoro described the cuts as cutting into his own flesh. But for the first time the plant’s resources went into a single thing that could actually be mass-produced.

The brand “Yaskawa Motors” then caught the rearmament that followed the Manchurian Incident. Sales of motors and controllers grew, the accumulated deficit built up since 1915 was finally cleared, and in 1937 — the year the Yaskawa Motor trademark was registered and Daigoro became president — the company stood on its own without the zaibatsu treasury behind it. Twenty-two years after founding, the pattern it would repeat for the rest of its history had appeared for the first time: spread and lose, narrow and revive.

Listed on the Tokyo and Fukuoka exchanges in 1949, Yaskawa then declined the largest growth market of the postwar era. Asked repeatedly why it would not make home appliances, Daigoro refused to widen the range simply because others were doing it or because it paid, and aimed instead at the less crowded industrial side — a specialist unmatched in electric power and its control. The technology that came out of that choice was the servomotor: in 1958 a designer of rotating machines, taking his cue from a plum blossom his daughter had drawn, invented the low-inertia Minertia motor, an attempt to replace hydraulics — then the standard in servo control — with a motor. In 1960, after an executive read a Fortune piece on General Electric’s industrial electronics strategy, president Yasukawa Hiroshi committed the company to industrial electronics, organized around three pillars: motor, data and servo electronics.

In 1964 Yaskawa built its first plant outside Kyushu, at Iruma in Saitama, to mass-produce servomotors — leaving the general-purpose motor business at Kurosaki and raising the new electronics business at a physical distance, like an internal venture. The town of thirty thousand issued bonds to build the access road, which is still called Yaskawa-dori. Overseas sales began in 1967 with Yaskawa Electric America, and in 1968 the company entered numerical control in earnest. Avoiding appliances had bought it a motion-control business that is still running half a century later.

In 1969 Yaskawa coined the word mechatronics for the marriage of motors and electronic control. The products that matched the word arrived out of a crisis. In numerical control, a young engineer’s contouring invention (the Saida function, patented in 1972) and joint research with Okuma Tekkosho led to YASNAC, a microcomputer-based NC unit mass-produced from 1976. In robotics, the vision-equipped Cyclops prototype of 1970 was followed by a run of teaching-playback machines and, in 1977, by MOTOMAN-L10, a vertically articulated arc-welding robot.

Underneath that development work the business was collapsing. Orders from Nippon Steel’s Yawata works — the company’s largest customer — thinned out, and in 1976 president Yasukawa Keiji pushed through a restructuring built on voluntary retirement for seven hundred people, roughly a tenth of the workforce, against union opposition and a strike. Two straight years without a dividend followed through the year ended March 1978. Dai-Ichi Kangyo Bank, the main bank, installed its managing director Kiya Reijiro as representative vice-president, and family management by the Yasukawas of Kyushu gave way to a bank-led rebuild.

What the bank was funding, in effect, was the payoff from the earlier narrowing. Under its supervision Yaskawa assembled the motion-control line-up it still sells: a vector-control inverter in 1979, AC servomotors in volume from 1983, the ten-thousandth MOTOMAN shipped in 1988. The price of dependence on heavy electrical machinery had been paid; what it bought was a place at the front of factory automation.

In September 1991 the company dropped “Manufacturing” from the name it had carried since 1915 and became simply Yaskawa Electric Corporation. The same month it opened Yaskawa Electric Singapore; in 1994 it took control of Motoman Inc. in the United States and Yaskawa Robotec in Europe, converting robot sales abroad from distributor agencies into a directly held business. A joint venture with Siemens in industrial drives followed in 1999, alongside a wholly owned entry into mainland China through Yaskawa Electric (Shanghai). In June 2000 the medium and large rotating-machine division was spun off as Yaskawa Motor — the last of the heavy-electrical inheritance cut away, and the structural shift to a mechatronics specialist complete.

The specialist was also fully exposed. A net loss came in the year ended March 2002 with the IT downturn; recovery ran to a then-record operating profit of $309.1M (¥36bn) in the year ended March 2008; and then the Lehman shock hit servos and robots directly. In the year ended March 2010 revenue fell 35.8%, from $3.4B (¥350bn) to $2.4B (¥225bn), and the company posted an operating loss of $74.6M (¥7bn) and a net loss of $60.9M (¥6bn). Japan alone swung from a ¥10.4 billion operating profit to an ¥11.2 billion loss. The old weakness — a steep fall immediately after a demand peak — had survived the change of products.

The recovery began with consolidation. In June 2010 Yaskawa Electric America and Motoman were merged into a single Yaskawa America, and the European sales and robot companies were likewise combined — the regional entities that had proliferated since the 1994 buy-outs pulled into one frame able to absorb the next swing in demand. In January 2012 the Shanghai company was converted into an investment holding company as the China head office, with plants at Shenyang and elsewhere mass-producing AC servos. In 2015 the head-office site was rebuilt around a robotics campus, the Robot Village.

Ogasawara Hiroshi, president from 2016, then wrote a ten-year plan, Vision 2025, drafted from the bottom up. It limited the company to two core businesses — industrial robots and motion control — and aimed at world number one in both: the founding habit of narrowing, restated as a long-range plan. What stood out was the choice of targets. The sales goal was left vague (roughly double the fiscal 2015 level), while the hard numbers were operating profit of $826.3M (¥100bn) or more, ROIC of 15% or better and a payout ratio above 30%. For the first time, a company that had spent a century spreading and narrowing removed growth in scale itself from the top of its plan.

The Siemens drives venture was bought out entirely in 2018 and folded into the parent in the 2019 reorganization. Ogawa Masahiro succeeded to the presidency in 2022 and immediately posted the best results in the company’s history — revenue of $4.2B (¥556bn) and operating profit of $519.9M (¥68bn) in fiscal 2022, held near that level the following year — before fourth-quarter orders fell 14%. The harder change was competitive. Industrial robots and AC servos had long been close to a Japanese oligopoly, and Ogawa has said plainly that this is no longer a safe position: Chinese domestic makers have closed the technology gap and are pushing the market on volume, which he treats as the road any growing country travels. Yaskawa’s answer is not to fight on the same ground. Local production is being switched from a backlog-driven model to one linked to actual demand, raising production density rather than output; ROIC becomes the control metric of the next mid-term plan; and production is being concentrated in a fifth robot plant. The company that once refused appliances and threw away switchboards is now changing where and how it builds, rather than what it builds.