Yaskawa Electric - Company History

A late electrical maker funded by the Yasukawa zaibatsu, and seventeen years of losses

In July 1915 Yasukawa Keiichiro (安川敬一郎), who had made a fortune in the Chikuho coalfield at the head of the Yasukawa zaibatsu (a family-controlled industrial group), urged his sons Seizaburo (清三郎) and Daigoro (第五郎) to start a business of their own, telling them, I will put up the money, but I will not interfere.[1] What the brothers chose was electrical machinery — a field in which the principal equipment was still imported and domestic manufacture lagged behind. Daigoro was an engineer who had read electrical engineering at Tokyo Imperial University and then gained practical experience at Hitachi and at Westinghouse[2]; with the zaibatsu's money behind him he bought a site of 10,000 tsubo (about 3.3 hectares) in the paddy fields of Kurosaki, Onga district, Fukuoka Prefecture[3], and founded Yasukawa Denki Seisakusho as a limited partnership with capital of ¥250,000[4][5]. As chief engineer he brought down to Kyushu Sakai Yasujiro (酒井安治郎), the man who had written his letter of introduction at Westinghouse[6], entrusting him with everything from the selection of the machinery to the design of the first products. The head-office plant at Kurosaki was completed in November 1916[7]; in 1919 a separate joint-stock company, Yasukawa Denki Seisakusho, was set up with capital of ¥1.25m, and the following year, 1920, the two were merged, settling the foundations of the business[8].

The general heavy-electrical line — generators, motors, rotary converters and transformers, one of each — ran into markets already held by Hitachi and by Shibaura Engineering Works (later Toshiba), and as a late entrant Yaskawa could match them neither on technology nor on cost[9]. Daigoro's ideal, that a good product will sell itself, did not connect to running a business. For the seventeen years to 1932 Yaskawa ran at a loss and paid no dividend, surviving only on the financial support of Meiji Mining, the core company of the Yasukawa zaibatsu, through reductions and increases of capital[10]. Behind the ability to tolerate losses over so long a stretch stood his father Keiichiro and the backing of Meiji Mining. A late entrant with no technology of its own had taken on every field the incumbents held, and that was what brought on the long struggle.

Abandoning switchboards and transformers for the Yaskawa motor

In December 1930, struck by the Showa Depression, Yaskawa cut 200 of its roughly 400 employees[11]. For Daigoro this was the second time he had had to let go skilled engineers and workmen, and he recalled that it felt as though his own flesh were being cut away[12]. Then, in 1932, Yaskawa gave up being a general heavy-electrical maker that turned its hand to anything: it withdrew from switchboards and transformers, which made no profit, and narrowed its range to motors and controllers alone[13]. It was a decision to stop competing across every field against the incumbents and to concentrate the company's resources on the single product line that suited it best. This was a painful rebuild in which the range was cut back even at the cost of releasing good engineers, and from here the company threw its whole strength into motors, where volume production would tell.

Just as it concentrated its resources on motors that could be built in volume and raised the banner of the Yaskawa motor, the military expansion that followed the Manchurian Incident came as a tailwind[14]. Sales of motors and controllers grew, and the accumulated deficit of the seventeen years since the founding was at last cleared[15]. In 1937 the company registered Yasukawa Motor (安川モートル) as a trademark, and under Daigoro, who became president that same year, Yaskawa became a company that stood on its own feet without leaning on the zaibatsu's coffers. Twenty-two years after the founding, the pattern of rebuilding this company would repeat ever after — defeated by widening, revived by narrowing — appeared here for the first time. For the first time, too, Yaskawa's position changed: from a late entrant supported by the Yasukawa zaibatsu into a specialist that earned its own way.

The Tokyo plant: industrial electronics chosen over consumer appliances

After the war, having listed on both the Tokyo and Fukuoka stock exchanges in 1949, Yaskawa passed up the chance to enter the growing market for consumer appliances[16]. Daigoro warned against a management that widens its frontage because others are doing it or because there is money in it, and he aimed instead at industrial applications, where competition was relatively light. What he wanted was to become a specialist firm with technology in electric power and its control that no other company could match[17]. The experience of widening and losing in general heavy electricals led to the deliberate decision to avoid consumer appliances, the largest growth market of the post-war years. In the heyday of home electronics Daigoro was asked again and again why Yaskawa would not go into household appliances, and to the last he refused a scattergun management that chased the fashion.

The technology Yaskawa grew in industrial applications was the servomotor. In 1958 a designer of rotating machines, taking his idea from a plum blossom his daughter had drawn, invented the Minertia (ミナーシャ) motor, a low-inertia machine that carried the conductors directly on the rotor[18]. It was an attempt to replace with a motor the servo control for which hydraulics were the norm. In 1960 Tominaga Kazuo (富永和郎), a managing director, read in Fortune about General Electric's industrial-electronics strategy, and president Yasukawa Hiroshi (安川寛) resolved on a full-scale move into industrial electronics[19]. Three pillars — motor electronics, data electronics and servo electronics — became the framework of research and development from then on[20].

In 1964 Yaskawa built the Tokyo plant at Iruma, Saitama Prefecture, its first production site away from Kyushu, and began volume production of servomotors[21]. The existing motor business stayed at Kurosaki, while the new electronics were raised in the Kanto region, physically apart, in the manner of an internal venture. Musashi, a town of some 30,000 people, issued bonds to build the road that led to the plant, and that road is still called Yasukawa-dori[22]. In 1967 the company went into overseas sales through Yaskawa Electric America[23], and in 1968 it entered numerical control (NC) in earnest. The choice to avoid consumer appliances became the foundation of a motion-control business that has lasted half a century. The two-track structure — general-purpose motors at Kurosaki, electronics in Kanto — was settled here.