Hitachi sets expansion of Philippine base

Hitachi is looking to expand in the Philippines, where it plans to tap Filipino talent in production and design, executives of the Japanese conglomerate said during a media briefing on Monday.

“For us, the Philippines is one of the most important countries for production,” said Hiroti Goto, general manager of the Philippine branch of Hitachi Asia Limited, which is responsible for sales and marketing in the continent.

Hitachi operates 19 companies in the Philippines, 10 of which are in production.

Goto said that half of their 9,000 employees in the Philippines are working for the Hitachi plant making optical drives for computers in southern Metro Manila.

Compared to other workers in Southeast Asia, Filipinos are reputed to be more skilled and more educated.

These qualifications, on top of their proficiency in English, make them easier to train.

Goto said that Hitachi sees “many possibilities” for expansion in the Philippines.

He cited industrial design, in which the company employs 200 Filipinos working on plans for thermal power plants.

Competition from Thailand
Takayuki Hirota, the managing director of Hitachi Asia Limited, said, “Our management is expecting Asia to recover first [from the global financial crisis].”

He added that Thailand was very aggressive in attracting Hitachi investments there, where production plants number more than twice those in the Philippines.

Also, Hirota said, Thai labor costs are relatively cheaper, and the government there has been extending a number of investment incentives.

He added that Hitachi has been doing business in Thailand for 52 years, about a decade earlier before the Japanese company started operations in the Philippines.

But Goto said, “As far as I know, the incentives between Thailand and the Philippines are not so different.” He added that the presence of several Japanese manufacturing companies around the Philippines also offers possibilities, and that they were looking into that.

He added that Hitachi has more than P6 billion, or about $120 million, in capital investments in the Philippines, where their operations are mostly located in special economic zones.

The Philippines contributes only about 10 percent to Hitachi’s earnings, Goto said, stressing that they were eager to explore a number of possibilities.

He conceded that Thailand has better infrastructure and lower power costs than the Philippines.

Goto said that the last quarter of 2009 was good for Hitachi operations in the Philippines, but he declined to give specific figures on the expansion plans, adding that it depends on the how quickly the global economy and consumer demand recover.

Yoichi Yamano, the senior manager also of Hitachi Asia, said, “The world is paying attention to Asia.”

He added that Asia was not the driving force for the global economy, and that the new Japanese government was also increasing its focus on this region—more so than the Western industrial powers.

Hitachi is a century-old Japanese enterprise that was founded initially to make “useful products,” according to company literature.

Hitachi Asia Limited Philippines markets a wide range of products and services for various industry sectors like power generation systems, transmission and distribution systems, heavy industrial equipment, industrial component and equipment and elevators and escalators. –DANTE “KLINK” ANG 2ND Executive Editor, Manila Times