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Japan-Update

Hitachi president lays tracks to 60% gain in Asian sales

Japanese tech group's five-year goal tied to region's infrastructure demands

Hitachi President Toshiaki Higashihara, right, said at a press conference in Yangon that the company aims to tap rail and water infrastructure needs around Asia.

YANGON -- Hitachi aims to capture demand for rail and other infrastructure in an effort to lift sales 60% in Asian markets outside of China and Japan by fiscal 2021, the head of the Japanese technology group said Monday.

The group targets 1.5 trillion yen ($13.1 billion) in sales, up from roughly 930 billion yen during the fiscal year that ended in March 2016.

"The ability to develop proposals for clients will become key," President Toshiaki Higashihara told The Nikkei while visiting Yangon. Hitachi will incorporate core elements of winning models into proposals matching each country's needs. The company's Lumada "internet of things" data analysis platform will feature heavily in the strategy.

Rail represents one growth area. Tokyo is assisting Myanmar in refurbishing the line connecting Yangon and Mandalay, the nation's two biggest cities. The project also includes the railway looping through Yangon. Hitachi won an order funded by grant aid to upgrade the signaling system in parts of the network.

In Vietnam, the company landed a large equipment order for Ho Chi Minh City's metro that includes train cars and a signaling system.

"Hitachi can comprehensively supply everything from ticketing systems to interior train surveillance cameras, not just rolling stock and signals," Higashihara said.

The technology group's larger infrastructure plan extends to water treatment. Higashihara predicts environmental regulations will spur demand for industrial wastewater purification equipment.

Hitachi also eyes the elevator market, made promising by new building construction. Not only is the company developing affordable models for Asian and Middle Eastern markets, it also established a maintenance training center in Thailand, a regional production hub.

But the Japanese company still faces cost competition from Chinese and South Korean rivals. "We wish to explain [to clients] that although the initial investment may be high, there are few breakdowns, and lower maintenance expenses will lead to a lower overall cost," the president said.

The company is hosting the Hitachi Young Leaders Initiative, now on its 14th edition, in Myanmar for the first time. College students from around Asia are invited to take part in the four-day event ending Thursday in Yangon.

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