Message from the President

Contributing to the Realization of a Better World by Constantly Creating Products and Services with True Value

Contributing to the
Realization of a Better
World by Constantly
Creating Products and
Services
with True Value

KOBELCO CONSTRUCTION
MACHINERY CO., LTD.
President & CEO
Kazuhide Naraki

Established by Integration for a Stronger Business Foundation

Two years ago the KOBELCO Group established a medium-term five-year plan in FY2016 in order to develop and expand our business operations, and this fiscal year marks the third year of this plan. I believe that FY2018 is an extremely important year given the changes in the needs and demand trends of our customers as we move towards 2020, the last fiscal year in which our plan will be completed.

At the same time as this five-year plan, we also saw the birth of a new KOBELCO CONSTRUCTION MACHINERY created by integrating the management of KOBELCO CONSTRUCTION MACHINERY (Excavator Div.) and KOBELCO CRANES (Crane Div.). For two years, we have experienced positive effects from our structural reorganization in the form of optimized business management, strengthened product development capabilities, and accelerated global development. The structural reform for the integration of our excavator and crane operations was complemented by the integration of our European operation bases at the end of 2017, perfect timing for us to really spread our wings by expanding and improving our operations.

Perceiving Diverse Needs to Respond Rapidly

Reflecting on the previous year shows an increase in the global demand for construction machinery due to factors such as a recovery in demand for hydraulic excavators in China, Indonesia, India, and other Asian countries, as well as strong European and American markets. Even Japan has enjoyed a period of continuous high growth, exceeding that of the Izanagi economic boom (for 57 months in 1965-70) in September of last month, with this growth considered to be due to the strength of construction machinery investment based on the demand created by the Olympics as well as the demand for upgrading infrastructure.

However, as this favorable tide continues, there is a major issue of a shortage of labor in the domestic construction industry. One of our solutions to this issue is to accelerate i-Construction compatibility with our "Horunavi/Horunavi + PLUS" system machines equipped with 3D machine control that allows inexperienced excavator operators to easily operate the machine with the same level as a veteran operator. Taking advantage of KOBELCO CONSTRUCTION MACHINERY's own unique IoT, we have been creating preventive technology for unexpected machine stoppage such as our "KSCAN" preventive maintenance function that suggests maintenance before a problem occurs. Another issue facing the construction industry is that of eliminating work-related injury or death, for which we have introduced our "K-EYE PRO", a collision reduction system equipped with an automatic deceleration/stop function that is the first in the construction machinery industry.

We are additionally continuing to rapidly and precisely meet the new needs of our customers as seen in the release of new models by the Crane Division such as a 300-ton crawler crane for general use in overseas markets and a TK crane for basic applications.

To Continue to be Indispensable for the Development of a More Prosperous Society

Looking internally at our company, we will be further expanding and developing the "Work Style Reform" started in FY2016 through measures aimed at creating an environment in which all employees of the KOBELCO CONSTRUCTION MACHINERY GROUP can work challenging yet rewarding jobs in which they perform meaningful tasks. In addition to the many positive benefits and affects we have seen and felt over the last two years since these efforts started, I have felt even more strongly how those around me have also changed by not only my talking about changes, but also by my taking the initiative to act. As we change our individual awareness, we also improve the quality of our work by providing mutual support to each other through active communication, with the ultimate goal of establishing lifestyles that contribute positively to individuals, companies, and society.

Previously, we have created new value in regards to the environment in the form of "Low fuel consumption" and "Low noise". Now, we will continue to produce products and services having true value for our customers with a strict adherence to compliance serving as the major principle for all our actions and philosophy, and by each and every employee embodying our "Spirit" in the form of a mindset, sense of values and standard of conduct that is shared by all employees of the KOBELCO CONSTRUCTION MACHINERY GROUP. We will continue to deliver value to society through our daily business operations as we grow together with society. Finally, I would like us to continue to work and act in a manner that is indispensable to developing a more prosperous society.