Hitachi to have new president, spin off car parts, TV operations+

TOKYO, March 16 Kyodo - Hitachi Ltd. said Monday it has appointed Takashi Kawamura, its former vice
president and currently chairman of its affiliate Hitachi Maxell Ltd., as its
new president effective April 1 and that it will spin off its struggling auto
parts and TV operations into separate companies on July 1.

The comprehensive electrical machinery maker, which also has nuclear power and
railway car businesses, said its board decided on the spinoff to combat falling
demand and turn around its sharply deteriorating earnings through structural
reform.
After becoming president, the 69-year-old Kawamura will also serve concurrently
as chairman of the board following approval at a general shareholders meeting
in late June. Current President Kazuo Furukawa, 62, will become vice chairman
and current Chairman Etsuhiko Shoyama, 73, will chair the board, both taking
effect April 1, Hitachi said.
The announcement of the unusual top management changes, in which an older
former company executive will succeed a younger incumbent official as
president, came after a number of other major Japanese manufacturers, including
Toyota Motor Corp. and Sony Corp., decided to replace their presidents
following sharp downturns in their earnings amid the deepening global economic
slump.
''We were already expecting an extremely severe outcome for fiscal 2008 (in
early February,) but also anticipated a recovery in fiscal 2009 at that time,''
outgoing President Furukawa said at a press conference.
''But now, being far from a recovery, things are expected to get worse and we
decided to form a more powerful management team,'' he said, adding Kawamura has
abundant experience managing Hitachi group firms.
''I will dedicate all my strength to restoring Hitachi,'' said Kawamura, who is
returning to a job at the parent company for the first time in two years. He
said the Hitachi group will now put greater emphasis on social infrastructure
business, such as nuclear power operations.
Under a structural reform plan, Hitachi said it will spin off its automotive
system group into a new wholly owned subsidiary and that the new firm will
focus its management resources on environmentally friendly or automotive safety
equipment, such as lithium ion batteries for gas-electric hybrid cars.
Hitachi said it will streamline its design and production bases for automotive
equipment at home and abroad by the end of March next year, including closing
down the Hiratsuka plant in Kanagawa prefecture and the Nishine plant in Iwate
Prefecture.
To cope with the sharply shrinking U.S. market, Hitachi plans to bring two U.S.
units -- Unisia Of Georgia Corp. and Tokico (USA) Inc. -- under
Kentucky-headquartered Hitachi Automotive Products (USA) Inc. in effectively
integrating the management of the three companies.
Hitachi will also separate its consumer business group into another wholly
owned subsidiary, which will be in charge of the development, production and
sale of flat-panel TVs and industrial-use liquid crystal display projectors for
the domestic market.
The new automotive system company will have 7,600 employees at the time of its
establishment, while the new consumer business company will employ about 750.
The two firms' names and locations have yet to be decided, Hitachi said.
Furukawa said by spinning off the operations, Hitachi will have greater
opportunities to form alliances with other companies in the business areas to
boost its efficiency.
Hit by weak sales and the yen's steep appreciation, Hitachi is projecting its
worst-ever group net loss of 700 billion yen for the 2008 business year ending
March 31.
Kawamura graduated from the electrical engineering department of the University
of Tokyo before joining Hitachi in 1962. He became general manager of Hitachi
Works plant in 1992 and chairman of Hitachi Software Engineering Co. in 2003.
He took the chairmanship of Hitachi Maxell, a maker of data storage media and
batteries, in June 2007.
==Kyodo