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Komatsu

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With its headquarters based in Tokyo, Japan, Komatsu is a public company that consists of Komatsu Ltd. and 187 other companies. Next to Caterpillar, Komatsu is the world's second largest manufacturer of construction and mining equipment. Named after the Japanese city of Komatsu, more than 70 percent of the company's revenues can be attributed to the sale of mining and construction equipment.[1] These include bulldozers, dump trucks, hydraulic excavators, mobile debris crushers, motor graders, rough terrain cranes, tunnel boring machines, and wheel loaders. The company also currently builds the world's largest bulldozer, the D575.

Komatsu's secondary market for manufacturing is in industrial machinery and vehicles including metal forging, stamp presses, sheet metal machinery, machine tools, forklifts, armored personnel carriers, and other defense equipment.

An estimated seven percent of sales revenue is generated from an electronics division.[2] The company is also rapidly diversifying its business base to encompass other product areas that include prefabricated housing, transportation, and logistics equipment.

Contents

[edit] History

[edit] The Foundation of Komatsu Ltd.

Komatsu was originally a division of Takeuchi Mining Co., founded in 1894 by Tashiro Shiraishi, an engineer by trade. Shiraishi served as the company's first president up until 1925. Takeuchi Mining Co. established Komatsu Iron Works in 1917 to manufacture machine tools and mining equipment. In May 1921, the Takeuchi Mining Co. permanently changed its name to Komatsu Ltd.

The 1920s to the 1930s marked major developments for Komatsu and prominent growth with the production of a metal press in 1924, Japan's first crawler-type farm tractor in 1931, and the production of steel materials in 1935. By the end of the 1920s the company had expanded its workforce from 121 to 742 employees.[3]

[edit] Growth During Wartime and Beyond

During World War II, Komatsu thrived by producing for the Japanese military, a plethora of products that included military tractors, bulldozers, tanks and howitzers. After the war, the company introduced commercial bulldozers and forklifts to its equipment line up meanwhile experiencing exponential growth precipitated by strong market demand for bulldozers in a post-war construction era. For instance, the company introduced its D50 bulldozer to the market in 1947.[4] The company brought a wide range of new products to market by the late 1960s including motor graders, dump trucks, special purpose vehicles, shovel loaders, wheel loaders, and hydraulic excavators.

[edit] International Expansion

In the 1960s, Komatsu concentrated export efforts overseas entering the US market in 1967 and taking on head-to-head, leading competitor Caterpillar, the manufacturer of the world's largest bulldozer at the time. The company adopted an aggressive strategy to catch up to Caterpillar under the leadership of President Ryoichi Kawai by devising yearly detailed action plans that were closely modeled after Caterpillar's performance. As a result, Kawai's growth strategy for Komatsu paid off. Over the next 20 years, the company grew from being just a small, local manufacturer to a more dominant competitor in the global construction market.

[edit] Komatsu Dresser

In the 1980s Komatsu merged with Dresser Industries and established Komatsu Dresser to build construction machinery and equipment. The partnership between the two companies was formidable for a while, permitting Komatsu to shift the assembly of its construction equipment to Dresser's U.S.-based plants that operated at a 50 percent higher capacity. The partnership was short-lived however, expiring in 1994 when Komatsu bought out Dresser. In 1997 Komatsu proceeded to consolidate its mining products and assets under the name Komatsu Mining Systems.

[edit] New Leadership

The company continued to expand through the 1970s but sales began to steadily decline as early as 1982. Tetsuya Katada, who took over as president in 1989, felt the company had been blind sighted by focusing growth efforts entirely after long time rival Caterpillar. Though this strategy initially was useful in the company's global expansion, it failed to deliver over the long-term when worldwide demand for construction equipment decreased. Katada initiated a corporate mindset that focused on steering the company in a new direction: stop comparing Komatsu to Caterpillar. He encouraged management to envision Komatsu as a "total technology enterprise," opening up the idea of fostering growth with new product development and markets that fit within a wider context of the company. He had a specific target to double sales by the mid-1990s. After implementing his strategy, sales did begin to increase, with the company's non-construction business growing as much as 40 percent between 1989 and 1992.[5]

[edit] The Company Today

The company's fortune took a sharp decline in the early 2000s due to economic fall-out in the Asian market that hampered any precipitous growth. The Japanese economy was not exempt. Komatsu suffered losses and went into the red.

However, the company has managed to overcome volatile market fluctuations over the last decade, particularly in key construction markets, as a result of aggressive organizational restructuring and corporate mergers and joint ventures.

Today, Masahiro Sakane is the company's acting president and CEO. Komatsu currently employs 33,863 people and has production plants and sales centers in the U.S., Canada, Mexico, Brazil, the U.K., Germany, Italy, Indonesia, China, Thailand, India, and Taiwan. For the 2007 fiscal year-end, the company attained consolidated net sales of US$16,045 million; 82.8 percent of that total can be attributed to construction and mining equipment.[6] Komatsu is currently ranked No. 462 on the 2007 Fortune 500 list of companies and seventh overall in industrial and farm equipment.[7]

[edit] Equipment List

[edit] References

  1. Komatsu. Reference For Business. 2008-09-23.
  2. Komatsu. References For Business. 2008-09-23.
  3. Komatsu. References For Businesses. 2008-09-23.
  4. History. Komatsu. 2008-09-23.
  5. Komatsu. Reference For Business. 2008-09-23.
  6. Profile. Komatsu. 2008-09-23.
  7. Fortune 500. Money CNN. 2008-09-23.

[edit] External Links