Hitachi Construction Machinery’s Love-Hate Relationship with the Chinese Market

These days, Hitachi is all over the news. On November 4, Hitachi Group further reduced its stake in Hitachi Construction Machinery, and at the end of October, it was announced that it would be renamed Landcros. Looking back to 2022, Hitachi Group had already begun reducing its stake, and in 2019/2020, it even hinted at a complete divestment. What has happened to Hitachi Construction Machinery over the past two years? Let’s start with the Chinese market.

In 1949, Hitachi developed its first cable excavator, and in 1965, it produced its first hydraulic excavator. In 1970, it was spun off from Hitachi’s construction machinery division and renamed “Hitachi Construction Machinery,” a name that has been used ever since, 76years.

In 1995, Hitachi Construction Machinery established a factory in Hefei, China, and its sales quickly surpassed those of Kobe Steel. From then on, Japan’s three major brands—Komatsu, Hitachi, and Kobe Steel—experienced rapid growth in China. For a long time, they dominated 40% of China’s excavator market. Particularly in 2010, these three Japanese brands achieved sales of over 6.90 Bil. USD in China. Hitachi alone recorded sales of 2.2bil USD in China that year, marking its peak moment in the country.

By 2025, Hitachi will have been in China for 30 years. In the first half of the year, its excavator sales in China amounted to 80 mil USD, approximately 100 units. It’s safe to say that Hitachi is unwilling to give up on the Chinese market.

Unlike Caterpillar, Komatsu, Kobe Steel, and Develon, Hitachi has managed to preserve most of its profits despite the fierce competition in the Chinese market. Hitachi’s total sales in China have exceeded 19.3bil USD, and the vast majority of its profits have been securely realized.

In terms of excavator quality, Hitachi’s products have been excellent, with the exception of the first batch of Tier 3 electronic injection excavators and the first TRIAS hydraulic system excavators in 2011.

In some overseas markets, customers highly favor Hitachi, with even 1998 excavators still operating smoothly.

Regarding the name change, Hitachi’s official statement explains that it is transitioning into a solutions provider, integrating next-generation construction machinery with artificial intelligence, robotics, sensing, and communication technologies. The name change signifies a determination to adopt a new approach. “Landcros” means creating a prosperous land and society for the future.

Hitachi has achieved its current market position by carving out a niche in the high-end market, despite Caterpillar and Komatsu’s long-standing dominance. Hitachi conducts in-depth industry research and sets practical goals for itself. For example, in its 2023-2025 mid-term plan, it is expected to achieve 95% of this year’s targets, demonstrating a highly pragmatic approach.

Hitachi’s strategy in China differs from that of South Korean companies like Doosan and Hyundai, which initially adopted low-price strategies. Starting in 2014, Hyundai Heavy Industries sold 3,743 excavators in China, far below its record of 18,500 units. During the same period, Doosan’s sales in China also dropped from 22,100 units to 6,905. The main reason is that Chinese domestic brands, represented by Sany, took over the market share of South Korean companies. Meanwhile, competitors known for high quality, such as Japan’s Komatsu, Hitachi Construction Machinery, and Kobe Steel, continued to enjoy substantial profits in the high-end excavator market alongside Caterpillar. After 2014, Hitachi did not show a significant decline in the Chinese market.

Since 2020, China’s construction machinery sector has faced significant headwinds due to the downturn in the real estate industry, with foreign brands being particularly impacted. Hitachi has likewise found it difficult to escape these challenges.

In the second and third quarters of the 2025 calendar year, Hitachi’s global performance declined by 2%, while the Chinese market saw a drop of 17%. Excavator sales for FY25 are expected to remain flat compared to FY24.

Hitachi Construction Machinery has indeed generated significant profits in China and has set an example for Chinese brands in terms of quality, making a notable contribution. Now that Chinese production brands have matured, Hitachi needs to pivot to the next battlefield.

In the 2024 financial report, sales in China accounted for only 2% of the total, a 13-times difference from the peak of 26%!

Declining performance and a name change—does this story sound familiar? It seems reminiscent of Doosan’s rebranding to Develon. The next steps for Hitachi’s development will require time to tell.

Milestones of Hitachi Construction Machinery in China

In 1995, Hitachi Construction Machinery established Hefei Excavator Co., Ltd., marking the start of its localized production layout in China.
In December 1995, production of the EX300-3 hydraulic excavator began, signifying that Hitachi Construction Machinery’s equipment was being manufactured and put into operation locally in China.
In 1998, Hitachi Construction Machinery (Shanghai) Co., Ltd. was established, creating a sales and service base in East China and strengthening the company’s market development and customer support capabilities.
In 2003, Hitachi Construction Machinery’s excavator sales in China reached 5,112 units, ranking third in the national excavator market.
In 2007, cumulative sales of Hitachi excavators exceeded 9,000 units, representing a year-on-year increase of nearly 60%; in the same year, the company achieved a market share of close to 60%.
In 2008, cumulative sales in China reached 40,000 units. In the same year, the company entered the wheel loader and mining machinery segments, expanding its product portfolio from excavators to a broader range of construction equipment.
From 1998 to 2008, sales performance increased by nearly a factor of ten.
In 2010, the company celebrated its 15th anniversary in Hefei, with cumulative production surpassing 60,000 units, demonstrating a substantial localized manufacturing scale in China.
In 2011, Hitachi Construction Machinery (China) launched a new base project in Hefei with an annual capacity of 30,000 excavators and an investment exceeding RMB 4 billion, further upgrading its production capacity and local manufacturing capabilities.
In 2014, the competitive landscape of China’s excavator market changed significantly: Hyundai and Doosan saw a sharp decline in sales, while high-end excavator brands such as Hitachi, Komatsu and Caterpillar continued to maintain solid profitability in the premium segment. Over the previous five years, Caterpillar’s market share in China had doubled to around 11%. This year can be regarded as a turning point at which high-end brands regained their footing in China and market polarization intensified.
In 2015, Hitachi Construction Machinery’s cumulative sales in China exceeded 100,000 units, marking a major milestone in the company’s development in the Chinese market.
In 2022, Hitachi Construction Machinery Sales (China) Co., Ltd. was established with a registered capital of RMB 200 million as a new sales and service headquarters company set up by the parent group to strengthen its presence in the Chinese market. The company was officially founded on November 1, 2022.
On November 6, 2025, an industrial park invested in by a Hitachi Construction Machinery partner in Xinjiang, with an investment of over RMB 200 million, was officially opened. The production workshops cover 40,346.69 square meters and include extensive facilities for repair and remanufacturing.