Fuji Electric Co., Ltd. Business Information, Profile, and History

History of Fuji Electric Co., Ltd.

Fuji Electric is a manufacturer of electric machinery, components, and appliances. Most of its customers are other manufacturers who either use Fuji products or incorporate them into their own products. Because Fuji does not make television sets or stereos, it is virtually unknown outside of Japan.

But what Fuji lacks in public recognition, it makes up for in technological contributions. It is a major builder of integrated power plants and factories, as well as of power distribution systems, production control systems, and factory automation networks. It maintains close ties to several other leading industrial electronics companies, including Siemens, Demag, General Electric, and Westinghouse Electric.

Fuji Electric was founded in 1923 as a joint venture to facilitate technological cooperation between Furukawa Electric, of Japan, and Siemens, of Germany. Nearly a year and a half after its founding, Fuji Electric began production at a new factory in Kawasaki, near Tokyo. The company manufactured a variety of electrical components as well as telephones. In 1930 Fuji began making mercury-arc rectifiers, and in 1933 it added porcelain expansion-type circuit breakers to its product line. As the joint research between Furukawa and Siemens led Fuji further into the heavy machinery sector, Fuji decided that its telephone division would be better off as a separate company, and in 1935 that division was incorporated as Fujitsu, Ltd.

A second technical agreement, between Fuji and the German company Voith, led to a production agreement for that company's 4850-horsepower Francis turbines. As electric power came into widespread use in Japan, particularly in industry, Fuji began production of small and industrial watt-hour meters and larger, more advanced circuit breakers.

As militarists consolidated their hold on the Japanese government during the 1930s, they promoted a rapid economic and military mobilization. As Japan marched toward World War II, Fuji came under a greater degree of central control, leading it to cooperate more closely with other manufacturing interests related to Furukawa Electric. As a result, new factories at Matsumoto, Fukiage, Tokyo, and Mie were completed between 1942 and 1944 and immediately brought on line to manufacture a variety of products for the war effort. These factories were heavily bombed in the last year of the war, effectively crippling the company.

When the war ended in 1945, Fuji Electric was placed in government custody until military investigations were carried out and the company could be rehabilitated. Fuji began production again in stages, as factories were repaired and markets recovered.

In 1952 Fuji Electric helped to establish the heavy engine manufacturer Fuji Diesel, and the following year Fuji concluded another technical agreement, with the West German company Demag, to license technology for the production of magnetic motor starters, which it began to produce in 1954.

To a country so poor in natural resources, atomic power held tremendous potential in the 1950s. Accordingly, Fuji Electric joined the Daiichi Atomic Power Industry Group. Founded in 1956, this consortium of 22 companies built the first nuclear power plant in Japan through a combination of technology development and licensing. The 166-megawatt Tokai Nuclear Power plant went on line in 1960.

Fuji developed in two directions during the 1960s. It engineered larger and more powerful heavy machinery, such as transformers and propulsion equipment, and at the same time pioneered new diode and miniature circuit technologies. Fuji's strengths in research and development were greatly enhanced by the establishment in 1964 of its Central Research Laboratory.

During this period Fuji built new factories in Chiba, Kobe, and Suzuka to manufacture heavy transformers, control systems, switchgears, and motors. The company also made a technical agreement with Seeburg, of the United States, to purchase vending machine technology. The machines, produced at the Mie factory, became very profitable. Fuji's manufacturing capacity was expanded further in 1968 when it took over the operations of its smaller rival, Kawasaki Denki Seizo.

By 1970 Fuji Electric began to recognize that its spectacular growth had left weaknesses in its organization. Rival manufacturers had emerged with stronger positions in several markets. The company took measures to strengthen the Furukawa group, but it also set up a second, more specialized 15-company group specifically for heavy industrial projects.

Fuji Electric opened its eighth factory, to manufacture circuit breakers and control systems, in Ohtawara in 1974. The company also introduced a variety of new products and processes, including large-capacity steel furnaces, process computers, and robots during the early 1970s.

Fuji survived the oil crisis of 1973 without great strain, and in the mid-1970s started to benefit from the dove-tailing of research efforts carried out with Fuji group members, primarily Fujitsu. This effort resulted in the development of several improved-technology items in control systems and computers, as well as more efficient generators and larger transformers.

By the late 1970s, Fuji had greatly strengthened its position as a leader in industrial electronics and had forged a close relationship with Fujitsu, which had emerged as Japan's leading computer software developer. Fuji made a major commitment to technology in 1980 when it established a special corporate research and development subsidiary to concentrate attention on new technologies, previously developed by different divisions, in one place.

Fuji became involved in numerous foreign turnkey projects, many of them power plants. During 1980 and 1981 Fuji completed a geothermal power station and a 495-megawatt hydroelectric plant. Projects like these have given Fuji an international reputation for superior power-generating technology and engineering.

This reputation for quality was established over many years, but was first achieved with smaller devices. Fuji's strength in this market continued into the 1980s and even led the company to expand its capacity by opening a ninth plant in Kobe in 1983. Electronic products, which currently account for about 30% of sales, are expected to increase to 50% by 1993.

The company is divided into five groups. The electric machinery group is responsible for plants and heavy machinery. The systems group covers instrumentation, information systems, and mechatronics, including robots and data processing equipment. The standard machinery and apparatus group manufactures programmable controllers, heavy motors, and magnetic devices. The electronics group produces large diodes, transistors and circuits, as well as computer components and measuring equipment. The vending machine and appliance group manufactures vending machines and large refrigerator display units like those found in grocery stores.

Fuji Electric is unique among Japanese electronics firms because it has no in-house computer development. Instead, it manufactures semiconductors, hard disks, and other components for its affiliate Fujitsu. Fuji Electric and Fujitsu maintain a substantial cross-ownership of stock.

Known for attracting some of the most talented engineers, and with hundreds of monuments to its accomplishments in Japan and abroad, Fuji Electric is bound to remain a world leader in industrial electronics. Fuji is also in an excellent position, with its strong research organization, to develop leadership in new areas.

Principal Subsidiaries: Fuji Electric Corp. of America; U.S. Fuji Electric, Inc.; Fujin Electric GmbH; Hong Kong Fujidenki Co., Ltd.; Fuji Electric do Brasil Industria e Commercio Ltda.