Ishikawajima Harima Heavy Industries Co., Ltd. Business Information, Profile, and History

History of Ishikawajima Harima Heavy Industries Co., Ltd.

World-renowned for generations as a shipbuilder, Ishikawajima-Harima Heavy Industries Co., Ltd. (IHI) is second in Japan only to Mitsubishi Heavy Industries. IHI is involved in such high-tech industries as aerospace, energy, and material distribution. It is a pioneer in advanced technologies including nuclear fusion, superconductivity, lasers, and advanced compound and ceramic materials. With the decline of the shipbuilding industry, IHI used diversification as well as research and development to foster growth. IHI's desalination plants, for example, have won acclaim in a number of countries--particularly in the Middle East. A major shift in production and marketing emphasis during the 1980s made heavy industry and plant technology the source of close to 70% of the company's income. Also strong is the company's aerospace division, which produces jet engines, and leads the industry in developing space rockets and experimental devices.

In 1853 Lord Nariaki Tokugawa of Mito was appointed by the ruling Tokugawa Shogunate to build a shipyard on Ishikawajima. This island at the mouth of the Sumida River, which flows into Tokyo Bay was strategic for the coastal defense of Japan.

The year 1853 was a particularly propitious time to start a shipbuilding company in Japan. As the number of U.S., British, German, and other interests in the Pacific area increased, new pressures were being brought to bear to lift Japan's centuries-old barriers to trade with foreign nations. Shoguns, powerful clans that were outgrowths of the feudal system, ruled the country, with an emperor as a figurehead. In the mid-19th century, the Tokugawa shogunate in power realized that trade would soon be reopened--by force if not by consent. Even though trade was reopened peacefully after Commodore Matthew Perry had sailed a U.S. fleet into Japanese waters in 1854, the fear of a possible attack spurred the Japanese government to begin production of modern western-style ships.

With the lifting of trade barriers and exposure to new cultural and economic influences, a rapid process of industrialization was soon underway. Feudalism and the shogun system were abolished and power was transferred to an imperial government whose announced intention was to modernize the nation. Coming to the throne in 1868, Emperor Meiji conscripted an army, and, at the same time, set plans in motion to adopt some of the technology and work methods developed abroad.

The new government's plans to become active in the worldwide industrial revolution called for encouragement of private enterprise. Accordingly, the government sold the Ishikawajima shipyard in 1876 to Tomiji Hirano, a civilian. As Ishikawajima Hirano Shipyard, the company became Japan's first private shipyard and, within a year, produced Tsuun Maru, the first steamship built by a Japanese shipbuilder.

Diversification began in 1883, with production of the nation's first steel bridge. The Miyako Bridge spanned the Ooka River in Yokohama. Four years later, the company constructed the largest steel bridge yet built in Japan, across Tokyo's Sumida River.

Incorporated in 1889, the company was renamed Ishikawajima Shipyard Company, Limited. In 1892, the company built the nation's first 80-horsepower air compressor and first high-speed power-generating boiler.

Another name change was made in 1893 when Tokyo Ishikawajima Shipyard Co., Ltd. became a joint-stock company. Three years later the company constructed Japan's first thermal power plant facilities. Ishikawajima began manufacturing steel structures for Tokyo's National Sports Hall in 1909, and for Tokyo Central Station in 1911. Ishikawajima constructed Japan's first four-ton open-hearth-furnace charging crane in 1916, and first ingot crane in 1917; both were built for state-run steel-production companies.

After World War I, and despite a severe earthquake in 1923, the company continued its research and development, innovation, and expansion into new product lines. In 1924, the Ishikawajima Airplane Manufacturing Company began operation, and by 1929 the Ishikawajima Automobile Manufacturing Company was established.

The second Sino-Japanese War and the start of World War II increased demand for Ishikawajima's established products and resulted in new product developments such as the 350-ton hammer-head crane in 1935 and the nation's first jet engines ten years later--both for the Japanese Navy. A subsidiary, Ishikawajima Shibaura Turbine Company, began operations in 1936.

Japanese industries achieved a relatively quick recovery following the nation's defeat in World War II. The company, renamed Ishikawajima Heavy Industry Co., Ltd. in 1945, began to renew its reputation as innovator by 1956 when it manufactured the world's largest spherical gas-storage tank. In 1958 Ishikawajima completed Japan's first mobile offshore drilling platform and in 1959 built its largest blast furnace to date. That same year, the company established its first foreign subsidiary, in Brazil.

A new era for Ishikawajima--and the change to its current name--began in 1960 as the company merged with the 53-year-old Harima Shipbuilding & Engineering Company, Ltd. A major shipyard known for its construction of large vessels, Harima had three subsidiaries of its own.

In 1961, IHI developed a variety of steel known as IN, which maintains high toughness at low temperatures. The merged companies combined transport-producing facilities to create additional innovations such as the world's first mammoth tankers, a series of standardized multipurpose dry cargo carriers produced in the 1960s, the world's first barge-mounted polyethylene plant, and a series of high-powered jet engines. A cement calcinating process was developed in the early 1970s.

International operations proliferated from the early 1970s onward, as IHI acquired contracts with overseas companies or formed joint ventures with them. Services the company rendered to developing countries ranged from project planning through design, engineering, construction supervision, plant maintenance, and training of personnel.

As Japan's top manufacturer of jet engines, IHI was part of a five-country consortium, including the United States, United Kingdom, West Germany, and Italy, to develop a V2500 turbofan engine to power 150-passenger commercial jetliners. Under development since 1983, the engine was certified by the U.S. Federal Aviation Administration in 1988 and went into production.

A joint venture in 1988, with Sumitomo Heavy Industries, established Diesel United Company, which rapidly gained 20% of the domestic market in industrial machinery. ICA Technologies, Ltd., another 1986 IHI joint venture--with ATEQ Corporation of Oregon, and Canon Sales Company of Tokyo--was formed to enter the semiconductor-related market. It also established the IHI Granitech Corporation, to advance stone processing for building construction; Ishikawajima Systems Technology Company, a systems engineering company for production of electronics and computers; and Joy Planning Company, in the area of fitness clubs and sports facilities. In addition, IHI entered real estate development of prime idle lands in the Tokyo Bay area. IHI has survived partially because of success in technology and partially because of the company's proactive responses to market conditioning. The company's policy has been almost continual diversification into new and profitable enterprises.

IHI, which maintained close ties with the Toshiba Corporation, has placed its stamp on products and projects around the globe. Examples include large-scale bridges in several countries, a floating pulp plant in Brazil, desalination plants in the Middle East, a rolling mill in Shanghai, container ships in Singapore, an iron ore carrier in Australia, ethylene plant compressors in China, a blast furnace in Korea, laser processing systems in Europe, and cement plants in Indonesia, India, and Saudi Arabia.

Shipbuilding orders declined in the late 1980s. Plant export businesses lost profitability because of the strong yen. IHI, however, continued to show an overall profit in 1989 by scaling down affected operations and concentrating on the expanding air- and space-related divisions. Focus has shifted to domestic markets and the development of electronic products.

IHI's mass-produced machinery remained a strong sector. The 1988 sales for this division were up 20% from 1987. Its products included compressors, dishwashers, precision machining, and turbochargers. IHI was ranked as the top manufacturer of integrated turbochargers for marine diesel engines and automobiles. IHI is also participating in NASA's manned space station project by developing an experimental module.

Principal Subsidiaries: Ishikawajima Construction Machinery Company, Ltd.; Ishikawajima Inspection Company, Ltd.; Ishikawajima Construction Materials Company, Ltd.; Ishikawajima Shibaura Machinery Company, Ltd.; Ishikawajima Packaged Boiler Company, Ltd.; Ishikawajima Noise Control Company, Ltd.