Kawasaki Heavy Industries said it will spin off its motorcycle and engine business in April 2021. The business is the only B2C business in KHI. By spinning off the business, the company aims to speed up decision-making and offer new products and services for consumers.
Specifically, the company is considering entering the new personal mobility business of electric three-wheeled vehicles. In addition, the business is facing challenges such as complying with environmental regulations, and the company plans to reinforce cooperation within the industry and revitalize the market through joint development of electrification and advanced safety technology, as well as the sharing of functional components.
On the other hand, since the general-purpose engine business has a close relationship with the precision machinery and robotics business, after the spin-off, they will collaborate in the flexibility of management resources in the mass production business and in the agricultural machinery and lawn-related markets for hydraulic equipment and general-purpose engines. They will also collaborate on the development of near-future mobility that incorporates robotics and remote technology to create new businesses.
Source: Response
PSR Analysis: Until now, it appears that Kawasaki’s motorcycle business has been a strategy to increase its market presence by catering to the needs of its core fans, rather than aiming for the top market share. Of course, this brand atmosphere will continue to be maintained in the future, but it is almost certain that the company will be forced to respond to the trend toward EVs in the future, and this spin-off should be viewed as part of the company’s efforts to create a structure that will allow it to respond to the market environment and demand that is likely to move significantly in the future.
It will also promote self-reliance and make it easier to accept outside capital. At the same time, the railway business was spun off at the same time, and Kawasaki Heavy Industries plans to accelerate its hydrogen and robotics businesses. PSR
Akihiro Komuro is a Research Analyst, Far East and Southeast Asia, for Power Systems Research
