Power Grids makes plans after Hitachi acquisition
After being acquired by Hitachi, ABB Power Grids, with over 4,000 employees in Sweden, is facing the market that has been turned upside down by the crisis.
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Sweden: After being acquired by Hitachi, ABB Power Grids, with over 4,000 employees in Sweden, is facing the market that has been turned upside down by the corona crisis.
Claudio Facchin, Global CEO of Power Grids, talks about the way forward after the giant business Power Grids has separated from ABB saying, “The biggest challenge now is to maintain our speed and flexibility in transforming the energy sector into sustainable alternatives in a market that has been turned upside down as a result of the corona crisis.”
According to Facchin, Hitachi sees a strong industrial logic in the acquisition of Power Grids. “Common to all Hitachi customers, regardless of the segment, is a need for both smart energy solutions and digitalisation. Hitachi has been investing in its digital business for several years and has now also built a platform for its energy business where the acquisition of Power Grids is the foundation,” Facchin adds.
The alternative of Power Grids becoming an independent company after the spin-off from ABB has been evaluated, however, it was judged that restructuring would not suffice and the need for both large investments and strong partners prevailed due to Power Grids being at the centre of a major transformation in the energy sector.
The intention of the Japanese group is to step up its power grid business where the transition to renewable energy sources such as solar and wind power is expected to generate strong market growth. Strategies are still under evaluation and Facchin is cautious about commenting on any changes and restructuring. Hitachi has previously spoken of important synergies being extracted from the merger without mentioning any figures.
Power Grids accounted for about half of ABB’s Swedish operations with more than 4,000 employees at production facilities in, among others, Ludvika and Västerås. Some restructuring has already been done – some of the former Swedish manufacturing has been moved to Poland, while other parts will be relocated in Vietnam.
When asked about the plans for further restructuring of production, Facchin says, “We will not restructure our business as a result of the corona crisis as we see it as a temporary factor, but in the longer term we see that changes in the organisation may need to be implemented to maintain our market-leading position.”
“If the corona crisis continues for another two years, then we must obviously review our long-term plan, but our strategy rests on two pillars – technology and people. Sweden is an important part of the strategy and our global operations that we cannot manage without,” concludes Facchin.
Source: Hitachi ABB