John Deere-Hitachi celebrates 30 years of joint venture

by Jon M. Casey

John Deere-Hitachi Construction Machinery Corporation celebrated the anniversary of their 30-year joint venture by hosting a three-day event May 17-19 at their Kernersville, NC manufacturing and assembly facility. Activities included a media day, a customer appreciation day and an employee celebration on Saturday the 19th. On May 17, Deere-Hitachi President Jonathan Chase welcomed media guests for a day of equipment demonstrations followed by a plant tour. Attendees were able to see the manufacturing process from “Steel to Real” (start to finish) because the plant was in full production during our visit.

Chase said the 30-year Deere-Hitachi partnership is unlike any other joint venture in the industry. “It is a testament to the longstanding mutual respect and dedication of our teams. Combining the strength of Hitachi’s world-leading hydraulic excavator technology with the resources and might of the 180-year-old John Deere brand, the alliance produces excavators for the world’s best customers.”

Chase went on to explain how the two companies began collaborating in the 1960’s. In 1983, John Deere and Hitachi entered an OEM supply agreement for excavators. Five years later, they began their joint venture in Kernersville, NC. In 1998, they began building complete units at the plant rather than just supplying the booms and arms for both products. Between 1998 and 2012, the new joint venture established additional ventures including Deere-Hitachi Specialty Products (DHSP) in Langley, British Columbia, Canada. There they produce Hitachi and John Deere forestry swing machines ranging from 26 to 46 metric tons.

In 2002, the companies signed an Integrated Marketing Agreement to help simplify the sales and distribution of both lines. This agreement covers marketing in North, Central and South America. It includes construction and forestry equipment, and Hitachi mining equipment. This includes mining shovels and 200-300 ton class haul trucks, which are manufactured in Japan.

In 2011, another joint venture, DHB, was established in Indaiatuba, Brazil. At this 247,570 square foot facility, Deere-Hitachi produces mid-size excavator models for both brands in sizes ranging from 16 to 35 metric tons.

In 2012, Deere-Hitachi doubled the size of their North Carolina facility by building a new assembly plant, adjacent to the existing one. Together, the two sites encompass one million square feet, where 800 employees build excavators in the 13 to 47 metric ton range. Production of the largest models — the 47 MT units — began in 2016. Recently, to better serve Latin American countries, John Deere and Hitachi opened a new 115,000 square foot regional parts distribution center in Miami, FL.

Plant tour

Following a morning equipment demonstration, which we will feature in future articles, the group first toured the original facility, which is laid out for receiving and cutting steel to be fabricated into basic excavator components such as chassis frames, booms and track frames. The ISO certified facility relies on a unified effort of DH-LEAN manufacturing and the KAIZEN and 5S processes, to produce quality products safely. While readers will be familiar with the LEAN manufacturing process, the Kaizen system “aims to eliminate waste in all aspects of an organization through standardizing activities and processes.” Additionally, the 5S program is part of the LEAN manufacturing idea that focuses on having visual order, organization, cleanliness, standardization and safety. The Kernersville plant prides itself on its safe work environment and cleanliness.

At the end of each shift, work team members are expected to tidy up and sweep their entire work area. They are also expected to prep the jobsite for the next shift of workers. More importantly, all the tools needed for each stage of the job are made available on clearly marked tool boards that are positioned within the worker’s immediate reach. Accordingly, the workers are to make sure that all of the tools have been returned to their respective, designated spots on these boards.

Moving past one of the sites where major welding is taking place, we are told that this facility employs more than 200 welders in addition to the robotic welders that are placed in various strategic locations. Each weld joint is ultrasonically tested for quality and integrity. If any welds fail to meet the quality standards, the original welder is required to make the appropriate changes to bring the component up to Deere-Hitachi standards.

Each unit is tracked throughout the fabrication and assembly process with RFID unit tracking that gives real-time reporting to operators. This precise method of tracking provides operators with instructions specific to each unit order. With this kind of precision, Deere-Hitachi strives to build a unit to order and they are able to take a retail order and have a finished product within 30 days. While they establish a 12 month forecast and production plan, they prepare a 10-day line up in advance of the actual production. When this “build to order” process begins, the excavator goes from “Steel to Real” in just eight days.

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