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Oct. 1, 2015 — A new joint venture gives Johnson Controls majority ownership of Hitachi’s HVAC business. The Hitachi HVAC business has been spun off into a joint venture called Johnson Controls-Hitachi Air Conditioning. Johnson Controls owns 60 percent of the new joint venture and Hitachi Appliances retains a 40 percent ownership of the company.
The new joint venture has annual sales of roughly $2.8 billion, with about 14,000 employees in 24 global locations.
The joint venture will offer important benefits to facility managers, said Bill Jackson, president of Johnson Controls’ building efficiency business. On projects where VRF (variable refrigerant flow) equipment makes sense, Johnson Controls will be able to offer an integrated system, with the VRF system tied into the Metasys building automation system. “It’s all integrated,” said Jackson. “It has a lot of value because of that.”
What’s more, with its extensive field organization, Johnson Controls is able to install VRF systems. The company recently opened a VRF training center in Dallas, Texas.
The deal also strengthens Johnson Controls’ position globally, which offers advantages to facility managers in the United States who are responsible for projects overseas, said Jackson. “We can solve their global needs. We have a global product offering and the global ability to integrate it.”
Jackson gives Hitachi top marks for its VRF technology. “The real trick to VRF is the compressor technology,” said Jackson. “Hitachi has world-class technology.”
An OEM agreement between the two companies had already enabled Johnson Controls to sell Hitachi VRF systems in North America. Under that agreement, Johnson Controls had bid on $40 million in VRF business, according to Jackson.
Hitachi’s equipment line-up, which also includes absorption, centrifugal, and water-cooled scroll chillers, broadens the existing Johnson Controls HVAC product portfolio. That puts Johnson Controls in a better position to meet customers’ needs, said Jackson. “You want to be able to understand what their needs are and not be biased by your product portfolio,” he said.
