Hitachi Ltd. said Thursday it will spin off its home appliance group and industrial components and equipment group in an effort to speed up management decisions.

The moves, expected by April, are part of Hitachi's overall plan to streamline and strengthen its troubled operations through mergers and alliances.

Hitachi and other Japanese electronics makers have been hit hard by the global downturn.

The reorganization will enable Hitachi to effectively invest capital on growing businesses and will be a step toward creating a holding company, Hitachi President Etsuhiko Shoyama said.

The major electronics maker has promoted spinoffs in recent years and Shoyama said that trend will continue.

Following the spinoffs, Hitachi will set up two new subsidiaries. The new company for home appliances will integrate Hitachi's home appliances group and two domestic group manufacturing firms -- Hitachi Tochigi Technology Co. and Hitachi Taga Electronics Co.

The new firm will develop, produce and market appliances such as refrigerators and washing machines. It will also sell Hitachi audio visual products.

In fiscal 2003, the new firm is expected to earn 600 billion yen in group sales and reduce fixed costs by 7 billion yen, company officials said.

Kunio Sebata, chief operating officer of Hitachi's consumer products group, which handles home appliances, said the new company will try to increase the percentage of its electric appliances sold overseas from the current 27 percent to 40 percent by 2003.

The other new company will be formed by integrating Hitachi's industrial components and equipment group and four domestic group companies -- Hitachi Service & Engineering (EAST) Ltd., Hitachi Service & Engineering (West) Ltd., Hitachi Drive Systems Ltd. and Hitachi Nakajo Technology Ltd.

The firm will also deal with a full range of businesses related to industrial products such as low-voltage motors and transformers. In fiscal 2003, it plans to obtain 158 billion yen in group sales and reduce fixed costs by 700 million yen, company officials said.

Kiyohiko Shiiki, chief operating officer of Hitachi's industrial components and equipment group, said the new firm will reinforce solution services, including consultation on energy-efficient equipment and buildings.

The two new companies will be wholly owned by Hitachi.

Further details regarding the two, including leadership, names and capital, will be determined by the end of February, Shoyama said.

Electronic appliances

Domestic shipments of electronic appliances dipped 0.4 percent in August from a year earlier to 140.5 billion yen, the Japan Electronics and Information Technology Industries Association said Thursday.

Shipments of visual appliances such as DVD players and digital still cameras rose 0.5 percent to 84.3 billion yen, while those of items categorized as car audio, video and communications appliances, such as navigation systems and CD players, rose 2.5 percent to 34.7 billion yen.

However, shipments of audio appliances, such as minidisc players, slid 7.8 percent to 21.4 billion yen.

By item, shipments of TVs with liquid-crystal and plasma displays, satellite-capable digital TVs, receivers, projectors and peripherals for home use also rose, the association said.