The establishment of the Kyuhoji plant (currently: Kyuhoji Business Center)
Kubota’s industrial use scales were widely adopted in labor saving and automation equipment during the period of rapid economic growth, and the business greatly expanded. In addition to the main products for industrial use, the development and sales of household use, commercial use and automatic vending machine products were also successful, and diversification continued.
However, business results started to stagnate from around 1971, due to a decline in investment in equipment and the intensification of competition. In order to strengthen the business, a move from the cramped Funade-cho plant became an urgent task. This was the reason for the construction of the Kyuhoji plant, which was built where a Japan Steel Works plant had formerly stood in Yao City, Osaka Prefecture.
As this new venture was started on land roughly three times the size of the Funade-cho plant, this meant an end to the Funade-cho plant, a name which had existed since 1908.
The start of production for the compact construction machine,
the “mini back-hoe” excavator
Although a renovation boom spread through Japan in 1972 based on the government’s “plan for remodeling the Japanese archipelago,” Kubota struggled because it was behind in the development of large cranes and pneumatic shovels.
In order to rebuild the company’s construction machinery business, a decision was made to focus on compact vehicles, and the organization, production bases and sales system were all renewed. The KH1 fully-rotating mini back-hoe (compact pneumatic shovel) was completed in 1974, and would become the base machine for the company.
In the latter half of the 1970s, the opportunities for the use of the mini back-hoe increased as there was an increase in small-scale construction work ordered by local authorities and urban-style construction for the improvement of the living environment. As Kubota had been first in the market, the sales volumes rose steadily. In 1979, a new construction machinery division was created to bring together the technology, sales and manufacturing of the products.
The establishment of a sales base for agricultural and construction equipment in France
The low economic growth in Japan meant that no large expansion of the domestic market could be expected. Kubota turned to the overseas market as a means for survival, and put efforts into the expansion of bases. The “Kubota Tractor Sales Europe” limited company was established as a joint venture with the Marubeni Corporation in France in 1974.
That company went on to become a base for tractor exports to other European countries as well as France, including West Germany, Holland and Switzerland. In addition, the “U.K. Kubota Tractor Sales Co., Ltd.” was established in 1979 and the “Kubota Germany Limited Company” was established in 1983. Tractor sales bases were also opened in Australia and Canada.
In addition, manufacturing and sales companies were also opened up in various Asian countries including Indonesia, the Philippines and Thailand, in order to cooperate with the move to the domestic production of agricultural machinery at that time.
The establishment of the Tsukuba plant
As the market moved rapidly towards “ride-on” agriculture in the 1970s, the company reinstated a plan to build a new plant, which had been put on hold due to the first “oil shock.” The Tsukuba plant was completed in August 1975.
The plant was built on grounds covering 337,000m², and was equipped with all the latest automation systems, in the pursuit of high-quality and low-cost production. It was a very modern plant, with a training center specifically for tractors and consideration of environmental protection and tree-planting in its design.
It produced its 100,000 tractor in just its second year of production. A ceremony in October 1979 to commemorate the production of 700,000 Kubota tractors was held here.
Stock was listed on the New York Stock Exchange
One necessary condition for management in a period of low growth is the strengthening of the company in financial terms. In February 1976, Kubota issued 7.5 million dollars of convertible bonds in a public offering in the United States. The company received an A rating from the credit rating agency “Standard & Poor’s” at the time, and also passed the strict examination by the United States Securities and Exchange Commission.
Based on these results, in November of the same year Kubota became the third Japanese company to be listed on the New York Stock Exchange, the biggest exchange in the world’s capital market.
To successfully extend a business internationally, it is essential to pass strict quality and PL (product liability) evaluations in the United States and Europe. For that reason, the company introduced TQC (Total Quality Control) in February 1974. In November 1976, the Sakai production plant and the internal combustion machinery research headquarters were awarded the Deming Prize, the first such achievement in the agricultural machinery industry.
Completed the new headquarters building(currently: Kubota Building)
When the Osaka Headquarters Building was completed in 1960 the number of employees there was 730. This number had continued to rise, and in 1975 the number reached 1,600 employees, and the company started the construction of a new building. A 16-story building was completed in October 1977, containing many of Kubota’s own products such as G-columns, cast aluminum siding, air conditioning equipment, a greywater system and fountain machines.
A display of new products was set up on the first floor of the new building in 1979, to introduce the company’s new products and technology to people inside and outside the company. In 1980, past products of particular importance which described the company’s history were also added, and the display became a permanent feature.
Received an order from Egypt for a desert greening system
To green the desert and become self-sufficient in food had long been a desire of populations living in the dry regions of Earth. In 1976, the company decided to set the development of systems for desert greening as a business theme, by utilizing the technologies that had been developed in the company’s agriculture and water related businesses.
Kubota agreed a technical tie-up with the Rain Bird Corporation in the United States, which had an established reputation in irrigation technology, and started sales activities.
In 1980, a Kubota system was adopted by a project of the Sharkia State government in Egypt, to develop an area of desert roughly 400 times the size of the Koshien Baseball Stadium in Japan, and to mechanize agricultural work.
The optimal irrigation method for each type of crop was introduced as the greening proceeded, and the project was completed in 1983, two years after the construction work had started. The farm area had been reborn as a green expanse of land, and today many different vegetables and fruits are grown there.
Established the Sakai-Rinkai (coastal) plant
At a time when agricultural machinery demand was depressed due to the second policy to reduce rice cultivation acreage, etc., the company decided to strengthen and expand the external sales of compact engines, which had previously mostly been used in Kubota’s own products.
In order to increase production capacity and improve cost competitiveness, a new plant was built in Chikko-shinmachi, Sakai City. A highly efficient plant was created which could produce a total of 500,000 engines per year, both air-cooled gasoline engines and water-cooled diesel engines, with just 180 employees.
In addition, Kubota was also first in the manufacturing industry in Japan to introduce a VAN (value added network) between the company and affiliated companies. Many other advanced technologies were also introduced, for example with the construction of an original procurement and logistics system.
The company received an award from a private advisory body to the Minister of International Trade and Industry in 1985 for its “excellent information processing system.” It was also awarded the “1985 Nikkei Superior Trend-Setting Office Award.”