VALUE CREATION Regional Strategy

Creating value in a way only possible
with our community-based business base
Connecting customers and
the Air Water Group to build a business

The origin and significance of the strategy

Regional strategy is our core strategy that has been supporting domestic industries and local communities. Unlike other manufacturers, Air Water has been committed to “direct sales” since the days of our predecessors, selling the gas we produce directly to our customers. Such orientation laid the foundation for the integrated production and sales system that continues to this day.

The industrial gas business is an equipment industry based on common air. In addition to the difficulty of differentiating the product in terms of quality, the transportation of the product is very costly. This enables a business model in which a manufacturing base is located close to the consumption area to create a commercial zone. In the past, the gas was usually produced in large volumes at low cost at large plants located along the Pacific coast, where steel mills and chemical plants are clustered, and the gas was transported by tanker truck across the country.

However, we have recognized changes in the domestic industrial structure, such as the emergence of the semiconductor industry located inland and the contraction of the heavy industry. Since 2000, we have deployed our highly efficient compact “VSU” plants in 22 locations in Japan, where there were previously no manufacturing bases. Thus, we have established a locally produced and consumed model of gas supply for the entire Japanese market. Each of the newly based regions has deepened its partnerships with local companies and municipalities, making it a place to explore new growth drivers.


Started from localized small lot sales

Our starting point - the two predecessor companies without large gas production facilities began downstream small-lot sales, such as cylinder gas.


Started sales of liquefied oxygen and LP gas

In Osaka, we sold liquefied oxygen directly without distributors. In Hokkaido, we launched the LP gas business for households, and expanded the service bases.


Reinforced “Regional Strategy” structure

Established a company dedicated to downstream distribution, which is the origin of our regional operating companies now, and strengthened in-house integrated system from manufacturing to supply.


Strengthened sales network through two mergers

Expanded sales base network from business areas centered on Hokkaido and western Japan to all over Japan.


Promoted strategic “federated and partnering” management

Established sales companies (regional operating companies) in each region. Simultaneously promoted “federated” management that boosts the downstream areas and “partnering” management that emphasizes collaboration with other companies.


Enabled locally produced & consumed gas supply by VSU

Developed new bases in cooperation with leading industrial gas suppliers in each region to maintain/increase market share through areal expansion.


Moved branch functions into eight regional operating companies

To make the regional business a core pillar of our growth, we have reorganized regional operating companies specializing in sales into eight companies in eight blocks across Japan, and Air Water’s branch functions were integrated into each company.


Launched the three new regional companies

Consolidated the eight regional operating companies into three (Hokkaido, East Japan, and West Japan) in order to achieve a corporate scale that can grow on its own with each region.

Regional business companies

Increase presence in the region and play a leading role to grow business in Japan.

A. Social problem solving business

We commercialize solutions to social and regional issues through our technological innovation, etc.

B. Cross-industry business

We conduct solution-based business by leveraging our diverse business domains.

C. Growing scale and revenue base

We strengthen earnings base through reinforcing existing businesses and customer-oriented marketing models.

Social capital of the regional companies

A. Press Conference with Hokkaido
Prefecture (Governor Suzuki)

We established the “Hometown Support H Program” to support all municipalities in Hokkaido, as a company nurtured by Hokkaido and oriented to new growth there. We will donate a total of one billion yen to this program by 2030 and support initiatives to solve their local challenges. Also, we plan to build an open innovation promotion facility to support the region through our business activities.

B. Agreement with Kumamoto Prefecture (Governor Kabashima) to locate a business

We are planning to build a complex business base in the electronics field in Kumamoto Pref., where large-scale factories of semiconductor device manufacturers are being built. While continuing to focus on industrial gas, we will build our cryogenic logistics base for agricultural products in Kumamoto, one of the leading vegetable producing areas in Japan, with a view to improving transportation efficiency to the Tokyo metropolitan/Kansai areas. We are creating new businesses based on regional characteristics.