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thyssenkrupp Addresses Sale, Details Plans for Split

thyssenkrupp CEO Guido Kerkhoff told a German newspaper that the company has no plans to sell its elevator business, according to a Reuters report posted on Euronews.com. Kerkhoff, speaking to the Rheinische Post, said a plan to split the company into two separate divisions should boost its equity and capital base. thyssenkrupp is currently preparing to spin off its elevators, car-parts and plant-engineering divisions into a separately listed entity, thyssenkrupp Industrials, while its remaining businesses — materials trading, shipbuilding, forging and a stake in a joint venture with India’s Tata Steel — will be renamed thyssenkrupp Materials.

“As part of (thyssenkrupp) Industrials, Elevator can develop and improve its performance much better,” Kerkhoff said, adding that the elevator division, thyssenkrupp’s most profitable, would undergo deep restructuring of its Americas business, including disentangling activities in North and South America to speed up dealings with customers. “This will also include personnel changes at the leadership level there,” Kerkhoff said.

thyssenkrupp also announced leadership structures of the two future companies, saying it has progressed on its path to planned separation (ELEVATOR WORLD, December 2018), thyssenkrupp Industrials and thyssenkrupp Materials. To “become leaner, faster and better,” the companies will have simplified leadership structures. At each, the number of board directorates will be reduced to three, and central functions will be combined. From 17 corporate and service functions today, there will be 14 at thyssenkrupp Industrials and 10 at thyssenkrupp Materials. Additionally, the current matrix structure will be dissolved in favor of no regional structure besides the business areas at headquarters level. The tasks in the regions will be performed by the operating units or central functions, and the shared service units will be allocated according to business requirements.

thyssenkrupp Industrials, which will include the elevator, car parts and plant-engineering divisions, will focus on innovative engineering with a leadership structure the company calls a “differentiated model.” While responsibility will be delegated to the organization, certain tasks will also be centralized to leverage synergies in, for example, recruitment, talent management or innovation. In some areas, the headquarters and business areas will work together in integrated teams. Thanks to several major projects in the Asia/Pacific region, Elevator Technology reported a new record high in order intake of EUR2.1 billion (US$2.38 billion) in its first quarter of 2018/2019. However, its earnings were also lower year-on-year (down 7% to EUR204 million [US$ million]) due to higher material costs in China and tariffs on material imports into the U.S.

thyssenkrupp Materials AG will combine Materials Services, the share in the company’s steel joint venture and Marine Systems, and the forging operations and bearings business. There are fewer synergies here, so the distinct businesses will develop independently of each other.

The final vote on the separation plans is to take place at the thyssenkrupp Annual General Meeting in January 2020. Both companies are to commence operations at the start of the next fiscal year on October 1, 2019. As agreed with employee representatives, there will be no compulsory redundancies on account of the separation.

Otis Asia Pacific E&I Center Inaugurated in Hong Kong

Otis Chief Transformation Officer Julie Brandt, Industrial Centre of The Hong Kong Polytechnic University Director Dr. Michael Leung and Otis Hong Kong, Macau and Taiwan Managing Director Joseph Armas were joined by more than 100 employees on February 15 to inaugurate Otis’ Asia Pacific Experience and Innovation (E&I) Center in Hong Kong. Divided into six zones, the center showcases Otis’ products and services, such as Signature Service and ONE, through apps and live demonstrations. Building owners have a dedicated zone that highlights how they can improve their buildings’ value and improve tenant comfort and safety. The company observed: “Intuitively located interactive touchpoints that blend the physical with the digital spark curiosity and offer hands-on experience of Otis innovations in the real world.”

Australia’s Orbitz Elevators Names Burns CFO

Orbitz Elevators, headquartered on Australia’s Gold Coast, has named Stephen Burns chief financial officer (CFO). Burns has more than 25 years’ experience. He has worked as a CFO for Australian Stock Exchange-listed companies, managing multibillion-dollar defense contracts and reporting to multiple entities domestically and internationally. In announcing the appointment, Orbitz stated:

“With a focus on good governance and getting the fundamentals right, Burns is committed to ensuring appropriate measures are in place to implement and manage the overall financial strategy of Orbitz Elevators. He is a proven leader who is passionate about developing teams that punch above their weight and deliver value to the broader business.”

Schindler Partners With Access-Control Solutions Provider

Schindler has partnered with Texas-based access-control solutions provider Open Options to enhance customers’ ability to manage their elevator dispatch control through the latest version of Open Options’ DNA Fusion software, Security Sales & Integration reported. The platform allows information to be transferred in real time to the Schindler PORT destination-dispatch system. Open Options also has partnerships with KONE, Otis and thyssenkrupp.

“We’re excited to offer a joint solution with our DNA Fusion access-control software and multiple elevator management platforms, including our most recent integration with Schindler,” Open Options Vice President of Marketing & Communications Brent Doherty said.

KONE Earns Kudos for Sustainability, Climate- Change Mitigation

KONE announced it earned recognitions for being sustainable and helping mitigate climate change. Sustainable business magazine Corporate Knights, headquartered in Toronto, ranked KONE the 43rd most sustainable company in the world on its 2019 Global 100 Most Sustainable Corporations in the World list. The only elevator company to be ranked, KONE also ranked second among 443 global category peers in the Machinery Manufacturing category. The ranking involves analysis of 7,500 companies with revenue of more than US$1 billion. Corporate Knights CEO Toby Heaps observed that top sustainability performers tend to provide better revenue for investors and have greater corporate longevity.

KONE was also recognized for its “actions and strategies to mitigate climate change,” scoring an A- on climate action on the CDP 2018 list of the world’s leading companies on environmental performance. Headquartered in London, CDP is an international nonprofit that runs a global disclosure system enabling companies, cities, states and regions to measure and manage their environmental impacts. KONE has disclosed through CDP since 2009, consistently earning at least an A- score.

Chinese Company to Start Elevator Production in Armenia

Chinese company Xinjiang Zheng Yi Agriculture Science and Technology Co. LLC said during a meeting with government officials in Yerevan, Armenia, in January that it plans to create an elevator assembly facility in central Armenia, ARKA News Agency reported. Armenian Minister of Economic Development and Investments Tigran Khachatryan said the ministry would provide full assistance to the investors. The facility would have a capacity of 2,000 elevators per year, with production to be organized in Armenia.

Mitsubishi Electric Inaugurates New Office in Ta’if

Mitsubishi Electric Saudi Ltd. (MELSA) inaugurated its newest office in Ta’if, Saudi Arabia, in January. The MELSA president, vice president, regional manager and employees were in attendance. Headquartered in Riyadh, MELSA is a joint venture established in 1980 between Mitsubishi Electric Corp. of Japan and Omar Kasim Alesayi & Co., Ltd. of Saudi Arabia. The Ta’if office adds to locations in Jeddah, Dammam, Makkah and Madinah. MELSA reports it has more than 900 employees and has installed more than 20,000 units in roughly 6,000 projects in the kingdom. The company is looking to expand its Ta’if staff, and interested candidates may send an email to jobs@melsa.com.sa.

KONE to Supply 128 Units to Shanghai Metro Line 18

KONE has been selected to provide 128 heavy-duty TransitMasterTM escalators to 10 underground stations in the first phase of Shanghai Metro Line 18, an important cross- river route that will connect to 13 other metro lines in China’s largest city. An estimated one million people are expected to use the equipment each day. The Shanghai Metro system opened in 1993 and is the world’s largest rapid-transit system by route length. Estimated to be complete by 2021, phase one of Line 18 is being developed by Shanghai Rail Transit Line 18 Development Co., Ltd., and the architect is Shanghai Tunnel Engineering & Rail Transit Design and Research Institute.

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Elevator World | April 2019 Cover