Cleaner, more comfortable air for climate-conscious customers

Can you give us a brief introduction to your company?

The name PMAC is derived from the name of our product: it stands for Prefabricated Module Air Conditioning Cassette, a term coined by us. It is a heat pump air conditioner that collects energy from water and processes it in a single unit. The PMAC system is optimised to provide stable air circulation by automatically controlling each unit at the correct temperature. The PMAC system is an individual air-conditioning system that uses a small amount of water as a heat source for distribution, and now, with the expansion of water heat sources in the low temperature range, other renewable energies such as geothermal heat and groundwater can also be used for heating and cooling. The PMAC system is an environmentally friendly system that recycles renewable energy.

Our parent company, Takasago Thermal Engineering, was established in 1923 and is Japan's largest designer and builder of heating, ventilation and air conditioning systems. Although not a manufacturer, Takasago was faced with a number of design and construction challenges during the economic boom of 50 years ago, and from an engineering point of view, sought to create a faster, cheaper and more effective solution, which led to the creation of the current compact prefabricated system, PMAC. The prefabricated system avoids the problems encountered, such as the complexity of assembly on site and the availability of labour for the project, and for this reason it now exists on the market as a unique product with a strong competitive edge.

The compactness of the PMAC system is one of the reasons why it stands out from other heating and air conditioning equipment or machines. The idea behind the PMAC design is to meet the expectations of our customers. Due to the limited space available on construction sites and buildings, there is a need for compact and more efficient means of ventilation, heating and cooling, and this has been our main product for over 50 years.

I would like to return to the “Monozukuri” (manufacturing) part that you spoke about earlier. In the last twenty-five years, Japanese companies have been faced with stiff price competition from regional competitors such as those located in Korea, Taiwan, and China. These competitors can replicate the Japanese monozukuri at a cheaper cost, thereby supplying the customers with cheaper yet inferior quality products. Could you tell us why Japan is still a trusted partner when it comes to high technology and what should Japan do to overcome these regional competitors?

The added value of Japanese manufacturing encompasses many things, including its essence and the spirit of perseverance to the end. It is about meeting and optimising the needs, satisfaction and expectations of the customer. This is the origin of Monozukuri in Japan, especially in terms of manufacturing. We are not only concerned with the personal interests of the company, but also with the satisfaction of our customers. The Japanese word "Omotenashi" (hospitality) describes well the Japanese attitude towards everything that a Japanese company can do. We are manufacturers, but we place more emphasis on satisfaction and refinement than on simplifying our products for mass production. The fundamentals of Japanese manufacturing ultimately lead to value-added prices derived from excellence in production.

From the very beginning, we have been continuously improving our product range, just as we do today, and on the contrary, we have adapted our equipment to the needs of our customers little by little. Our philosophy is to contribute to society by creating comfortable spaces that are friendly to both people and the environment. Continuity is essential in manufacturing. It helps us to create better products without interruption.

On the other hand, a neat technology developed in Japan over a long period of time may not meet the needs and expectations of other markets in the world. Therefore, PMAC and other companies from Japan may have to adapt and become more flexible in this respect, instead of concentrating only on the Japanese market. I believe that the culture and scene of business is changing on a global scale: the bursting of the bubble in Japan 30 years ago was the catalyst for Japanese companies, including PMAC, to introduce products and services from overseas.

We hear from Japanese companies how they create these fantastic technologies but often they fail to convey to a worldwide audience the true benefits of them and thus they fail to sell overseas, this is known as the “Galápagos syndrome”. How are you creating products that are utilized worldwide and how are you showing the world the key benefits of them?

I am not too pessimistic, as many Japanese companies are aware of these challenges and goals and understand how they need to improve and change their capabilities to meet them. Today, the geographical boundaries of Japanese companies' global operations are becoming clearly transparent. And the current generation of CEOs is improving and learning from the mistakes of past generations. Learning from mistakes is the best way forward. In this age of the internet, information sources are plentiful and obstacles to foreign market entry can be easily overcome.

One piece of advice I would give is that when Japanese companies introduce something to a foreign market, there is no need to make extreme changes. It is still a matter of doing business with the essence of a Japanese company. Nevertheless, it is important to take into account that each country has its own business practices, regulations and processes.

When expanding abroad, we need to take into account governmental movements, such as capitalism and communism. For example, the "Edo period" is known as Japan's industrial renaissance. Even in a very restrictive political and policy environment, the Japanese survived by improving and changing in many fields. The Japanese are very good at adapting and improving things to achieve excellence. This is the hallmark of Japanese manufacturing and production.

I am reminded of our interview with Tagasago Thermal Engineering about three or four years ago. The engineer explained to us the differences in their ventilation or air-conditioning systems. While customers in Japan favour the quietness of the system, those in China prefer the opposite to ensure that the system is working. Your firm has a track record of working with two very distinct markets which are Japan and the hotel sector in America. Could you tell us the difference between these two markets and how is your firm able to adjust its products to match the requirements of each market?

We always carry out a market analysis. In Japan, where market expectations and demands are high, PMAC's comprehensive approach is ideal. In Japan, product quality and energy saving performance must be of a high standard, so the PMAC system needs to be flexible.

The PMAC system can be introduced to local companies and commercialised to meet the expectations of local customers. In addition, the PMAC and fan coil + heat pump hybrid system (PAFMAC) can be adapted to any country and any temperature range drop. For example, in Taiwan it is hot all year round, so there is not much need for a heating system, but our products can also provide heating using cold water as a heat source. Due to global warming, the known temperature ranges in different countries are changing. We are developing our products to try and anticipate these changes in weather and temperature ranges.

I have a question closely related to the functionality of Heating, Ventilation, and Air conditioning or HVAC systems. Nowadays, during COVID, these systems have a health aspect to them. The World Health Organization has said that such systems can reduce air recirculation and increase the rate of fresh air that comes into a building. Could you tell us more about your system and how it can benefit your customers in terms of COVID and other respiratory ailments such as asthma?

In our medium-term management plan, our key words are not only energy saving, but also contributing to people's health and the environment. Last year, when the Coronavirus epidemic broke out all over the world, our sales and profits were down. As a first step towards realising our keywords, we launched the "Yale" commercial air purifier in December last year, based on three of PMAC's specialties: noise reduction, filter technology and maintenance of high quality.

This is a quiet and inexpensive commercial air purifier that cleans the space by using HEPA filters, filtering out airborne allergens such as DSS, PM2.5 and COVID attached particles.

Another product range, the ASPAC, is as unique as the PAFMAC range. It is a so-called hybrid system, which has the potential to improve the COVID situation. The system can be installed individually or in parts on site, bringing in outside air and adapting it to different buildings. It can be installed individually or in parts.

We have an additional question closely related to the functionality of ASPAC. We know that buildings consume a third of all energy, directly or indirectly, in the world and thus contribute to carbon dioxide or CO2 emissions. The ASPAC system is very energy efficient, and it is utilizing new technologies. Could you please tell us more about how you are supplying products that are energy efficient and are environmentally friendly?

In much of the world there has been little interest in raising environmental awareness of global warming and the reduction of CO2 emissions. However, the initial concept of PMAC was to create such low energy consumption products. We will continue to look for new features and performance for CO2 reduction and low-energy consumption in future products.

ASPAC is very flexible and functional because the compressor is integrated in the unit, so it does not need to be connected to the outdoor unit. Two of our major strengths are not limited to ASPAC. Firstly, our heat pump system makes a significant contribution to the reduction of CO2 emissions, as it uses energy from sources such as river water, wastewater and groundwater. Secondly, our units are integrated, meaning that the amount of refrigerant contained in the system is low, thus reducing the amount of refrigerant used throughout the building.

In the EU, especially in France, Italy and Germany, environmental issues have become a major concern in recent years and new regulations have been put in place in many countries and companies, so we hope to showcase the best features of our products in the future. We are also currently working on a technical partnership with a university, which will allow us to enrich our existing range of features with new technologies and more sophisticated product highlights.

As you are looking to expand in Europe, can you tell us what method you are looking to employ to realize your goals and showcase your technologies? Would you be looking for mergers and acquisitions, technical tie-ups, opening a new sales office, or a manufacturing base?

PMAC is not at the same level as other large companies and the brand awareness is still low, so we need to do something on the marketing side. Our sales engineers need to be educated on how to propose the product at the time of installation, and we need to educate them on the product and after-sales service. In terms of cost performance, I think we still need to study and adjust.

PMAC already has a foothold in the United States since 2016, can you please tell us your plans for the US market going forward?

At the moment, though, our business is shut down for a variety of reasons, not just because of the pandemic. In the United States, we believe that there is great potential for the future in areas such as hotels. The biggest problem we are facing is, as I said before, brand awareness. We are not very well known yet and, to be honest, our products are not cheap. We need to be properly introduced to our customers and the market. Nevertheless, Mr Yamamoto, Mr Masaki and the rest of the executive team are working hard towards this mission and we hope that the market will reopen soon and we can restart and rebuild our business in the US with a new kind of approach.

New York is a city of 400 to 500 hotels in a small area. Normally, when a four or five-star hotel renovates, it has to shut down the whole establishment for a year, which has a financial impact. With our system, the refurbishment can be carried out on a room-by-room basis, according to the hotel owner's plans, without having to shut down the property. After New York, we will focus on Taiwan, and in the future we hope to expand into the European and Australian markets.