A construction company founded in 1990, Takeuchi has established itself as a developer of pioneering methods for laying building foundations.
The construction industry faces significant challenges, including rising labor, the 2024 Problem and material costs. Case in point, the number of skilled carpenters has dropped to a 40-year low of 33%. Despite these hurdles, the Japanese construction market is projected to grow at a compound annual growth rate of 3.3%, reaching USD 609 billion in 2024 and USD 716 billion by 2029. This is being driven by major projects such as the Osaka World Expo, a new Shinkansen Maglev line, and investment in semiconductor facilities. What is your assessment of Japan’s current construction industry and its needs for the years to come? What implementations of policy have made your company better prepared for the future?
To answer your first question, as you mentioned, there are some big projects in the works, such as the Shinkansen Maglev line, the Osaka World Expo, and investment in semiconductor equipment, but our technology is related to industrial use and, in particular, is adopted for use in factories and warehouses. The logistics sector has the 2024 problem to face, but those problems can be covered by technology. In order to tackle these issues better, factories and warehouses are trying to update their existing technology and equipment. The domestic market is seeing an expanding trend, and our business has capitalized on this trend. In that sense, our business is successful. Instead of developing or adopting new technologies, we will update our existing technology.
What I’ve mentioned relates to the external environment. Our company has an original ground improvement method called TNF, which stands for Tender Net Foundation. Going forward, we will optimize TNF ground depending on the condition of the ground and cut our customers' costs.
To achieve this, advanced ground design technology is essential. We have already introduced FEM analysis, but we plan to further improve and sophisticate our analysis technology.
Over the next five years the Asia Pacific region is poised to remain the key construction market, accounting for nearly 40% of the global industry’s output value by 2030, with the United States and European Union following close behind. Takeuchi Construction first entered the Vietnamese market in November 2007, with your 16,000-meter square factory standing as a testament to your international success. Could you run us through some of the challenges you’ve had operating in the region? What have you learned in the 16 years you’ve been operating in Vietnam?
Our group has a subsidiary in Vietnam and is currently conducting feasibility studies and contacting specific projects to start up local business (accumulating local construction achievements) in Vietnam. Through these efforts, we plan to build up local business as a sustainable business model in the medium to long term.
As you mentioned, we expanded into Vietnam in 2007; however, after that, we don’t have any record of developing new businesses in foreign countries. When establishing ourselves in Vietnam, we had expected that our business there would collaborate with the company in Japan to provide designs and analysis for the Japanese market; however, establishing a local business outside of Japan is very difficult. Starting with feasibility studies, we first had to clarify what we could do in Vietnam. This business is a mid-to-long-term effort for our company.
Do you have any aspirations outside of Vietnam in local countries such as Thailand, Cambodia, Bhutan, or India? If you were to expand in those countries, what would you do differently?
When starting businesses, we focus on profits, not sales. Ideally, we are looking at the US or Australian market because those markets have highly developed infrastructure, so their living standards are high. Some countries need technologies like T-BAGS and TNF because their land is very soft and they have very frequent earthquakes. We want to bring our technologies to those countries as well. We now have two directions to do business: one focusing on profit and the other focusing on contributing to society. We are doing these two types of business simultaneously.
We recognize that the Asia-Pacific region is a market with significant growth potential. For areas outside of Vietnam, our company is considering whether we can construct a business model that ensures a profit margin at the same level as in Japan when deploying our construction method internationally. Human resources are essential for the overseas expansion of our construction method, and we recognize the need to explore a business model that takes this into account while ensuring profitability. We also believe that it is not necessarily required for our group to handle the entire process from design to construction in the same way as we do in Japan. In constructing our method, we are considering a business model where we would handle key processes such as soil analysis and design, while outsourcing the actual construction to local companies and earning royalties. However, even in this case, we acknowledge that there remains an issue of how to manage the guarantee of our construction method for the projects, without our group being in charge of the construction process. We are considering these challenges one by one as we move forward with our efforts towards international expansion.”
Given the Global Commitment Action Plan outlined in the Paris Agreement and Japan’s specific goals of carbon neutrality by 2050, there has been a significant push towards decarbonizing the economy. Companies like Muji House have led the way by using responsibly sourced wood and recycled materials. In light of the many efforts from companies across the construction industry, can you elaborate on the specific changes Takeuchi Construction has made to become more environmentally friendly?
TNF is an environmentally friendly technology because the volume of material is the lowest. We have the lowest life cycle cost (LCC) among similar technologies. I think that this technology also has the lowest CO2 emissions.
We all witnessed the devastating effects of the 2024 Noto Earthquake, including the 30,000 buildings that were either partially or completely destroyed. For the three years leading up to the 2024 earthquake, the Noto peninsula was experiencing a two-year earthquake swarm. 2016 was Kumamoto, 2011 was Tohoku, and 1995 was Kobe. Takeuchi Construction has been heralded as a leader for both its T-BAGS Seismic Based Isolation and its TNF Method. The last time we interviewed you, it was mentioned that you had plans to bring these lifesaving methods to the United States and Indonesia. How are those plans progressing? What strategies have you implemented to make this a reality?
In Japan, our construction methods have seen an increase in orders in recent years, driven by the demand for the construction of commercial facilities such as logistics warehouses, hazardous material warehouses, factories, and retail stores. We are considering expanding into North America and Australia, where there is strong demand for such facilities.
I am always saying that we would like to expand our business to the United States, so this is a desire of mine. However, we have yet to be able to contact any local companies in the US, and this is a problem we have been trying to solve for the past five years. We need to gain the understanding of local companies involved in the development of these types of buildings regarding our construction methods and its concepts. We face the challenge of establishing efficient and effective ways to access and communicate with these companies.
We are planning to attend the International Conferences to be held from July to August to present our research. There we will talk about TNF since there are some people who have shown interest in our technology.
The technology is low in cost, so these are suitable for US buildings that are both large in scale and low-story. It is unfortunate that, at this time, we don’t have the appropriate method to expand into the US. We expect that having our technology reported in the media will help us gain recognition and in turn, help us to expand in foreign markets.
Your TNF technology was first started in October 1993 and you last modified it with TNF2.0. You’ve spoken in the past how it’s paramount to pour your passion and expertise to create new technologies and services that meet the ever changing needs of society. Could you tell us about future disaster prevention technologies? What are future changes to TNF and T-BAGS going to look like?
First of all, we intend to improve ground and earthquake design technology.
In earthquake analysis, we currently use seismic waves defined in the design standards to carry out uniform design in each region, regardless of ground conditions. In addition, for ground analysis, we have set uniform conditions for the site area, but in the future we plan to carry out ground and earthquake analysis that accurately reflects the load for each ground condition and pillar position at the proposed construction site.
As you mentioned, we currently have two countermeasures technologies: TNF and T-BAGS. Although these technologies can help us implement measures to some extent, in the future, we would like to develop earthquake-proofing and settlement-prevention technology for entire blocks rather than individual buildings. If successful, we will be the first in the world to realize such technology. Continuing our current approach, I wish that we could make this technology affordable.
When we last spoke, Takeuchi was already a prominent player in the construction machinery industry. It's been two years, and I'm eager to hear about the company's journey since then. Could you share some of the key milestones and achievements Takeuchi has accomplished during this period?
TNF2.0 was officially released and adopted in 117 projects, including McDonald's stores. TNF2.0 is a construction method that varies the improvement depth according to the column stress of the building, whereas previously the improvement layer had a constant depth. This method better controls differential settlement. The TNF-DD method was released and adopted in approximately 61 projects. The TNF-DD method places a flange plate on top of the inverted trapezoidal footing, enhancing resistance to horizontal forces or seismic forces. By making the concrete footing in an inverted trapezoidal shape, the building's load is efficiently dispersed to the lower ground, while also reducing the concrete volume by about 40%.
Environmental sustainability is increasingly important in construction. Takeuchi’s TNF method mitigates environmental impacts by reducing material usage and construction waste. Unlike traditional methods that often require extensive piling, the TNF method minimizes ground disturbance and energy consumption, leading to a lower carbon footprint and less ecological disruption. With environmental sustainability becoming increasingly important, how do Takeuchi’s foundation methods, particularly the TNF method, mitigate environmental impacts compared to traditional construction methods?
Compared to pile foundations, there are significant environmental impact differences in both construction and removal phases for TNF methods. Compared to pile foundation methods, TNF method significantly reduces environmental impacts both during construction and removal phases. During construction, TNF method involves shallow ground improvement using a grid pattern, which minimizes the use of construction materials. Additionally, when rebuilding with TNF for existing buildings supported by piles, there is no need to remove the previous piles. In contrast, rebuilding with a pile foundation requires removing existing piles, which can significantly damage the ground and compromise its bearing capacity. The TNF method not only eliminates the labor- intensive process of pile removal but also preserves the original bearing capacity of the ground. Regarding TNF removal, the TNF ground can be reused as high-quality construction material after crushing. Solidified soil can be easily crushed with conventional heavy machinery, resulting in lower costs and shorter construction periods than pile removal.
You mentioned briefly upgrading your technology. Takeuchi Construction Inc. emphasizes continuous innovation to stay ahead in the foundation technology industry. You invest in research and development to enhance existing technologies like the TNF method, focusing on improving efficiency and adaptability. While also exploring advanced materials and techniques to boost resilience and sustainability. These initiatives are essential for developing next-generation foundation technologies that offer superior performance, cost savings, and reduced environmental impact. Have you made any efforts to use automation or robotics in your operations? And what are some current R&D projects at Takeuchi aimed at further enhancing your foundation technologies.
Our company is advancing these efforts. In the design process, which includes analysis, we have already introduced the Building Information Modeling system, known as BIM, to our works. These BIM models are shared with our clients so that we can efficiently lead the construction design process. This is a continued development in our company. Major companies are also working on similar projects, but our company has reached an advanced stage.
Our research and development are currently focused on the following: The Development of Piled TNF Method, Development of Foundation Structures with Reduced Concrete and Rebar, and Development of the T-BAGS Seismic Isolation Method.
The piled TNF method involves installing friction piles beneath the TNF ground improvement layer, extending the application of the TNF method, which was previously limited to low-rise buildings, to mid-rise buildings. The research involves modeling the building and ground as monolithic, considering the building's impact during ground analysis, and verifying the optimal arrangement and length of the piles. We are in the process of establishing this design method. Our research findings were presented at international conferences in 2022, at Stress Wave, in the Netherlands, and in 2023 at Geotech Hanoi in Vietnam.
Next is the development of Foundation Structures with Reduced Concrete and Rebar: reinforcing steel, concrete, and steel materials have been often used in foundation structures such as piles and footing concrete. These robust foundation structures are designed to support buildings robustly, minimizing the influence of varying ground conditions across project sites. However, such designs often lead to excessive construction costs and increased environmental impact. In our company, we focus our research on thoroughly analyzing the ground conditions at each site and maximizing the inherent bearing capacity of the ground. Our goal is to minimize foundation structures as much as possible.
We want to also continue developing Liquefaction Countermeasures. The Noto Peninsula Earthquake in Ishikawa Prefecture caused significant liquefaction damage. Our post-earthquake damage survey revealed minimal liquefaction damage in the buildings using the TNF method. Although the TNF method has been known to be effective against liquefaction, we plan to further enhance our liquefaction countermeasure methods, as well as update TNF Hybrid Method.
Also we are working on developing our T-BAGS Seismic Isolation Method. We conducted computer simulations to apply the T-BAGS seismic isolation method to five-story buildings, demonstrating that the T-BAGS system effectively functions for seismic isolation even in five-story buildings. Building vibrations are significant in five-story buildings, and the seismic isolation effect of T-BAGS through sliding is limited. However, considering the shear deformation of T-BAGS sandbags, we demonstrated that the system also provides an efficient "vibration control function" to suppress building vibrations. Remarkably, we successfully achieved a significant reduction in seismic forces, especially in terms of response acceleration at the top of buildings. We will present these research findings sequentially at international conferences.
Vibration simulation of T-BAGS seismic isolation system
Left: Without T-BAGS system / Right: With T-BAGS system
(Display scale enlarged 50 times)
Our company is really focusing on low costs, and we are trying not to use too much manual labor. We reduce the amount of materials used and shorten Construction period. Applying the method that uses the least amount of concrete is something we often explore with clients, but at the same time, we try to maximize the impact.
You’ve spoken about your difficulties breaking into the American market. You also mentioned that you are going to present your research at international conferences. Can you tell us more?
I'm sure there will be people who will be interested in our technology in the international conference where we will be. We also hope to be able to build a cooperative relationship with those people.
Currently, we do not have any cooperative relationships with overseas companies, such as business partnerships.
In addition, we have no capital ties with any Japanese companies and are independently funded, which allows us to make decisions quickly. We understand that expanding overseas requires partnering with companies in the relevant country, but we are concerned about cultural differences.
If you were to give a speech next year highlighting Takeuchi Construction, what would you like to say about the successes? How would you sum up your life with Takeuchi Construction thus far, and what would you like to achieve in the coming years?
Next year marks our 35th anniversary, and for that anniversary, we are looking to build a new head office building in a new location. We are also in the process of developing TNF3.0.
On a personal level, I was decorated by the Emperor of Japan in Spring 2023. Specifically, I was decorated for representing our employees who supported Takeuchi Construction. I would ask my employees in a speech to think about what more we can do for the company.
Our company employs individuals from nine different nationalities, making us significantly more diverse compared to other Japanese companies. Including our overseas subsidiaries, the proportion of foreign workers in our group exceeds 60%. We are a very rare company in the construction industry. These foreign workers can take our technology back to their home countries and expand our business. We will continue to strive to build an organization composed of such diverse nationalities.
For more information, visit: http://www.takeuchi-const.co.jp/
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