AISIN GROUP

AISIN GROUP TOP MESSAGE 2017

AISIN GROUP TOP MESSAGE 2017

Aiming to be a Vibrant,
Globally Competitive Company
That Proposes New Value

President Aisin Seiki Co., Ltd.
Yasumori Ihara

Review of Fiscal 2017

Problem-Solving Activities through Genchi Genbutsu (Go and See for Yourself)
Lead to Record-High Profits

During fiscal 2017, operating profit increased ¥35.9 billion and we achieved record-high revenue and operating profit. The primary factors driving these solid results included the approximate 1.32 million increase in unit sales of automatic transmissions by Aisin AW, to 8.69 million units. Also contributing to performance were especially strong sales of high-added-value body parts, including system products such as Aisin Seiki’s power sliding doors, in Japan and China.

I am extremely grateful that we finished the fiscal period with outstanding business results, especially when considering the cloudy outlook at the beginning of the fiscal year due to the effects of the Kumamoto earthquakes and the impact of the strong yen. I would also like to express my appreciation to all our employees for their hard work.

Looking at our business activities, our top management priority has been to strengthen the competiveness of our existing businesses. In line with this objective, for approximately two years I personally visited all 227 companies and 320 main bases that are undertaking business to accurately ascertain the current state of our business operations through genchi genbutsu. In doing so, I discovered and examined problems for each function, geographic region and product, and identified approximately 350 of the most critical problems. In response, we subsequently carried out problem-solving activities by ranking each problem based on its level of urgency and then solving problems one by one starting with the highest-priority issues. I believe our problemsolving activities functioned extremely well.

For example, in door locks, one of the company’s mainstay products, we video recorded and then performed comparative evaluations of all assembly lines at our nine bases worldwide, centering on the Shinkawa Plant in Japan. This has allowed us to deploy the most efficient manufacturing processes globally as well as to continuously compare and review purchased components at all bases, which has resulted in improved profits. Besides this example, we are achieving significant results at various bases and for products, and our problem-solving activities are now being firmly positioned throughout our operations worldwide.

We also began undertaking business restructuring in fiscal 2016. As part of this reorganization, in February of fiscal 2017 we integrated the management of Art Metal MFG Co., Ltd. in the piston business. With this business integration, we have now completed the framework for business restructuring implemented in the powertrain domain, Chassis & Vehicle Safety System Domain and Body Product Domain as we proceed smoothly with initiatives for strengthening competitiveness in all domains.

As these examples demonstrate, I am confident that we are making steady progress toward “strengthening our underlying foundation.” Based on this assessment, I would like to make fiscal 2018 a year in which we transition from “defense” to “offense.”

Outline of business restructuring
Toward Future Growth

Issues to Be Addressed by the AISIN Group

The AISIN Group has promoted the establishment of separate, independent companies and achieved growth as a professional corporate group under the respective management policies of each of these companies that specialize in specific product lines. When looking at the state of the world in recent years, however, I am concerned about growing business risks and regional risks, such as an increase in global protectionism policies, and have a heightened sense of uncertainty about the future. The impact of recent developments on the AISIN Group’s business activities is totally unpredictable. At the same time, IT is advancing with unprecedented speed, and society is undergoing dramatic changes as everything around us is now connected to the internet.

In the automobile industry, a wave of unprecedented dramatic structural change is rapidly approaching. This includes the advance of automated driving technologies, the spread of connected cars and evolving lifestyles characterized by cars changing from something you own to something you share.

The AISIN Group’s transmission business is currently performing well. That said, I am unsure whether we can maintain our future competitiveness as these changes unfold merely by maintaining the status quo. As a response, we will promote initiatives for strengthening our sense of unity as a Group and our ability to respond to change.