Isuzu 2002 Annual Report Download - page 4

ISUZU MOTORS LIMITED ANNUAL REPORT 2002
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the plan’s consolidated net sales target, which has now
been scaled down somewhat to ¥1.33 trillion.
PROGRESS OF MID-TERM BUSINESS PLAN The focus
in the first year of the plan was on energetically address-
ing the principal issues it identified while at the same time
carrying out fine-tuning to expeditiously cope with dra-
matic changes in the operating environment, all for the
purpose of achieving recognizable results. However, in-
creased outlays for North American sales operations, the
prolonged market slump in Japan and an intensifying
competitive situation, all had a negative impact on earn-
ings. Consequently, first year earnings fell short of tar-
get. Despite the shortfall, Isuzu aggressively implemented
every initiative and we were able to lay a solid founda-
tion for reforming the business and corporate structure,
to increase revenue in the power-train business, and to
develop a new model of a pick-up truck for urban deliver-
ies, all while steadily expanding our collaboration with
GM. I am confident that we are now in a position to achieve
improved earnings in the years ahead.
As I said earlier, one of the primary goals of the Isuzu
V Plan is to recover corporate value. To this end, Isuzu is
making concerted efforts to reform its cost structure in
Japan through an eight-step action plan.
(1) Consolidating Domestic Production Infrastructure
The first step focuses on consolidating domestic produc-
tion infrastructure at three facilities. Optimal allocation of
resources is expected to raise capacity utilization rates
In May 2001, we formulated the Isuzu V Plan, a new mid-term business plan, covering the three-year
period through March 2004. The plan aims at far-reaching reforms of our business and corporate
structure that will restore enterprise value and strengthen competitiveness. It also calls for a stream-
lined organization and resurgence of corporate value, which forms the basis of sound management.
Isuzu will leverage its own competitive advantages and alliance with General Motors to establish
a global business network.
ISUZU V PLAN The Isuzu Group moved into the black
in the fiscal year ended March 2002 after two consecutive
years of consolidated operating losses. This is confirma-
tion of the progress we have made under the Isuzu V Plan
and that it is starting to yield tangible results. The origi-
nal plan envisioned a minimum consolidated operating
income of ¥60,000 million on consolidated net sales of
¥1.52 trillion in the fiscal year ending March 2004. The
goal for consolidated net income was ¥30,000 million.
However, factors such as the recent sudden drop in North
American sales forced us in November 2001 to review
PRESIDENT’S M ESSAGE
Yoshinori Ida
President and Representative Director