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[20] MITSUBISHI MOTORS CORPORATION Annual Report 2001
A12.[U] No. We believe the first phase is complete, but we still have more to do.
Domestic sales of trucks and buses are currently hovering around the 220,000-
unit mark, nearly half the 400,000 units sold in fiscal 1996. Moreover, export
demand suffered a sharp drop from approximately 400,000 units in fiscal 1997 to
less than 300,000 units in fiscal 1999. This was primarily the result of a slump in
demand throughout Asia following the currency crises that plagued the region.
Demand is expected to remain sluggish for some time.
Amid the challenges of this environment, domestic shipments and exports of MMC-
brand trucks and buses declined from 225,000 units in fiscal 1996 to 146,000 units in
fiscal 1998, forcing the Truck & Bus Division into the red.
To reverse the situation, the division implemented measures under the RM2001
and Heart-Beat 21 (HB21) reform programs. Results have been significant and encour-
aging, with the division finally returning to profitability in fiscal 2000.
The key points in our reform effort were as follows:
• Sale of the Maruko Plant and consolidation of production lines, in addition to con-
solidation of the Maruko Plant’s R&D operation with the Kitsuregawa Laboratory
• Closure of the small-truck production line at the Nakatsu Plant (reducing the total
number of truck production lines from five to four), and consolidation of the Nakatsu
engine production line with the Kawasaki Plant (reducing the total number of engine
production lines from four to three)
• Closure of the casting line at the Kawasaki Plant and integration of the subsidiary
operating the Kawasaki Plant with Mitsubishi Automotive Techno-Metal
• A 14% reduction in the number of employees in the Truck & Bus Division
The aforementioned efforts lowered the break-even point from 205,000 units in fiscal
1997 to 149,000 units in fiscal 2000 (including overseas PPC*).
We have also integrated sales companies, reducing the number from 45 to 30 as a
means of promoting efficiency throughout our sales channels.
Measures such as these enabled us to return to profitability in fiscal 2000.