Mitsubishi 2007 Annual Report Download - page 57

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55
Notes to Consolidated Financial Statements
(iv) Regional strategy
a. Japan
As one of the cornerstones of the “Mitsubishi Motors Revitalization Plan”, the MMC group has been accelerating
reconstruction of its domestic sales network and it plans to integrate and merge widespread domestic consolidated
sales companies and parts sales companies during FY 2007. By continuing to implement the policies of: improving
efficiency in sales network; strengthening sales operations; and enhancing corporate governance, the MMC group
strives to obtain top class customer satisfaction in the industry and improve profitability. As a result of these measures,
the MMC group strives to achieve profitability in domestic operation at an early stage.
b. North America
In order to establish a structure for profitable operations in the North American market, the MMC group appointed a
head office managing director to become CEO and President of its North American subsidiary. The MMC group also
introduced a new management structure that will strengthen links and promote effective communication with MMC.
c. Europe
To move its European operations forward from start-up stage into the growth stage, the MMC group will work to promote sales
for a stronger model lineup and will place its effort to strengthen its management and improve sales structures.
d. China
The MMC group seeks to expand its operation by continuing to promote the Mitsubishi brand that is already being well
established in China. In September 2006, the MMC group completed capital investment in South East (Fujian) Motors
Co., Ltd. to upgrade the Mitsubishi brand models and expand its range of models for sale. The MMC group is also
considering establishing engine joint ventures in China, as a major engine production hub, and R&D facilities to meet
local market needs on a timely basis.
e. Other markets
The MMC group is taking steps to strengthen its operational footing in ASEAN markets. These include strengthening
sales operations in Thailand, establishing sales structures in Malaysia, and reorganizing operations in Indonesia. The
MMC group is also increasing production capacity in Thailand, which now serves as one of the important export hubs
to global markets.
(v) Cost reductions
a. Manpower
As a result of changes in organizational structure and work processes, improved operational efficiency and reduction of
the numbers of personnel, the MMC group’s staff reduction program is on track and scheduled to achieve the planned
target. The MMC group also continues to work on further improvements in operational efficiencies.
b. Materials costs
In spite of rising prices of raw materials, the MMC group continues to make every effort for further cost reductions.