Alpine 2008 Annual Report Download - page 14

14
Reviewing the world economy in the fiscal year ended March 31, 2008, with concern over the
high oil prices, the US economy slowed down due to the turmoil of the financial and capital
markets arising from the subprime mortgage problem. In Europe, the economy maintained a
slow growth supported by domestic demand, despite sluggish exports due to a strong Euro.
Although the Japanese economy had maintained a stable growth driven by exporting
companies supported by a cheap Yen, the U.S. economic recession brought marked
slowdown to businesses and signs of decrease in personal consumption.
In the automobile industry, the demand shifted to smaller, fuel-efficient cars. Emerging markets
expanded, led by the BRIC countries, with Russia and the Middle East gaining from the high oil
prices and China and India spearheading growth in Asia.
In the car electronics industry, the domestic after-market featured the introduction of navigation
systems equipped for terrestrial digital broadcasting and internet compatibility via mobile phone
and computer connections. Meanwhile, portable navigation devices (PNDs) expanded the size
of the U.S. and Europe market. Automobile manufacturers launched integrated equipment with
new functions compatible with real-time information and communication systems.
In this environment, the Alpine Group prepared the mid-term business plan, “CHALLENGE
30,” aimed for reforming its earnings, cost and development structure.
We also exhibited our products at motor shows in Japan and overseas to showcase our
state-of-the-art technologies to automobile manufacturers and stepped up our drive to create
industry-leading products for the after-market. Moreover, we reinforced our sales network
through such initiatives as establishing sales facilities in China and Thailand in anticipation
of cultivating high-growth emerging markets. However, sales from business with automobile
manufacturers declined during the year, due to the U.S. economic slowdown and model
changes.
Performance by Segment
Audio Products
In this segment, strong sales performers included Alpine’s iPod-LINK automotive CD players
for the after-market and the “IDA-X001” digital media head unit, which got a European
Imaging and Sound Association award. However, sales decreased due to the intensifying price
competition and contraction of the market.
For businesses with automobile manufacturers, the installation in SUVs of the new media “DVD
audio systems” increased in North America, and sales for installed “CD audio systems” in the
BRIC markets were stable, and sales for sound systems designed to overcome severe vehicle
indoor conditions.
The fiscal year was in the midst of model changes and for business with European automobile
manufacturers shifts from single car audio products to integrated products centering on
navigation systems equipments, with trends from single car audio products to integrated
products centering on navigation systems.
As a result, sales of this segment decreased 4.9% compared with the previous fiscal year.
Information and Communication Products
In this segment, we launched the series of next-generation car navigation systems called
“Mobile Media Station X07/X075” which are compatible with terrestrial digital broadcasting
(1-segment + 12-segment) to the Japanese domestic after-market. Despite promotions for
sales expansion, shifts in product demand toward diffusion price zones resulted in sluggish
sales.
On the other hand, “Overhead Monitors” which are high-quality, high-definition rear-seat
entertainment systems with DVD and terrestrial digital broadcasting compatibility achieved
successful sales performance due to responded user needs.
Overseas, sales of the “Blackbird” portable navigation system which was launched in the
European after-market and sales of the “IVA-W205” 2DIN mobile multimedia station featuring
the functions to expand the portable navigation functions were in severe conditions due to the
intensified price competition. Business with automobile manufacturers expanded by effective
promotional activities with growing trends toward factory installation of car navigation systems
and integrated information and communication products. Nevertheless, this factor failed to

(Millions of yen)
2004
170,984
2005
180,828
2006
215,281
2007
228,379
2008


(Millions of yen)
2004
8,940
2005
10,402
2006
10,778
2007
12,620
2008


(Millions of yen)
2004
181,185
120,908
2005
145,127
80,912
2006
156,507
89,874
2007
169,553
112,377
2008


Total Assets
Net Assets
Net Assets for the years from 2003 to 2006 are recalculated.
Consolidated Financial Review