Mitsubishi 2000 Annual Report Download

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Table of contents

  • Page 1

  • Page 2
    ...Technology. Mitsubishi Motors Corporation is also undergoing a substantial transformation as the recent formation of two major alliances marks 2000 as the year in which the Company moves decisively away from a traditional Japan-centric to a more global-oriented management model. In its passenger car...

  • Page 3
    .... Non-consolidated summary Mitsubishi Motors Corporation 2000 Years ended March 31 Net sales Operating income (loss) Income (loss) before tax Net income (loss) Per share of common stock Net income (loss): Basic Fully diluted Cash dividends ¥ 2,106,522 13,435 269 515 (in yen) 1999 ¥ 2,333,971 21...

  • Page 4
    ...two powerful allies: DaimlerChrysler and AB Volvo. In other words, we are now in a position to seek the growth that will add value to the Company, create added value for our shareholders and employees, and deliver enhanced value to our customers. If there is one fact of life I have been keenly aware...

  • Page 5
    ... and for creating and adding value, Heart-Beat 21 will ensure MMC gets up to speed at the earliest possible time. Driven by the Internet and other Information Technology, the globalization of business in progress today requires that we adopt a new style of management. The rapidly shrinking windows...

  • Page 6
    ... build up and maintain customer satisfaction and brand loyalty by providing excellence in product and service. To achieve this and to concentrate on what we do best, we are focusing resources on three core model series: SUW, Pajero, Mini car. Powered by very clean DI diesel and GDI gasoline engines...

  • Page 7
    ... year to set a new world record for an electric vehicle. We are working with Mitsubishi Heavy Industries on the development of fuel-cell electric vehicles. In March this year, we announced the MEEV-II proposal for a next-generation urban micro-car. Mindful of the explosive growth of the Internet and...

  • Page 8
    ... level of quality in all its products. The other pressing challenges facing MMC today are to put the Company on a firm and profitable foot- ing, to restore dividend payments and to grow the business. Heart-Beat 21 gives us the roadmap, while the progress made to date and our new global alliances...

  • Page 9
    ... MMC in the truck business. Formerly held the post of Executive Vice President, Office of Truck & Bus. Member of the board since 1993. Yuhiko Kiyota Senior Vice President and Senior Executive Officer, Office of Marketing Strategy. Born in 1941. Appointed Corporate General Manager of Car Research...

  • Page 10
    ... the synergies expected from global alliances, Heart-Beat 21 now adds strategies designed for growth. The new plan also provides a blueprint for the company to build up its corporate brand and to become more market-oriented in its management and operations Aims & targets MMC's foremost target under...

  • Page 11
    ... (DC) and AB Volvo. Through the equity and operational ties with these two companies, MMC will transform into a corporation that fully meets the international accounting and other management standards due to be introduced into Japan in the near future. Growth strategies; cars The reforms completed...

  • Page 12
    ... strategy car States developed in, developed for and built in the United and other market-tailored models that will boost and parts with DaimlerChrysler; and where available will utilize DaimlerChrysler procurement and sales networks, financial services resources and realize other value-adding...

  • Page 13
    ... cab and engine; conducting joint research into crashworthiness, engine emissions and other future technologies; expanding sales of made-in-Europe Canter trucks; generating sales collaboration benefits in South America and New Zealand; and global sourcing. Financial health MMC is working to improve...

  • Page 14
    ...: 2000 Intent on providing shareholders with an accurate and pertinent picture of the company's current situation and the direction it is heading in, MMC president Katsuhiko Kawasoe once again this year bares his soul to a group of leading analysts at three major security companies based in Tokyo...

  • Page 15
    ... kind of corporate culture, working environment and mindset that encourage new ideas and viewpoints. One of our major achievements over this last year has been the introduction of the executive officer system still a comparative rarity in Japan. I believe you have to separate capital management from...

  • Page 16
    ... the AB Volvo management thought very much along the same lines as ourselves. When we started to think about a passenger car alliance, there was a wide choice in terms of potential synergies but we concluded that teaming up with DaimlerChrysler would bring the greatest benefits. The 3-liter car is...

  • Page 17
    ... somewhat lacking in terms of the total ing assistance by doing all we can to raise the technological capabilities of our partners. In our alliance with the national enterprise Proton in Malaysia, we are helping the country to achieve its aim of raising its capabilities to the level of an advanced...

  • Page 18
    ... at the moment? K: MMC and DaimlerChrysler are currently looking at collaboration in three main areas: the Z-Car, the Asian market and the North American market. If something else thing the old school of management will find difficult (laughter). But, the bottom line is that that's the...

  • Page 19
    ... This being the case, sales and marketing power become the deciding factors. Until recently, we were happy to sell minicars as we have always sold them but we are currently reassessing this. The restructuring of our sales force is also a priority matter. Our passenger car sales companies still have...

  • Page 20
    ... Direct Injection diesel engines are all playing a major role in realizing major reductions in greenhouse gas emissions. The Company is also pouring extensive resources into the development of hybrid, electric, fuel cell and other clean energy vehicles that promise advanced environmental performance...

  • Page 21
    ... issues. This was replaced in August 1999 by the MMC Environmental Guidelines, which also address the latest issues in laying down basic environmental stewardship policy for MMC group member companies. These guidelines affirm that conservation of the global environment is the most important issue...

  • Page 22
    ... in Europe. The use of the GDI engine to power more and more models in the Mitsubishi lineup has seen a steady improvement in fleet fuel economy since 1997. The GDI Sigma Series powertrain, announced in March 1999, is a new environmental technology developed to maximize the superior fuel efficiency...

  • Page 23
    ... to generate electrical power. GDI+HEV utilizes these qualities of the GDI engine to maximum advantage, and combined with Mitsubishi's integrated management GDI+CVT powertrain realizes a superior hybrid power system. The company is planning to launch a GDI+HEV model in the near future. Pistachio...

  • Page 24
    ... uses fuzzy logic control technology, to 1996 model-year Fuso heavy trucks. This smart automatic transmission not only reduces driver fatigue and stress, it also extracts the full performance of Mitsubishi's clean and powerful direct-injection diesel engines to realize superior fuel economy. INOMAT...

  • Page 25
    ... as well as the Super Great heavy truck launched this year. Compliant diesel passenger cars include the Delica Space Gear and the new Pajero, released in June and September 1999 respectively. MMC is working to improve combustion chamber design and fuel injection systems, and on the development...

  • Page 26
    ..., MMC is currently working with other member companies on the development of a FCEV, with a target production date of 2005. The company is working with Mitsubishi Heavy Industries on the development of the fuel cell system and reformer, and with Mitsubishi Electric on the vehicle control system. The...

  • Page 27
    ... CNG-fuelled Canter light truck and Aerostar large public transport bus models on the general market in 1997 and 1998 respectively. There are also over 300 CNG light commercial vehicles and minicars on the roads developed by MMC in cooperation with Osaka Gas Company. LPG trucks Trucks powered by LPG...

  • Page 28
    ... tanding all-round road performance and Pininfarina des ign and production technology excellence res ults in a unique and highly attractive vehicle that meets the needs of the European market. T he 5 door vers ion will debut at the Paris Motor S how this autumn. Pajero (Montero) T he ful l y r edes...

  • Page 29
    ... ources and to improve recyclability. T he S uper Super Great heavy truck Gr eat heavy truck, wi th a maximum G.V.W. of 2 5 tons , is the flags hi p up. of S uper the Gr eat Mits ubis hi Fus o linemodels are powered by a new generation of clean and high-performance engines that us e MIQCS ( Mits...

  • Page 30
    ...will assume joint ownership of MMC's European production unit Netherlands Car B.V., where they will produce a small car to be developed jointly by the two companies. Sharing the same platform, this model developed for the MMC and AB Volvo announce commercial vehicle alliance Operational review 28

  • Page 31
    ... partnerships described above, MMC has entered a number of technology licensing alliances. In January 1999, the Company signed an agreement with Peugeot-Citroen covering the supply of technology relating to the GDI engine. In April 1999, Hyundai Motor of Korea launched the Equus luxury model powered...

  • Page 32
    ... year and the depressed state of the market meant these new models failed to prevent a slight decline in MMC market share. New models MMC introduced four new models in fiscal 1999. Reflecting Proudia luxury sedan the company's recent policy of concentrating on core revenue Operational review 30

  • Page 33
    ... bus Fuso Super Great heavy truck models. In October 1999, the Company launched the new Pistachio model with GDI+ASG powertrain, which uses Automatic Stop & Go idling technology to further improve GDI fuel consumption around town by cutting the engine off at traffic lights and other times the car...

  • Page 34
    ... Lancer Cedia launched in May 2000, and the GDI+Turbo that powers the Pajero iO 5-door Turbo launched in July this year. The Company will continue to play its role in reducing environmental loads as it releases new eco-models that use GDI Sigma powertrains to achieve significant improvements in fuel...

  • Page 35
    ... of the new fast-selling Eclipse model up by 55%. In Asia, production grew strongly over 1998 levels, thanks to the market recovery in parts of the region. North America MMC enjoyed an excellent year in terms of production and sales in North America in fiscal 1999. Mitsubishi Motors was the...

  • Page 36
    ...Strada pickup and SUV models from Thailand, the Company's global production hub for this type of vehicle, were 67,000 units, 5% up on the previous year. Total sales in the Philippine market decreased 28% to 71,000 units in fiscal 1999. Driven by the Pajero, Mirage and Adventure models, MMC brand car...

  • Page 37
    ... 475 Space Wagon (European market model) continued sluggish demand and the major earthquake in September last year. Sales of MMC brand cars were 89,000 units, 9% down on 1998, but still topping the sales league for the third year in a row. Commercial vehicle operations Total industry truck sales in...

  • Page 38
    ... and a new type of engine retarder, the new engines comply with the Long-term L200 (Export market model) Emissions Regulations. Medium and heavy trucks powered by the new engines were launched in April 1999 and February 2000 respectively. Integration of sales companies in Japan MMC began a major...

  • Page 39
    ... types of business models by connecting with other sectors of industry. Organization chart Office of Corporate Planning & Strategy Office of Human Resources & Organization Office of Finance & Public Relations Office of Quality & Technical Affairs Office of Purchasing Office of Service Parts Office...

  • Page 40
    ... business models. MMC is working to introduce global design and procurement activities using the latest Information Technology; to develop new ways of marketing in Japan using information equipment, and to introduce supply chain management and other ways of boosting management efficiencies...

  • Page 41
    ... FY Net income Net income per share '95 12.7 13.84 '96 11.6 12.59 '97 -101.8 -110.49 '98 5.7 6.15 '99 -23.3 -24.87 800 600 378 400 200 0 215 233 229 185 417 452 414 338 20 15 10 5 0 Segment performance (business) Sales from the passenger car business for the current fiscal year were ¥3,262...

  • Page 42
    ...0 -1,000 Japan North America 296 246 -798 -750 0 FY Europe Asia Others Corporate Consolidated and eliminations '95 3,007.7 '96 3,233.2 '97 3,370.5 '98 3,060.4 '99 2,784.1 Stockholders' equity Retained earnings at the end of March 2000 were ¥76.8 billion. The decrease was due mainly to the...

  • Page 43
    ... that the major reason for the consolidated net loss forecast for fiscal 2000 is the one-time charge of ¥140 billion that the Company plans to take to cover pension fund liabilities consequent upon changes in accounting standards for postretirement benefits. Consolidated forecast Sales Operating...

  • Page 44
    Mitsubishi Motors Corporation and Consolidated Subsidiaries Consolidated Balance Sheets March 31, 2000 1999 2000 (In thousands of U.S. dollars) (Note 3) (In millions of yen) Assets Current assets: Cash and cash equivalents Trade notes and accounts receivable (Notes 4 and 8) Marketable securities (...

  • Page 45
    March 31, 2000 1999 2000 (In thousands of U.S. dollars) (Note 3) (In millions of yen) Liabilities and stockholders' equity Current liabilities: Trade notes and accounts payable Short-term borrowings (Note 8) Current portion of long-term debt (Note 8) Accrued income taxes Other current liabilities (...

  • Page 46
    Mitsubishi Motors Corporation and Consolidated Subsidiaries Consolidated Statements of Operations Year ended March 31, 2000 1999 2000 (In thousands of U.S. dollars) (Note 3) (In millions of yen) Net sales Cost of sales Reversal of deferred profit on installment sales... Per share of common stock: Net ...

  • Page 47
    Mitsubishi Motors Corporation and Consolidated Subsidiaries Consolidated Statements of Stockholders' Equity Common stock (Number of shares) Common stock Capital surplus Retained earnings Total (In millions of yen) Balance at April 1, 1998 Change due to inclusion of subsidiaries and affiliates ...

  • Page 48
    Mitsubishi Motors Corporation and Consolidated Subsidiaries Consolidated Statements of Cash Flows Year ended March 31, 2000 1999 2000 (In thousands of U.S. dollars) (Note 3) (In millions of yen) Operating activities Net income (loss) Adjustments to reconcile net income (loss) to net cash provided ...

  • Page 49
    ... Financial Statements March 31, 2000 1. Significant accounting policies (a) Basis of presentation Mitsubishi Motors Corporation ("MMC") and its domestic subsidiaries maintain their books of account in conformity with the financial accounting standards of Japan, and its foreign subsidiaries...

  • Page 50
    ...Directors and corporate auditors of MMC and its domestic consolidated subsidiaries are customarily entitled to lumpsum payments under their respective unfunded severance benefit plan subject to the shareholders' approval. Provision for the indemnity for severance benefits for those officers has been...

  • Page 51
    ...they have been stated at the lower of cost or market method in order to conform to MMC. The effect of this change in method of accounting is minor. d. Until the year ended March 31, 1999, severance payment to directors and corporate auditors of the domestic consolidated subsidiaries had been charged...

  • Page 52
    ... without recourse which have been deducted from the respective accounts amounted to ¥47,793 million ($450,240 thousand) and ¥32,583million as of March 31, 2000 and 1999, respectively. Such amounts as deducted from short-term and long-term loans receivable were ¥226,400million ($2,132,831 thousand...

  • Page 53
    ...,183 74,090 ¥ 927,274 $ 5,880,207 232,096 $ 6,112,303 Long-term debt at March 31, 2000 and 1999 consisted of the following: Loans, principally from banks and insurance companies due through 2022 at rates averaged 3.8% Secured Unsecured 2.15% bonds due 2001 1.9% bonds due 2001 4.4% bonds due 2001...

  • Page 54
    ... At March 31, 2000, if all the outstanding convertible bonds had been converted at the current conversion price, 91,629 thousand new shares would have been issuable. The conversion price is subject to adjustment in certain cases including stock splits. The maturities of long-term debt are summarized...

  • Page 55
    ...Year ended March 31, 2000 1999 (In millions of yen) 2000 (In thousands of U.S. dollars) Gains on sales of marketable securities Gains on sales and disposal of property, plant and equipment Equity in profit in affiliates Foreign exchange gain (loss) Severance payment for early retirement Settlement...

  • Page 56
    ... are included in the consolidated balance sheets as follows: 2000 Year ended March 31, 1999 2000 (In thousands of U.S. dollars) (In millions of yen) Deferred income taxes Long-term prepaid expenses and other Other current liabilities Deferred tax liabilities Net deferred tax assets (liabilities...

  • Page 57
    12. Segment information a. Business segments The business segment information for MMC and its subsidiaries for the year ended March 31 is summarized as follows: Year ended March 31, 2000 (In millions of yen) (In thousands of U.S. dollars) Sales Automobile Financial services Total Intersegment ...

  • Page 58
    ... segment information for MMC and its subsidiaries for the year ended March 31, 2000 and 1999 is summarized as follows: Year ended March 31, 2000 1999 2000 (In millions of yen) Sales Japan North America Europe Asia Others Total Interarea Consolidated Operating income Japan North America Europe Asia...

  • Page 59
    ...377 396 187 104 ¥ 84 1,762 980 $ 791 14. Leases As lessee MMC and its subsidiaries lease certain property, plant and equipment. For the years ended March 31, 2000 and 1999, finance lease transactions, except for agreements which stipulate transfer of the title of the assets to the lessee were...

  • Page 60
    ... ¥ 99,855 $ 168,243 680,245 $ 848,488 As lessor Operating lease transactions entered into as lessor by MMC and its consolidated subsidiaries for the years ended March 31, 2000 and 1999 were as follows: March 31, 1999 2000 2000 (In thousands of U.S. dollars) (In millions of yen) Future minimum...

  • Page 61
    Report of the independent public accountants Report of the independent public accountants 59

  • Page 62
    ..., 2000. Board members were newly elected on June 27, 2000) Date of establishment April 22, 1970 Securities traded All stock exchanges in Japan: Tokyo, Osaka, Nagoya, Kyoto, Fukuoka and Sapporo Paid in capital 150,730,455,000 Transfer agent and register The Mitsubishi Trust & Banking Corporation...

  • Page 63
    ... CEO Mitsubishi Fuso Truck & Bus Co. Steven A. Torok International Alliance Promotion Team Ulrich Walker Office of Marketing Strategy Manfred Bishoff Member of the board, DaimlerChrysler Takashi Nishioka President, Mitsubishi Heavy Industries Mikio Sasaki President, Mitsubishi Corporation Statutory...

  • Page 64
    ... Truck & Bus Research & Development Center 10, Okura-cho, Nakahara-ku, Kawasaki, Kanagawa 211-8522, Japan Telephone: +81-44-587-2000 Kitsuregawa Proving Ground 4300, Washijuku, Kitsuregawa-cho, Shioya-gun, Tochigi 329-1411, Japan Telephone: +81-286-86-4711 Engineering centers Works Passenger car...

  • Page 65
    ... Bus Manufacturing Co.,Ltd. Mitsubishi Motors Training Center Co.,Ltd. PABCO Co.,Ltd. Pajero Manufacturing Co.,Ltd. Mitsubishi Automotive Tecno-Service Co.,Ltd. Mitsubishi Automotive Engineering Co.,Ltd. Mitsubishi Automotive Logistics Co.,Ltd. Hokkaido Mitsubishi Motor Sales Co. Tokyo Mitsubishi...

  • Page 66
    ... year ended March 1998 and March 2000 is not available due to the loss for the period. Non-consolidated summary Mitsubishi Motors Corporation 1991 Years ended March 31 Net Sales Operating income (loss) Income (loss) before tax Net income (loss) Per share of common stock (in yen): Net income (loss...

  • Page 67
    ...672,085 45,660 13,968 11,599 (in yen) 12.59 11.34 7.00 ¥ 1998 1999 2000 ¥ 3,414,133 95,912 50,086 12,615 ¥ 3,537,018 71,911 24,208 12,...¥ 2,585,940 57,148 20,367 15,067 (in yen) 16.36 14.68 7.00 ¥ 1998 1999 2000 ¥ 2,652,517 67,745 42,526 18,826 ¥ 2,522,559 62,359 20,468 20,468 2,...

  • Page 68
    ... (SAAJ) Named "Best IR Company 1999" by Japan Investor Relations Association (JIRA) 5-33-8, Shiba, Minato-ku, Tokyo 108-8410 Japan Corporate Public Relations Department Tel: +81-3-5232-7176 (Investor Relations) +81-3-5232-7165 (Media Relations) http://www.mitsubishi-motors.co.jp fax: +81-3-5232...