Mitsubishi 2010 Annual Report Download - page 18

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0100
10
09
08
07
410.0 (Forecast)
368.5
398.4
488.5
200 500 600300 400
–30 –20
10
09
08
07
6.0 (Forecast)
–1.2
–15.1
–18.9
–10 100
050
10
09
08
07
183 (Forecast)
171
168
219
200 250100 150
Japan
Targeting Increased Sales Volume in Each Region through Global Rollout of New Compact SUV
In fiscal year 2009, automobile demand, which had declined significantly in the second half of the previous fiscal year, started to
recover in many regions. MMC’s automobile retail sales volumes increased as the fiscal year progressed, but full-year sales rose
year on year in only some regions. However, during fiscal year 2009, MMC continued to implement the emergency measures of
rigorous cost reductions initiated in the second half of the previous fiscal year. As a result, the entire MMC Group succeeded in
increasing operating income.
In fiscal year 2010, aggregate demand is expected to decrease due to the reduction or termination of governmental demand
stimulation policies in Japan and Europe. However, the U.S. is showing a mild recovery, and emerging nations are already in a
phase of powerful growth. In this market environment, MMC aims to increase both earnings and profit across the whole MMC
Group through increasing sales volume in all regions, including by globally rolling out a new compact SUV.
Fiscal Year 2009 Performance
Retail Sales
Retail sales in Japan increased 1%, or 3,000 units, year on year to 171,000
units. MMC increased retail sales despite lower year on year sales of minicars
partly due to a delayed recovery of aggregate demand. The increased sales
were driven by registered vehicles including the Colt series and Delica D:5,
which had received the benefits of the reduced taxes on eco-friendly cars,
and the strong launch of the RVR new compact SUV introduced in February.
Net Sales and Operating Income (Loss)
[Decreased sales, reduced loss]
Net sales in Japan declined 8%, or ¥29.9 billion, year on year to ¥368.5
billion partly due to a fall in the sales volume of OEM-supply vehicles. Oper-
ating loss improved ¥13.9 billion from the previous fiscal year, to an operat-
ing loss of ¥1.2 billion. The improvement was due to a rise in profits from
new vehicles through increased sales of registered vehicles and to cost
reductions, especially in selling expenses and materials costs.
Outlook for Fiscal Year 2010
Retail Sales
In fiscal year 2010, MMC is targeting domestic retail sales of 183,000 units,
an increase of 12,000 units, or 7% year on year. Although reduced demand is
anticipated after the expiration of subsidies for environmentally friendly
vehicles, increased sales are projected from the Mitsubishi “Aichaku”
Project*, launched from June, as well as increased retail sales from the RVR
new compact SUV introduced in February. Sales of the i-MiEV to individuals
commenced from April, with the final cost to the customer of ¥2.84 million
after government subsidies and a ¥619,000 reduction in the manufacturer’s
suggested retail price.
Net Sales and Operating Income (Loss)
[Increase in sales, return to profitability]
In fiscal year 2010, MMC is targeting net sales in Japan of ¥410.0 billion, an
increase of ¥41.5 billion, or 11%, year on year. The main factor underlying
this target is higher retail sales. MMC is targeting an operating income of
¥6.0 billion, an improvement of ¥7.2 billion year on year from the operating
loss of the previous year. In addition to higher retail sales, the main factors
underlying this target are reductions in material costs and other costs.
* Mitsubishi “Aichaku” Project: A sales promotion campaign conducted together with dealers
nationwide aimed at persuading customers to keep their MMC vehicle for longer. The campaign’s
“Aichaku” coupons offer various benefits, of which the main three are: (1) the first Japanese
manufacturer’s special extended guarantee for 10 years/100,000 kilometers to enable customers
to continue driving their newly purchased MMC vehicle with peace of mind for a long time, (2) on
the assumption that customers will use their MMC vehicle for 10 years, an upgrade service to
remodel the vehicle interior/exterior, install a moveable front passenger seat, etc. in response to
vehicle aging and customer lifestyle changes, and (3) a free replacement service of the battery for
the vehicle’s keyless entry device to encourage MMC users to visit our showrooms.
Net Sales
Operating Income (Loss)
Retail Sales
(FY)
(FY)
(FY)
(¥ billion)
(¥ billion)
(Thousand
units)
Regional Topics
We will aim to return to profitability by increasing sales with our new RVR compact
SUV, and the Mitsubishi “Aichaku” Project. We have lowered the price of the i-MiEV
and commenced sales to individuals.
Tetsuro Aikawa
Managing Director, Head Officer of the Headquarters, Domestic Sales Group Headquarters
16
MITSUBISHI MOTORS CORPORATION Annual Report 2010