For Investors
Thank you very much indeed for your good offices.
I would like to express my sincere condolences to those people who have died of COVID-19, and my sympathy to those who have been affected and to all those involved. Also I would like to give a special thanks to the healthcare professionals and those who are making their efforts to prevent the spread of infection.
The automotive industry has entered the period of once-in-a-century transformation, and its structure is drastically changing amid a tide of technological paradigm shift like CASE. In 2020, the global pandemic of COVID-19 brought the severe economic recession which may take long to recover and added confusion to the dynamic changes in the industrial structure.
On the other hand, Sanden started its comprehensive structural reform several years ago to improve its management climate. Our efforts for reform, such as reduction in the fixed cost through optimization of the business portfolio, integration and reorganization of business locations and labor optimization, thorough asset efficiency enhancement, corporate governance improvement, etc., produced results steadily.
From the latter half of the fiscal 2018, however, the automotive market rapidly shrank and deteriorated due to the US-China trade dispute and the influence of European fuel efficiency regulations. We developed the mid-term management plan, SCOPE2023, in April, 2019 to survive under such circumstances, and started working on ‘5 Reform Plans’ as our priority strategies to carry out the structural reform for restructuring the management infrastructure and achieve continuous growth.
We transferred the commercial store systems business, which was one of our core business segments, in October of the same year to concentrate our management resources on the automotive systems business. Thus we changed the course of company and started transforming our business structure to be a partner company that is indispensable for developing environment-friendly vehicles especially in the ‘Thermal management system’ field.
On the core business front, we have been promoting collaborative creation for the ‘Thermal management system’ especially in the electric vehicle field. The on-vehicle tests for the Thermal management system were already started at Yattajima Plant, our mother factory located in Gunma Prefecture. We have achieved the effects as initially intended, so the partners and customers highly appreciate our success and place more expectations on us.
In addition, we were successful in acquiring new large-scale commercial rights and another commercial right for the new concept vehicle in 2020. In this way, our new pillar business domain for the environment-friendly vehicle shows steady improvement toward future growth.
In 2020, however, the whole world fell into unprecedented turmoil due to the global pandemic of COVID-19. In addition, the auto sales drastically dropped across the world especially in the European, Chinese, and Indian markets. As a result, Sanden group was forced to suspend its manufacturing operation at its major factories in the world.
Taking account of those adverse effects and uncertain futures, Sanden group filed formal applications for the Turnaround ADR Proceedings with the Japanese Association of Turnaround Professionals to establish a solid earnings structure for corporate turnaround and achieve comprehensive improvement in the financial structure. We deeply apologize for causing a great deal of concern and inconvenience to all concerned.
In the founding spirit of ‘Let Us Develop with Wisdom and Prosper in Harmony’, we will tackle corporate revitalization with unwavering resolve. We also endeavor to contribute to ‘create the affluent society’ as stated in the corporate vision.
We look forward to your ongoing support and cooperation.
