Hisataka NobumotoPresident and CEOAkebono Brake Industry Co., Ltd.Also, we have made the development of products for the globalplatform systems being adopted across the automobile industryworldwide a high priority. Automakers expect us to deliver not onlyhigh performance but also competitive pricing. We are reviewingour manufacturing footprint across the globe to ensure thatAkebono has a production network that covers all major marketsaround the globe and is capable of efficiently delivering productsthat satisfy the quality requirements of each market.We have to be successful in these initiatives because in doingso we will overcome the challenges presented by these initiativesas we move our company ahead of the globalization of our industry.With these in mind, we will further reinforce our quality assurancestructure to bolster product safety and quality, two core requirementsof Akebono’s operations. Simultaneously we have to maintainour cost competitiveness in emerging markets through thedevelopment and introduction of differentiated products. Thisrequires us to address issues related to production lead times thatare becoming more complex and growing longer as our productionnetwork expands worldwide. To that end, we will operate with amanagement structure capable of handling all of these challengeswhile allowing for global fluctuations in operational risks.“C&S+t” Initiatives Aimed at “Making a Difference with Next-Generation Technologies”The Akebono Group is committed to disseminating its manufacturingexpertise and principles to locations throughout the world,sharing the knowledge and experience it has accumulated inJapan. To that end, it is important to establish universal standardsfor products and production methods as the foundations of manufacturing.To achieve this, efforts are now under way to promote“C&S+t” initiatives, that is, “Commonization and Standardization”plus enhanced product features (which we call “topping”) initiatives.Each of these initiatives is critical to our achieving thesegoals. While promoting C&S in all aspects of business operationsto improve efficiency, we must incorporate enhanced product featuresthat precisely meet local market needs and raise our competitivenessin every market. The continuous pursuit of C&S+tinitiatives will ensure customer satisfaction with regard to suchpractical considerations as cost, production methods and productperformance. Moreover, this effort directly advances the aforementionedpriority of “making a difference with next-generation technologies.”We strongly believe that wholehearted commitment to thiseffort is the best and only way for us to maximize customer satisfaction.Guided by this belief, we must disseminate the “One akebono”manufacturing approach and put it into practice worldwide.Strengthening Organizational Capabilities through the Promotionof Diversity and CommunicationAlong with the pursuit of C&S+t initiatives, we have to nurture thegrowth and development of our staff and associates as a core principleof true globalization. At present, 60% of the Akebono Group’snet sales are generated outside Japan and 60% of Group associatesare working outside Japan. To be a successful global player,we have to embrace our diversity and learn from the different perspectivesfound within our company.Similarly, specifications with regard to product functionality andperformance can vary by county and region, and we need to alwaysbe sensitive to that to ensure that our manufacturing operationsare responsive to each market. Taking the above into consideration,we stepped up our focus on human resources with theestablishment of the “Ai-Village” global training center in December2012. Serving not only as a training facility, Ai-Village is equippedwith a lounge, accommodation for visitors and kitchen facilities forinformal exchanges among the participants from around the worldin our training programs. Ai-Village is a learning center that aims tocreate a home away from home where there is an exchange amongassociates from Group operations worldwide. By establishing afacility that allows visitors to experience other cultures withoutleaving Japan, Ai-Village is expected to facilitate communicationsand understanding among associates with different nationalities,languages, and other backgrounds, thereby enhancing the organizationalcapabilities of “One akebono.”Reconfirming Akebono’s Significance as a Provider of AbsoluteSafetyBrakes are not merely car parts; they are indispensable automobilecomponents that ensure safe and smooth driving. We encourageall who work at Akebono Group companies to take great pride inthe fact that they deliver safety and security to people throughoutsociety through the production of superior brake products. By recognizingthe importance of the significant contribution they make tosociety, we hope to stimulate the kind of proactive thinking andresponse to challenges that provide both personal fulfillment andcorporate success. Launched in 2005, corporate brand managementis one initiative promoted in line with this aim. Guided by theidea that every associate should be an advocate of the Akebonobrand in their day-to-day operations, we will achieve greater recognitionfor our company among all of our stakeholders.We hope that all our stakeholders will find that the AKEBONOREPORT 2013 gives them a better understanding of our globalmanufacturing operations and our goals. We ask all of you for yourongoing support and invite your comments about this report.June 2013