AKEBONO REPORT 2017

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Review of OperationsIn August 2016, AKBT celebrated its 10th anniversary. During the event, awards were given for in-house contests and a commemorative tree was planted, and other activities were held for the 400 or so associates who attended. AKBT was established in 2006 as a production base for automotive disc brakes and pads. In 2011, severe ooding in Thailand halted customers’ operations, creating a difcult situation that AKBT was able to overcome thanks to the combined efforts of its associates. In 2012, local production of pistons, a key component in brakes, commenced at AKBT, contributing to the development of Thailand’s automotive industry. AKBT will continue working toward the realization of sustainable growth along with local communities. AAIJ has undertaken a companywide initiative to make various improvements with the aim of enhancing the skills and abilities of each associate and for the Group as a whole. This initiative has had measurable results, with AAIJ scoring highly at customer improvement contests held in 2016. AAIJ won the Astra Daihatsu Motor Supplier Clubs Contest held in February 2016, and in September nished the Yamaha TVP Lean Kaizen Festival 2016 among the top ve best suppliers. Moreover, AAIJ won the Astra Group’s Automotive Division Contest held the same month, going on to enter the main event, which includes various industries gathered together. In December, AAIJ was a winner at the Toyota Kaizen Festival. While continu-by 1.3% year-on-year to JPY16.3 billion. With regard to prots, higher materials expenses caused by a weakening of the Indonesian rupiah and increases in labor expenses caused operating prot to decline by 17.9% year-on-year to JPY1.4 billion.Outlook for Fiscal 2017In China, net sales are set to increase as tax breaks for compact cars have been extended by another year, albeit on a reduced scale, and demand for SUVs is growing stronger. In the ASEAN region, we anticipate growth in the automobile market in Indonesia, supported by government investment in infrastructure. In Thailand, the Company forecasts higher sales as the economy recovers. Altogether, Akebono expects sales to increase further year on year in the Asia business. The Company is focusing efforts on improving earnings by strengthening management amid intensifying market competition. Overview of AKBTAssociates427 (342 direct employees, 85 indirect employees) *As of July 2016BusinessProduction and sale of disc brakes and pads, etc.Work hoursTwo shifts per day (8am-5pm, 8pm-5am)History2006Company founded, caliper manufacturing plant construction started2007Finished construction of caliper manufacturing plant, started production of calipers, began construction of brake pad plant2008Finished construction of brake pad plant, held grand opening ceremony, began deliveries of calipers and brake pads2012Finished construction of piston manufacturing plant, began production of pistonsing to rene skills and abilities, AAIJ aims to become a truly global supplier out of Indonesia. Akebono Brake (Thailand) Co., Ltd. (AKBT) Celebrates 10th AnniversaryPT. Akebono Brake Astra Indonesia (AAIJ) Wins Customer Improvement ContestThe Anniversary EventThe Toyota Kaizen FestivalAKEBONO REPORT 2017 28Part 2 Review of Operations