Good evening. Thank you for participating in the FY ‘20 financial results meeting today.

Now, the COVID-19, which has been rampant around the world since the beginning of last year has had a major impact on the global economy and demand for automobiles. At last vaccination began in each country, and it seems that it is gradually regaining stability.

However, conditions still remain unpredictable, such as the spread of new variants of COVID-19. FY ‘20 marks the 50th anniversary of our Foundation, and was the year of change, the first year of our new mid-term plan.

Under the new mid-term plan, which called for further promotion of selection and concentration, the first priority was to implement cost structure reform. And we immediately embarked on measures.

And I think that we made significant progress than expected and successfully took the first step. Today I would like to talk about the result of FY 2020, the forecast of FY 2021 and an update to our new mid-term plan, Small and Beautiful.

Afterwards as much as the time allows we’d like to take your questions. Now, Ikeya-san, the floor is yours.

First of all, we would like to explain our global total sales for FY 2020. Our total sales in our region decreased by 29% from the previous year to 801,000 units.

First in the ASEAN region, which is our core market. Although there were differences among countries, including Indonesia, where severe condition continues and Vietnam we’ve succeeded in curbing COVID-19, the pace of overall recovery was slow as I mentioned earlier.

And in addition, Thailand, where economic activity has stagnated again since the end of last year due to the re-expansion of COVID-19 continues to face severe conditions. On the other hand, in Indonesia, where the recovery was slowest.

Times of the recovery were finally confirmed as a result, sales in FY 2020 fell 35% year-on-year to 189,000 units. In Australia and New Zealand, automobile demand continues to recover gradually.

And we also posted sales in line with the market recovery, falling 18% from the previous year to 72,000 units. In Japan on a whole market, although demand for automobiles recovered to a certain level, however, we prioritized structural reforms such as restraining fleet sales and reviewing selling prices, and our product lineup was insufficient in the segments that were driving the recovery of the market.

As a result, sales fell 23% year-on-year to 73,000 units. In other regions, sales in China and North America declined by a little less than 30% year-on-year as a result of prioritizing improvements in the quality of sales like in Japan.

Sales volume in other regions, including Europe, Latin America, Middle East and Africa were in line with a decline in the market. Next page, please.

Please refer to the FY 2020 full year results summary based on the actual unit sales. As I mentioned earlier, the global sluggish demand for automobiles due to the spread of COVID-19, which had emerged since the beginning of last year is gradually regaining stability in developed countries.

However, the recovery in the market in which we excel was delayed and the condition remains to be. On the other hand, while there were no noticeable new car launches, our results bottomed out in the first half, due to the effects of reducing sales expenses and improving the grade mix and we saw a significant improvement from Q3.

As a result, net sales for the full year decreased 36% from the previous to JPY 1,455.5 billion. Operating profit was nevertheless affected by these factors.

However, our company-wide efforts to reduce expenses and the fixed costs and structural reform activities contributed in reducing the loss to JPY 95.3 billion, which is an improvement from the full year forecast of JPY 100 billion and operating loss announced in February. Ordinary profit was negative JPY 105.2 billion and net income was negative JPY 312.3 billion, mainly due to the recording of an extraordinary loss from the implementation of structural reforms.

Free cash flow turned negative again in the fourth quarter, partly due to expenditures for recording and structural reform related costs. But the overall improvement trend continued and the cumulative negative amounts shrunk significantly.

And in Q4, which is January to March, net sales were JPY 502.7 billion, operating loss was JPY 8.6 billion, ordinary loss was JPY 12.3 billion and net loss was JPY 68.3 billion and in sales about 232,000 units. Bottoming out in the first half of the fiscal year, earnings momentum has steadily recovered.

Please see Page 5. The factors behind the year-on-year changes in operating profit as shown in the slide.

In terms of the volume and mix, a decreasing unit sales had a negative impact of JPY 136 billion. However, an improvement in mix and selling prices had a positive effect of JPY 8.4 billion, which reduces the deterioration to JPY 127.6 billion compared with the previous fiscal year.

In line with our plan of selection and concentration, sales expenses in non-core regions were kept down, while concentrated investment in core regions led to an increase in profit of JPY 8.1 billion over the previous fiscal year. Cost reduction was JPY 22.2 billion year-on-year, mainly due to material cost saving reduced by the prolonged impact of production adjustment in the first half of FY 2020.

Structural reforms, which we have implemented since the beginning of the fiscal year progressed at a faster pace than we expected. And those produced a positive effect of JPY 35.6 billion.

In addition, R&D expenses improved by JPY 18.9 billion due to the streamlining of R&D through the selection and concentration. Other element frozen by JPY 24.6 billion year-on-year, mainly due to the duration of the after sales business and quality related expenses.

Although the yen continue to depreciate, resulting in a positive effect of JPY 3.7 billion from the previous fiscal year. Page 6, please.

This slide explains the factors behind year-on-year changes in operating profit for the Q4 of FY 2020. The volume and the mix were affected mainly by a decrease in unit sales, resulting in a decrease of JPY 13 billion in operating profit.

Sales expenses increased slightly in Q4 due to the launch of new cars and the resumption of marketing activities through a lockdown mitigation. However, we were able to control overall expenses in line with the plan and generating a positive effect of JPY 1.8 billion.

And cost reductions such as material costs were affected by lower capacity utilization and by – soaring raw material prices, resulting in a decrease of JPY 13.3 billion. R&D expenses were slightly negative year-on-year, mainly due to the impact of the development of new products now underway for the ASEAN region.

Other impacts were also negative year-on-year mainly due to deterioration in warranty claim expenses and deterioration of domestic subsidiary business. On the other hand, structural reform activities continued to have the effect of increasing a profit by JPY 10.1 billion.

And ForEx also had a positive effect of JPY 3.7 billion due to the impact of the yen depreciation trend. Page seven, please.

So in FY 2020, we also focused on reducing inventories. As a result as shown in the graph.

We were able to reduce more inventories unplanned resulting in healthier level of inventory. We will continue to collaborate with each region at all times in an effort to maintain healthy inventory levels and expand sales with quality.

And next is I would like to explain our financial outlook for FY 2021. Please look at Page 9.

The global automobile demand which fell in 2020 due to the spread of COVID-19 will not recover to its previous level, but it’s expected to recover to a certain extent, partly due to the support of economic stimulus measures in each countries. On the other hand, the current business environment surrounding us remains unstable due to the spread of COVID-19 variants and surging commodity markets and the risk of supply chain disruptions mainly due to a shortage of semiconductor supply.

Despite this uncertain external environment, we expect FY 2021 performance to be JPY 2.06 trillion in net sales, JPY 30 billion in operating profit, JPY 26 billion in ordinary profit and JPY 10 billion in net income by recovering sales in our core region, and by continuing to promote structural reforms sustainably. And the retail sales forecasted at 957,000 units.

Regarding the forecast for dividend per share, we consider the return of profits to shareholders to be one of our important policies. And our basic policy is to pay dividends based on maintaining the stable dividend and in consideration of our business performance, financial condition and other factors.

However, it is still unclear whether we will constantly secure funds for dividend payments. We therefore sincerely regret that we forecast non-dividend payments for FY 2021, we will endeavor to resume dividend payments as much as possible and we ask for your continued understanding and support.

Page 10, please. As I mentioned earlier, the difficulty of forecasting the future is increasing on a daily basis.

The COVID-19 crisis is still unpredictable and a worldwide shortage of semiconductors is expected to have a major impact on automobile manufacturing, including us. On the other hand, the automobile market is on the recovery trend.

In particular, the ASEAN market, which is our core region, which had been slow to recover is also showing recoveries, except for some areas. Taking into account, these changes in the external environment, the introduction of our flagship model of new Outlander and the renewal of products in the focused ASEAN region.

We are forecasting unit sales in FY 2021 of 957,000 units and around 20% increase from the previous fiscal year as you can see in the slide. In ASEAN, which is our core market, we anticipate a 47% year-on-year growth in sales to 277,000 units due to a visible recovery in the delayed market the effect of a renovation of existing models and the strengthening of our sales network and another core market, Australia and New Zealand, we forecast a 26% year-on-year growth to 91,000 units due to the forecast of continued recovery and the scheduled launch of the new Outlander and other models.

In Japan, the home market, although the impact of the spread of COVID-19 is uncertain, we forecast that favorable recovery trend will continue due to the expansion of vaccination. Accordingly, we forecast a 29% year-on-year increase in sales to 94,000 units.

In addition, in the Chinese market, which is already recovering, we forecast a slight decrease of JPY 0.1 million year-on-year. In North America, where we have gone from the favorable start for new Outlander, we forecast a 36% increase to 154,000 units.

And in Europe, where we froze the development of new models, we forecast a 13% decrease to 125,000 units. Page 11, please.

The factors behind year-on-year changes in the operating profit forecast for FY 2021 are shown in the slide. In terms of the volume mix and the selling prices, our total positive effects of JPY 90 billion is expected mainly due to the expansion of sales mainly in the ASEAN region of our core market, which is on the recovery trend, despite some impacts from the shortage of semiconductors.

Regarding selling expenses, as in the previous fiscal year, we will drive cost effectiveness by concentrating expenditures on core regions and sales of new vehicles. Cost reductions are expected to have a positive effect, totaling JPY 12.7 billion by promoting activities to reduce procurement costs.

Despite the negative impact of soaring raw material prices and the shortage of semiconductors. We expect R&D expenses to deteriorate slightly compared to the previous fiscal year due to progress in development for core regions and segments.

In addition, an upturn of JPY 17.8 billion is assumed due to the full year effect of structural reform costs. Regarding the impact of foreign exchange rate, an upturn of JPY 21 billion is forecasted based on the assumption that the yen will continue to depreciate as a whole.

And next page, please. In FY 2021, we will continue to strengthen our product, the new Outlander is an iconic driver for the future turnaround.

In the world premiere event held on Amazon’s online site in North America in February, there were approximately 0.6 million live viewers and more than 440,000 dedicated website viewers as of the end of March, both of which were more than double our expectation or the target. Customer feedbacks at the retail outlets are extremely positive as well, and we feel a great response.

In addition, the new Outlander PHEV model will be launched globally, starting with Japan this fiscal year. We will introduce a dramatically revamped XPANDER for the ASEAN region of our core market.

In addition, we will expand the sales countries of the new PAJERO SPORT and Mirage models. We will also expand exports of the XPANDER from the ASEAN to other regions, including the commencement of exports to Mexico.

Next, we will give you an update on the mid-term plan, Small but Beautiful. Kato-san, please.

Our structural reform activities announced in July last year have progressed more than originally anticipated, and we were able to achieve a reduction plan of 20% or more in two years, one year ahead of schedule. Although there were some painful measures, such as the implementation of the voluntary retirement system, we achieved a reduction of approximately 10% from 20,000 headcount on a global basis.

All of the reorganization of the production system has also progressed as planned. In addition, many fixed cost reduction measures taken in the previous fiscal year, such as the recognition of asset impairment losses are expected to result in greater reductions, because they will be effective throughout this fiscal year.

On the other hand, we will aggressively invest in growth from this fiscal year such as advertising cost for new car launches and new product development to launch from FY 2023 onwards. However, we plan to cover these investments with a full year contributions of fixed cost savings and reduce the total value to roughly the same level as the previous year.

Please go to the next page. In Europe, where we decided to freeze the development of new products, we also began reorganizing our sales network.

As we have already announced, we have decided to withdraw from the new car sales business in 15 out of 32 countries by 2023 and at the same time, in order to optimize our product lineup, we have decided to receive an OEM supply of two models from Renault, our alliance partner. Through the implementation of these measures, we will optimize development resource as a whole and improve the European business profitability.

And we’ll continue to carefully examine the potential for future business in preparation for stricter environmental regulations and changes in market trends. Next page, please.

In the core region of ASEAN and Oceania, we will implement initiatives that are appropriate for each country in order to further increase our market share and expand the sales. First, the market environment in Thailand and Philippines, where we were exposed to fierce competition amid COVID-19 in FY 2020, is expected to remain harsh in FY 2021.

We recognize that it will take a certain amount of time to regain market share. Although we are implementing measures to address each issue.

Against the backdrop of a challenging business environment, we will prepare for a turnaround and accelerate the strengthening of our sales network. On the other hand, we anticipate that strong sales momentum will continue in FY 2021 in such countries as Indonesia, where the market is recovering steadily due to luxury tax exemption and the measures to relax down the payment limits for our drop in loan.

Malaysia, where sales and profits continue to expand through strong sales of XPANDER and TRITON and Vietnam, where we achieved record high unit sales amid remarkable market expansion. In addition, in New Zealand, where we achieved record high market share in the last fiscal year, and in Australia, where the exchange rate moved favorably, we will further expand unit sales through the introduction of new Outlander and ECLIPSE CROSS PHEV, which have been very well received after the launch.

In this way, in countries in such a difficult environment, we will steadily implement measures. And in other countries where we can expect opportunities, we will firmly see the opportunities and do our utmost to achieve the firm for the current fiscal year.

Please go to the next page. Next, I would like to talk about future product development.

Since the announcement of our new mid-term plan last year, we have focused on core regions where we can leverage our strengths and have really defined our Mitsubishi Motors for sustainable growth over the medium-term to long-term. First of all, we believe that the idea or form we aim for Mitsubishi Motors that is safety, security and comfort focusing on the environment.

Specifically, we intend to manufacture our cars that will enable our customers to experience our strength in electrification technologies, SUV technologies with a high level of offer driving power and comfortable performance in functional and pleasant interior. Next page, please.

The first thing is our policy for environmental initiatives. In November of last year, we set the target shown on the slide in the new environmental plan package.

To achieve these goals, we will set up electric vehicles for all models by 2030. In addition, we will actively introduce electric vehicles to countries and regions where infrastructure is being developed and regulations are being further strengthened.

At the same time, we plan to strengthen our competitiveness by introducing PHEVs and EVs in advance for countries and regions where infrastructural facilities and environment regulations are still in the development stage and will progress in the future while offering products that meet regional demand. Next page, please.

Page 19. So, as you know, we are a pioneer in EV manufacturer.

And we have technologies and knowhow that we can be proud of all over the world. In 2009, we launched i-MiEV, the world’s first mass produced EV and opened the door to popularization of EV.

Later we introduced our MINICAB MiEV to expand the field of commercial use of EV. In PHEV, the Outlander PHEV launched in 2013 is the world’s first SUV type plug-in hybrid, and has become the world’s best-selling plug-in hybrid vehicle with number one global unit sales in cumulative terms since its launch.

In FY 2020, we added our new PHEV to ECLIPSE CROSS and received strong orders both domestically and in Europe. And during the current fiscal year, we plan to introduce a PHEV model of the new Outlander, which was recently launched.

In addition, as I mentioned that the announcement of the mid-term plan last fiscal year, we are also advancing joint development with Nissan of Kei-car EVs and plan to further strengthen our lineup of electric vehicles. Please go to next stage.

We believe that our strength for electrification is to have various options through the Alliance and our proprietary technologies. Specifically, while utilizing our proprietary technologies of PHEVs and EVs, we can also leverage the electric units and components of other companies in the alliance or provide model developed in our PHEV and foundry or unit to other companies.

In the future, we believe that the Alliance Group will be able to standardize its more efficient electric units and components. By combining these wide ranging component options, we will meet the needs of each country and region and successively rollout attractive product that incorporates the unique characteristics of Mitsubishi Motors-ness.

Please go to the next page. We believe that initiatives that are rapidly advancing toward the zero carbon society present a major opportunity for us.

Of these, we think that light commercial EVs are one optimal solution to the last one mile in logistics. The MINICAB MiEV is highly regarded as an easy handling commercial EV, because the power of the motor, quietness and the convenience of not requiring refueling.

Due to the growing interest in carbon-neutral society, business opportunities are increasing, including one with Japan Post to which we have already delivered our EVs. By June this year, we will have introduced 200 units on a trial basis to about 20 companies.

And we will work together with some companies to improve our products. We plan to collect product requests and introduce improved models that reflect our customers’ various requests within two to three years.

Commercial mini EV business negotiations have also begun in ASEAN and where the logistics networks will be established in earnest in the future. Going forward, we will further make product improvements and carry out demonstration tests to contribute to society with companies in various industries.

Please go to the next page. We believe that PHEV at the core of our electrification technology is immediate optimum solution to a rapidly spreading decarbonization society with the advantages shown in the slide.

First of all, we would like to highlight the smallest environmental burden that is the superiority in terms of the lifecycle assessment. CO2 emission of PHEV based on lifecycle assessment is less than the EV at the moment, and it is superior in total environmental performance.

Next, in ASEAN, the core region for us where environmental regulations will be tightened in the future, countries will begin to develop infrastructure. In such an infrastructure environment, we have seen that plug-in hybrids that can be charged at home and can drive on gasoline and generate power on their own will be one good solution.

By incorporating these superior PHEV into SUVs that can maintain high performance in any road conditions. We will promote them as the only model having driving performance that can take drivers anywhere without worrying about electricity shortage.

Next page, please. In addition, through products equipped with our electric power technology, we intend to provide a variety of value to all users for their environmental efforts.

For example, for corporations, we believe that it will be useful in reducing CO2 associated with business operations. We also believe that it can be used as a source of electricity in an emergency.

For municipalities, we anticipate that we will be able to provide added value, including the supply source of electricity in the event of disaster and electricity support during the transportation of vaccines for COVID-19, which are becoming fully fledged. For consumers, it is not only useful for achieving SDGs at the personal level, but it can also be a source of electricity in the event of disaster.

In addition, we are advancing V2X initiatives as a secondary utilization of the contribution to the community. Specifically, we are proceeding with the experiment to use EV as an adjustment resource for electricity and we intend to further develop it as a business.

Next page, please. In this slide, we introduce specific examples of our contributions to society through our electric power technologies.

We have already concluded disaster agreements with 113 local governments. And we are aiming to conclude contracts with local governments nationwide by FY 2022.

In addition to operations in the event of a disaster, we are participating in local government disaster prevention drills and increasing opportunities to promote understanding our power supply functions. In the event of a disaster, PHEVs can supply more power by using power generation by the engine and can become an optimum power source.

In addition, as released on April 28th, we decided to lease Outlander PHEV to Minato were as a vehicle for vaccination for COVID-19. In addition, we have received inquiries from multiple local governments and we intend to respond to them sequentially.

These efforts will be part of Dental Community Support Program which we have been promoting since August 2019. We will continue to pursue the potential of humility and create a vibrant society through the promotion of Dental Community Support Program.

Next page, please. Other than that, we will further refine Mitsubishi Motors-ness.

One part of that is that, we have decided to relaunch a Raleigh art brand for customers in Mitsubishi Motors plant who want to add to Mitsubishi Motors-ness even more. In the future, we plan to develop items, genuine accessories for a wide range of models, and we would like to take opportunity to be involved in motor sports as well.

As I mentioned at the time of last year’s mid-term plan announcement, we have been accelerating development in order to further enhance our products in FY 2022 onwards. In ASEAN, starting with our next generation TRITON, we will renovate our existing products and strengthen our product lineup.

In addition, we will gradually launch completely new products utilizing the ASEAN performance plan, we will do our utmost to further strengthen our brand by enhancing our lineup in each segment. We also plan to introduce cars that S-body Mitsubishi Motors-ness in other regions as well.

Please go to the next page. Finally, we created the video for the development of the Outlander PHEV in order to share with you.

Our enthusiasm for development, which is our crystals. We have posted a limited release link in today’s presentation materials that was posted on our website.

So, please take a look at it later. In FY 2020, we prioritized structural reforms focused on selection and concentration.

As a result, reforms progress faster than expected, and we were able to exceed our initial targets for the full fiscal year. We also believe that the effect of the structural reform will continue to contribute to the improvement of our profitability in the current fiscal year and beyond.

On the other hand, global automobile demand is polarized between countries that are recovering, particularly in developed countries, where vaccination has progressed in other countries that are still experiencing stagnant economic activity due to the spread of new coronavirus variant. In addition, the impact of the shortage of semiconductors and soaring material prices is extremely serious in the current fiscal year, and the environment surrounding us remains challenging and uncertain.

However, even in this challenging environment, we believe that our profitability has improved steadily over the previous year. So we will strive to achieve steady profitability in fiscal 2021.

Thank you for your attention.

Can you hear me?

Yes.

Thank you. So I have two questions.

One is about the say, likelihood of the plan for this year. I’m looking at Page 11.

So you mentioned quite a lot about the semiconductor supply issues and the soaring of the material prices. And what are your assumption of those impact on your sales volume?

And also, you see JPY 37.4 billion negative. So we’d like to know about the likelihood of the risk that you are assuming in your plan?

And also the second question is therefore the past term, so you have reduced the deficit from by about – to JPY 140 billion. So that’s a significant reduction through the structural reform related cost reductions.

So we would like to know, what is your plan for this coming term in terms of the structural reforms?

This is Ikeya speaking. So let me answer to the first question.

So the Page 11 about – among the JPY 30 billion yen, and how much of the risks especially for the semiconductor issue, take into account. So that was your question.

And so with regard to the supply of semiconductor, as far as we know, so for the first half of the year, it will impact to about 80,000 volumes, net unit and so we are trying to recover the impact in the second half. So by expanding the sales of the vehicles that are not – that did not have the equipment, which does not have the equipment, which will face the supply shortage, and by expanding that, we’ll be able to at least mitigate that impact by half and so 40,000 units.

So this marginal profit of 40,000 units take into account in this result. And also about – the second question is about the raw material.

Raw material price and others and you see JPY 37.4 billion negative and the majority of the JPY 37.4 billion coming from the raw material, especially rhodium and palladium, those prices are soaring since beginning of this term. So we are regarding those as a quite a big risks and we already incorporated those risks in our plan.

So that was my comment to the risk.

This is Kato speaking, and let me add additional comments. So those numbers he mentioned already part of our forecast, but there is a possibility that the risk may become bigger than what we assumed.

So if the steady increase in the risk is within our assumption, then of course, we can absorb that even in the second half of this year, say the if the COVID impact still continues, the supply of semiconductors still having difficulty in recovering, those risks are still there. So if such an unexpected the risks emerged, then may put us in a very difficult situation.

But for this term, we will implement our plans understanding that they also have uncertainties, and also the cost reduction activities to the likelihood of JPY 50 billion next year because of the cost reduction activities in structural reform. Of course, we cannot categorically make an announcement or commitment.

But in the first year of the structural reform, we made a lot of progress in reducing costs. So because the initial plan was to work on the cost this year and next year as well, because most of the ideas are implemented, and the impact will last for throughout the year.

So when we announced the mid-term business plan last year, we made certain assumption but the impacts from the cost reduction activities from previous term were bigger than our assumptions. So are we going to continue work on the cost reduction?

Or are we going to make – are we going to use the money set aside for advertisement or make an investment further? So making this good discernment on how to use such resources is our strength, I believe, because, and we’d like to utilize those generated like spot cash for increasing the sales or the top line.

And but at the same time, we believe that there’s still room for reducing the cost. So maybe because of the – what you see on the table is higher than the previous level.

Thank you very much.

And about, say JPY 87.3 billion, the volume – so 833,000, the volume is talking about we actually – I was actually thinking about expecting more increase than 87.3. Well actually for our inventory level is quite low.

And we’d like to maintain this, say, healthy level of inventory. And if we can maintain that level, then 87.3 will be the plan that we believe that we’ll achieve.

But say if the say, the economy recovers faster than we expected, of course, I’m sure we will have more volume. So we would like to be flexible for that.

But this number, 873 that you see is under the assumption that we maintain a low level of inventory or a healthy level of inventory.

Thank you very much.

Thank you. Do you hear me?

Yes.

I have two questions. The first question is market condition.

Yeah. US and Australia, the market is good and the response of, you said that you had good response about the Outlander.

And then you cited the example of Amazon, corporation with Amazon. So I would like to understand more about your view on demand for Outlander.

And then, yeah, any impacts on Outlander sales about the shortage? And I’m looking at Slide 26.

So this is the ASEAN models like after 2022. And for the ASEAN, existing models with hybrid for XPANDER and then 2 hybrids coming up.

And I see 2 more silhouettes toward the bottom. So do you mean that the models to be sold in ASEAN will be launched in other region than ASEAN?

So could you elaborate a little bit about the specific models then specific regions that these models will be sold?

Okay, to your first question, Yatabe will answer your first question about our new Outlander. As I was explained in the presentation last month in the US we released this in the US, last month.

And the response from our dealers has been quite strong and promising. So talking about this year sales, the sales volume in the North America, we would like to increase our sales volume primarily with the Outlander.

And the impact of semiconductor shortage, there will be some impact. So for now, we would like to focus on a higher grade model and we hope to sell them at the higher price.

And as of now, so is the level of incentive is lower compared to the ones we use in the past so that we can take your profit. And as we – it’s promising that we can increase volume compared to the older models.

Talking about Australia, that number that we have not launched yet. In Australia, but we have some success stories from North America, so based on that we would like to be well prepared for the launches in Australia and New Zealand.

And also, yeah, we will launch gradually like into domestic market. So this is the biggest kind of a model for us to launch this year.

That is all.

Okay. My second – Nagaoka is going to answer your second question.

The ones at the top. Those are the products for ASEAN market.

More specifically it’s XPANDER HEV and next generation XPANDER. And we utilize that platform to launch 2 new models.

So we will develop in parallel so that we can attach XPANDER HEV to these new models. And it’s 2 at the bottom, they are totally different from the ones at the top.

So this is for global market, including Japan. So about specific platform.

So this is a New Outlander or popular ECLIPSE CROSS. So those can be potential base of those new models.

Unfortunately, I cannot disclose anything in detail. But we hope to develop cars, new models with full of Mitsubishi Motors-ness.

Thank you, please.

Yeah. Thank you very much.

Okasan Securities, Naruse speaking. Can you hear me?

Yes.

So I have two questions as well. The first question is kind of, it’s a confirmation of the first question, so about the volume plan for this term.

So I understand the pressure had changed initially. So last time, 836 units.

And then, including the inventory adjustment of 150K. Now it’s 350K.

I think that was what you communicated three months ago and you mentioned 40,000 related to the semiconductor supply, but you also explained that you don’t have a plan to increase the inventory level. So I would like to once again, have clarity on say, the inventory, and also the retail sales.

So if you can give me more clarity on your direction? And second question is that, this is also a follow-up question from the previous time.

So page number, page 20. So like you mentioned earlier, like simplified PHEV, your exclusive high – and also e-POWER those you already mentioned in the previous session.

But if you can inform us of your status update, because now you are giving us more information about say, the number of models. So if you can elaborate a little bit more on your plan on this page?

So the first question, this is Yatabe speaking. So about the sales volume or retail volume.

So as we just mentioned, so from the numbers that were previously announced, so now we’re taking into account the impact such as semiconductor issue, and we dropped by several tens of thousands units. So that’s the plan and about the inventory.

So, in the previous session, we said we are reducing the inventory level significantly, taking into account the situation of the previous year, we do have a room to increase the inventory if we want to. So I think that was the comment that we made.

And the status remains the same. But according to our current plan, the current level which is say, a year from now, are ending in March 21, we are not planning to increase the inventory levels significantly maybe with increase of about say, several tens of thousands but not significantly.

Thank you very much.

And about the inventory. So it is possible for us to increase the amount.

But one point is about semiconductors. So at the moment, we cannot produce every quarter as much as we would like to.

So that’s another background that we need to take into account. So, I hope you understand.

Thank you.

And then the second question about the electrification. So this is Nagaoka speaking.

So like I mentioned earlier, so for the 2 vehicles in PHEV. More for say, global models.

But in the future how the ASEAN would develop, for example, including the restrictions from the government, depending on the situation, there’s still possibility and launching those plug-in PHEV in those markets as well. So this is not the final plan, but we have a plan to launch PHEV in many regions, and then also for HEV, ASEAN market, including new vehicles, and our main activities in ASEAN will be HEV, at the same time, we also have a plan to launch HEV in the global arena, as well.

And about Kei-car. One of our assets is other SUV, which is the commercial EV.

And we have a plan to do an update within the next two to three years’ timeframe. And that is also included in this slide.

And also with the alignment, collaboration with Nissan, we are going to have a plan to have the commercial KEV, which on the bottom of this page. So by leveraging on the electrification assets that the Alliance has, and we will use them as needed.

So we’re not planning to launch all of the, say, Alliance EVs, but for example, KEV or say, the HEV or e-POWER. So these are like – there are possibilities that some of the assets will be converted into those models.

And so for us, we make sure to leverage on the assets that we own to disseminate electrification, but also leverage on the assets, which are owned by our partners. And those are the strings that we can play with.

And in terms of our future, regardless of the unit, through the component level, if we can promote commoditization, for example, maybe we use the same model. But we will develop Mitsubishi plug-in hybrid, and then Nissan use the same model, but they will make their own, say, PHEV.

So and Nissan had started that discussion as well. So there’s a room for a larger site definition collaboration among the Alliance.

Okay. Thank you.

So compared to three months ago, you are having a better direction. And then also you have been making a progress.

Thank you.

Hello. Hakomori from Daiwa Securities.

Just two short questions. One biggest change since last presidential was that Indonesia?

So this is the reduction of the luxury tax. And I understand that the retail situation is improving.

And how is Indonesian market now for you in terms of the number of inquiries and orders? So I would like to hear from you about your expectation for Indonesian market?

That’s my first question. And the second question is the hybrid for the ASEAN market.

So I understand that your aspiration for compliance – regulatory compliance but from the consumers’ point of view, how do they see hybrid in the market? So if you could share some of your information concerning market research concerning hybrid cars?

Okay. Yatabe will answer your first question.

Talking about the Indonesia. Indonesian government you know last year, I just said due to COVID impact and their market was reduced by half or so.

But finally, you know the COVID situation seems to be slightly improving. So in order to better the situation, they reduced – the government decided to reduce the luxury tax in March.

And in order to bring the benefit of the reduced tax to the consumers as soon as possible, we took action and for example, situation in April. So we sold more than 10,000 units for the first time in a long time.

So 13 like we could achieve this good number. So we see very good response.

So May and June time we have very strong inquiries and interest. So a 100% luxury tax exemption is only up to June, and it will be reduced to 50% in the following months.

So how the market demand will change as a result of this change level of the assumptions. But for now, I think it’s very good now, good response and in the second half of the year, we will have a totally changed XPANDER.

So, we would like to continue the momentum so that we can make a good recovery towards the end of the year. Okay, so, ASEAN hybrid, Kato would like to answer your question about ASEAN hybrid.

The situation varies from country-to-country as to how the consumers see this. And then one factor is the requirements put forth by the government.

And also – so government subsidy to promote local production of the cars. So those are major factors, I think.

And from the customers’ point of view, you know and I think we need some more time until the consumer, local consumer truly feel the benefit of a hybrid vehicle. So we are closely watching the situation, but at Thailand where the regulation is more advanced.

So I think our consumers have a high recognition about hybrid vehicles. So regulation and maybe we are still in a stage where we need to carefully check the development of regulations and customers’ preference.

That ASEAN countries. In ASEAN countries, the interest in environmental consciousness is increasing.

So, we want to watch the situation how it develops very carefully.

Okay, thank you very much.

Thank you.