2015 New Year Message
ShareManagement
Happy New Year! I trust that everyone and their families, whether here in Japan or a member of overseas operations, had a safe and relaxing year-end holiday.
This occasion marks the second passing of the New Year since UACJ was founded, and also the end of another year of exciting progress for the UACJ Group. On behalf of the management, we are sincerely grateful for your ongoing efforts throughout 2014 and wish to express a special thank you to those members who worked during the holidays constructing new facilities and installing equipment.
On October 1, 2013, the UACJ Group was created with the aim of becoming an aluminum industry leader in a competitive global market. In the year and three months that have passed, we have managed operations based on decision-making standards that take into consideration what is best for the Group as a whole. Our most pressing issues have been “unification,” “optimizing synergistic effects generated by integrating business operations early on,” and “vertical startup of the Thailand rolling mill.” It is clear that all business sectors and departments have carefully addressed these issues in their respective areas of responsibility.
As part of the Vision for the Future management strategy announced in March 2014, the UACJ Group established three major policies for pursuing business growth:
- Proactively expand in growth fields and markets around the globe,
- Improve cost competitiveness through restructuring, and
- Develop revolutionary technologies and products.
One of our main tasks during the past year has been to optimize the post-merger synergies generated early on in our business activities. To accomplish this, a unified management philosophy and code of conduct were introduced for the entire Group, various company systems were consolidated, and personnel exchanges among departments and companies have been promoted proactively. Steps have also been taken to eliminate overlapping costs and create technological synergies. This included establishing UACJ Foil Corporation and UACJ Metal Components Corporation, and merging UACJ Logistics Corporation with LCOMPO and UACJ Components Fukaya Corporation with Nikkei Kakoh.
The UACJ Group has also expanded globally, making a capital investment in UPIA Co., Ltd. of South Korea, acquiring a foil company in Malaysia and renaming it UACJ Foil Malaysia Sdn. Bhd., and beginning operations at UACJ Trading (America) Co., Ltd. and IWAI METAL CENTRAL MEXICO, S.A. DE C.V. The first phase of operations at UACJ (Thailand) Co., Ltd. began as scheduled in January last year, and preparations to get the second phase underway are proceeding smoothly. For the USA, in May we signed a joint-venture agreement with Constellium N.V. to provide Body-in-White panels for the automotive industry and have started preparations to begin production in 2016.
This progress is evidence that members of the UACJ Group are working diligently to achieve various goals based on regional conditions and environments. Again, thank you all for your cooperation and commitment to our growth.
Last month, on December 10th, Global Step I, the fiscal 2015-2017 mid-term management plan, was approved by management and announced. Based on the current global business environment, including anticipated worldwide demand for flat rolled products, identifying growth regions and fields, and the initiatives outlined in UACJ Group’s Vision for the Future, the mid-term management plan stipulates three important policies to be implemented:
- Focusing on automotive products, proactively increase involvement in the transportation and energy fields in growth regions such as Asia,
- Utilizing the technological synergies created through unification, construct an optimal production network for each business sector, and
- Applying our vast technological prowess to fundamental research, develop unique technologies and products that contribute to the industry and society as a whole.
Our mid-term management plans over the next nine years and beyond represent three stages for transforming UACJ into an aluminum industry leader in a competitive global market. Global Step I (fiscal 2015-2017) focuses on reinforcing business foundations, Global Step II (fiscal 2018-2020) focuses on accelerating growth, and Global Step III (fiscal 2021 onwards) focuses on exponential advancement. The first three years, in which we will focus on strengthening the foundations of businesses around the world, are especially important. This is the time USAJ will grow the roots and thick trunk of a corporate tree capable of withstanding and responding to rapidly changing business environments. Everything we do will be vital for building the foundations that will support the accelerated growth during Global Step II, at which time the buds formed on the limbs of our tree will bloom and bear the fruit of our efforts.
As we greet the New Year, I ask that you be mindful of this importance throughout the Group. As we implement sector-specific policies and measures that enable us to move steadily towards Global Step II, it is imperative that each business sector and department reaffirm commitment to the aforementioned policies. Global Step I will involve many challenges and require a range of different measures. The full understanding and support of all involved is necessary for its success.
Our targets have been set. The remaining task is to push forward as a united group in implementing these goals. For this, we look forward to your continued cooperation.
Global Step I also touches on CSR initiatives vital to UACJ Group operations. In order to secure the trust of stakeholders, the plan calls for following two basic approaches:
- Secure the trust of customers and business partners through the continuous creation and supply of products, technologies and services that are safe and beneficial to society, and
- Through sound corporate activities, contribute to stakeholders, employees and local communities
These points I’ve brought up many times before as it is important for all of us to remain constantly mindful of them in our work. They share much in common with the issues I spoke of during my New Year’s greeting last year; those of “maximizing customer satisfaction” and “thorough attention to compliance, safety, the environment and quality.”
Customers are the bedrock of corporate activities. It is important that we hold true to these convictions in our day-to-day activities. In addition to improving quality, we must increase the competitive value of products by lowering costs, use advanced production technologies to shorten lead times, and instill even greater customer satisfaction by quickly understanding the wants and needs of our customers and then developing and introducing new products that meet those demands.
Compliance is probably the most essential factor for ensuring the sustainability of the UACJ Group. Last year, we introduced management philosophy and code of conduct. As corporate members of society, we must not forget that our value and sustainability are fully dependent on our adherence to society’s rules. If a mistake is made and the public’s trust is lost, regaining that trust is no simple task.
To date, I have mentioned many opportunities for UACJ related to safety, the environment and quality. These themes are also related to our business foundation. Without evolving safety, environmental and quality standards, continuous business development is impossible. As such, we should not establish fixed goals for these themes. It is important that we reassess our goals, establish ever higher aims and set out to overcome the new challenges that await us.
In closing, I would like to reiterate my thanks to our labor union and UACJ Group employees for your understanding and cooperation throughout the past year. I look forward to your continued hard work and understanding in the year to come. UACJ continues to work with the labor union on combining our new human resources system. While the merger has brought many changes, consolidating the human resources systems of the two former companies has been extremely important for effective integration.
As we begin the new year, let us continue to evolve the UACJ Group as a safe, rewarding and accident-free workplace for all.
Mitsuru Okada
Member of the Board
President CEO