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Mid-term Management Plan 2012

Oct, 18 2012

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Bridgestone Corporation announced today the formulation of its Mid-Term Management Plan for 2012.

Bridgestone Corporation announced today the formulation of its Mid-Term Management Plan for 2012 (MTP2012). The Bridgestone Group’s ultimate goal is to become the “undisputed world No. 1 tire and rubber company in both name and reality”. Consistent with the company’s prior approach, the Group and new executive management team continue to view mid-term management plans as fundamental and key to management. MTP2012 therefore, incorporates the articulated vision of the new executive team to accelerate management reforms.

The following is an overview of MTP2012.

  1. Positioning of MTP2012 Period: 5-years from 2013–2017 MTP2012 will reflect changes in the operating environment since the formulation of MTP2011, and will revise and add additional strategies and measures as deemed necessary.

  1. Outline of MTP2012 Initiatives to Achieve a “Dan-Totsu” Position The Bridgestone Group aims to be a truly global corporate group. To this end, it has reformed its organizational structure, formulated mid-term management plans, and refined its corporate philosophy. Moreover, it is making strong progress toward accomplishing its immediate management goal of achieving return on assets (ROA) of 6% in 2012.

The operating environment faced by the Bridgestone Group is growing increasingly unstable and uncertain. In the course of developing MTP2012, the Group therefore identified the current operating environment as critical time to advance further management reforms. Following the initial reforms to the Group’s governance and operations which were begun in 2006, management reforms to be implemented going forward are defined as “second phase” transformational reforms. In order to effectively address the challenges of the current environment, and the challenges that will be faced in the future, the Group will implement reforms centered on the principles of flexibly responding to economic fluctuations and creating new value for customers. Through these efforts, our goal is to become the absolute and clear leader-in Japanese, “Dan-Totsu” – in all our industries. One particular area of focus will be leveraging the benefits to be realized through vertical and horizontal expansion. We will add further depth to the initiatives implemented last year, and accelerate our progress in these areas through a commitment to technology and business model innovation.

(1) Technological innovation

a. Raw materials
Diversification of natural rubber production
Shift from fossil resources to renewable resources

b. Products
Enhancement and expansion of strategic products that demonstrate technological superiority
100% sustainable material concept tire
Air free concept tire

c. Services
Tire technology which provides drivers with real-time information regarding road surface
Conditions
Tire printing technology

(2) Business model innovation

a. Fleet solution
Solutions package proposals combining new tires, retread tires, and maintenance services

b. Mining solution
New customer value created by combining Bridgestone products and services

(3) MTP 2012 target performance

a. ROA
More than 6%, “improve further” as target

b. Net sales
Yearly average over 5% increase

c. Operating income ratio
Achieve 10% as early as possible, “improve further” as target

d. Capital expenditure
Yearly average ¥250.0 billion, approximately 50% for tire strategic projects