Recent Developments by Region

Japan
- Unconsolidated sales increased by 5,878 million yen or 6.2% year-on-year, to 100,928 million yen, hitting a record high and exceeding 100 billion on an unconsolidated basis for the first time. This was due to increased sales in connection with higher export volume by its customers; increased orders for new products such as seats with slow-movement mechanisms, new types of window regulators; production increases of vehicle models with high content rates of the Company's products; as well as the benefits gained from the launch of the remodeled Corolla, one of Toyota's best-selling mass-market models. .
- By customer, sales to the Toyota Group increased favorably by 9.4% year-on-year or 5,397 million yen, to 62,866 million yen total. As a result sales in Japan reached 100,934 million yen (up by 6.4%) while operating profit was at 2,376 million yen (up 19.1% year-on-year).

- Kyushu Shiroki Co., Ltd., located in Kita Kyushu, Japan, has began preparing to produce window regulators, the Company's major product. The Company is planning to commence full commercial operations at a second plant in May 2007. The Company responded to increased production volume of automakers in Kyushu and to new orders it won, while at the same time improving the production efficiency of its two plants. Shiroki Shoji Co., Ltd., located in Anjo City, Japan, was spun off in July 2006 to enhance the efficiency of group operations. In its place the Company established Shiroki Create Service Co., Ltd., located in Toyokawa City Japan.

North America
- Sales at Shiroki North America, Inc. (in the state of Tennessee) were up by 5.9% or 1,498 million yen year-on-year, to 27,020 million yen, hitting a record high for the fifth consecutive year. This was mainly due to increased production volume of door sashes for the Altima, Nissan Motor's model mass-produced in North America. Nissan started producing the vehicle model in the fall of 2006. As a result, the Company's operating profit was three million yen, compared with last year's operating loss of 141 million.

- In December 2006 Shiroki-GA. L.L.C in Georgia expanded its plant, while Shiroki-GT L.L.C. in Tennessee, Shiroki's third plant in North America, started operations in March 2007 to cope with increased production volume of Japanese automakers and respond to new orders, taking advantage of their nearby locations. The Company has made company-wide efforts to prepare for the production of door sashes to be supplied to one of the best-selling mass-produced vehicle models in North America, the Nissan Altima. Production started in September 2006. The Company focused on increasing its production capacity and gaining new orders to strengthen its business structure in North America.

Asia
- Sales at Guangzhou Shiroki Corp. in China grew sharply, recording 2,324 million yen, or 4.97 times the previous record, up by 1,865 million yen year-on-year. This was mainly the result Toyota's launching production of the Camry, to which the Company supplied products.

- In Thailand, Shiroki (Thailand), Co., Ltd. in Chonburi increased sales year-on year by 934 million yen, or 39.9%, to 3,279 million yen. This was mainly attributable to greater sales of the IMV, a strategic vehicle destined for the global market, by Toyota Motor in Thailand. As a result sales in Asia reached 5,571 million yen (up 101.3% compared to those of the previous term), and operating profit was 408 million yen. These were favorable results compared to an operating loss of 156 million yen in the last fiscal year.

-China
- In connection with Toyota's launching production in Guangzhou, China at Guangzhou Shiroki Corp. the Company increased the production volume of door sashes and moldings in May 2006 while starting production of window regulators. To deal with the increased production volume in addition to new orders from Japanese automakers in China, the Company started building a second plant within the premises of the existing plant in November 2006, thereby strengthening both its production and business structure in South China.

-Thailand
- Shiroki (Thailand), Co., Ltd. (Chonburi) continued dealing with increased production volume of Toyota's strategic vehicle destined for the global market, the IMV. In June 2006 the Company started to supply door sashes, one of its major products, to Nissan Motor in Thailand on an outsourcing basis to Nissan in order to strengthen its business structure in the country.

-India
- In February 2007 the Company decided to invest in an Indian auto parts maker, Technico Industries Ltd., located in Haryana. The Company currently licenses various technology on window regulators to Technico, aiming to strengthen its alliances with its business partners.

Accelerated outsourcing of parts produced in Japan
The Company will promote outsourcing of parts production in Japan. Outsourcing to its group parts suppliers will be expanded to cover a variety of products except for its three main products of door parts, window regulators (devices to lift and lower windows) and seat components, as well as mechatronics components related to leading parts and electronic control. In view of a forecast of mid to long-term deceleration in the domestic automotive market, Shiroki Corporation will devote its management resources primarily to manufacturing and development of its mainstay products. In Aichi and surrounding areas where the company's main plants are located, The Company will increase outsourcing to member companies of NS (New Shiroki) Association, consisting of tier-2 and tier-3 suppliers. Outside of Aichi prefecture, at Fujisawa plant in Fujisawa city, Kanagawa prefecture, which is supplying mainly to Nissan Motor, Nissan Shatai, Hino Motors and NHK Spring, Osaka plant in Ibaraki city, Osaka, whose major customers are Daihatsu Motor and Mitsubishi Motors, and its subsidiary Kyushu Shiroki Co., Ltd in Yahata Higashi-ku, Kita-Kyushu city, the company will consider outsourcing to subcontractors belonging to other groups. The Company is undergoing reorganization of domestic production system by taking such steps as closure of its Toyota plant (Toyota city, Aichi prefecture, the 3rd manufacturing section of Nagoya plant) during fiscal 2007 and transfer of production of door sashes to the headquarters plant in Toyokawa city and assembly of seat components to its Nagoya plant (Toyota city), as well as easing tight operation at the Osaka plant by increasing the production capacity at Kyushu Shiroki. (From an article in the Nikkan Jidosha Shimbun on Mar. 9, 2007)

- R&D expenses for the automotive parts business in FY2006 were 2,142 million yen on a consolidated basis.

Recent R&D achievements (Automotive Division)
Development of;
1. Next-generation seat tracks (power/manual) (both power and manual)
2. Next-generation power recliners
3. New wire-type regulators
4. New arm-type regulators
5. New door frames

Technological Alliances (as of March 2007)

Capital investment made into the automotive component business in FY2006 totaled 7,371 million JPY, mainly to improve facilities to augment production volume, achieve cost reductions, and prepare for the production launch of a new vehicle model.

Overseas manufacturing capabilities

-Thailand

The Company will introduce clean room engineering to its major overseas plants. The company has already built and installed at its Toyokawa Plant (Toyokawa City, Aichi Prefecture) a dust-free production line for window regulators with the "anti-trap" mechanism developed jointly with Brose Fahrzeugteile GmbH & Co. (Germany), paving the way for improved production quality, including durability. Shiroki intends to complete the installation of such "clean equipment" at Shiroki Co., (Thailand) located in Amata Nakom City by the end of August and to supply window regulators to Toyota Motor Thailand for the "Yaris" (called "Vitz" in Japan). In time with localization of the product, the company will extend application of the system to China (in Guangzhou) and the U.S. (From an article in the Nikkan Jidosha Shimbun on Sep. 1 2006)

-China

The Company announced that it will construct a second production facility at its Chinese subsidiary in Guangzhou with an investment of 350 million yen in a plant building. The additional factory will be set up in the premises of Guangzhou Shiroki Corporation to manufacture exterior auto parts including window regulators and moldings for supply to Japanese affiliated automakers operating in China. The construction is scheduled to be completed by June 2007 in preparation for startup of the operation. Guangzhou Shiroki established a comprehensive production line from stamping to assembly process for door sashes and window regulators at the end of last year, and also added a new production line in time for production launches at Nissan Motor's local joint venture "Dongfeng Motor" and Toyota's local joint venture "Guangzhou Toyota," to increase production capacity of door sashes and moldings to 100,000 units a month respectively, and window regulators to 40,000 units a month.(From an article in the Nikkan Jidosha Shimbun on Aug. 4, 2006)

-USA

The Company announced plans to increase its U.S. production capacity. It will enlarge its plant in Georgia to increase doorframe production and purchase a closed plant of a local company in Tennessee to establish the third U.S. plant for functional seat components production. The total investment, excluding equipments and molds, will be limited to approx. 1.1 billion yen. With these plans, the company aims to respond to production expansion of its major client, Toyota, and to new parts orders from Nissan for the volume production models. (From a story in the Nikkan Jidosha Shimbun on May 13, 2006)

The Company announced that it has established its third plant in the U.S.A., SWM-GT, L.L.C., as a fully-owned subsidiary of SW Manufacturing Inc., Shiroki's another U.S. subsidiary that oversees the company's operations in North America. The plant construction will begin in August 2006 and the operation will start in January 2007. The total investment will be 440 million yen. The new plant will have a workforce of 80, comprised mainly of local nationals, and aims at generating sales of over 1.7 billion yen in the first fiscal year. Starting from January 2007, the new plant will produce mechanical parts for automotive seats, such as seat recliners and adjusters, and parts for doors, such as window regulators and door locks. The Company already has overseas plants in Tennessee, Georgia, China (Guangzhou Shiroki Corp.) and Thailand (Shiroki Corp. (Thailand), Ltd.). After the addition of the new U.S. plant, it will have five overseas plants.(From a story in the Nikkan Jidosha Shimbun on Jun. 22, 2006)

New equipment installation