Recent Years

Business Overview (FY ended Mar. 31, 2014)

 -Operating revenue during the fiscal year that ended March 2014 was 1,053,000 million yen, which was a year-on-year increase of 8.0%. This improvement is the result of a increase in production at OEMs in Japan and North America.
-The Company was able to increase its operating profit. It was higher year-on-year by 25.8% to 81,200 million yen.

Contracts

Year	Maker/ Model	Products	Remarks
2013	Mazda "Axela Hybrid"	HV's motor-integrated transmissions	Mazda developed this vehicle by utilizing hybrid technology licensed from Toyota.　The Company produce the transmissions at the second plant of its headquarters.
2010	Citroen "C5"	Medium-capacity FF 6-speed transmission	Succeed in improving fuel efficiency and drive performance through a smaller-sized design and optimum gear ratio.
2010	Volkswagen "Touareg"	Large-capacity FF 8-speed transmission	Succeed in improving fuel efficiency and drive performance through a smaller-sized design and improved efficiency.
2010	Porsche "Cayenne"	Large-capacity FF 8-speed transmission	Succeed in improving fuel efficiency and drive performance through a smaller-sized design and improved efficiency.
2010	Audi "Q7"	Large-capacity FF 8-speed transmission	Succeed in improving fuel efficiency and drive performance through a smaller-sized design and optimum efficiency.
2010	Guangzhou Automobile Group "Trumpchi"	Large-capacity FF 5-speed transmission	-
2009	Dongfeng Liuzhou Automobile "Joyear"	FF 5-speed automatic transmission 55-51SN	-
2009	Peugeot "308CC"	Medium-capacity FF 6-speed transmission	Succeed in improving fuel efficiency and drive performance through a smaller-sized design and optimum gear ratio.
2008	Jaguar "X", 2.2L Diesel Engine	FF (front-mounted/front-wheel drive) 6-speed AT (automatic transmission)	-
2008	Toyota "Camry Hybrid"	FF Hybrid  Transmission HF-10	-
2008	Toyota "Estima Hybrid"	FF Hybrid  Transmission HF-10	-
2008	Toyota "Lexus LS460"	FR 8-speed AT, HDD car-navigation systems	Joint development with Toyota Motors
2008	Toyota "Lexus GS450h"	FR 2-motor hybrid transmissions	-

Awards

Year	Car Maker	Award
2013	Mitsubishi Motors	VFG (Vehicle Function Group) Award for Excellence
2012	Toyota Motor Sales U.S.A.	Gold Award
2012	GM	Supplier Quality Excellence Award 2012
2012	Volkswagen	Supplier Award 2012 (as one of the 18 suppliers)
2012	Guangzhou Automobile Group Motor Co., Ltd. (GAGM)	Outstanding Cooperation Award
2012	FAW Car	Outstanding Contribution Award
2012	Chongqing Changan Automobile	Excellent Supplier Award
2011	Volvo	Award of Excellence 2011
2011	Toyota	Exceptional VA award
2011	Porsche	Supplier Award
2011	Guangzhou Automobile	Excellent Development Award
2010	Daihatsu	Outstanding Performance in quality

Recent Development in Japan

-In 2010, the Company has produced an aggregate total of 10 million car navigation systems since it began producing its first voice navigation system for the Toyota "Celsior" in August 1992. The Company shipped out its 1 millionth navigation system in July 1999 and its 5 millionth navigation system in January 2006. The Company is currently supplying the product for 9 automakers including Toyota and 4 car audio manufacturers including Fujitsu Ten. (From a press release on November 1, 2010)

-In 2008, the Company will try to expand its volume of production of transmission units, with electric motors, for hybrid vehicles (HVs) for Toyota Motor Corporation. The Company plans to become an even bigger supplier of transmissions to Toyota, which is planning to increase sales of hybrid vehicles. Aisin AW has been producing transmissions for Lexus HVs as well as for the Toyota "Camry" HVs at its Okazaki East Plant. The Company is now trying to win a new order for at least half of the transmission units to be mounted on the Toyota "Prius", a major hybrid model in the market. Toyota produces most of the transmission units for front wheel drive HVs like the "Prius" at its own plants. But in the early 2010s, Toyota is planning to sell 1 million HVs a year, so the Company will pursue a strategy to expand its annual production volume of units for Toyota to 0.5 million so that it will be able to supply half of the units that the automaker will then need. (From an article in the Nikkan Jidosha Shimbun on Sep. 8, 2008)

Recent Development Outside Japan

<Belgium>
-In 2009, the Company announced that the total car navigation system production at AW Europe S.A., its subsidiary in Belgium, has reached 500,000 units. (From a press release on Oct. 14, 2009)

Business Restructuring

-In 2008, in order to maintain the current level of production capacity at its U.S. plant, the Company announced that it will transfer some of its production operations involved with making automatic transmissions for the "Land Cruiser", from Japan to the U.S. The amount of production volume that the Company will transfer beginning Nov. 2008 is estimated to be several thousand units a month. The Company's production plant in North America has surplus workers due to a decrease in work, as Toyota's "Tundra" and "Sequoia" have been out of production. (From an article in the Nikkan Jidosha Shimbun on Sep. 6, 2008)

Joint Ventures

-In 2008, the Company announced that it will establish AW Hangzou Software Development Co., Ltd. in Dec. 2008. The new company, which will be a joint venture with Totyu Software Co., Ltd. and engage in developing software, will be located in Hangzhou, Zhejiang, China, and capitalized at 100 million yen. It will be responsible for responding to growing demand for the development of control software for automatic transmissions. The Company will invest 80% and Totyu Software will invest the remaining 20% in the software company. Initially a total of 80 employees will be engaged in contract design, evaluation, and development of onboard software as well as research and gathering of technical information. (From an article in the Nikkan Jidosha Shimbun on Nov. 27, 2008)

R&D Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Overall	52,400	52,900	49,000

R&D Facilities

Name	Location
Monozukuri Center	Aichi Pref., Japan
AW Technical Center U.S.A., Inc.	Michigan, USA
AW Technical Center Europe S.A.	Braine-l'Alleud, Belgium
AW Suzhou Technical Center Co., Ltd.	Suzhou, China

R&D Structure

-The Company announced that it had established "AW Suzhou Technical Center Co., Ltd." in Suzhou, China for the research and development of automatic transmissions. This is the Japanese supplier's first center in China, and the third overseas following the U.S. and Europe. The new facility will be involved in the design and evaluation of automatic transmissions, in addition to providing related functions as product development and technical support in coordination with automakers of Japan, the U.S. and Europe operating in China. Aisin intends to win more contracts through this business expansion. The Center plans to hire approx. 60 employees by November 2013 to undertake forthcoming tasks. (From an article in the Nikkan Jidosha Shimbun on Dec. 14, 2012)

-In 2008, the Company will largely increase its capacity to develop transmission systems for hybrid electric vehicles by hiring an additional 150 engineers within the next three years. This addition will raise the number of engineers specialized in hybrid technologies by 70 percent from the current level. The increased number of engineers is intended to support Toyota Motor Corporation's plan to sell 1 million hybrid vehicles worldwide in 2010, which is scheduled to be followed by releases of a variety of hybrid models. Reinforcing its development structure in line with Toyota's hybridization strategy is expected to help the Company's hybrid-vehicle transmission business achieve even greater results. The Company supplies its motor-driven transmissions for hybrid vehicles to Toyota through joint development activities with the automaker. Its transmissions are also used in hybrid vehicles manufactured by Ford Motor Company. Working closely with Toyota, the Company will step up its initiatives to engineer new hybrid models and to reduce production costs connected with producing more compact transmission units. (From an article in the Nikkan Jidosha Shimbun on Dec. 8, 2008)

R&D Activities

-During the fiscal year that ended March 2014, the Company worked to develop next-generation products ahead of its customers based on the expertise it has gained from developing its products and technologies thus far such as transmissions and navigation systems. This was done to respond to diversified drivetrain systems and high-level information systems in our car-dependent society. In this regard, the Company's main achievements include FWD 2-Motor Hybrid Transmission.

-In 2010, the Company is developing an automatic transmission optimized for downsized engines, which are expected to be widely used as one of technological solutions to respond to environmental challenges. Engine downsizing is a concept to ensure both low fuel consumption and sufficient output by combining a turbocharger with an engine with a smaller displacement. But, vulnerability to vibration caused by a fewer number of cylinders in the engine has been the problem with this system. By devising attribute of the automatic transmission to absorb vibrations, the Company intends to explore new needs of automakers that are eager to save their development expenses.
(From an article in the Nikkan Jidosha Shimbun on August. 3, 2010)

Product Development

Entering the automotive display market
-In Oct. 2013, the Company has started to develop new products in preparation for entering the automotive display market. The company plans to commercialize products including an augmented reality lane guidance system and a high performance HUD. The augmented reality lane guidance system will display the street view captured by an in-vehicle camera on a liquid crystal display. In addition, directional arrows from the car's navigation system will be superimposed on the display. The high-performance HUD will display a speedometer and directional arrows on the windshield of a vehicle. If successfully commercialized, these new products will mark the Company's first entry into the automotive display market. The company plans to finish development of these products by 2016 and decide then whether to enter the display market. (From an article in the Nikkan Jidosha Shimbun on October 17, 2013)

-In 2008, the Company with Toyota Motor Corporation jointly developed 8-speed automatic transmissions for rear-drive vehicles and an HDD car navigation system for the "Lexus LS460".

Capital Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2014	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012
Overall	74,854	66,632	52,955

Investments in Japan

-In Oct. 2012, CVTEC Co., Ltd., an Aisin AW group company to make metallic CVT belts based in Aichi Prefecture, announced on October 25 it will establish a new production subsidiary in Hokkaido. The new company “CVTEC Hokkaido” will be set up by December 2012 and go into operation in January 2014. With an investment of about 6 billion yen (approx. $75 million), a production line will be installed at a leased building on the premises of Toyota Motor Hokkaido in Tomakomai. Its production capacity will be enough to equip 600,000 vehicles a year. Given an expected increase in CVT production at Toyota Motor Hokkaido in the medium turn, CVTEC intends to improve its competitive edge by entering into local production of CVT belts. (From an article in the Nikkan Jidosha Shimbun on Oct. 26, 2012)

Investments Outside Japan

<China>
-In 2012, the Company announced that it will establish a new plant in Tianjin, China to manufacture automatic transmissions. It is going to invest 16 billion yen to mass-produce 6-speed automatic transmissions for front-wheel drive vehicles, starting as early as the end of 2014. The factory is expected to have the capacity to produce transmissions for 400,000 vehicles a year. In China, the company is already producing automatic transmissions for rear-wheel drive vehicles, while planning to open a new plant to manufacture 4-speed automatic transmissions for front-wheel drive vehicles in the middle of 2013. When the new Tianjin facility starts its operations, the Company will be able to produce over 700,000 transmissions a year in China. Prior to the plant construction, the Company will form a wholly owned production subsidiary in April, which will be headed by Izumi Mizutani, now the plant manager of the Plant No. 2 at Aisin AW headquarters. The Company's expansion project is in line with Japanese automakers' move to step up operations in China. It aims to become more competitive in the market by increasing procurement from local suppliers. The new plant is going to ensure the local content ratio of about 70 percent from the startup, while the ratio at the existing automatic transmission plant for rear-wheel drive cars stands at approximately 60 percent. (From an article in the Nikkan Jidosha Shimbun on March 26, 2012)

-In 2011,  the Company has announced that it will establish a new, wholly owned subsidiary in Suzhou City, Jiangsu Province, China to manufacture automatic transmissions for front-wheel-drive vehicles. The plant is scheduled to commence full-scale production around the middle of 2013 with the capacity to manufacture 240,000 transmissions per year. The facility will serve as the Company's second production foothold in China, and third outside Japan. Through this expansion, the Company intends to meet increased requirements from Toyota Motor Corporation and other major customers, which are stepping up production in the country. Total investment in the project is likely to reach 18 billion yen. The new company, AW Suzhou Automotive Parts Co., Ltd., will be formed in April 2011 with a registered capital of 100 million US dollars (approximately 8.3 billion yen.) The plant will have a building area of around 45,000 square meters on 103,000 square meters of land. It will hire about 600 employees to manufacture step automatic transmissions for front-wheel-drive vehicles. The new operations will allow the Company to produce 360,000 automatic transmissions per year in China, including those for rear-wheel-drive vehicles it already makes at its existing plant in Tianjing. (From an article in the Nikkan Jidosha Shimbun on January 28, 2011)