Integrated Report

2023

ESG Promotion Dept., Corporate Infrastructure Division
2-2-13, Fujinoki, Itami City, Hyogo 664-0847, Japan
Tel: +81-72-789-9126
https://www.toyotires.co.jp/csr/
Publishing date: September 2023** It is English version published.
Japanese version was published in August 2023.

Contents

As a key element of engagementwith our stakeholders
In order to provide information on our corporate activities to stakeholders, we previously
published annual report as a tool to comprehensively communicate the financial information,business strategies and other details of our corporate management, and a separate
sustainability report to communicate our ESG initiatives for strengthening our sustainability
management.
It has become increasingly important in recent years for businesses to disclose
information that provide insight into their future prospects such as their company
philosophy, business model, governance, and business opportunities and risks. In response,
we have published Integrated Report 2023, which provides integrated disclosure of financial
and non-financial information for fiscal 2023.
An integrated report is a key element of our engagement to facilitate mutual
understanding, not only with capital providers such as institutional investors andshareholders but also with wider stakeholders. In this report, we define material issues(materiality), or aspects of our operations that are likely to have a significant impact on theenvironment, society and economy, and that may have a substantial influence on thestakeholders’ evaluation and decision-making. The report presents our process of value
creation and structures it as a story told in a medium- to long-term perspective.
It is our aim to continue our disclosures in the form of integrated reports thatsystemically retell the story of our corporate value in words, which we hope will help todeepen our relationship with all our stakeholders and gain the confidence of wider society.
Integrated Report 2023 is the starting point of this endeavor, and we hope that it will find awide audience.

01

Editorial Notes

02

Contents

Introduction

Materiality

03

Our Philosophy

33

Domain Ⅰ

Value creation

07

Growth Trajectory

39

Domain Ⅱ

Foundation for value creation

09

At a glance

43

Domain Ⅲ

Risk management

Top Message

Governance

11

51

Pursuing sound governance

54

Message from the Chairman

55

Messages from the Outside Directors

59

Directors, Audit & Supervisory Board
Members and Corporate Officers

Message from the President

Vision17

External Environment and
Risks & Opportunities

19

Toyo Tire Materiality

21

Value Creation Process

23

Our Strengths

Data

Strategy

Editorial policy
Reporting period:

Guidelines and other references:

From January 2022 to December 2022
* The report contains some information fromoutside the above period• International Integrated Reporting Council (IIRC),
The International Integrated Reporting Framework• Japan’s Ministry of Economy, Trade and Industry,
Guidance for Collaborative Value Creation 2.0• Global Reporting Initiative,GRI Standards (sustainability reporting standards)

Toyo Tire Corporation and group companies
in and outside Japan (consolidated
subsidiaries)

Organization names in this report:
Toyo Tire Corporation itself is referred to as“Toyo Tire Corporation” or “we”
The entire Group is referred to as “Toyo Tire
Group,” “the Group” or “we”
Individual companies in the Group are referred
to by their company name

1

TOYO TIRE Integrated Report 2023

63

Consolidated Balance Sheets

65

Consolidated Statements of Income /Consolidated Statements ofComprehensive Income

Financial Strategy

27

Medium-Term ’21 Plan Progress

29

Business Overview

66

Consolidated Statements of Cash Flows31

Financial Highlights

67

Investor Information32

Non-financial Highlights

68

Corporate Data

Positioning of this report
Financial information

Note on forward-looking statements
This report contains forward-looking statements
concerning future performance. These statements are nota guarantee of future performance and involve risks anduncertainties. Please note that factors such as changes in
the operational environment may cause the actual future
performance to deviate from planned figures.

Financial Summary (11 years)

25

Integrated Report 2023
ConciseScope:

61

Securities report in JapaneseCorporate website
IR

Corporate Governance reportin JapaneseCorporate website
Sustainability

Comprehensive

Editorial Notes

Non-financial information

TOYO TIRE Integrated Report 2023

2

Introduction

Our Philosophy
Philosophy (Defined in January 2017)
Company Philosophy

We will endeavor to continuously
improve our products, and create value
for everyone who we work with.
The highest-order concept in the
Company philosophy framework
The founding spirit we maintainand pass on to the future

Our Mission

To create excitement and surprise with our products thatexceed customer expectations and enriches society.

Our promise to society and toourselves

Company
Philosophy

Our Mission

Our Vision
The vision of how we want our Company
to be in order to keep our promise tosociety (=our mission)

Our Vision
Our goal is to be a company that:- Stays one step ahead of the future through constant technological innovation;- Drives entrepreneurial and creative spirit through a progressive culture; and- Shares in the enjoyment felt by everyone involved in our activities.

The principles each of us value that guideour mission and promise and make ourvision a reality

Our Fundamental Values:“The TOYO WAY”

Our Fundamental Values: “The TOYO WAY”
Fairness

Be fair and selfless in one’s actions to benefit society.

Pride

Take pride in one’s self, work and company, and to persevere.

Initiative

Show initiative in all matters, and take ownership of one’s actions.

Open Roads Await

Appreciation Demonstrate sincere compassion and appreciation for people andsociety.
Solidarity

3

Continuously advance creativity and innovation by working
together to mobilize our corporate knowledge and capabilities.

TOYO TIRE Integrated Report 2023

TOYO TIRE Integrated Report 2023

4

Introduction

The Spirit That Underpins Our Company Philosophy

We will endeavor to continuously improve our products, andcreate value for everyone who we work with.
Our Company Philosophy was established by the founding president, Rikimatsu Tomihisa, in September 1950 to serve as aclear statement of his management philosophy. This short statement reflects the noble spirit he thought people should
aspire to at the time of the country’s rebirth. Ten years after the founding of the Company, Rikimatsu Tomihisa said, “thedecade of growth our Company has enjoyed is largely thanks to the way every employee has faithfully followed the spirit of
our Company Philosophy.”
Even though times have changed and the business environment in which we operate has been drastically transformed,
the Company Philosophy embodies insights and guidance that are still relevant today. We see our Company Philosophy as
the founding spirit which we should always hold on to as we pursue our tasks at work and pass on into the future.
[The spirit that underpins our Company
Philosophy]
Industry progresses steadily day by day
and never rests.
We must understand the importance of ourwork well and make progress every day.
We must research, create and beingenious, always determined that we will
be better today than yesterday.
Abundance of high-quality materials may
make it easier to produce good products, but they are not always
available, and knowledge and skills vary also from person to person.
We must start with the understanding that there are too many change

factors to have stability, and be relentless in our pursuit of improvement
in order to produce good, balanced products consistently.
Our motto must be to sell valuable products at the right prices, andwe must above all refrain from seeking to profiteer to the detrimentof people.
Consumers do not just mean customers; the next process at work
is also a consumer.
Everyone in a company is a necessary
person. Conversely, every person
has an important responsibility.
Everyone must do their very best atwork.

Turning wishes and hopes for the future of our Company into words
The project to review the role and content of Philosophy statements was structured as a reciprocal back-and-forth ofideas between employees and the management, where a working group of employees would present their thoughts inthe form of recommendations to the management, the management team would in turn discuss the same themes andreturn their feedback, the employees’ working group would then use the feedback to hold further discussions, and so on.
The nine-month long dialogue considered three aspects: “what values do our colleagues hold as important throughwork?”; “what values have we come to learn as important in view of the scandals we have gone through?”; and “whatvalues do we want to hold on to as important now and in the future?” Common values distilled from the dialogue were
put together into words to formulate Philosophy statements.
These discussions brought out a clear picture of what we felt the Company should aspire to be, and this wascrystalized in the new Philosophy statements established on January 1, 2017.
The 2017 New Year Address by the president announced the launch of the new Philosophy to the workforce, in which
he stated, “Our Philosophy is the central pillar of the Company itself, a shared set of values that employees must holdand take into the future. Every officer and every employee must place it at the starting point of every task, understandwhat it means correctly and strive to be its embodiment.”

At work,
what values do ourcolleagues hold asimportant at work?

In view of the scandals,

Now and in the future,what values have we cometo learn as important?

what values do we want tohold on to as important?

Words

Words

Words

Shared philosophy

Philosophy Review Process
Our Philosophy review began as a response to the issue of data fabrication that came to light in 2015 concerning theseismic isolation rubber business and anti-vibration rubber business. As the investigations into the root cause of the
problem progressed in 2016, the management team realized that there was a need for reforming the company culture
and came to a consensus to review and redraft our Philosophy statements in order to reaffirm our values. In April 2016, a
project was launched to review the role and content of our Philosophy statements.
December 2015

General review of the issues (investigation into cause,announcement of measures to prevent recurrences)

March 2016

Intensive discussions at officers’ level
Conclusion: verbalizing of shared philosophy and its
dissemination across all levels of organization are importanttasks we should undertake

April–

5

December 2016

Project to review the role and content of Philosophy statements
Bottom-up hearing of employees’ voices
andShaping statements through officers’ discussions

January 2017

Establishment of new Philosophy statements

TOYO TIRE Integrated Report 2023

Instilling the Philosophy
Since the introduction of the Philosophy in 2017, we have been taking various initiatives to promote the awareness andunderstanding of it across all employees.
These initiatives include: a Philosophy card for every employee to carry, and the text hung on the wall of meetingrooms and visitor reception rooms at each site; a lecture on the Philosophy given as the first session of every internal
training course; case workshops to promote the understanding of the importance in workplaces of visions andstrategies that are linked to the Philosophy; and group-based workshops to share creative ideas to promote thePhilosophy within each organization.
Our human resources management system is designed to base the evaluation and career progression of each
employee on clearly defined ideals and expectations for each level, and one of the expected roles is “to embody andinstill the Philosophy” in order to embed a culture of thinking and acting in line with the Philosophy while carrying out
tasks and running departments.

TOYO TIRE Integrated Report 2023

6

Introduction

Growth Trajectory

Operations & management

The Toyo Tire Group can trace its roots back to 1945, a time of unprecedented disarray around the end of World War II.
Since then, we have experienced a period of high economic growth and the bubble economy, and we have overcome
recessions, continuously delivering a multitude of values, including “safety,” “the joy of driving” and “a society ofsustainable mobility,” to the world by expanding globally while adapting to the diversifying automobile market.

1945-1970:
Founding and groundwork for growth

1971-2003:
Diversification and globalization

In August 1945, Toyo Rubber Industrial, which was established anddeveloped by Toyo Boseki (currently, Toyobo) in order to develop therubber industry, merged with Hirano Rubber Manufacturing, acompany whose operations Toyo Boseki had invested in andstrengthened, resulting in the establishment of Toyo Tire & RubberCo., Ltd. Both predecessor companies’ main factories had been
severely damaged in air raids and our history started with rebuilding
the devastated business environment. Since our founding we have
kept technology in our sights, and in 1946 we established adepartment to develop elemental technologies, the precursor to theCentral Research Center, as well as the Toyo Institute of Rubber,
Industry and Technology. In 1950, after wartime restrictions werelifted, we began producing rubber products, aiming to make theleap to a general rubber company. In 1952, we launched thelong-awaited RS (Royal Wing Special) Tire. In 1966, while expanding
our sales network, we took thelead in the industry by
establishing Toyo Tire (U.S.A.)
Corp. in the U.S. (currently Toyo
Tire U.S.A. Corp.) and expanded
the scale of our business, riding
the wave of rapid economic
growth.
Former Central Research CenterIn the early 1970s, our diversification andstimulation strategy promoted four businesses:
tires, chemicals, footwear and industrial goods.
Following the oil crisis, during a period in which
we found it extremely difficult to secure raw
materials, we focused on improving ourorganizational structure. In 1979, we entered into
a comprehensive business partnership with Nitto
Tire Co., Ltd. and reorganized our production
bases. We also further expanded our sales
strategy outside Japan by establishing local
subsidiaries in Australia and what was West
Germany. In an effort to strengthen our
technological development we opened theAutomotive Parts Technical Center in 1986 andthe Toyo Technical Center (currently, the Tire
Technical Center) in 2001.

Tire Technical Center

Society & The automotive industry

Toyo Institute of Rubber, Industry andTechnology

7

Ceremony to celebrate the first shipmentof the year1945
End of WWII and the start of post-war rapid
economic growth

1945

1973
First oil crisis

1991
Burst of Japan’s
economic bubble

1973

1991

2004-2015:
Taking on the North American
market and further global expansion

2016-2020:“Second founding” with mobility
business at our core

From 2021:
Embarking on Medium-Term Business
Plan “Mid-Term ’21 Plan” to strengthen
sustainability management

In 2004, Toyo Tire North America
Manufacturing Inc. (TNA) wasestablished in Georgia, U.S.A., as our
first tire production plant outside Japan.
We introduced a new proprietaryproduction method at the plant thatcombines design and high performance,
backed by differentiating technologies.
Under Toyo Tire Holdings of the Americas
Inc., the North American regional
headquarters established in 2008, TNA
has worked hard to constantly expand its
production capacity, and local sales
subsidiaries have been unwavering intheir support of our presence in thelarge-diameter tire category for pickup
trucks and SUVs. During this period, we
also strengthened our global production
and supply system by establishing tire
production bases in China and Malaysia,
and steadily implementing sales
strategies in European countries,
Thailand, and Mexico.

In 2017 we re-established our philosophy. We
introduced a function-based organizationalframework, relocated our headquarters andmoved our technology development and platform
technology development functions to an area
close to our new headquarters. These changes
enabled us to accelerate cooperation, create
solidarity and speed up decision-making. In
2018 we became a new management entitywith mobility at the core of our business, andthe following year we changed our name to
Toyo Tire Corporation. That same year, weestablished a new brand statement, “OpenRoads Await.” In addition to formulating a
growth strategy for our new corporate stage,
we established a North America R&D Centerand a European R&D Center (in Germany). We
also decided to establish a new tire plant in
Serbia to strengthen our development andproduction/supply systems.

In 2021, we announced theMedium-Term ’21 Plan. Under theslogan of “bolstering ability to promptly
and flexibly respond through global
collaboration,” our ideal we are aiming
for, we are implementing businessstrategies to achieve our managementtargets. In April 2021, we established a
Sustainability Committee, chaired by
the president, to strengthen oursustainability management and aim forthe true integration of business andsustainability. We are making steadyprogress despite the COVID-19
pandemic and other changes in thebusiness environment. Operations at
our new Serbia Factory are up andrunning and we are steadily developing
our digital transformation
infrastructure.

TNA, the largest tire plantin the Group

Headquarters (in Itami, Hyogo Prefecture, Japan)

Serbia Factory

Malaysia Plant

1995
Hanshin-Awaji
earthquake

2008
Globalfinancial crisis

2011
East Japan
earthquake

1995

2008

2011

2015
Adoption of theParis Agreement

2015

2020
Start of COVID-19 pandemic

2020

Around 1945

1960s

1970s

1990s

2000s

2020 onwards

Transition from a controlled
economy to a free economy

Keyword for the period:
innovation

Emergence of pollution
problem and oil crisis

Bursting of the bubble, periodof recession

Global movement to protect
the environment

Movement toward an era ofsustainable mobility

While the reconstruction of production
bases damaged by air raids began
amidst the chaos at the end of WorldWar II, the production of cars andrubber products was controlled byGeneral Headquarters (GHQ) until 1950.

We entered into technical tie-ups withleading manufacturers in advanced
countries in Europe and the U.S., andstrived to create products that would be
accepted in the global market by adding
practical improvements to the latest
technologies.

Japan was caught up in the excitement of
hosting the World Expo Osaka. However,problems such as air and water pollution
also began to emerge. In addition, the oilshock caused industrial and economic
turmoil, and the business environment in
the automobile industry deteriorated.

With the bursting of the bubble economy,
the heyday of the Japanese car market
came to an end, and emphasis began tobe placed on more practical vehicles suchas compact and light cars. At the sametime, awareness of the need to protect the
global environment started to grow.

Reducing the burden on the environment
became a concern in many parts of theworld, and environmentally conscious
developments such as hybrid vehicles
and diesel engines were promoted.

Next-generation mobility, such as electricand fuel cell vehicles, began to emerge,leading to demand for a variety ofvalue-added tires.

TOYO TIRE Integrated Report 2023

TOYO TIRE Integrated Report 2023

8

Introduction

At a glance

Number of global bases

14 countries 40 bases*

The Toyo Tire Group has 14 production bases and 5 R&D centers, and is developing its tire and automotive parts
business globally.

Regional headquarters:
Production bases:

British Columbia (Canada)
Guangzhou (China)

Sales companies, etc.: 22

5R&D Centers:* Some bases have more than one function and therefore the total number does not match.
California (U.S.A.)

Zhucheng (China)

Moscow (Russia)

3
14

Zhangjiagang (China)

Consolidated
number of employees

Willich (Germany)

11,744

Willich (Germany)
Oud Gastel (Netherlands)(including temporary employees)

Northampton (U.K.)
Kentucky (U.S.A.)

Number of countries
in which we operate:

Georgia (U.S.A.)

More thanSendai (Japan)
Aichi (Japan)
Kuwana (Japan)
Kuwana (Japan)

Georgia (U.S.A.)
Georgia (U.S.A.)

Hyogo (Japan)

100 countries

Queretaro (Mexico)

Shanghai(China)Main global bases

Collesalvetti (Italy)
Ayutthaya
Wangnoi (Thailand)

Indjija (Serbia)

Tire business
Sales
companies

Tijuana (Mexico)
Perak (Malaysia)

Production
bases

Automotive parts business

Selangor (Malaysia)

Sales
companies

New South Wales (Australia)

Production
bases

R&D centers
Tires and automotive parts

Net sales by business segment (2022)
Automotive parts

Net sales by region (2022)

Tires

8.3%

91.7%

41,346 million yen

455,796 million yen

Other

Japan

13.5%

22.1%

67,090 million yen

Percentage of tire production volume(new rubber) by region (FY2022)
Europe 1%

Asia

17%

109,892 million yen

Japan

Total

Total

497,213497,213

million yen

million yen

North America

64.4%

320,230 million yen
9

TOYO TIRE Integrated Report 2023

Total

247.8

North America

28%

thousand tons

54%

* Figures current as of December 2022

Percentage of tire sales by region (FY2022)
Other(including for
new vehicles in andoutside Japan)

23.7%
Southeast
Asia

North
America

40.2%

5.5%
Europe 11.4%

Japan 19.2 %TOYO TIRE Integrated Report 2023

10

Top Message

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Message from the President
Strengthening our presence
as we step on to the next corporate stage
Takashi Shimizu
Representative Director,
President & CEO■ Can you share your thoughts on the release of the integrated report?
Showing where we are with management reform and business operations
In 2021, we embarked on the Medium-Term ’21 Plan, ourfive-year medium-term business plan. At the heart of thisplan lie business strategies that seek to improve thequality of what we do rather than to pursue quantitative
growth. In parallel to that, it also aims to strengthen thefoundations of the Group’s management in many areas.
The Medium-Term ’21 Plan shows our determination tomove up a gear with these transformational changes as
we step on to the next stage.
The plan is our declaration that we are going to merge

business and sustainability over this five-year journey,
which means playing our role in making a sustainable
society a reality by creating social value as well as
economic value through our business endeavors.
An integrated report is an important tool to help our
stakeholders understand where we are in our ongoing
management reform initiative, and I feel that the
publication of this first report is in itself a significant stepthat symbolizes the transformation we are going through.

The significance of the underlying Philosophy
At the start of the Medium-Term ’21 Plan in April 2021, weestablished the Sustainability Committee, which reports
directly to the Executive Committee, and I assumed therole of its chair. The Executive Committee is the highest
decision-making body in the Group, to which matters on
corporate management are referred. It is immensely
significant in our history that our new, seventh special
committee is one that has been specifically tasked withsustainability.
In the first year of establishment, the committee spentconsiderable time in discussions to develop the basic
policy that would set the course for our sustainability

11

TOYO TIRE Integrated Report 2023

action, identify the material issues we should prioritize,and draft the action plan, targets and KPIs linked to themateriality.
When defining the basic policy and materiality, our key
focus was to ensure that they were connected with our
Philosophy. This is because it is important that we facesustainability challenges without losing sight of whatmakes us the company we are, and it is therefore
essential that our sustainability actions are underpinnedby our Philosophy, which expresses our purpose. We
believe that this connection will enable us to merge
sustainability and business.

TOYO TIRE Integrated Report 2023

12

Top Message

Introduction

Engaging in dialogues with our stakeholders
to further explore what our integrated report should be

Top Message

VisionStrategy

implement them. This change had a major impact on allparts of the organization, affecting the way tasks on the
shop floor and frontlines of our business were carried out,
and this made the Group more responsive and agile. The
financial result of the second half of fiscal 2020 reflects thebenefit of the change, and I understand it also had apositive effect on the process of developing the MediumTerm ’21 Plan, which was going on at that time.
Since the reorganization in 2017 to create a functionbased organizational structure, we have aimed to be acompany where production, sales, R&D and corporate
functions work as one to improve our strength. Functions
are placed in a flat hierarchy, directly reporting to theMateriality

Governance

Data

President, so that they can share information andchallenges in a timely manner and work collaboratively. It
seems that the pandemic unexpectedly helped to bring
the functional units closer and strengthen ourorganizational foundation.
This meeting body, which started as an emergency
response, is still continuing as one of the good habits weacquired back then, under a different name that reflects
the permanent position it holds today. It is a place where
the top team can pick up management issues early as
they appear and discuss how to respond. It has become
embedded in the Group as a unique feature of ourmanagement style.

Stage to demonstrate our potential
We see our integrated report not merely as a medium but
as a theater stage on which we have an important job ofshowing to our stakeholders the value we are seeking tocreate, the capacity we have and are building, and ourpotential as a company.
The awareness of sustainability issues within theorganization has significantly and tangibly grown evencompared to just two years ago. However, despite theemerging linking of awareness to action, it is hard to map
out what sort of business we will be engaged in in ten,twenty or thirty years from now or what value we will beable to provide to society while earning profits, when thebusiness environment we are facing in the short termseems unclear. We have realized that it is not going to bean easy task to express in words our vision of the futureof business and sustainability.
In the end, we believe that we have succeeded inproviding a systematic overview of our businessprocesses based on the business strategies defined in
the Medium-Term ’21 Plan, as well as our strengths andweaknesses, and presenting a clear picture of how ourbusiness operations are linked to sustainability issues inthis report.
We have also been able to show how our businessactivities generate not just financial results or products
and services but wider outputs, which bring outcomesthat impact on capital in the form of social value, and how
this capital can in turn be leveraged in our business
operations. I believe that the work we undertook to
produce the report has been vital in merging businessand sustainability.
We hope that the readers will be able to observe ourvalue creation processes in our first integrated report. To
us, this report is not a finished product but the starting
point. We look forward to engaging in dialogues with our
stakeholders to further explore what the report should be.

Sharing the idea of how we should be
The current state of the Group’s management
performance and governance will be made public so thatthe information can be assessed against the commitments
stated in the Medium-Term ’21 Plan as the central core ofour business strategies. For details, please refer to thefinancial results to be announced officially along with thematerials explaining the current status of the Plan. Here, I
would like to touch on my vision of how the Group shouldbe, as well as the strengths of our portfolio.
The key concept of the Medium-Term ’21 Plan is toachieve qualitative transformation rather than making
everything new or aiming for a spectacular growth, as we
define these five years as an important period to prepare
for the move to the next stage. Internally, I have presented
three key concepts of our future direction that everyone
needs to understand.
The first is to work on our strengths to further
enhance them. This applies, for example, to our presencein the North American market, which I will explain later.

Solidifying this existing strength is an obvious approach
we should take. The second is to demonstrate how“leanness” can be a strength. We should not see limited
resources as a negative and instead see it as being
unencumbered and turn it into our strength. Or we can benimble by actively using external resources and turn it into
our unique strength. This can be one of the ways of ourbeing. The third and last is to internalize changes andevolve. This means thinking outside the box andchallenging ourselves to achieve transformation in orderto solidify all the bases we have left untouched until now.
By indicating the direction of travel simply and clearly,
we have ensured that the entire Group understands thetasks ahead and that everyone’s thinking is aligned. We
have been able to establish across the Group a sharedunderstanding of the way forward so that everyone ismotivated to implement the Medium-Term ’21 Plan anddrive it strongly.

■ How do you rate the progress of the Group’s management?
Closer collaboration between organizational functions
At the end of 2019, novel coronavirus COVID-19 started its
devastating spread across the world, which became a
global pandemic that lasted three and half years. In
February 2020, as soon as I realized the magnitude of theincoming crisis, I gathered the officers responsible fororganizational functions around a table so that we could
start sharing information on what was happening in

13

TOYO TIRE Integrated Report 2023

different parts of the world. We needed to know what
impact business units in different regions around the globe
were facing and decide what we had to do in response.
We created a new system, where the top management
team held daily morning meetings to look at the issues wewere facing from the same level and same perspective,
discuss what measures to take, and move quickly to

All hands on deck to solidify the foundation of North American businessOur main market is North America, where customers
highly rate our products and we have been able toestablish a particularly strong presence in the largediameter tire category. We have focused onstrengthening inter-functional cooperation, throughwhich we feed untapped needs we learn from our close
relationships with our customers back to the productdevelopment team. This approach has also been highly

effective in driving the Medium-Term ’21 Plan forward.
We have also reorganized our sales channels inorder to solidify our loyal customer base further, andhave significantly expanded the distribution network ofour branded products. This bold expansion strategy
helped to boost our market presence, which not only
minimized the damage from weakening demand during
the pandemic but also enabled us to respond quickly

TOYO TIRE Integrated Report 2023

14

Top Message

when demand started to recover.
We have reallocated more of the U.S. plant’s
production lines to large-diameter tire products andhave also started shipping products to North America
from our Serbia Factory, which started operation in 2022.
We are translating our commitment to enhancing ourIntroduction

strengths further into strategic actions, including
augmenting supply from other factories. As of this pointin 2023, our operations are on target in line with the roadmap, and we will make every effort to continue driving
this strategy forward.

■ How do you rate the progress of sustainability management?
Improving management quality by facing challenges head-on
In the first fiscal year of its launch, the Sustainability
Committee discussed our approach to be presented as
the Group policy for the entire organization, reviewed awide range of issues and carefully mapped out the areasof action we should tackle comprehensively. We have
now gone through a full cycle of activities we started
Group-wide and have turned over the half-way point of
the second year.
Each theme has a specific promoting body assigned
to it, such as a main supervisory department or acompany-wide interdepartmental taskforce, which
defines clear targets, plans and administrative
frameworks. The Sustainability Committee checks theirprogress, reviews the issues in focus from a medium- tolong-term perspective, and discusses topics to bereferred to the Executive Committee. There are manytasks we are only starting, such as collaboration withother special committees such as the TechnicalCommittee and the Organization & Personnel Committee,
reporting and discussions at the Board of Directors, but I
believe that we are making a steady progress in ourgovernance of ESG issues.
In the meantime, numerous new challenges to theenvironment, society and economy are emerging, and theinternational organizations, states, regions and industries
are required to respond ever more quickly, with no signsof the turmoil abating. We need to continuously watch
and see what new risks and opportunities our business
operations are facing and take action from a medium- tolong-term perspective. The issues in front of us are
extremely challenging, but I firmly believe that, by facing
them head-on, we can further improve the quality of ourmanagement and seek the Group’s purpose in society.

Top Message

VisionStrategy

Materiality

Governance

Data

Strengthening our presence in the incoming tide of EVs
Next-generation mobility is the near future of our industry
sector, and the speed of transformation to make it
feasible is accelerating. The most important question forthe sustainability of a mobility society is how much we
can reduce the environmental impact of mobility, andelectric vehicles (EVs) are one of the key solutions. EVs do
not look particularly different from conventional cars interms of appearance; the difference lies in their drasticallydifferent internal mechanism and their weight. Likewise,
tires that support EVs may not appear different, but therole they play becomes much more important. At theminimum, they must be able to meet and exceed threerequirements: larger diameter; lower rolling resistance;and low noise.
Being a large-diameter tire specialist, we are at anadvantage, and it is essential that we aim fordifferentiation considering the size of our business. In the
expanding and diversifying EV market, we should put theunique joy of driving that we can deliver front and center,and preempt and meet the needs of discerning
customers. Our medium- to long-term scenario to ride
this incoming tide is to employ a unique strategy like this.
Even with rugged tires for pickup trucks, which at the firstglance may not be expected to perform well in terms ofenvironmental impact, we will take an approach ofoffering distinct, attractive styling combined with a profile
design that reduces air resistance in order to elevateenvironmental performance.
Our ambition is to provide solutions to social issues
through our business and create social value, and we areworking to integrate corporate management andsustainability and to improve its quality through dialogues
with our stakeholders in order to achieve this ambition.
We welcome and appreciate the opinions and advice ofthe readers of this report to help us improve ourcorporate management. Thank you so much for yourcontinued trust in and loyalty to the Toyo Tire Group.

Fostering greater awareness

ESG thinking beginning to be embedded within
Inside the Group, ESG actions are starting to become aday-to-day part of our work.
For example, it is clear that the big issue of climatechange is no longer seen as something distant from us
but is felt much closer today. Procurement of renewableenergy is now incorporated in the yearly plans on thebasis of a medium- to long-term plan, and is implemented
after appropriate internal examination. We have designeda system of investment appraisal for decarbonization andintroduced it in our meeting bodies. Also, having stated
our endorsement of the TCFD recommendations, we are
currently making the necessary preparations fordisclosure. Quantifying the financial impact of our action
to tackle climate change will enable us to demonstrate
our sincere commitment to decarbonization as a

15

TOYO TIRE Integrated Report 2023

management issue. It is a direct responsibility of the
management how we can mitigate climate impact on ourbusinesses.
We are also expanding our view across our supply
chain and applying more in-depth look at it, which we arenaturally expected to do. We are starting to examine who
we share our approaches with as we operate our businessand making it our mission to ensure that we have healthy
approaches, appropriate relationships and a sound spirit.
We believe that the spirit, enthusiasm and ambition of
the human resources that drive all corporate activities need
to be healthy and positively motivated in order to support a
company’s sustainability and creation of social value. We
are committed to further improving and advancing thework to build the foundation of our human capital.

of creating value for society
through our business

TOYO TIRE Integrated Report 2023

16

VisionIntroduction

Top Message

VisionStrategy

Materiality

Governance

Data

External Environment and Risks & Opportunities
We are aware of the risks and opportunities posed by the external macro environment in which the Medium-Term’21 Plan was formulated and is being implemented, as well as the changes in the mobility field that are expected
to occur by around 2030. We will work to create value along the entire value chain through our operations,products and services based on this awareness.

Awareness of the external macro
environment (before 2025)

Predicted changes in the mobility field(before 2030)

Opportunities
Opportunities to increase demandthrough technological innovation anduniqueness in our EV response

Significant changes in consumer
behavior in the post-COVID-19 era● Mindset: Home bound, budget-minded,avoiding person-to-person contact● Behavior: EC/cashless purchases,changes in requested services

Growth of environmentallycompliant/electric vehicles

Opportunities to increase demandthrough technological innovation anduniqueness in our environmental
response
Opportunities in the solutions business

Products and services

EV-specific/
compatible tires

Life cycle
focused productdevelopment

Highly durable/
maintenance-freetires, airless tires

Sensing

Increasing in geopolitical risks● Decoupling trend continued, including

competition for leadership between U.S.
and China● Economic disparities widening due to
COVID-19 also aggravate populism

Increased use of driverlesstransport and alternativetransport services

Aligning of social & environmental
interests with economic interests
accelerated● Prioritization of employee/customer

satisfaction increased● Accelerated trend to align public interest

with economic interests throughcustomer-producer collaboration

Evolution and accelerated introductionof laborsaving technology● Digital investment accelerated to make up

for slow growth in worker headcount● Advanced roles for humans as

quality/quantity of data increased

17

TOYO TIRE Integrated Report 2023

Risks
Risks associated with climate-related
measures
Risk of not being able to secure astable human resource base

Greater use of IT(mobility-related data linking)

Further diversification to meet
individual needs andRisks associated with measures touphold human rights in ouroperations and supply chain

Operations

Improve energy
efficiency andexpand use ofrenewable energy

Promote resource
circulation andrecycling

Risks of failing to ensure quality,
including environmental compliance,
throughout the value chain

Process assurance

Risks associated with the growing
demand for safety

Tire safety
awareness

Human capitalmanagement
Strengthen
supplier
engagement

Responsible raw
material
procurement andtraceability

Individual
management
systems in themarketconvenience

TOYO TIRE Integrated Report 2023

18

VisionIntroduction

Top Message

VisionStrategy

Materiality

Governance

Data

Toyo Tire Materiality
In promoting sustainability, we believe it important to identify issues that should be given priority when consideringfactors such as the relevant scope of our business domain and internal resource limitations. We have thus
established our Group material issues, which were decided upon by the Sustainability Committee in June 2021
and then approved by the Executive Committee in July.
Along with strategically investing our internal resources into initiatives related to the material issues, we will
also use this opportunity to foster a corporate culture where each employee addresses sustainability issues byconnecting materiality to their own duties, as well as strengthen materiality-focused stakeholder engagement,such as public ESG dialogues.

Process of identifying material issues

Material issues

After declaring our intention to build sustainability into
corporate management in our Medium-term ’21 Planannounced in February, we soon formed a steering committee
for sustainability where the President and vice presidents ofeach headquarters began discussions on identifying material
issues. This was transitioned into the Sustainability Committee
in April, and the two committees collectively held discussions
from February a total of four times over four months. In May, atotal of 40 division general managers and other executives
who are key in the promotion of sustainability met to discuss
the same themes, and the outcome was taken into account incommittee discussions.

Ⅰ Value creation

Domain12Determine the Toyo Tire approachto sustainability

Investigate how sustainability
impacts business opportunities
and social value● Extract key themes to address — based on speciﬁc

products and services, target customers and futuresocial change — in order to realize the Toyo Tire
corporate philosophy● Determine the value created in society throughtheme initiatives and evaluate their priority

3

have been identiﬁed by international groups, ESG
rating organizations and other bodies, and risks weare aware of through our corporate activities● Determine their potential to hinder achievement ofour corporate philosophy and social value creation,and the status of existing Group efforts, andevaluate their priority

19

Help create a society ofsustainable mobility
We recognize that the sustainability of tire and autoparts manufacturers can only be ensured through asociety of sustainable mobility. We will thus fulfil our
duty in using our unique products and services to help
establish a society of sustainable mobility that boasts
net-zero environmental impact, zero accidents andefficient transportation.

The base for value creation

Support diverse talent withmotivating challenges and job
satisfaction
We seek individuals who can equip themselves withthe medium- to long-term perspective of a tire andautomotive parts manufacturer, think creatively andflexibly, and show initiative and ambition. We willsecure a foundation for diverse talent who support ourcompany’s business management and create highadded value in these rapidly changing and uncertain
economic and social times.

Investigate sustainability andbusiness risk
● Conﬁrm risks in the tire and auto parts industry that

4

Unique value provided to customers andsociety through our products and services

Ⅱ Foundation for value creation

DomainIdentify material issues based on
the results of steps 2 and 3

TOYO TIRE Integrated Report 2023

Support the enjoyment ofmobility for all
We see it important to offer creative added value that
supports the diversity of a society of sustainablemobility by fulfilling the essential conditions forsustainability (environmental compliance, safety) while
also meeting the varied expectations people have for
their own mobility through our unique products andservices.

Continue innovatingnext-generation mobility
technology
The value we provide through our products andservices must support the evolution in mobility being
demanded in this new era. To make this happen, we
believe it is vital to engage in ongoing technologicalinnovation and make continuous advancements thatmeet the demands of society.

Domain

Ⅲ Risk management

Responsible business practices that protect
the means of value creation

Pursue decarbonization in all
corporate activities
Our Group will adjust its course to match that of global
society, including Japan, business communities andindustries in sharing the same targets towards
decarbonization, and work united as a company intackling this key issue. We will not only aim to eliminate
the environmental impact of mobility through our
products and services, but also to decarbonize ourentire manufacturing process and supply chain, and tie
these measures to increased cost competitiveness.

Promote supply chain sustainability
We understand that our own sustainability cannot beensured without the sustainability of our suppliers ofnatural rubber and other raw materials, and that thegenuine enjoyment of mobility is created through ahealthy supply chain. We thus see environmental andsocial issues in the supply chain as key challenges
that we will prioritize in our efforts.

Ensure the fundamentals of
manufacturing: quality and safety
No matter how much value a product or service may
create, if it cannot maintain a strong core of quality
and safety, it is no longer able to offer thatsignificance or value to society. Quality and safety are
therefore our top priority in all of our operations,building on lessons we have learned in the past.

TOYO TIRE Integrated Report 2023

20

VisionIntroduction

Top Message

VisionStrategy

Materiality

Governance

Data

Value Creation Process
The Toyo Tire Group believes in the importance of organizing and disclosing our corporate philosophy, businessmodel, governance, and business risks and opportunities to help promote a clearer understanding of the type ofcompany we want to be in the future. As part of our value creation process, we have verbalized our six capitals,
and defined the outputs generated through the utilization of these capitals and the outcomes that might impact
stakeholders.

Inputs (FY2022)

11,744

Designability

Global network(Number of consolidated subsidiaries)

Enhancing sources of growth(Japan: 8, International: 29)
Natural capital
Total energy
consumption

Total volume of
raw materials

7,370.8

589.0

thousand GJ

Human resource
base

Digitaltransformation
platform

Financial base

Reducing medium- to long-term risk
Climate change
response

Environmental andhuman rights measuresin the supply chain

thousand t

Corporate governance

Unique products andservices

Value creation

Over

Technologicalprowess

Social andrelationship capital

37

60.0B yen

Human talent

od

R&D

Number of consolidated
employees

14% or higher

R&D

t

Pr

Financial
indicators

55%

Differentiated SUV and CUV products that combine
environmental performance and sophistication● Innovation to address the shift to electric SUVs andpickup vehicles● Customer endorsement
Rank 5th on sales share in North America(Medium-Term ’21 Plan challenge)

ROE overMedium-Term’21 PlanShareholder returns

Maintain a dividend payout

12% or higher% or higher,
ratio ofwith ROE target in mind

30●

Organic cooperation, growth and active
participation of diverse talent● Development program to nurture ultimate
individuality, quality and ability●●

A society ofsustainablemobility

The enjoymentof mobility
for allHelp achieving decarbonizedsociety through products andservices

Ratio of sustainable raw materials used in products
2030: 40%, 2050: 100%

Safe and comfortable mobility
Decarbonization

men

Percentage ofsales from priority
products

Supplychain

Human capitalu reConsolidated
operatingincome●Scope 1 & 2 emissions
2030: 46% reduction vs. 2019 levels,
2050: carbon neutral●

Scope 3 emissions
2030: 20% per tire vs. 2019 levels●

Suppliers with completed environmental and social
risk assessments
2025: 100% of primary suppliers

Mobility that creates
excitement and surprise

Ultimate driving enjoyment

Quality
Qualityocpr11,320M yen

nd

R&D expenditureh a sin g aIntellectual capital

Coordinatedfunctions[strengths]

Consolidated
operating income
marginFoundation for value
creation

M yen

Japan: 5
International: 9

P u rc47,303

Outcomes

Medium-Term’21 Plan

Risk management

Number of
production sites

pply logistics
Su

les
Sa

Capitalexpendituren

la n n in g

Manufactured capital

Customer baseand marketingby market

tp598,889M yen

Global production
framework /supply chainuc

Total assets

Prod
uc
tio

Financial capital

Outputs

Business processes

Established process assurance system
Traceable individual management to end of market● Improved user safety awareness●●Our philosophy

21

TOYO TIRE Integrated Report 2023

TOYO TIRE Integrated Report 2023

22

VisionIntroduction

VisionTop Message

Strategy

Materiality

Governance

Data

Our Strengths
The core competence of the Toyo Tire Group lies in our technological prowess. We are developing our business bylinking technological developments to our production and distribution systems on a global scale. We intend tofurther refine our strength in differentiated products at our technology development bases in and outside Japan,
while also building new production facilities to secure stable supply capacity and engage in global sales tailored toregional characteristics.

Solid customer base built to target the North American market
Our business strategy in North America has evolved into an iconic business model for our tire business.
We have built a strong customer base by narrowing down target models and users and by collaborating withlocal dealers who know their customers extremely well, rather than operating directly managed dealerships.
In addition, through our marketing activities we identify needs which we promptly feed back into the Group,
to create a virtuous cycle that leads to the development of differentiated products.

Optimal global production and supply system

North America business model

We incorporate design support technology that uses AI into our tire and driving
simulations to simulate aerodynamics and snow traction and accurately analyze
tire patterns behavior in detail.

Design support
technology(T-MODE)We centrally manage various data as common assets, and add value bycorrelating data, and we use machine learning to enable the acquisition oftire characteristic values in real time.
Japan-R&D

Europe-R&D

Japan-R&D
Global Headquarters

NA-R&D●●

Designability

All R&D functions
Development of high-performance technologies(research, development, evaluation, utilization of big
data and AI)

Responsible for all R&D functions and updates various platform technologies.

NA-R&D●●

Marketing
Development of customer-oriented products

Cooperates with the marketing department in North America, our core market,
to develop customer-oriented products that respond to preferences.

Europe-R&D●●

Advanced materials / next-generation mobility survey
Development of high-performance technologies

Focuses on surveys and research for the utilization of cutting-edge materials
to facilitate the development of next-generation mobility technologies suchas EVs.

23

TOYO TIRE Integrated Report 2023

Customer baseand marketingby market

la n nin g
tp

u re

uc

r

Simulation
technology(T-MODE)

Technologicalprowess

Development to respondto market needs● Technical feedback from
off-road racing●dp

We strive to develop the ideal rubber material by predicting, creating functions,precisely controlling, and observing and discovering the properties of thevarious materials used in tire rubber at the nano-level (1 nano = one billionthof a meter).

c h a sin g a n

Material design
technology(Nano BalanceTechnology)

Sales channels based onstrong relationships oftrust with dealers● Pricing closely adjusted tocustomer needs●

Sales(Dealers)

Coordinatedfunctions[strengths]ocHigh-performance
products backed bytechnology

Production

ply logistic
Sup
s

P ur

The automotive industry is currently undergoing major transformations and tire development is also
expected to quickly provide quantitative performance and functions to support the evolution of mobility.
We are constantly updating our proprietary technology base to achieve higher precision and speed inmaterial compounding and tire design.
Our R&D functions in Japan, the U.S. and Europe each play a different role in our research and weare combining their results and collaborating with sales and production departments to develop highly
functional and differentiated products that meet the needs of each market.

n

●

les
Sa

Proprietary technology and tripolar R&D collaboration
between Japan, the U.S. and Europe

Prod
uc
tio

We are promoting local production for local consumption in markets where our production bases are located, whileworking to optimize the product mix at each of our plants and to deliver products to our customers in a timely
manner through our flexible and optimal supply system made up of such production bases. Large-diameter tires for
SUVs and pickup trucks, an area in which we excel, enjoy tremendous support in the North American market. We
are gradually increasing the production capacity at our U.S. plant in order to meet the demand for such tires.
We are also renovating facilities at our plants in Japan to increase supply to North America.
In 2022, we opened our first European plant in Serbia. The plant aims to deliver competitive
products to the European market and to supply tires for passenger cars to the North American
market. In Malaysia, we are consolidating our production bases and shifting to the productionof high-margin brand lines.
Global production
framework /supply chain

m ent

R&D

Pr

od

Customers

Marketing(Consumers)

R&D
Identification ofmarket needs● Recognition (prestige)
through participation
in off-road races●

Customer support(fans)● Niche market position●

Message from Vice President,
Business Headquarters

Kiyohito Hasumi
Corporate Officer

At Toyo Tire Corporation, we aim to manage ourbusiness through a function-based organization withthe mobility field at its core. We pursue a strategy of
maximizing the advantages of our corporate scale andoperating with minimum resources, which enables us
to turn the fact that we do not have certain functions
within our organization into unique strengths byfocusing on and developing the functions we have. We
proactively work on issues identified throughcollaboration between production, sales and R&D
while picking up and coordinating issues that require
collaboration but tend to be overlooked due to thespecialized and independent nature of each function.
Through this approach, we are refining our ability torespond to changes and high agility to create value
throughout the Company.
Such inter-functional collaboration is needed not
only at headquarters, but also at the bases where our
products are manufactured and sold. The way in which
the functions collaborate varies depending on our
position in the region. We have been successful inattaining solid support from our customers in the North
American market not only because of our local coherent
production, sales and R&D capabilities, but also thanks
to our holding function, which bundles together andfirmly backs up these capabilities. In Europe, where thelong-awaited Serbia Factory is now up and running, an
R&D Center is already in operation in addition to oursales bases and we have established a regional
management company. However, we are not a full-line
supplier and we excel in areas where we have an edge.
While transplanting our know-how from North America,
I would like us to be identified in Europe, not in terms of
our size, but in terms of our uniqueness.
I now feel that each of us needs to work on building
up our ability as a company to construct scenarios andexplain what needs to be done to people both insideand outside the Company. I repeatedly tell staff
working in my division that scenarios are the key topersuading others and to speedy decision making,and that even if scenarios don’t go according to plan,
verification of the causes will lead to future action.
Looking at it from another perspective, harmony,
humility and consideration, all qualities which arevalued in Japan, while important, should not become
an obstacle that delays decisions and results. The
ability to accurately convey ideas in a way that they canbe correctly understood by a diverse group of people
who speak different languages and come from different
backgrounds is essential. We will build scenarios with
foresight and fulfill our responsibilities so that we canconvert such diversity into our strength.

TOYO TIRE Integrated Report 2023

24

Strategy

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Financial Strategy
Medium-Term ‘21 Plan: Financial policies and targets

Growth investment

In the medium-term business plan, the Medium-Term ‘21 Plan,announced in 2021, Toyo Tire Corporation set out its future vision
for three management platforms (digital and IT infrastructure,sustainability management, and organizational and humanresource infrastructure) designed to create value through thesolution of social issues and ultimately generate sustainablecorporate growth. Right now, we are steadily progressing eachmanagement platform and earnestly working to strengthen thefinancial base that underpins these platforms.
We intend to pursue stable management, even when facedwith an uncertain and rapidly changing economic environment,
and build a robust financial base by promoting measuresdesigned to: improve capital efficiency by scrutinizing ourbusiness assets; achieve cash flow-focused management bystrengthening our power to create cash and accelerating cash
cycles; and ensure financial soundness.

Regarding growth investment, we will promote investment that isessential for ensuring future growth in the medium- to long-term,
namely digital-related investment, market investment andinvestment in new R&D fields.
First, on digital-related investment, we aim to improve
profitability by reorganizing our enterprise resource planning (ERP)system, and seeking to strengthen global data governance by, forinstance, visualizing management resources and risks,
accelerating business processes and improving the quality of ourdecision-making.

In terms of concrete targets, we have set targets in theMedium-Term ‘21 Plan for a consolidated operating income
margin of 14% or more and consolidated operating income of 60
billion yen in fiscal 2025. We have also set a minimum 55% sales
composition ratio for priority products, which is vital for achieving
the aforementioned targets. We are promoting initiatives tomaximize our strengths in order to increase profitability.
Furthermore, we set a minimum target for return on equity(ROE) of 12% during the medium-term plan because we aremoving into a new corporate stage, and clarified our policy for
improving capital efficiency as well as profitability.
We are determined to improve our own unique corporate
value, which focuses on enhancing quality, by steadily achieving
these financial policies and targets.

Financial situation(Millions of yen)

FY2020

FY2021

FY2022

Total assets

445,579

531,229598,889

Equity capital

220,776

279,954

320,683

Cash and cash equivalents at end of the year

36,30353,592

41,600Interest-bearing debt at end of the year

110,578

128,784

135,436

Capital ratio (%)

49.55

52.70

53.55

Total payout ratio (%)

59.31

16.76

27.61

Return on equity (ROE) (%)

5.27

16.52

15.97

We have established a policy regarding the allocation of capitalwith due consideration of shareholder returns, and formulated thecapital investment plans based on the tandem pursuit ofprofitability and potential growth.
We plan to make capital investments of 194.0 billion yen overthe five years of the Medium-Term ’21 Plan. We intend to use
operating cash flow generated during the period, along withadditional procured funds if necessary, to cover the total amountof capital investment and shareholder returns.
To give a more specific breakdown, our basic approach is toallocate 50% of operating cash flow for capital investment
required to ensure future growth from a medium- to long-term
perspective, which we have strategically labeled as growthinvestment. Of the remaining 50%, 30% will be allocated forEnvironment and social (ES) investment
We expect to make further sustainability-related investments
going forward in order to promote a shift toward sustainability
management. Regarding decarbonization-related investments inparticular, it can be difficult to incorporate any CO2 reduction
impact into the profit simulation used for verifying profitability anddetermining whether or not to promote regular investment
projects. As a result, those investments may be consideredunsuitable in terms of sustainability management.
With that issue in mind, we introduced internal carbon pricing(ICP) on a trial basis in fiscal 2023. ICP is a good way to visualize

capital investment required to maintain and update facilities topreserve the competitiveness of our existing businesses as wellas improve productivity, and 20% will be used to return profits toshareholders.
We plan to generate further growth while maintaining strictfinancial discipline. Light trucks and SUVs form the bulk of sales in
the U.S. market, which are both areas in which we excel. Basedon that trend, we intend to strengthen our supply framework forlarge-diameter light truck tires because we believe they harborstrong growth potential. We will also consider investing in highly
unique product development that leverages our strengths. At thesame time, we will provide shareholder returns and increase
dividends by improving profitability, and meet capital market
expectations.

TOYO TIRE Integrated Report 2023

to achieve a dividend payout ratio of 30% or higher during the
Medium-Term ‘21 Plan.
The ultimate aim is to realize a shareholder returns policy thatprovides stability and reflects business performance. This will bedone by adjusting non-recurring special gains (losses) included in
profit attributable to owners of the parent and linking returns toreal profit that more closely reflects actual profit values.

Three-year cash allocation
Strategic
allocation
Growthinvestments
50%

Operatingcash flow

Capitalexpenditure
30%
Shareholder
returns
20%

25

the impact of reducing CO2 emissions by translating that impact
into a quantifiable monetary value and to incorporate that impact
into a quantitative model. We want to facilitate the considerationof the CO2 reduction impact as a monetary value in investment
decision-making because we believe this will help promotedecarbonization-related investment.
Going forward, we will use ICP to review the performance ofour decarbonization investments. We also plan to introduce ICP
as an official evaluation standard in 2024 based on external ICP
price-setting trends.

Shareholder returns
In our new corporate stage, we will set policies for capital
investment and shareholder returns in addition to ROE indicators,
and we will pursue both profitability and efficiency in a wellbalanced manner.
As part of this policy, we want to provide returns toshareholders that reflect annual performance, while maintaining
our commitment to the provision of stable dividends. We expect

Investment and financial strategies

Second, in terms of market investment, we will invest
management resources in building user-centric sales andmarketing, including digital marketing, engagement activities
designed to enhance our brand power and promotional activities
to expand sales.
Third, in terms of investment in new R&D fields, we will strive
to establish and commercialize technologies for next-generation
vehicles in order to create forms of sustainable mobility that areworthy of a carbon-neutral society.

● Make investments that contribute to growth● Control interest-bearing debt

Investments needed to achieve growth over the medium- to long-term● Digital-related investments● Market investments● R&D investments in new fields

Investments needed to maintain competitiveness of core businesses● Investments to maintain the sustainable growth of existing businesses, improve productivity● Investments to rebuild our management foundation

Payout ratio: 30% or higher● Continue stable shareholder returns linked to annual performance

TOYO TIRE Integrated Report 2023

26

Strategy

Introduction

Top Message

Strategy

VisionMateriality

Governance

Data

Medium-Term ’21 Plan ProgressThis section explains the progress made on our five-year medium-term business plan that we call Medium-Term’21 Plan. To help address the dramatic changes in our external environment, we are pursuing the plan’s goals by
coordinating R&D, production, sales and other functions on a global scale and demonstrating an ability to adapt
swiftly and flexibly to change.

Basic policy
The new Toyo Tire Group: Use our new global strategy to maximize corporate value

R&D

Build a foundation for advancing our global technologicalcompetitivenessProduction

Create a globally balanced supply framework with the launch of
our Serbia Factory

Sales

Expand contact with potential customers, enhance our uniquepresence in the market

New
corporate
stage[Corporate]
Realize effective coordination among R&D, production andsales functions
Establish a management platform to drive our growth strategies andenhance human resources<Corporate>
Strengthen business administration
foundation and support
Transform corporate governanceand compliance structures

Previous
corporatestage(past initiatives)<R&D, Production, Sales>
Strengthen areas of expertise
Demonstrate uniqueness
Shift to a function-based organization

Progress on R&D, production and sales strategies
R&D
Strengthen our proprietary technology by joining
up the R&D of Japan, the U.S. and Europe todevelop highly preferable and differentiatedproducts that meet environmental and othernext-generation mobility needs

Production
Build a stable supply base for the North
American market and make the Serbia Factory
highly cost competitive

Sales
Strengthen offerings for strategic models bylaunching differentiated products for North
America, Europe, Japan and Asia according tolocal market strategies, and creating tie-ups
between tires and automotive parts

27

TOYO TIRE Integrated Report 2023

We have developed and launched a new product with a new silica dispersing agent madefrom natural sustainable raw materials. In the field of materials development, we havecreated a technology for synthesizing the butadiene required for synthetic rubber from CO2
jointly with the University of Toyama. This helps reduce environmental impact compared topetroleum-derived products. We are also actively developing the high-functioning EV tires
with the superior rolling resistance and wear resistance required for EVs, and is working tocreate differentiated products that combine environment-conscious technologies with thesophisticated features for which we are renowned.
Production at the Serbia Factory, our first production base in Europe, began in July
2022. We aim to generate highly efficient production fueled by state-of-the-art
equipment and systems that fulfills our desire to produce locally in Europe for local
consumption and secures a stable supply of passenger car tires for the North
American market. We are pressing ahead with the construction of an optimal global
production and supply system inspired by the launch of the Serbia Factory. For
instance, establishing a production system at the Serbia Factory will enable us toincrease the production capacity of large-diameter light truck tires at our U.S. plant.
We will continue to launch new products with unique and sophisticatedcharacteristics and use our wide-reaching sales network to actively expand sales oflarge-diameter light truck tires in the priority market of North America. In addition, weare boosting the sales ratio of priority products by introducing regionally tailoredproducts in each market and participating in motorsports activities to improve ourbrand power and presence. In Japan, we are pressing ahead with efforts to build
sales and logistics systems that are highly efficient and meet customer needs.

Digital transformation policy
With regard to digital transformation (DX), in 2021, Toyo Tire Corporation established a headquarter for each function to guide theestablishment of a management platform capable of firmly supporting the growth strategies laid out in the Medium-Term ’21 Plan andunderpin the required improvements in corporate structure to achieve that growth. We are strengthening inter-functional links across theboard and promoting digital innovation in three separate stages. We are currently in the first stage of that process in which we arestandardizing global operations by developing various infrastructure and rebuilding enterprise resource planning systems, and alsobuilding an integrated data platform that is key to data-driven management. The aim
is to move swiftly into the second stage, which will help generate higher profitability
Growth strategies
and improve value.
Production/Supply
R&D
Regions
On the technology and product development front, we proactively utilize data to
optimize products through lifecycle management and improve productivity at our
manufacturing sites. We are also formulating a sales strategy and developingDX
priority products based on the centralized management and optimal operation of① Reinforce② Improve③ Increase value
global inventories and precise data analysis. Our ultimate aim in using this digitalmanagement
profitability
Products, innovative
foundation
Data-driven
strategy is to simultaneously ensure a customer-focused manufacturing frameworkservices and value
Rebuild systems,
management, efficient
provisiondevelop digital platforms
operations
and highly profitable business management that will support our growth strategies.

Progress on key performance indicators
In fiscal 2022, the Toyo Tire Group achieved consolidated operating income of 44.0 billion yen and a consolidated operating margin of
8.9%. Compared to the smooth progress made toward our quantitative targets in the first year of the plan, progress in fiscal 2022 was
temporarily hindered by changes in external factors caused by emerging geopolitical risks. However, the operating income target for fiscal
2025 is within reach and we plan to move forward with confidence in order to achieve that level.
The fiscal 2022 return on equity (ROE) level of 16% remained above the 12% target. The policy on the dividend payout ratio stipulated
in the medium-term plan to achieve a ratio of 30% or higher on a net profit after deduction of one-time gains (losses) basis remains
unchanged. We will achieve a good balance between growth investments, investments in business continuity and shareholder returns.

Flexibly adapt to environmental changes, attain upward profit track to achieve targets

FY2025targets

Consolidated
operating income:

60.0B yen

Consolidated operating
income margin:

14% or higher

60.0B yen

Actual performance (operating income, margin)

53.1B yen
13.5%
44.0B yen
11.8%

44.0 B yen
8.9%
44.5B yen
9.8%

30%
17%

50.0 B yen
9.3%

FY2022* Latest estimates

Breakdown

Tires
52.0B yenat the time of
publication

ROE:

Payout ratio:

12% or higher 30% or higher

35%

Target payout ratio:
30% or higher

16%

Target ROE:
12% or higher

Dividend per share

76 yen80 yenFY2021

FY2022

Automotive
components-2.0 B yen

Initial estimates (operating income, margin)
FY2021

14.0%

OverMedium-Term’21 Plan

FY2023 (E)FY2025

FY2025

FY2021

FY2025 targets
Percentage of sales
from priority products

55%

North
America65%

Japan
Europe37.8B yen

49%

45%

Overall* FY2022 results

51%

194.0B yen
Total capital
investment
over 5 years

Ratio of units soldto North America(FY2025)

43%(FY2022)

North America
proportion of
total sales

FY202241%

48.0B yen

58%

(FY2025)

66%(FY2022)

TOYO TIRE Integrated Report 2023

28

Strategy

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Business Overview

Tire Business

Automotive Parts Business

The primary business of the Toyo Tire Group, which accounts forapproximately 90% of net sales, is the production and global sale ofautomotive tires for passenger vehicles, light trucks and SUVs, andtrucks and buses, and other related products. The tire market isprimarily classified into original equipment tires (global), replacement
tires for the Japanese market and replacement tires for global
markets. The replacement tires for the North American market inparticular accounts for a significant proportion of our sales.

The external environment
The United States is a major sales region for Toyo Tire Corporation.
In that market, while some people were pessimistic about theeconomic outlook at the end of 2022, the latest employment andincome environment has remained strong, economic sentiment is
improving and private consumption is holding firm. Meanwhile, in
Europe, corporate sentiment is expected to deteriorate andeconomic conditions are expected to remain soft as the positive
benefits that accompanied the resumption of economic activities
following the COVID-19 pandemic start to fade. In Japan, theeconomy has picked up thanks to the impact of various
government measures, but close attention should be paid to therisk that a downturn in international economies could dampen theJapanese economy, and that continued high prices could dampen
the pace of recovery.
The global economy is exhibiting a certain degree ofresilience, and we believe that the ownership of light trucks, which
is a key area of strength for us, will hold firm and demand forhighly sophisticated large-diameter light truck tires will remain
steady. We will work to further expand sales of large-diameter
light truck tires and SUV tires, in which we excel, as well as otherpriority products by utilizing our global production bases in the
U.S., Malaysia, China and Serbia and our global supply anddemand system that can swiftly adapt to change to their fulladvantage. On another point, most people now expect the
proportion of battery electric vehicles (BEVs) to new vehicle sales
to certainly rise, so the outer diameter of tires is expected to

Net sales(billions of yen)
500
400

332.8

300

455.8
306.6

497.0

354.6

200
100
0

2019

2020

2021

The Toyo Tire Group leverages its vibration control technology tosupply products that improve automotive handling stability andsoundproofing. We are striving to establish a solid position as asupplier by promptly proposing products that match the needs ofautomakers. Moreover, given the fact that automobile production
sites are located across the globe, we are focusing our efforts onrealizing an optimal supply network by establishing a production
structure centered on Japan, the U.S. and China.

2022 2023 (E)increase in relation to the weight of the vehicles. The trend toward
electric pickup trucks is also expected to advance in North
America. We view this shift toward electric vehicles (EVs) as anopportunity and we plan to develop EV tires that leverage ourstrengths and introduce them into the market.

FY2022 review and future outlook
In the North American market, both sales volume and net sales
increased year on year in fiscal 2022 compared to fiscal 2021
thanks to our focus on the sale of priority products, such aslarge-diameter light truck tires, as well as an improved product mix
thanks to higher prices and expanded sales of priority products. In
the European market, sales volumes declined year on year in thewake of the situation in Russia and Ukraine. However, net sales
held steady year on year due to price increases in individual
European markets and an improved product mix. In Japan, bothsales volume and net sales increased year on year thanks tostronger sales of winter tires, focused sales of priority products andan improved product mix generated by higher prices and higher
sales of priority products. In terms of the future outlook, we expect
to generate an increase in both sales and profits going forward
based on a forecasted increase in units sold and assumed positive
benefits from revised ocean freight rates. We will also work to
improve productivity at our plant in the U.S. and boost production
beyond the previous year’s level while steadily implementing ourplan for full-scale operation at our plant in Serbia.

Create differentiated products by further strengthening our proprietary technologies
Establish highly cost-competitive operations at the Serbia Factory, build a stable supply base and a highly efficient global production system
by horizontally deploying the latest production systems● Consistently develop high value-added products tailored to specific needs● Solidify and extend a dominant position in large-diameter light truck tires in North America

The external environment
The environment surrounding the automotive parts business wasaffected by a reduction in production on the part of automakers
that was caused by a shortage of parts and semiconductors in
the wake of COVID-19. However, automaker production is
expected to recover going forward. Sales for the Toyo Tire Groupare predicted to increase on the back of higher sales prices for
current products and products for new models, and the recovery
in production by automakers. This trend was already pointed out
in the previous external environment segment for the tirebusiness, but the ratio of BEVs to new vehicle sales willundoubtedly increase in future, so we need to diligently consider
the pending shift to EVs.
Toyo Tire Corporation’s management can be characterized byits combination of two segments that are vital for mobility, namely
tires and automotive parts. We will help promote the shift to EVs
and develop next-generation mobility by pursuing a uniqueapproach that links both the tire business and the automotive
parts business.
The main products in this segment that best demonstrate ourtechnological prowess include engine mounts, EV motor mounts
and resin boots. We aim to make full use of the differentiation
technologies that we have acquired through technical exchanges
with automakers to promote the development of high valueadded products and encourage orders, while maintaining andimproving the required functionality. We seek to progressively
improve automotive-related technologies, and wish to channel the

Net sales(billions of yen)
50

44.6
37.1

40

43.0

39.0

41.3

2021

2022 2023 (E)

30
20
10
0

2019

2020

early collection of information on vehicle trends into pioneering
next-generation mobility technologies.

FY2022 review and future outlook
In fiscal 2022, we were affected by the production cuts instigatedby automakers, but managed to partially reflect the soaring cost of
raw materials in prices, which resulted in a year-on-year increase in
net sales compared to fiscal 2021.
In terms of the future outlook, we expect to see an
improvement on the profit front thanks to a recovery in vehicle
production and a consequent increase in sales. We will continue
to work on improvements by better reflecting conditions in thematerials market and soaring energy costs in prices, streamlining
raw material procurement and production processes andpursuing greater efficiencies in international transportation costs.
We recognize that turning a profit in the automotive parts
business is an important issue for us. We have already madeprogress on streamlining operations at our plants and reducing
selling, general and administrative expenses, but we arecommitted to further improving profit structures in order to movethe segment into the black.

●

Basic
strategy●Develop products that offer environmental, sustainable and other elements in addition to our renowned sophisticated features
Expand the application of modular design to promote early commercialization
● Introduce
production equipment to prepare for EV shift

Establish a superior position as a system supplier by organically linking tires and automotive parts

Basicstrategy●Individual
measures●

Encourage product use in next-generation mobility vehicles and other strategic models

●

●

R&D

Individual
measures

Production●Establish annual production capacity of 5 million units at the Serbia Factory
Increase supply capacity of large-diameter light truck tires at U.S. plant●

Develop approaches to encourage new orders for high value-added products
Optimize production bases and ordering concepts to improve profitability●●Consistently launch new products with unique and sophisticated features
Prioritize development of digital marketing, generate synergies through stronger cooperation with existing sales network● Pursuevarious categories of motorsports activities to help enhance performance and brand power
●

Sales

29

●

TOYO TIRE Integrated Report 2023

TOYO TIRE Integrated Report 2023

30

Strategy

Introduction

Financial Highlights

Energy consumed*

Operating income / Operating income margin
Operating income margin (right scale)Operating income(Billions of yen)
500

(Billions of yen)
60

497.2
377.5

375

343.8

Strategy

Vision

53.1

393.6

42.4

40

44.0

38.4

13.5

36.3
10.6

(%)
20

(thousand GJ)
8,000.0
7,473.015

6,000.0104,000.012

7,346.1

19.0

6,777.4

19.5

6,992.9(GJ/millions of yen)24
7,370.8
18

17.8

19.7

14.8

125

15

5

2,000.0

6

0

0

0

0

0

2020

2021

2022

2018

(%)
15

48.0
10.5

9.6

24.5
6.5
10.6

2.7

3.4

0
2018

2019

2020

2021

2022

450

7.5

300

3.75

150

0

0

(FY)

47.5
262.5
32.5
175.0

49.5
222.7

52.7
280.2

(%)
60

53.5
320.9

45

224.5

30

87.5

15

0

0
2020

2021

2019

2020

2021

2022

(FY)

Greenhouse Gas (GHG) emissions*
GHG emissions (Scope 1)

598.9
531.2

468.7

469.4
8.1

445.6

11.4

9.0

7.8
6.8

2018

2019

2020

2021

2022

(FY)

(%)
16

(thousand t-CO2e)
800.0

12

600.0

8

400.0

4

200.0

0

0

2020

2021

2022

Consumption of fuel from non-renewableenergy sources (gas, heavy oil)

4,662.4

4,735.7

5,130.8

Purchased electricity consumption

1,818.8

1,944.2

1,923.5

0.0

0.0

114.2

Consumption of fuel from renewableenergy sources (photovoltaics)

0.4

0.8

0.7

Purchased steam consumption

295.8

312.2

315.8

Consumption of purchased
electricity from renewable energy
sources, consumption equivalent toprocurement of non-fossil certificatesRaw materials used

GHG emissions (Scope 2)

400

311.5
268.6
16.5

200
100

6.8

161.4

2022

(FY)

0

2018

75.9
2019

2020

(%)
30

(people)14,00022.5

10,50016.0 15

13.0

7.5

5.3

0
2021

2022

626.3

590.9

313.3

296.3
1.59

(FY)

535.5

552.6

263.9

268.2

1.57

3

600

265.3

2

400

1

200

0

0

0

616.0

596.0

588.0

589.0

2021

2022

500.0

1.40

1.56

294.6

271.6

284.4

1.04
253.6

2018

2019

2020

2021

2022

(FY)

2018

2019

2020

(FY)

Percentage of female employees /Percentage of female managers (non-consolidated)
Percentage of female employees

Japan

Percentage of female managers(%)

12,804

13,132

6,565

7,023

12,426
6,455

11,524

11,744

5,705

6,052

10.0
7.5

6.5

6.6

6.7

4.8

5.0

2019

2020

5.0

7,000
3,500

(thousand t)
800

518.9

313.0

Overseas

(yen)

300

(t-CO2/millions of yen)4

Number of employees (consolidated)

Return on equity (ROE) (right scale)

83.1
2019

2018

(FY)

Return on assets (ROA) (right scale)Earnings per share

157.3

2018

2022

Earnings per share / Return on equity (ROE)

Capital ratio (right scale)(Billions of yen)
350.0

2021

(Billions of yen)
600

11.25

Net assets / Capital ratio
Net assets

2020

8.9

(thousand GJ)

GHG emissions intensity (right scale)

41.4

12.5

2019

Total assets(Billions of yen)
50.0

11.7

10.2

Total assets / Return on assets (ROA)

Profit attributable to owners of parent
Profit attributable to owners of parent margin (right scale)

25.0

10.8

(FY)

Profit attributable to owners of parent /Profit attributable to owners of parent margin

37.5

Data

Energy consumed by source

30

2019

Governance

Energy intensity (right scale)

Energy consumed

250

2018

Materiality

Non-financial Highlights

Net sales

393.2

Top Message

6,239

6,109

5,971

5,819

2019

2020

2021

2022

6.9

5.6

5.7

2021

2022

2.5

5,692

0
2018

7.0

(FY)

1.0
2018

(FY)

* Scope of energy consumed and greenhouse gas emissions: production sites and administrative/technical sites in and outside Japan

31

TOYO TIRE Integrated Report 2023

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32

Materiality

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

DomainⅠ Value creation

Basic policy

Material issues relating
to value creation

We know that the sustainable future for tire and automotive parts manufacturers will only be ensured once a society ofsustainable mobility has been created. That’s why we are contributing to help establish a society of sustainable mobility
that boasts fewer environmental impact, fewer traffic accidents and efficient transportation. In addition to providing thenecessary elements for promoting sustainability, we believe that using our unique products and services to satisfy thevarious features that people expect from superior mobility life will create added value designed to support a diverse mobile
society, so that is what we intend to do.

These material issues illustrate the unique value that the Toyo Tire Group offers in its
dedicated mission to society and the value that links directly to the Group’s purpose.
We believe that the value we create and deliver through our business activities must

Message from Vice President,
R&D Headquarters

Creating value from technology

contribute to the building of a society of sustainable mobility.

Satoru Moriya
Director, Corporate Officer

Material issue01

Help create a society of sustainable mobility

Material issue

02

33

Support the enjoyment of mobility for all●

Environmental contribution (CO2 emissions reduction): Reducing tire rolling resistance,
improving EV compatibility, saving resources●

Safety: Maintenance-free products, diagnosis of tire wear●

Commercializing airless tires●

Ultimate enjoyment of driving and sophisticated features

TOYO TIRE Integrated Report 2023

The automotive industry is undergoing huge change, with theincreasingly rapid advancement of all technological innovations
for next-generation mobility solutions. In such an era,
maintaining a high degree of safety awareness is the mostimportant thing for us as engineers involved in thedevelopment of future tires. The Toyo Tire Group is always
encouraging people to engage in technological developmentwith the understanding that a vehicle’s tires are the only things
that are in direct contact with the road surface, and as such,they support the vehicle body, and protect the lives of all its
passengers.
Our ultimate quest is to create tires that are truly loved,
trusted and supported by customers. Engineers sometimes
get distracted by the idea that their thoughts and ideas arebacked by technological theories and data, but the mostimportant thing is to heed the opinions of the market and strive
to achieve the performance that our customers require. Toyo
Tire Corporation is not overly large compared to some of its
global competitors. I believe the fact that we are able topromote close daily communication between production,
sales, R&D, corporate and other functions reinforces our
corporate strength.
For instance, here in the R&D function, we receive
information on market needs from the market frontline via thesales function, which enables us to recognize customers’
perspective in a timely and detailed manner and develop
differentiated products. Thanks to this inter-functional
collaboration, we are able to create new product categories byswiftly launching products with sophisticated design featuresthat other companies don’t possess, while also pursuing ahigh level of basic performance.
Meanwhile, environmental and social demands regarding
decarbonization, resource recycling and other issues are
growing stronger every year. We are entering a newchallenging stage of achieving mutually opposing properties,
which involves further reducing rolling resistance, developing
sustainable raw materials that guarantee the same
performance as existing materials, and intertwining that withelegant design features. Rising to these challenges will help
generate the value that we want to deliver to society over the
medium- to long-term, and we in the R&D function aredetermined to channel our efforts into doing just that.
AI, with its various uses, has become indispensable in thetechnology development field. Deep learning generates
answers with overwhelming speed and accuracy, so, in future,
it will be possible to carry out the whole process from tiredevelopment through evaluation by creating a tire model in adriving simulator and inputting characteristic value. Certainly,
we will be able to do more things at the touch of a button, but
it is important to be able to design technologies and productswith a correct understanding of the underlying principles andfacts. I don’t want our engineers to rely too heavily on AIderived results. Instead, I want them to be able to explain theprinciples upon which their designs are based, and what greatfeatures make a great tire. We will also enhance training
programs to nurture next-generation engineers who can use
AI to expand their thinking skills and abilities.

TOYO TIRE Integrated Report 2023

34

Materiality
DomainⅠ

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Value creation

Action promotion system (April 2023)

Executive Committee

Sustainability Committee
Technical Committee

Spearheaded by our R&D Headquarters, we are working
together with product planning, production management, sales
planning and digital transformation (DX) functions and promoting
sustainability-related activities based on various themes that
correlate with the aims of our medium-term business plan.
The Technical Committee oversees the overall
implementation of those activities and reports progress to the
Sustainability Committee.

R&D Headquarters
Business Headquarters● Product Planning Division
Production Headquarters● Production Management Department
Sales Headquarters● Sales Planning Department
Digital Transformation Headquarters

Technology-driven business strategy

Reducing the environmental impact of mobility
Reducing the CO2 emissions of vehicles is a challenging issue
that needs to be addressed across the supply chain. At Toyo
Tire Corporation, our goal is to help reduce greenhouse gas(GHG) emissions per tire by 20% by 2030 compared to 2019
levels.
To cut CO2 emissions of vehicles caused by running tires,we set the reduction of tire rolling resistance as a top priority
and included improving the fuel efficiency grading of tires as adevelopment requirement for product model changes.
Materials development is one of the approaches we use toimprove fuel efficiency. We are constantly updating Nano
Balance Technology, our proprietary platform technology forrubber materials, to facilitate more accurate predictions
regarding specific material properties and optimize material
structure, and we are now promoting the use of this technology
in practical development. For instance, Comfort Ⅱs, the new
products in our PROXES global flagship tire brand series
launched in Japan in 2023, uses a new naturally derived silica
dispersing agent to reduce rolling resistance by 28% comparedto PROXES C1S, the existing model, and to optimize wet-grip

performance and wear resistance.
We are committed to creating environmental value throughthe implementation of our business strategies, and bysystematically and consistently improving the fuel-efficiency
performance of our product lineup by coordinating theactivities of our product planning and technical development
teams.

The use of IT and data is becoming increasingly embedded in
the automotive industry. Going forward, this development will
not be limited to manufacturing, with the very creation andutilization of data also becoming more important for improving
business value. We are developing sensing technology thatcollects various information from tires, which are the only
components of a vehicle to actually come into contact with theroad surface, and promoting the idea of creating new added
value by using tires as information acquisition devices.
The sensing technology calculates and processes various
information detected by sensors attached to tires to derive themaximum level of tire performance. This enables us tounderstand and visualize the tire performance required for theroad surface conditions under which the tire is currently being
driven, and check whether the tire is demonstrating its due tireforce*1 when driving. Right now, we are conducting trials on
public roads and circuits and moving forward with
development to help achieve the required level of autonomous
driving safety.
The Technology Development Division and the DX
Promotion Division are collaborating on an application that candiagnose tire wear based on information about the usage
status of truck and bus tires. The teams are conducting trials
by asking customers to try out the app so they can improve
the accuracy of their predictions and expand the range offunctions to facilitate the remote confirmation of air pressure
and wear prediction results. This technology enables us to help
improve the safety of drivers and passengers by encouraging
customers to appropriately rotate their tires based on the wear
predictions. We also expect it will have environmental benefits
by extending tire life and increasing the possibility of reuse as
retread tires.*2*1	Tire force is a term assigned by Toyo Tire Corporation that refers to actual tire

performance as estimated from information input from the tire, such as airpressure, temperature, road surface distinction, load, wear and any detected
anomalies.
2	* A worn tire that is reused by replacing the rubber in the part of the tire that comes
into contact with the road surface.

The app screen visualizes tire force during driving* ● Tested at: Toyo Tire Corporation, using the indoor drum rolling resistance testingmachine● T ire size: PROXES Comfort IIs 215/55R17 94V and PROXES C1S 215/55R17 98W● Rim size: 17 x 7.0J ● Inflation pressure: 210 kPa ● Load force: 5.26 kN● Speed: 80 km/h●●

Detailed data of this test was submitted to Tire Fair Trade Council.
Different results may be obtained in tests conducted under the same condition.

PROXES tire series

Unique EV approach offers ultimate enjoyment of driving
Toyo Tire Corporation’s unique strategy is to develop
technologies and commercialize products in pursuit of design
features and the ultimate enjoyment of driving while alsosatisfying high levels of environmental and safety
considerations.
We participate in international races such as the Dakar
Rally and the Baja 1000, which are said to be the toughest
off-road races in the world. The knowledge and experience wegained from these races have fueled our product development,
resulting in superior basic performance and aggressive patterndesigns. Our efforts have been well received especially in the
North American market, where heavy-duty SUVs have been
gaining ground.

Developing solutions services

The spread of EVs is expected to both accelerate andfurther diversify as it makes its way to the North American
market in the future. We will capture the EV market trends andwork on our uniquestrategy to develop andenhance differentiatedproducts that make themost of our strengths.

Maintenance-free airless tires
Our “noair” airless concept tire is designed to facilitate
maintenance-free, no-spare solutions that satisfy the needs ofthe next-generation mobility society in which people opt for
self-service gas stations, home charging of electric vehicles
and more prevalent car sharing. In 2017, noair became the firsttire in the industry to demonstrate a level of performance thatenabled it to be installed and driven on a passenger vehicle byachieving a level of durability and maneuverability that is close
to that of pneumatic tires. We installed the noair tires on golf
carts and conducted test drive events in 2022 as part of ourefforts to facilitate their practical use. We are paying close
attention to the formulation of laws and regulations regarding
airless tires as we consider installing them on futuristic mobility
vehicles and using them in recycling operations.
Golf cart using “noair” tires

Vehicle equipped with Open Country M/T-R
off-road racing tires

35

TOYO TIRE Integrated Report 2023

TOYO TIRE Integrated Report 2023

36

Materiality
DomainⅠ

Introduction

VisionStrategy

Materiality

Governance

Data

Value creation

Message from Vice President,
Production Headquarters

What inspires our manufacturing

Yuji Miyazaki
Corporate Officer

Technology is advancing and the equipment used in
manufacturing is becoming more sophisticated. However, I
believe that manufacturing is a people-centric activity. The tires
and automotive parts that the Toyo Tire Group handle are
created through a number of processes that start with thekneading of rubber. Many employees play their part in eachprocess and work closely together. Our Group has production
bases in six countries around the world. Employees working in
our new plant in Serbia are extremely enthusiastic to beworking for a Japanese manufacturer, and I always think manyof the employees at our plant in Malaysia display a level ofenergy that reflects their nation’s growth. We have chosen tobring people with diverse ideas and different backgrounds
together with a shared sense of purpose to invigorate ourcompany and serve as a new source of growth. I feel verystrongly that a company should serve as a bedrock that
supports individual lives and that it must pursue sustainable
development.
The production function has two main roles. One is to help
create a prosperous society through our products. This forms
the central axis for all that we do. We deliver products that ourcustomers can feel comfortable and safe using because we
conduct our work correctly and in accordance with standards
that we have cultivated over many years. I am keen to foster aconstant feeling of proximity to the customer even in the
production function. We do that by guiding customers on
factory visits arranged by the sales function in a proactive andInitiatives designed to realize a decarbonized society are now
visible across the automotive supply chain. Each of the Toyo Tire
Group’s production sites is playing its own part in this trend byimproving the energy efficiency of manufacturing processes andexpanding the use of electricity derived from renewable sources.
Each production site is also working closely with the R&D
function to upgrade the fuel efficiency of our products, address
EV needs, and to make the necessary adjustments to
production processes and equipment required to facilitate theuse of sustainable raw materials.
The Serbia Factory, the Group’s first production base inEurope, began operations in July 2022. The plant will serve as
an export base for the buoyant North American market. It will
also produce competitive tires that incorporate insight gained
from the European market with its high requirements onenvironmental performance and other factors. The plant is
expected to have a system up and running by the end of 2023

TOYO TIRE Integrated Report 2023

Message from Vice President,
Sales Headquarters

Creating value together with customers

Tatsuo Mitsuhata
sincere manner, incorporating customer requests passed onby the sales function at the development stage, and making
the most of any opportunities generated through interfunctional cooperation.
Our second role is to ensure we successfully co-exist withlocal communities and generate mutual prosperity. Companies
that make products using the rich resources, environment,
and labor of local communities have a duty to contribute toregional development. Each one of our plants works with local
residents to address local environmental and social issues,and I believe the sense of belonging gained from participatingin local society helps boost employee motivation and pride in
their work.
The automobile is at a crossroads as its driving force shifts
from the internal combustion engine to the electric motors.
Our manufacturing sites are also dealing with various changes
in terms of materials, manufacturing methods, required
product performance and other factors. We currently apply
results-focused digital transformation in the manufacturing
process, but we will expand its use going forward to consider
underlying elements by, for instance, analyzing and utilizing
various digital data on the operational status of equipment toachieve highly efficient and high-quality manufacturing. We
intend to create concrete solutions based on the answers
derived from research conducted in the R&D function,
because we believe that no one can give better shape tothose ideas than we can. To that aim, I want to create evenstronger and closer cooperation among equipment,
manufacturing technology and other functions.

Launching the Serbia Factory

37

Top Message

Director, Corporate Officer

I believe that the role of the sales function is to understandcustomer needs, communicate those needs internally in an
appropriate manner, and encourage other departments totake action to address those needs. Toyo Tire Corporation
does not sell tires through directly managed outlets, so ourclosest customers are our dealers. We have to understandthe actual needs surrounding the products that our dealers
want to deliver to final users, namely consumers. We alsoneed to develop the marketing ability to unearth the latentneeds of individual dealers regarding the added value theywant us to provide in terms of available approaches,
proposals and services. Different markets display different
characteristics and a diverse range of different needs. I
believe that our strength stems from our ability to precisely
marry the things that customers are looking for with the areasthat we should be addressing as a company.
The mission of the sales function is to ensure the tandem
pursuit of strategies on sales and distribution channels. To
achieve that, it is vital to accurately understand our positionin the industry and our strengths and weaknesses, and I am
always looking to raise awareness of these elements within
the function. To date, the Group has built its own strong
customer base through on-point marketing in the North
American market, the provision of technology-driven
differentiated products, and the sales activities that dovetailwith customer demands. In 2018, we explored the structuralchanges in the market and moved forward with a boldreorganization of our customer base to meet customer
expectations and enhance our presence. This movegenerated subsequent growth for our company that
outstripped the market average.
In other markets, we are also working to change the way
we sell our products, including our distribution network. We
cannot leverage our superior strengths in the same way andwith the same speed as our larger competitors, so we need
to be the first to instigate change. We recognize there isroom to further reform our methods and strengthen ourcustomer base in markets outside of North America.
Our strength when executing these sales strategies lies
in our unique and flexible cooperation between functions andour ability to adapt with agility to information from the market
frontline. One of the great things about our company is its
ability to nurture an understanding of the kind of business
opportunities that are out there, and where, as well as how to
respond to those opportunities, not only in the production,
sales and R&D functions, but across the whole company. I
want to continue to promote and protect our mission to
deepen understanding of our differentiated products,
strengthen our sales capabilities and deliver products thatare tailored to local needs.

Regional and sales strategies
to manufacture approximately five million passenger vehicleequivalent tires a year. The plant will also strive to reduce CO2
emissions through the active use of renewable energy generated
in-house by one of the country’s largest photovoltaic power
generation systems. This should also help advance Serbia’s
economic growth and progress on decarbonization. (see p46:
Expanding the use of clean energy)

In the important priority market of North America, the Toyo Tire
Group is developing a strategy to provide unique products that
only it can supply, such as its wide light truck tires that have an
overwhelming brand presence, through a sales network that isbuilt upon solid relationships with local dealers. Going forward,
we will continue to unearth potential demand and acquire newusers through thorough user-focused sales and marketing
activities. We will stay abreast of the shift toward EVs, whileclosely monitoring demand for off-road EV tires where ourcompany excels. We are working together with the technicaland sales divisions to prepare tires that dovetail with the latest
vehicle development and sales trends.
In Europe, following the launch of our plant in Serbia, we arepromoting local production of products that were previously
supplied from Japan and Malaysia, for local consumption. We
are also using high-performance products perfected at our
European R&D Center to strengthen our customer base andshifting our focus from unit sales volumes to increasing the
proportion of priority products to total sales.
In Japan, we are focusing on expanding sales in SUV andother growing categories. We are launching priority productsthat include our renowned sophisticated features as well as
products that offer high performance in terms of low tire noise
and wear resistance. We are also drastically reforming our sales
systems.
In Asia, we consolidated the production in Malaysia in 2021,
and are moving on to promoting the switch to the TOYO TIRES
branded products and expanding sales of high value-added
products.

TOYO TIRE Integrated Report 2023

38

Materiality
Domain Ⅱ

Introduction

Top Message

VisionMateriality

Strategy

Governance

Data

Foundation for value creation

Human resource baseMaterial issues that
underpin value creation
These material issues are recognized as an important foundation that supports the creation ofunique value. Our focus is to continue to create value that delights our customers and society atlarge through the offering of unique products and services. To do that, we need to constantly
strengthen the foundation for propelling and promoting the value creation and achieving sustainable
development for the Toyo Tire Group.

Our policy
As part of our efforts to build a management foundation to support sustainable growth, we stipulated the development of aframework in the Medium-term ’21 Plan that would enable diverse human resources to work together organically and play
an active role based on enthusiastic job satisfaction, as well as a training system that upholds individuality, quality and ability.
We are actively developing a foundation that dovetails with these goals by enabling diverse talent to grow and play an activerole, regardless of their nationality, gender, age, job experience, career aspirations or other factors. At the same time, we seek toachieve the best mix of talent through fair and unbiased recruitment and appointment that focus on ability, aptitude andachievements, and the swift promotion of the right person to the right job. In recent years, we have systematically advanced theappointment of women to management positions. Having achieved our goal to double the ratio of female assistant managers, which
is a managerial candidate position, over the five years from 2016 to 2020 (2.03% to 4.65%), we have now set a goal to increase theratio of women promoted from assistant manager to manager level or above compared to the ratio of men over the five years from2021 to 2025 (from 70% in 2020 to between 80 and 120%).
In terms of human capital investment, we intend to invest resources over the medium- to long-term in systems that are vital fordeveloping human resources, promoting diversity and creating healthy working environments (reforming work styles). These
initiatives include the building of systems to promote the systematic development of business managers and professional talent foreach function; the creation of office environments and human resources systems that diverse people are comfortable with; and theintroduction of work styles and tools that help improve employee performance and communication.

Material issue

03

Support diverse talent with motivating challenges
and job satisfaction●

Demonstrating ability and fostering motivation (developing talent)●

Securing diverse human resources (promoting diversity)●

Creating healthy working environments (reforming working styles)

Action promotion system (April 2023)
The Organization & Personnel Committee discusses anddetermines policies and important measures for strengthening theGroup’s human resource base, and the Corporate Headquarters
is directly responsible for supervising the execution of thesepolicies. The areas of activity relating to human resources that are
entrusted to the Sustainability Committee are also based on thesepolicies, and the committee will consult with the Organization &Personnel Committee when necessary.
Executive Committee

Organization & Personnel Committee
Consults

Sustainability Committee

Material issue

04

Continue innovating next-generation mobility
technology

Corporate Headquarters● Corporate Infrastructure Division
Human Resources and General Affairs
Department of each site or Group company

April 2023, we also partially revised the personnel system fornon-career-track levels, including production bases.
In addition, we introduced a new training system in 2022 topromote the diversification of human resources. Specificmeasures covered the addition and reorganization of training at
each level (the expected roles established under the new
personnel system, our Philosophy and areas in which core
employees should have a rudimentary knowledge, such as
digital transformation and ESG issues), and the updating of
selective training.
The training of general managers and division generalmanagers seeks to encourage participants to strengthen their
management skills through self-development and improve theirleadership skills to help solve medium- to long-term issues. We
also educate future management candidates to play an activerole on the global stage through selective training for mid-level
employees.

FY2022 training (Toyo Tire Corporation)
Training

Demonstrating ability and fostering motivation(developing talent)

39●

Enhancing the development of materials and platform technologies for our products
for a society of next-generation mobility●

Creating recycling technologies for products and raw materials●

Innovating low-impact alternatives to substances of concern

TOYO TIRE Integrated Report 2023

In 2021, we reviewed our human resources system andsignificantly revised the evaluation and remuneration system andtraining system for the first time in 11 years. The new systemclarifies what the Group expects of each role at each level andconducts evaluations based on these expectations to inspire
employees to achieve results and grow. These practices are
now being rigorously implemented. We also established a job
evaluation system that responds flexibly to diverse job andcareer preferences, whether in specified or general employment,
and raised the level of manager remuneration. We confirm theactual execution of these measures and systems through regularsurveys and check whether they are having the desired effect. In

Traininghours

No. ofparticipants

New recruits

96

31

First-year follow-up training

18

35

Second-year brush-up training

18

33

New assistant managers

24

35

New managers

24

28

New general managers/
representatives

24

16

New section leaders/assistant supervisors

8

17

New assistant managers

810

Evaluator (primary evaluator orabove)

4.5

71

Selective training I

20

5

Selective training II

48

5

By level

TOYO TIRE Integrated Report 2023

40

Materiality
Domain Ⅱ

Introduction

VisionStrategy

Materiality

Governance

Data

Foundation for value creation

Securing diverse human resources (promoting
diversity)

Creating healthy working environments(reforming working styles)

The Toyo Tire Group is committed to ensuring fair employment
practices and treatment of employees, and to creating
workplaces where diverse team members can flourish regardlessof nationality, gender or other characteristics.
When it comes to the recruitment of human resources, we
strive to secure a diverse range of talent across the world, by
recruiting both new graduates and mid-career candidates,
rehiring retirees and employing people with disabilities. We do not
set recruitment targets for women or candidates of foreign
nationality when hiring new graduates and we follow a fair andunbiased evaluation and recruitment policy for all talent.
We conduct career-building interviews with every employee
and formulate human resource development plans in order topromote the active careers of all employees. The Group uses a
uniform remuneration system for both men and women andprovides equal reward to people doing the same job with thesame qualifications. However, our analysis suggests that thedifference in the ratio of male and female managers is resulting in
the difference between total remuneration of men and women.
Going forward, we will more actively promote women to
managerial positions, and this will contribute to resolving suchpay gap.
We are enhancing our theme-based training sessions, suchas LGBT, empowering women, harassment, as well as e-learning
programs on diversity and inclusion, to encourage a deeper
understanding of diversity from different perspectives. We alsoplan to hold training sessions on unconscious bias to help build aculture that encourages employees to demonstrate theirindividuality and fuels innovation.

To create environments where diverse talent can flourish, we aremaking changes to working styles that improve work-life balance.
Since 2020, we have pursued particular measures to prevent
long working hours. These include requiring all departments totake stock of their business administration and improve efficiency
to create an organizational structure that doesn’t require
overtime, and encouraging the appropriate use of various paid
leave systems. Overtime levels have decreased across the Toyo
Tire Corporation compared to 2019 levels.
We also make it easier for employees to fulfill their childcare
or nursing care responsibilities by establishing a leave systemthat enables employees to devote themselves to raising children
under two years of age and caring for family members (amaximum of one year’s leave for employees with immediate orsecond-degree family members requiring care), and creating
systems and work environments that make it easier for men to
take childcare leave. We have also introduced a system whereannual paid leave that has expired after two years can bereinstated and used for reasons such as injury or illness,childcare or nursing care, volunteering, or hospital visits or
hospitalization for pregnancy or infertility treatments.
We have achieved the targets set out in the action plan
formulated based on Japan’s Act on Advancement of Measures
to Support Raising Next-Generation Children, and have received“Kurumin certification” from Japan’s Minister of Health, Labourand Welfare in 2020 for satisfying certain requirements.
Meanwhile, we have reviewed our internal dress code to take
into account diverse values and lifestyles and we have used thepost-COVID era as an opportunity to change practices andcreate workplaces that enhance output through office reforms.

Employee diversity(Toyo Tire Corporation, full-time employees)
Total

3,674 (-0.5% y/y)

By ageUnder 30

By gender*

1

30-50

60.6％

Over 50

21.0％

Male

93.1% (-0.2 pts y/y)People with disabilities

82

Employees from countries
other than Japan*2

14

Total management
personnel

859

Management by gender*1 Male

94.3% (-0.1 pt y/y)Female 5.7% (+0.1 pt y/y)
Employees from countries
other than Japan*2 inmanagement

0.7% (-0.4 pts y/y)

*1 D ata by gender: Refers to data based on the sex assigned at birth. We do not havequantitative data on gender identity because it is difficult to obtain, but we aim tocreate workplaces where all employees can take an equal active part.
*2 D ata on employees from countries other than Japan: Refers to data on foreign
nationals as defined in the Nationality Act of Japan.

TOYO TIRE Integrated Report 2023

Employee opinion survey

Platform technologies
Our policy
The Toyo Tire Group believes that the value we provide through our products and services must support the evolution ofmobility required for a new age. We will continue to challenge technological innovation to help build a society that exists inharmony with the environment and supports safe driving.

Action promotion system (April 2023)
R&D Headquarters is responsible for promoting initiatives in this area. The Technical Committee oversees all initiatives and reports progressto the Sustainability Committee.

Expand the use of recycled and renewable raw materials
As a global manufacturer, we believe it is our mission to help promote the transition from a society that consumes resources to a societythat circulates resources.
Sustainable technology development: Initiatives and targets
We conduct materials research and developmentwith the aim of increasing the ratio of sustainable raw(%)
materials* used in our products to 40% by 2030 and100
Rice100% by 2050.
husk
Biopolymers
80
rCB
For example, by 2025, the Group plans to graduallysilicaintroduce products made from recycled raw materials,
60
100such as recycled rubber made from used tires and％40
recovered carbon black (rCB), as well as products
Recycled Recovered
40
Bio-oil20
made from highly wear-resistant materials.
steel
cord
％
Furthermore, we are developing technologies to reduce0
the amount of petroleum-derived raw materials used,
2020
2030
2050
which have a large impact on climate change, andPromote materials development with the aim of an initial 40%
increase the use of naturally derived raw materials,
sustainable materials ratio per product by 2030.
such as biopolymers, which exert less impact.
* Toyo Tire Corporation defines sustainable raw materials as recycled raw materials and renewable

18.4％

Female 6.9% (+0.2 pts y/y)41

Top Message

We started conducting employee opinion surveys in 2021 toobtain a snapshot of our organizational culture, and arecommitted to conducting subsequent surveys once every two
years in principle. Action plans for dealing with any issues
identified by the survey results are independently andautonomously formulated and implemented by eachheadquarters based on the Toyo Tire Corporation’s overall
policy. Getting each headquarters to develop specific measures
to address their own strengths and weaknesses will help
generate improvements and resolve problem areas. As thesecretariat, the Human Resources Department regularly monitors
the progress of any measures taken, strives to steadily improveorganizational culture through PDCA cycles, and reports to theOrganization & Personnel Committee.

raw materials.

TOPIC

Existing method: Synthesizing butadiene rubber using petroleum-derived
butadiene as the starting material
Pyrolysis Distillation

Successful synthesis of butadiene rubber from CO2
Joint research conducted by Toyo Tire Corporation and the Universityof Toyama has resulted in the development of a catalyst that converts
carbon dioxide into butadiene at a high yield rate, and the successful
synthesis of butadiene rubber, which is a main raw material for tires.
The proportions of raw materials used in tires vary depending on the
category of tire. Broadly speaking, natural rubber accounts forapproximately 60% and synthetic rubber 40%, of which petroleumderived diene rubber constitutes roughly 30%. Paving the way tonaturally synthesize butadiene from carbon dioxide is expected tohelp minimize carbon dioxide emissions during the production
process compared to existing petroleum-derived raw materials.
Moving forward, we intend to proceed with the process development
for mass production and aim to put it into practical use by the end of
the decade.

PolymerizationnApprox. 900˚C

Butadiene

NaphthaButadiene rubber

Petroleumderived
butadiene
rubberNew method: Synthesizing butadiene rubber using CO2 as the starting
material
Catalyst Catalyst

CO2nButadiene rubber

Butadiene

Carbon dioxide
New catalyst

CO2

Polymerization

Zeolite catalyst

OH

Carbon dioxide

CO2-derived
butadiene
rubberEthanol

Butadiene

2-derived
Polymerization CO
butadiene
rubberCircular economy(A circular economy fueled by a technology that uses CO2 as a carbon
source for raw materials for manufactured goods)

TOYO TIRE Integrated Report 2023

42

Materiality
Domain Ⅲ

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Risk management

Decarbonization

Material issues relating
to risk management

Our policy
The impact of climate change is becoming increasingly severe and society’s demands regarding mobility are increasing all thetime. The mobility business lies at the very heart of the Toyo Tire Group operation and, as such, we recognize that addressing
climate change is the most important issue, and one which has the power to greatly influence our growth. For that reason, weare committed to reducing greenhouse gas (GHG) emissions and expanding the use of clean energy in order to achieve thelong-term goals set forth in the Paris Agreement. We also support the TCFD recommendations and strive to disclose information
based on the TCFD framework in order to stimulate dialogue, engage stakeholders and promote climate change initiatives.

There are various social responsibilities that we must fulfill as a company and that form
the premise of our business management. These material issues epitomize the solid
foundation required to ensure a sound and healthy environment and enable us to create

Action promotion system (April 2023)

our own unique value.

The Toyo Tire Sustainability Committee is chaired by thepresident and meets four times a year. The committee
reports, deliberates and makes decisions on how to respondto climate-related and other sustainability issues, and what
progress is being made. The Decarbonization Task Force,
which sits under the Sustainability Committee, discusses
climate-related activity plans, targets and KPIs, and theSustainability Committee regularly confirms and monitors thestatus of those activities.
Any climate-related matters that have been debated andapproved in the Sustainability Committee are then reported
to or debated in the Executive Committee and reflected in
the formulation or review of our annual and medium-termbusiness plans. The developments are reported to the Boardof Directors in a timely and appropriate fashion.

Material issue

05

Pursue decarbonization in all corporate activities●

Responding to climate change risks and opportunities (TCFD)●

Reducing greenhouse gas emissions●

Increasing use of clean energy

Material issue

06

Promote supply chain sustainability●

Procuring sustainable natural rubber●

Implementing supplier management and responding to conflict minerals risks●

Promoting efficient logistics

Climate change risks andopportunities
We conducted scenario analysis toascertain the impact of climate changeon the Group’s business activities.

Sustainability Committee
Establishes company-wide sustainability strategies, identifies
material issues, optimizes division of functions, confirms level of KPI
achievement, etc.
Chair: President
Members: Vice presidents of each headquarters (7 members)
Secretariat: ESG Promotion Dept., Corporate Infrastructure Division

Decarbonization Task Force
LeaderParticipants from R&D, Business, Production and Sales

Members headquarters
Support●

Improving quality and increasing customer satisfaction●

Promoting improved awareness of tire safety

TOYO TIRE Integrated Report 2023

ESG Promotion Department, Corporate Strategy Division,
Corporate Administration Division, Digital Transformation
Headquarters

Scenario analysis process

1. Select scenarios touse and understandthe outlook of eachscenario

2. Investigate risks
and opportunities
in each scenario

Baseline scenario

Ensure the fundamentals of manufacturing:
quality and safety

Officer in charge of Quality Assurance, Environment &Safety Headquarters

3. Assess thesignificance of eachrisk and opportunity,
and identify those ofhigh significanceWe assessed the impact of risks and opportunities in a baseline scenario (3-4°C scenario) and a transition scenario (1.5°C scenario).

(Scenario outlook)

Transition scenario(Scenario outlook)• No new political policies or stronger regulations other than what is• New policies and stronger regulations are enacted to curb climate• GHG emissions increase in some areas following economic growth• Extreme heat, heavy rainfall and other natural disasters intensify as• Global GHG emissions decline to net zero by 2050
• Climate change causes sea level rises and changes in weather patterns,

currently envisioned
temperatures rise

(Main scenarios referenced)

43

Executive Committee

1. Select scenarios to use and understand the outlook of each scenario

Material issue

07

Board of Directors• IEA Stated Polices Scenario (STEPS)• IPCC SSP5-8.5

changebut they remain below those in the baseline scenario(Main scenarios referenced)• IEA Sustainable Development Scenario (SDS)• IEA Net Zero Emission Scenario by 2050 case (NZE)• IPCC SSP1-2.6

TOYO TIRE Integrated Report 2023

44

Materiality
Domain Ⅲ

Introduction

Top Message

Strategy

Metrics and targets

We identified climate-related risks and opportunities for each scenario and evaluated the significance of risks and opportunities based on theprobability of certain events occurring that could prove to be pertinent factors in each risk and opportunity and the degree of impact on the
expected costs and other factors in our business.

Metrics

Highly significant risks
Type

Baseline

Chronic Changes inclimate patterns

Sea level rises

Acute

PolicyImpact on business• Migration of natural rubber tree crop zone,

decline in quality• Energy supply system instability• Increased demand for crude oil, natural gas,etc.

• Deterioration of roads• Reduced areas of snowfall• Reduced natural rubber harvests• Compromised ports and warehouses

Main financial impact

Significance• Increased raw material prices (natural rubber)• Increased R&D costs (alternative raw
Medium tomaterials)• Decreased sales, worsened profits

GovernanceData(decreased tire production)

Medium to• Increased R&D costs (heat-resistant tires)high• Decreased sales (winter tires)• Increased raw material prices (natural rubber)• Decreased sales (reduced or suspended tire Medium toproduction)highslowdown)highIncrease in
extreme weather• Compromised infrastructure networks

Frequent andsevere heavy
rainfall• Transport network disruption, loss of• Decreased sales, worsened profits (revision• Flooding of natural rubber plantations• Marine transport delays, accidents• Increased raw material prices (natural rubber)• Increased transport costs
Medium to• Inventory/product damage
highIntroduction ofcarbon pricing

commuting optionsof production plans)• Increased service prices as costs are passed • Increased distribution costson• Increased costs of R&D and equipment
investment (shift to low-carbon products)• Introduction of carbon border tax• Introduction of environmental taxes to• Worsened profits (tariffs)
auto-related exports• Increased costs for purchasing carbon• GHG emissions reduction targets* Decided by the Sustainability Committee in November 2021 and approved by the
Executive Committee in December 2021

* Announced on February 15, 2022

Medium tohighMedium tohigh

Scope 1 & 2GHG emissions: Reduce GHG emission by 46% by2030 compared to 2019 and aim to achieve carbon
neutrality by 2050.

Scope 3

GHG emission per unit: We aim to help reduce GHG
emissions per tire in 2030 by 20% compared to2019.

Scope 1 & 2 initiatives
The amount of energy consumed increases in line with increases
in production volume. However, as a means of addressing Scope
1 and 2 emissions, we are seeking to reduce energy consumption
at our production bases by repairing process pipelines andintroducing highly efficient equipment to improve energy efficiency,
and also by encouraging automation and improving the usage of
air-conditioning and lighting. In addition, we are switching to fuelsthat emit lower greenhouse gases.

credits

Market/ Increased raw
reputation material costs• Fewer rubber plantations due to poor
profitability• Increased raw material prices due todecreased natural rubber production

Medium tohighHighly significant opportunities
ScenarioType

Transition

MarketChanges in
economy andsociety
Greater ecoconscious
behavior bystakeholders• Acquisition of new business partners

Expansion of
low-carbon
product market• Greater demand for products to go low

Products/ Increased
services environmental
awareness incustomers

EnergyImpact on businessthrough focus on the environment• Increased added value of eco-conscious
products
carbonSignificance• Increased sales and profits (acquisition of
new business partners, increased added
value)• Increased sales and profits (increased added
value)HighHigh• Development and sales of products with low • Increased sales and profits (increased share,
environmental impact

Growth of EVs/
next-generation
vehicles• Greater demand for EV tires, early-stage

Skyrocketing coaland oil prices• Expansion of EV market

TOYO TIRE Integrated Report 2023

Main financial impact

development and sales

increased added value)High• Increased sales and profits (increased added Medium tovalue)• Increased sales and profits (sales of EV tires)

We are also introducing photovoltaic (PV) power generation
systems for in-house consumption. The largest PV power
generation system in Serbia (power generation capacity: 8.4 MW)
was installed on the premises of our Serbia Factory, which
launched operations in 2022. The system’s annual generation of
10.15 GWh of electricity is helping reduce CO2 emission by 7,100
tons a year.
Going forward, we will consider introducing PV power
generation systems at other sites both in and outside Japan tohelp reduce CO2 emissions from in-house power consumption.

high• Inventory/product damage (flood damage)• Decreased sales and profits (overall business Medium to

Increase andintensification oftropical cyclones• Greenhouse gas (GHG) emissions (Scope 1, 2, 3)• GHG emissions intensity• Internal carbon pricing
Targets

Climate-related
eventsScenario

Temperature
rises

45

Materiality

Risk management

2. Investigate risks and opportunities, and 3. Assess significanceTransition

Visionhigh
High

Using heat recovered from atmospheric vapor
In August 2022, we introduced a steam ejector in our Sendai
Plant that reuse steam utilized in vulcanization processes for
hardening rubber. Used steam that would have been released into
the atmosphere is now collected and blended with fresh highpressure steam to create medium-pressure steam. Roughly 60%of the collected used steam can be reused, which reduces theamount of natural gas required to fuel the steam-generating boiler.
This is expected to reduce the volume of CO2 emitted from theplant each year by 550 tons.

Expanding the use of clean energy
The Toyo Tire Group is pressing ahead with its efforts to convert
electricity used at production bases to that from renewableenergy sources. In 2022, we converted 100% of the electricity
purchased at our Sendai Plant to that from renewables. By theend of 2023, we plan to convert 100% of the electricity
purchased at the Kuwana Plant and our tire plant in the UnitedStates to renewable electricity. After that, we will gradually expand
the use of renewable electricity at our production bases in andoutside Japan as well as at our Japanese administration andtechnical bases. The aim is to increase our global ratio ofrenewable electricity to 50% or higher by the end of 2023, and
90% or higher by 2030.

PV power generating system at our Serbia Factory

Scope 3 initiatives
A calculation of GHG emissions throughout the Group’s value
chain based on the Japan Automobile Tyre Manufacturers
Association’s Tyre LCCO2 Calculation Guidelines Ver. 3.0.1
revealed that emissions from product use phase in Scope 3
account for at least 80% of overall GHG emitted. Our technicaldivision, with the help of the Product Planning Division, is working
to develop fuel-efficient tires and other technologies to help
reduce the CO2 emitted by vehicles. According to the guidelines,
fuel-efficient tires can reduce GHG emissions during use (during
vehicle driving) by 95.4 kg CO2e per tire for passenger car radial(PCR) and 879.0 kg CO2e per tire for truck and bus radial (TBR)
compared to standard tires. Over the medium to long term, theGroup plans to upgrade fuel-efficiency performance each time itchanges a tire model. (see p.35: Reducing the environmental
impact of mobility)
Meanwhile, in the area of downstream transportation, we areencouraging a modal shift in Japanese trunk line transportationand promoting direct shipments of tires. These efforts helped
reduce GHG emissions per tire weight by 9% in 2022 compared
to 2019 levels.

TOYO TIRE Integrated Report 2023

46

Materiality
Domain Ⅲ

Introduction

Top Message

VisionStrategy

Governance

Data

Risk management

Supply chain

level of traceability that complies with the activity plan
prescribed by our Supply Chain Task Force. We have also set
up a dedicated contact point specifically for the natural rubber
supply chain. We received no reports in 2022.

Our policy
The Toyo Tire Group has established the Toyo Tire Group Basic Purchasing Policies and seeks to secure appropriate

Supplier management

product quality and price through fair transactions.
We also formulated the Toyo Tire Group CSR Procurement Guidelines and the Sustainable Natural Rubber Procurement
Policy. We work with our suppliers to further promote sustainable procurement that aims to mitigate, prevent and minimize
the negative impact of our corporate activities on the environment and society and to improve our corporate value andcompetitiveness.
We also support sustainable logistics by improving the productivity and efficiency of truck transportation and ensuring
safe cargo handling operations.

Action promotion system (April 2023)
We established the Supply Chain Task Force under thejurisdiction of the Sustainability Committee to discuss activity
themes, targets and KPIs in relation to ESG issues in the supply
chain. The Sustainability Committee regularly confirms andmonitors the status of these activities.

Executive Committee
Sustainability Committee
Sustainable Supply Chain Task Force
LeaderVice President of Business Headquarters

Members

Procurement Division, Environment & Safety
Division, Quality Assurance Division, SCM
Division

SupportESG Promotion Dept., Legal Dept.

the leadership of the Tire Industry Project (TIP), which is part of
the World Business Council for Sustainable Development(WBCSD). As a member, we participate in discussions designed
to solve relevant issues. We are working to prevent
deforestation, conserve biodiversity and water resources,
uphold human rights and support local communities, improve
the productivity of natural rubber and make our supply chain
more transparent. We also exchange information with the civilsociety sector, which includes NGOs and other groupings thathave specialized knowledge of environmental and social issues
at natural rubber production sites.
Our aim going forward is to continue to cooperate withinternational initiatives and stakeholders and to build asustainable natural rubber supply chain across our whole value
chain.

* A platform that seeks to transcend industrial boundaries and ensure that the
production and use of the world’s natural rubber is carried out in a way that is more
conscious of the natural environment and social issues.

Procuring sustainable natural rubber
The securing of a stable natural rubber supply into the future is an
important management issue for a business group like ours thatuses natural rubber as the main raw material. The natural
rubber industry is facing issues relating to deforestation at
production sites and the infringement of local residents’ rights.
We recognize the importance of striving to solve these
problems across the entire supply chain from production
through consumption.

International cooperation for building a sustainablesupply chain
Toyo Tire Corporation is a member of the Global Platform for
Sustainable Natural Rubber (GPSNR)* launched in 2018 under

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Materiality

TOYO TIRE Integrated Report 2023

Promoting sustainable procurement
Following the guidance provided by GPSNR encouraging tire
manufacturers to incorporate the platform’s Principles of
Sustainable Natural Rubber into their business activities, we
conducted a thorough review of the items related to natural
rubber procurement that were determined as part of our CSR
Procurement Guidelines. Then, from 2021, we strengthened oursystem based on the separate Sustainable Natural Rubber
Procurement Policy. That policy is designed to improve theeffectiveness of initiatives relating to healthy ecosystems,
human rights, communities and other issues. Currently, in
addition to conveying this policy to suppliers and asking fortheir cooperation, we are forming contracts with suppliers andexchanging information with environmental NGOs to ensure a

Using guidelines to engage suppliers
We have formulated the Toyo Tire Group CSR Procurement
Guidelines and request suppliers to pursue activities inaccordance with these guidelines to help addressenvironmental and social issues across our entire supply chain.
We also appeal to our suppliers to help convey the purpose
and nature of these guidelines further up the supply chain. The
guidelines are reviewed whenever there is change in social
demands or the business environment. The guidelines havebeen published in Japanese, English and Chinese.
To help objectively assess environmental and social risks inour supply chain, we formed a contract with EcoVadis, athird-party organization that conducts CSR assessments, andcommissioned CSR questionnaires of our suppliers from 2022.
We conduct risk assessments based on the results of fair andobjective surveys carried out by EcoVadis expert analysts,
promote engagement with suppliers, and work together tosolve any issues in our supply chain. We are gradually
expanding the survey’s reach, starting with natural rubber
suppliers, and aim to cover all our suppliers by the end of 2025.
Furthermore, since 2021, we have been conducting ourown questionnaire of existing suppliers with regards todecarbonization, and we will strive to solve issues in order toreduce the environmental impact of our supply chain.

Fair and transparent transactions
We declared our commitment to free competition and fairtrading in each market in the Toyo Tire Group Code of Conduct.
We conduct our activities in compliance with antimonopoly andsubcontracting law, pursue fair procurement activities, comply
with import and export-related laws and regulations, and ensure
appropriate labeling and product explanations.
For instance, the Group seeks to ensure business activities
are based on fair and free competition by establishingpurchasing regulations that stipulate the thoroughimplementation of fair and non-discriminatory business dealingsand prohibit the development of personal interests with
suppliers. At Toyo Tire Corporation, we have establishedanti-cartel regulations to prevent cartels and bid-rigging
activities. In addition, we continuously perform self-inspections
regarding compliance with subcontracting law and implement
e-learning programs on the law.

Responding to conflict minerals risks
Conflict minerals response
In Europe and the United States, manufacturers are legallyobliged to conduct due diligence when purchasing conflictminerals (tin, tantalum, tungsten and gold) and cobalt mined inconflict and high risk areas in light of the fact that the moneyfrom such purchases may be used to fund local armed groups
and promote corrupt practices, such as human rights
infringements, bribery and money laundering. When procuring
minerals and raw materials mined and manufactured in suchareas, the Group’s policy is to ensure those materials are notlinked to human rights violations, environmental destruction,
conflict, or corruption, and we enlist the cooperation of
suppliers to trace back to the smelters and confirm that the raw
materials purchased by the Group are not linked to any suchinhumane acts. We would request remediation through our
suppliers if any such concerns were to emerge.

Efficient logistics
As the shortage of truck drivers grows ever more serious in
Japan, the Ministry of Land, Infrastructure, Transport andTourism is developing initiatives to improve the productivity andefficiency of truck transportation and create more comfortableworking environments.
To promote efficient logistics, Toyo Tire Corporation is
instigating a modal shift to ships, national railways and large
trailers for the long-distance transportation of goods in Japan
dispatched from our factories. We have already shifted over
50% of transportation to these new modes, and, ten years fromnow, we aim to have reduced long-distance truck transportation
to roughly half of 2022 levels. Ensuring even safer cargohandling operations will not only reduce the burden on drivers,
but will also fuel economic growth and help create higher levelsof job satisfaction.

Specific initiatives• Introduced and expanded large container transportation
by Japan Freight Railway Company for shipments from
Sendai Logistics Center and Kuwana Logistics Center• Introduced a large trailer transportation method that
reduces the burden on the driver by changing drivers at
transit points• Installed safety fences in our Sendai Logistics Center
warehouse following a risk assessment (to prevent tire
racks from toppling or items from falling in the event of anearthquake)• Installed monitoring cameras at logistics centers in eachplant and distribution centers in Japan to ensure safe
operation; installed monitoring cameras to ensure safe
forklift operation

TOYO TIRE Integrated Report 2023

48

Materiality
Domain Ⅲ

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Risk management

Quality

Increasing customer satisfaction
Responding to feedback from consumers

Our policy
Our principle for manufacturing is to provide high-quality and safe products and services that are useful to society, and westate our basic policy for product quality and code of conduct in the Toyo Tire Group Global Product Safety Policy.
The policy clearly states that product safety and global environmental protection must be taken into consideration
throughout the value chain, from the product planning, development and design stages to production, sales, use andafter-use.
We operate a quality management system based on IATF 16949 (or ISO 9001 at some production sites) predominantly at our
production bases, and take measures against risk.
—ISO 9001 certification (as of the end of May 2023)
Production bases: 14 sites (3 Toyo Tire Corporation sites*, 11 affiliated company sites)
Sales bases (affiliated companies): 4 sites* The Kuwana Plant has independently acquired certification at two sites: its tire production plant and automobile parts plant.

—IATF 16949 certification (as of the end of May 2023)
Production bases: 9 sites (3 Toyo Tire Corporation sites, 6 affiliated company sites)

Action promotion system (April 2023)
Quality Assurance, Environment & Safety Headquarters is
responsible for promoting initiatives in this area, and reports
progress to the Sustainability Committee.

Executive Committee

Sustainability Committee
Quality Assurance Committee
Quality Assurance, Environment & Safety
Headquarters● Quality Assurance Division
Quality assurance departments ofmanufacturing subsidiaries
R&D Headquarters● Technology Development Division
Sales Headquarters● Americas Business Development Division● Original Equipment Sales Division● Europe, Africa & Middle East Sales Division● Asia & Oceania Sales Division

throughout the Group to ensure we comply with the increasingly
complex quality-related regulations in each country.
Our tire and automotive parts businesses each hold annual
Global Quality Management Committee (Global QMC) meetings,
bringing together quality assurance managers and relevant
representatives from manufacturing bases worldwide to share anddiscuss each site’s initiatives related to product quality,
improvement of quality assurance systems for production, andquality-related demand of our business partners.
In addition, at the four tire
testing and evaluation sites inJapan, we test our tires incompliance with ISO/IEC 17025(general requirements for thecompetence of testing andcalibration laboratories) since ourinitial certification in 2013, and havebeen working to improve test
accuracy and reliability to continue
conducting tests in accordance withstandard requirements.

Group sales companies

Example Efforts to Meet Quality Standards

Improving product quality

Every piece of feedback that we receive from our customers isvaluable and conveys their expectations in the Group, thereby
providing us with opportunities to further improve our products
and services. In 2022, our Japan-based Customer Relations
Department received a total of 2,669 inquiries by telephone or
via our website. We respond to such inquiries by giving priority
to accurate and simple explanations.
We analyze the content of these inquiries and send thefindings to relevant departments to improve the usability of our
products and services. Such efforts have led to thedevelopment of the Open Country series, our popular line of
SUV tires, and the improvement of the readability of ourcatalogues and websites.
We take complaints seriously, and work with the Group’s
sales offices and technical service departments to ensure thatissues are dealt with promptly and satisfactorily, and that the
problem or complaint is resolved so that we can build longlasting positive relationships with customers.

Visualizing manufacturing quality using
manufacturing execution systems (MES)The Toyo Tire Group aim to build a quality assurance systemthat can predict and prevent issues from occurring in the
manufacturing process.
We have introduced automatic measuring instruments into
the tire manufacturing process, and are launching a system that
digitally collects and visualizes quality- and production-related
information from production equipment. This will ensure quality
in each manufacturing process, and make it possible to analyze
and monitor collected data to detect changes in process
trends.
Starting with the installation of manufacturing execution
system (MES) at our Serbia Factory, a new production base that
opened in 2022, we are working to introduce MES at otherproduction bases, as well as foster data-centric talent andcorporate culture.

TOPICS
Quality initiatives at our Serbia Factory

Tire safety awareness activities

Our Serbia Factory, opened in 2022, features state-of-theart technologies, such as enterprise resource planning(ERP) and MES, to visualize processes. By precisely linking
the status information of each piece of highly productive
production equipment, this “smart factory” unlocks ahigher dimension of production management system
optimization.
By using cutting-edge materials researched anddeveloped at our R&D Center located in our European
headquarters in Germany and by using high-performancetechnologies in each design process, the plant is
responsible for the production of high-performance,competitive tires that respond to market insights, including
the shift to EVs. The proving ground with a straight track of
720 meters and a total length of 1,690 meters, locatedadjacent to the plant, is used to carry out test runs. We
use the results to promptly verify compliance with finelysegmented laws and regulations, and certification
requirements in Europe.

We believe that one of our most important duties is to help
drivers learn how to use tires appropriately. Since theemergence of COVID-19, demand for cars as a means oftransportation has increased, and improving awareness ofsafety precautions has become even more important.
Using our proprietary driving simulator, we offer aworkshop for driver to experience the difference between
worn and new tires when breaking on wet roads or getting
a puncture, and maneuverability under different tirepressures. The results of a post-workshop questionnairesof participants indicates that this workshop has led to anincreased awareness of tire safety.

• Collecting information locally• Making recommendations by participating in industry
groupsMeeting the quality standards of each country
In the face of factors such as greater climate change risks,many countries are rapidly introducing new regulations related
to the environmental performance and quality of vehicles topromote higher fuel efficiency and reduce the CO2 emissions.
We are working to strengthen our response to quality standards

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TOYO TIRE Integrated Report 2023

• Exchanging opinions with regulatory institutions• Sharing information on the latest legal and regulatory
trends• Giving presentations on legal and regulatory matters

Tire proving groundfor Serbia Factory

A participant using
the driving simulator

TOYO TIRE Integrated Report 2023

50

GovernanceIntroduction

Top Message

VisionStrategy

Materiality

Governance

Data

Sustainability and ESG Themes
beyond the material issues
Governance structure (As of March 29, 2023)

Pursuing soundgovernance

General Meeting of Shareholders (annually)

Audit & Supervisory Board
Members: 5 Audit & Supervisory Board members(including 3 outside members)

Board of Directors (monthly)
Members: 8 directors (including 4 outside directors)

Nomination & Compensation Committee
Members: 6 directors(including 4 outside directors)

Executive Committee (twice a month)

Engage in corporate management that meets societal needs and has
a lasting positive reputation for value● Instill a healthy corporate culture and business practices●

Challenge

Special committees

Deepening understanding of our corporate philosophy among
executives and employees● Regular dialogue with shareholders and investors● Improving awareness of the Toyo Tire Group Charter of Corporate
Behavior and Code of Conduct

Sustainability Committee (quarterly)Technology Committee (monthly)

Discusses important matters related to the sustainability across the Group as well as
policies and strategies for strengthening and promoting sustainability management

Deliberates important issues related to R&D (strengthening of our core competence
technologies, that are our platform technology and leading technology, to realize theGroup’s management vision and medium-term business plans, as well as important
issues relating to technology in general●

Initiatives

Compliance Committee (quarterly)
Conducts discussions and examinations to promote, enhance and strengthen compliancewithin the Group

Quality Assurance Committee (quarterly)

Crisis Management Committee (quarterly)

Establishes our policies and measures to promote and operate Group-wide quality
assurance system. Discuss countermeasures if a serious quality issue arises toimplement policies, measures and responses for each department, primarily
centered around the quality assurance departments

Deliberates the planning of measures and management against crisis

Organization & Personnel Committee (quarterly)

Investment & Credit Committee (twice a month)

Deliberates important issues related human resources

Deliberates investments and credit related to business activities

Sound governance
Governance overview
Basic policy
The Toyo Tire Group practices the principles of Japan’s Corporate Governance Code in an appropriate fashion to ensure
effective corporate governance. We seek to ensure the rights and equal treatment of shareholders and to appropriately
cooperate and engage in dialogue with our other stakeholders. We strive to make appropriate information disclosure and●Organizational format●

ensure transparency to help achieve those aims. The Board of Directors is accountable to the Company’s shareholders
and, as such, strives to appropriately execute its roles and responsibilities in order to enhance profitability and capitalefficiency and, by extension, achieve the Company’s sustainable growth and increase corporate value over the medium tolong term.

●●

In addition, our philosophy states that we will always seek to act in an impartial manner by prioritizing the desire to be
useful to society through proper working practices as the basis for our decision-making.
As part of our efforts to strengthen compliance, which we consider to be the essential element that embodies thisphilosophy, we established the Toyo Tire Group Charter of Corporate Behavior as a set of common principles to help all
Group companies conduct sincere business activities. We also formulated the Toyo Tire Group Code of Conduct to assist

Audit & Supervisory
Board members●

5

Number of Board of
Directors’ meetings(FY2022)

17

Independent officers(including Audit &Supervisory Board
members)

7(outside members: 3 )●8

Directors(outside directors: 4 )● (female directors: 1 )●Company with an Audit &Supervisory Board●

Attendance of outside
directors at Board meetings(FY2022)100%

all executives and employees in implementing the Charter of Corporate Behavior, and seek to instill that code across thewhole Group. The Charter of Corporate Behavior and the Code of Conduct are reviewed when appropriate and anynecessary revisions are resolved upon by the Board of Directors.

Governance structure
Our corporate governance system consists of the Board of
Directors, which is responsible for decision-making andsupervisory functions, and, under that, the Nomination &Compensation Committee, which acts as an advisory body to
the Board of Directors on matters relating to personnel affairs,
compensation and other matters pertaining to directors.
We also have an Executive Committee that makes decisions
on business execution, various special committees that
deliberate and consult on individual fields, and an Audit &51

TOYO TIRE Integrated Report 2023

Board of Directors’ initiatives

Supervisory Board, a body that audits the Board of Directors
and the execution of directors’ duties. This system enables allthese functions to be fully exercised.
The Board of Directors meets, in principle, once a month todecide on important matters and supervise the execution ofduties by directors. Outside directors attend Board meetings,
take part in active exchange of opinions, and monitor andsupervise management. The Board of Directors also receives
regular reports on important management risks debated in the
Executive Committee and the Sustainability Committee,
supervises risk management and assesses its effectiveness.

Every year, we conduct a registered questionnaire of all directors
and Audit & Supervisory Board members on the operation,
composition, activities and other factors relating to the Board of
Directors in order to analyze and evaluate the effectiveness of
the Board as a whole. We entrust the aggregation, analysis andevaluation of the questionnaire responses to a third-party toensure a fair result. We commit to further improving thefunctioning of the Board of Directors based on the third-party
evaluation results.
[Overview of questionnaire analysis and evaluation, andfuture response]
The evaluation of many items increased compared to theprevious year and progress had been made. As a result, we

believe that the effectiveness of the Board of Directors as awhole has been ensured. Management supervision has been
evaluated particularly highly for the past seven years.
However, some did request an earlier completion of the
preparation process so that they can work on further improving
the quality of discussions to enhance Board effectiveness. We
will continue to work to improve these and other issues.

Engaging in dialogue with shareholders andinvestor
Toyo Tire Corporation holds an annual general meeting ofshareholders, and quarterly financial results briefings. Top
management conveys its opinions on performance trends,
business environments and future outlook for the Group to
institutional investors and securities analysts when we announce
interim and full-year business results. In addition to these
activities, we also seek to promote understanding of Groupstrategy by creating multiple opportunities for the company
president and other senior executives to engage in a dialogue on
the issues that interest institutional investors and securities
analysts, and providing quarterly opportunities (individualinterviews) for investors to communicate and ask questions of IR
staff. We also respond proactively to dialogue requests frominstitutional investors around the world either in the form ofindividual interviews or conferences. In 2022, senior executives
engaged with investors through small meetings on sevenoccasions (81 attendees from 73 institutions) and IR staff
handled 342 interviews for shareholders and investors from 254
institutions.

TOYO TIRE Integrated Report 2023

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GovernanceIntroduction

Top Message

VisionStrategy

Materiality

Governance

Data

Message from the Chairman
Compliance

Our Talent and Intellectual Property

Basic policy

Drive Sustainability and Growth

We ensure that all executives and employees within the Group prioritize compliance in their day-to-day operations.

Action promotion system
We set up the Compliance Committee as one of the special
committees under the jurisdiction of the Executive Committee toconsult and investigate ways to promote compliance. The Chief
Compliance Officer (CCO), compliance officers (CO) andcompliance leaders (CL) play a key role in promoting complianceunder our compliance officer system.
The Compliance Committee, chaired by the CCO appointed
by the Board of Directors, meets quarterly in principle, andreports the results of its discussions twice a year to the
Executive Committee, which is supervised by the Board of
Directors.
The status of activities to promote compliance is also
reported to the Board of Directors as appropriate.

Instilling the Group Charter of Corporate Behavior
and Code of Conduct
We instill awareness in each and every Group employee andwork to strengthen compliance by creating the Global Code of
Conduct Handbook (available in nine languages: Japanese,
English, Russian, German, Italian, Chinese, Thai, Malay andPortuguese) as a guide for putting the Toyo Tire Group Charterof Corporate Behavior and the Toyo Tire Group Code of
Conduct in practice.
In Japan, we conduct read-along training sessions for all
executives and employees, including Group companies, of theCode of Conduct Handbook or the Supplementary Reader withfamiliar and specific examples for manufacturing or sales sites.
Upon completing the training, each participant submits a written
pledge to promote compliance.

The Compliance Department provides support at all stages so that the system functions
properly and effectively.
Compliance Committee

Board of Directors
President & CEO

ReportReportAppoint

ReportChief Compliance Officer (CCO)

ReportCompliance Officer (CO)Instruct/Order

Report/Consult

ReportInstruct/Order

Report/Consult

ReportInternal Reporting System

Heads oforganizational units
ReportReporting Hotline
ReportCompliance
Leader (CL)Instruct/Order

Conducting compliance awareness surveys
Outside specialized bodyAppoint

Director

Chair: CCO
Members: COs and Compliance & Legal
Division Manager
Observers: Directors and Audit &Supervisory Board members
Secretariat: Compliance Dept.

Audit &
Supervisory
Board Member

Consultation Counter to Comply
Antimonopoly Law
Harassment Hotline

Report/Consult

Whistle-blowing/Consult

Employees

CCO: Investigates, gives instructions and orders (including the suspension ofoperations and shipments, etc.) and makes suggestions on compliancematters for the entire Group
CO: Investigates, gives instructions and orders (including suspension ofoperations and shipments, etc.) and makes suggestions on compliancematters in their department
CL: Assists COs and reports to department managers and COs upon
becoming aware of a compliance incident when promoting complianceactivities in the workplace

We conduct annual compliance awareness surveys to ascertain
the degree of compliance-related awareness among employees
and aid our future endeavors.

2022 compliance awarenesssurvey results

Response rate

89.4%

(2021: 92.5%)

Implementing activities to promote compliance

Made one or more attempts to raisecompliance awareness over the past year
Degree of compliance awareness and understanding

Understand what compliance means* Toyo Tire compliance: Instead of simply adhering to laws and

94%(2021: 94%)88%

(2021: 89%)

regulations, we must comply with laws, regulations and internal
rules, and be guided in our actions by a keen sense of ethics.

Degree of embedding of compliance

Remain conscious of compliance when
conducting own work activities

94%(2021: 94%)

Company-wide risk management system
Risks expected to affect the Group’s business activities are managed by the functional organization or meeting body associated witheach risk. We are currently restructuring our company-wide risk management system in light of the need to further strengthen risk
management, based on our awareness that the globalization of our business activities and supply chain has resulted in a wide variety ofrisks becoming more complex and interrelated.
The Corporate Headquarters identifies risks associated with climate change and human rights risks in all our business activities,
including our supply chain, and assesses their materiality, formulates measures in cooperation with relevant divisions and reports on suchactivities to the Sustainability Committee. We plan to manage such ESG risks in conjunction with our company-wide risk management
system.

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TOYO TIRE Integrated Report 2023

Yasuhiro Yamada
Chairman of the Board

Looking back on the first half of the medium-term business plan,although external factors impacted the financial results, I am
pleased to see that we are making a steady progress in the
direction shown in our stated growth strategy. Examples of ourachievements include the development of differentiatedproducts that focus on the coming decarbonized society, our
new Serbia Factory for the production of products for the local
market coming into operation, the strengthening of our brand at
the global level and a shift toward sustainability management.
We have also been successful in allocating operating cash flow
strategically to investments in growth and returns to ourshareholders.
The second half of the business plan toward 2025 is thestage where we start harvesting the fruits of the measures we
implemented in the first half. We need to accelerate the work we
do in the areas exposed to major changes such as the shift toelectric vehicles (EVs) and our solutions business initiatives. It is
important that we are mindful of the possibility that unexpectedchanges may occur in the external environment, and that we
become even more agile in responding to changes by ensuringthat all our corporate functions across the globe work together.
From a slightly longer-term perspective, of all the conditions
we are facing, the transition to EVs stands out as it is happening
faster than expected, and there is a good prospect of services
based on the CASE (Connected, Autonomous, Shared, Electric)model becoming a reality. Automobiles have a potential to
become a solution for global social issues such as
decarbonization, labor shortage and regional inequality as well
as a platform that supports livelihoods. These huge waves ofchange can bring novel customer experiences. We need to beaware that the changes in the customer base that has
supported our corporate value until now can be both a risk andopportunity for us. Our mission is “to create excitement andsurprise with our products that exceed customer expectations

and enriches society.” We can seize these changes as anopportunity by understanding that new customer experiences
will transform the quality of the excitement and surprise wecreate, and responding to it quickly and flexibly.
As for the effectiveness of our Board of Directors, I am
pleased to see that, all in all, it has been improving every year.
The diversity and skill mix of the outside directors have
improved. More importantly, there is a healthy tension in
discussions as the directors look at the big picture and express
their views to the executive side freely and vigorously, and this is
gradually becoming the culture of the Board. The synergy of thisdiversity and culture has made the discussions of importantmatters more thorough and meaningful, and this is improving thequality of decision making.
Another role of the Board of Directors is to make theexecutive side consider what a sustainable value creation
process would be from a medium- to long-term perspective andencourage it to take the necessary risks to enable it. As the chairof the board, I would like to use oversight as a means of further
boosting our earning power and guiding the Group for making it
an organization that creates long-term value. I believe that the
key drivers of our efforts to achieve stronger action onsustainability and more earning power at the same time are ourtalent and intellectual property in a wider sense, which includes
customer loyalty and the power of the brand that belong to theorganization. The human capital and intellectual capital areintangible assets that, if gathered, invested in and leveraged, willbring about a business model and a corporate brand that lead tosustainable corporate value creation.
We, the Board of Directors, are committed to playing ourpart in the Group’s growth by continuing to monitor short-term
results while also engaging in active debate that focuses on the
future, which is essential in order to improve our medium- tolong-term corporate value.

TOYO TIRE Integrated Report 2023

54

GovernanceIntroduction

Top Message

VisionStrategy

Materiality

Governance

Data

Messages from the Outside Directors

Ken Morita

Atsushi Takeda

Outside Director

Outside Director

The year 2023 marks the halfway point for Medium-Term ’21
Plan, the Toyo Tire Group’s published medium-term businessplan. I appreciate that the Group has made a certain degree ofprogress and achieved results on specific management
indicator targets, which represent a quantitative commitment.
In 2022, production activities did not proceed as plannedfor part of the year due to labor shortages and other issues at
the North America plant. The North American businessregained its usual strength following the implementation ofvarious measures. However, in such situations, I believe it isnecessary to carefully evaluate the particular nature of theplant, appropriately assess the validity of the Group’s plan, andpursue what is ultimately the right path for the long term, rather
than implement remedial measures that focus exclusively on
progress against an existing production plan. The best
approach is to guide and determine corporate direction
through debate that considers the Group’s strengths andweaknesses and links the ideas of individual business
functions. I believe companies grow stronger by preparing the
groundwork for that style of business operation.
Productivity at the new Serbia Factory is set to increaseover the second half of Medium-Term ’21 Plan. Here, the Groupshould consider how it intends to balance its pillar market ofNorth America and other markets going forward, and ensure
those considerations are incorporated into the plans for eachregional product segment when executing production andsales policies.
To that aim, the R&D, production and sales functions
should demonstrate their own specialist expertise, whileremaining mindful of the need to enhance inter-functional

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TOYO TIRE Integrated Report 2023

cooperation and optimize the capabilities of each individualfunction. I also feel that the Group should hone an objective
sense and perspective with regard to any excessive or deficientelements that might arise from its functional organization andmake the appropriate adjustments, while also strengthening
the Group’s strategic functions that provide the necessary
materials for setting overall business direction and making
management decisions.
Most people assume the world will continue on its
evolutionary path toward a sustainable society. The intrinsic
need for tires will not change dramatically, but we are likely to
see changes in the shape and nature of mobility. We could see
a clearer division of mobility needs between people who focus
more on the practical elements of driving and those who place
greater emphasis on driving pleasure and comfort. It will
become increasingly important for the Group to develop
strategies that successfully capture these trends andsuccessfully differentiate the Group by leveraging its strengths.
In May 2023, Toyo Tire Corporation announced its researchand development of butadiene rubber derived from carbon
dioxide, and I feel the Company will also start to attract
attention for its efforts to advance materials and processes thatare not directly manifested as product functions.
In my role as an outside director, I am committed tosupporting the continued development of the Toyo Tire Groupby objectively analyzing current situations, making proposals
that consider the Group’s strengths and weaknesses andhelping the Group strengthen its corporate frameworks toachieve sustainable growth.

In May 2023, the Japanese government downgraded the legal
status of COVID-19 to a class V virus on a par with seasonal
influenza. I admire how the Toyo Tire Group has managed togradually enhance its strength over the first half of Medium-Term’21 Plan, despite operating under the shadow of the virus
throughout that period.
The complications associated with the keenly awaited
launch of the Serbia Factory were acceptable given theprevailing circumstances during the first half of the medium-term
plan, but the Group now needs to determinedly progress tofull-scale operations at the plant by the end of 2023.
I also believe that, ideally, the Group should continue thestable operation of the U.S. plant as planned and further
strengthen its pillar business in the North American market. At
the same time, I believe strongly that the Group’s presence in
the Japanese market will increase following the integral
restructuring of domestic sales subsidiaries together with Toyo
Tire Corporation itself. Given the fact that the automobile
industry is currently undergoing major change, I believe the key
to success in the second half of Medium-Term ’21 Plan will lie in
the Group’s ability to fully utilize its data-driven solutions andother nascent technological innovation. It is vital that the sales
function clearly understands and feeds through any pertinent
information from the market in discussions with the R&D function
to leverage the Group’s expertise and encourage comprehensive
action across all functions. The Group also needs to use current
company-wide digital transformation (DX) initiatives to transformthe way it operates and to establish new work styles. I want to
see the Group use its COVID-19 experience to build its very own
new working style, and to communicate the appeal of that styleboth internally and externally.
I expect the airless tires that the Group is currently
developing will prove an ideal product for promoting safe
transportation in lightly populated areas and households withelderly residents. I expect the Group to conduct this kind of
future-oriented discussions and reveal new banner products.
The Toyo Tire Group promotes sustainability management by
setting medium- to long-term targets based on material issues
that dovetail with its corporate philosophy and aligning thosetargets with specific business issues. I’m keenly observing how
the Group’s steady build-up of a range of activities and thereliable application of activities to each individual issue can help
realize sustainability.
The path ahead will be strewn with uncertain external
factors. It is important for the Group to respond accurately andpromptly to variable factors that are beyond its control, whileachieving thorough and steady progress on issues that are notoverly influenced by those factors.
The Board of Directors has already undergone considerable
change during the Group’s business restructuring and namechange. I feel that proposals refined on the executive side are
now being presented, lively discussions are being held that
include outside directors, and the supervisory function of theBoard of Directors is being amply demonstrated. Personally, I
think it is important to visit frontline plants and research institutes
to share awareness of various issues with senior managers.
Going forward, I want to help the Toyo Tire Group develop andgrow by continuing to prize this approach, while also stimulating
more lively discussions on future development beyond MediumTerm ’21 Plan.

TOYO TIRE Integrated Report 2023

56

GovernanceIntroduction

Top Message

VisionStrategy

Materiality

Governance

Data

Messages from the Outside Directors

Michio Yoneda

Yukiko Araki

Outside Director

Outside Director

In the wake of COVID-19, Russia’s invasion of Ukraine andother events, the external environment proved turbulent in theyears of 2021 and 2022, which represent the first half ofMedium-Term ’21 Plan, and the impact on the Toyo Tire
Group’s business operations was considerable. However,while there has been some volatility, overall businessperformance has held steady. My overriding impression is that
the Group has managed to make steady progress because allfunctions have worked together to address global turmoil byadhering to the Group’s ultimate commitment to strengthen its
ability to promptly and flexibly respond to change. Change isfast becoming a common occurrence, and the speed of thatchange is accelerating dramatically. One area of concern isthe fragmentation of the global economy due to inflationary
trends and bilateral tensions. Having said that, the flipside ofany risk is opportunity, and, going forward, stakeholders will
likely pay greater attention to the organization’s ability torespond swiftly to environmental changes. I think theimportant thing is for the Group to build on its achievements inthe first half of Medium-Term ’21 Plan in the second half of theplan.
I have always said that digital transformation (DX) andhuman resources are key to achieving Medium-Term ’21 Plan
targets. The core point of DX is not simply to change acompany’s systems, but to change the very way it does
business. I laud the Group’s united approach, which I believe
will ultimately help foster more able human resources acrossall tasks. Right now, DX measures are primarily focused onrationalizing various functions but, once a sufficient degree ofrationalization and effective functional utilization is achieved, I

57

TOYO TIRE Integrated Report 2023

think the Group’s ability to build new business models basedon this progress will become increasingly important. People
will be the resource that ultimately fuels these dramaticchanges. Developing these kinds of human resources will
enable the Toyo Tire Group to generate further growth.
Meanwhile, I believe that the Board of Directors canimprove its effectiveness by instigating consistent reviews andincremental improvements. The Group is making gradualprogress on this front, including the issue of more diverse
representation, and I feel that the debate on this subject isextremely vigorous. In view of the increasingly global nature ofits business, it must respond to risk-associated changes in
economic environments from a global perspective. In such anenvironment, I believe one of the important roles of the Boardof Directors is to encourage debate based on diverse
perspectives, including those of outside directors, and actively
engage in healthy risk-taking.
There will be times when the Toyo Tire Group will need tochange its own processes and structures in order to ensure its
business management can adapt to dramatic change. It canbe extremely effective to listen to external perspectives when
making those decisions. In other words, I think outside
directors can serve as catalysts for change.
As an outside director, I can and will help the Group evolveby providing additional external perspective that will help
strengthen its corporate organization.

I was appointed outside director at the annual general meetingof shareholders held on March 29, 2023, and joined the
management team at the half-way point of our medium-termbusiness plan, the Medium-term ’21 Plan. Discussions of theBoard of Directors suggest to me that, in spite of the global
economic turmoil we have faced over the last few years,
including the COVID-19 pandemic and the Russian aggression
in Ukraine, the Group has succeeded in making progress to adegree by diligently implementing the Medium-Term ’21 Plan.
However, we should not take it for granted that the Group willachieve the final targets, and must remain alert for changes thatmight arise in this uncertain world and addressing them well.
Particularly, I believe the key is going to be how the Groupwill respond to the business risks brought on by the shifting of
focus on the environment and the wave of digitalization and turnthem into opportunities. The Toyo Tire Group needs to consider
carefully how these changes may affect the future of mobility,
but judging by the policies adopted in Europe, we should
assume that the speed of change may well be faster than we
expect. We are entering an era where new players from outside
the existing automotive supply chain can bring disruptive
innovations that can change the social system fundamentally.
The Group is good at product differentiation within its sector,
but it is nevertheless necessary to ensure that it devises a
strategy that anticipates these changes so that it can develop
new technologies and products without slowing down. Anotherclearly urgent issue is digitalization of production lines, whichmust go beyond improving production efficiency. It is importantto have a company-wide perspective of how to takemanufacturing to the next level and add value to production

activities as the Group invests in and implements the plans.
We hear so much about the need for more diversity withincompanies and their boards these days, and I am aware of themale-dominated nature of the Group’s sector even within the
manufacturing industry. However, manufacturing companies
have a wide variety of functional departments, including thefactory floor, and I hope to play a role in improving the diversityof the Group so that it can attract more women and give themthe opportunity to flourish.
Staying on the subject of diversity, I believe that the Groupalso needs to strengthen its governance structure to ensure it isfit for the next stage of its business as it globalizes its
operations. I think the Toyo Tire Group has a positive company
culture that values harmony and cooperation. I am convinced
that, if the Group maintains this culture and creates anenvironment where voices from diverse perspectives — be itfrom outside the Group or outside Japan — are welcomed, we
will be able to make the Group stronger even in these times of
uncertainty.
As we strive toward building a sustainable society,businesses will face even stronger demands from investors andwider society to embrace ESG and improve disclosure. I believe
it is important that the Group firstly identifies priorities andhigh-impact issues to tackle in areas where it operates,
including the business plans, business characteristics andsuppliers, then applies its human resources and othermanagement resources to those areas, and integrates theminto the overall management strategy. As an outside director, I
am determined to contribute toward the Group’s endeavor toachieve sustainable growth.

TOYO TIRE Integrated Report 2023

58

GovernanceIntroduction

Top Message

VisionStrategy

GovernanceMateriality

Data

Directors, Audit & Supervisory Board Members and Corporate Officers(Date of birth: December 13, 1960)

Number of shares of the Company held

Number of shares of the Company held

Career summary, positions, assignment and significant concurrent positions

Career summary, positions, assignment and significant concurrent positions

Apr. 1973
Dec. 2003

Apr. 1983

Yasuhiro Yamada

Takashi Shimizu(Date of birth: June 14, 1949)(Date of birth: April 8, 1958)(Date of birth: April 2, 1961)

Number of shares of the Company held

Number of shares of the Company held

028,160Career summary, positions, assignment and significant concurrent positions

Apr. 1983
Jun. 2007

Apr. 1985
Apr. 2010
Jan. 2013

Apr. 2018
Mar. 2019

Yukiko Araki

Representative Director, President & CEO

Career summary, positions, assignment and significant concurrent positions

Apr. 2015

Outside Director

Michio Yoneda

Director, Chairman of the Board

3,929

Apr. 2013

Outside Director

Joined Mitsubishi Corporation
Director, Hokuetsu Paper Mills, Ltd. (currently, Hokuetsu
Corporation)
General Manager, Paper & Packaging Dept., Mitsubishi
Corporation
Senior Vice President; Division COO, Living Essential
Products Division, Mitsubishi Corporation
Adviser (full-time), Toyo Tire Corporation
Director, Chairman of the Board (current position)

Mar. 2014

Jul. 2015

Nov. 2015

Joined Toyo Tire Corporation
President, Toyo Tire Holdings of Americas Inc.
Division General Manager, Tire Planning Division, Toyo Tire
Corporation
Corporate Officer; Division General Manager, Tire Planning
Division, Tire Business Group Headquarters; General
Manager, Europe Business Unit
Senior Corporate Officer; Division General Manager, Tire
Planning Division, Tire Business Group Headquarters;
General Manager, North America Business Unit
Representative Director, President & CEO (current position)

Mar. 2020

Joined Bank of Japan
President & CEO, Osaka Securities Exchange Co., Ltd.
(currently, Osaka Exchange, Inc.)
Director & Representative Executive Officer, Group COO,
Japan Exchange Group, Inc.
Special Advisor (part-time), Toyo Tire Corporation
Outside Director, Asahi Broadcasting Group Holdings
Corporation (current position)
Outside Corporate Auditor, Sumitomo Chemical Company,
Limited (current position)
Outside Director, Toyo Tire Corporation (current position)

Significant
concurrent
positions

Outside Director, Asahi Broadcasting Group Holdings
Corporation; Outside Corporate Auditor, Sumitomo
Chemical Company, Limited

Jan. 2013
Dec. 2016
Jun. 2018
Jun. 2018

0Jul. 2006

Jul. 2008
Dec. 2012

Apr. 2018

Dec. 2020
Mar. 2021
Mar. 2023
Jun. 2023

Joined Japan’s Ministry of International Trade and Industry(currently, Ministry of Economy, Trade and Industry)
Director, Tourism Economy and International Affairs
Division, Policy Bureau of Japan’s Ministry of Land,
Infrastructure and Transport (currently, Ministry of Land,
Infrastructure, Transport and Tourism)
Deputy Governor, Yamagata Prefecture
Joined Hitachi, Ltd.; General Manager, CSR Division, Legaland Communications Group; Member, Environmental
Strategy Office
Corporate Officer; Executive General Manager,
Sustainability Promotion Division, Government & External
Relations Group, Hitachi, Ltd.
Outside Director, Fuji Pharma Co., Ltd. (current position)
Outside Director, Nakanishi Inc. (current position)
Outside Director, Toyo Tire Corporation (current position)
Outside Director, Hirose Electric Co., Ltd. (current position)

Director, Corporate Officer

Director, Corporate Officer

Tatsuo Mitsuhata

Satoru Moriya(Date of birth: December 13, 1964)(Date of birth: December 23, 1965)

Number of shares of the Company held

Number of shares of the Company held

Director, Chairman of the Board

Yasuhiro Yamada

President & CEO

Takashi Shimizu*

Corporate Officer

Hiroshi Nobuzawa

Career summary, positions, assignment and significant concurrent positions

Career summary, positions, assignment and significant concurrent positions

Representative Director, President & CEO

Takashi Shimizu

Senior Corporate Officer

Tomoshige Mizutani

Corporate Officer

Yoji Imura

Apr. 1988
Jan. 2012
Jul. 2014

Apr. 1989
Nov. 2014
Apr. 2015

Director, Corporate Officer

Tatsuo Mitsuhata

Senior Corporate Officer

Masayuki Kanai

Corporate Officer

Tetsuo Shimomura

Director, Corporate Officer

Satoru Moriya

Senior Corporate Officer

Iori Suzuki

Corporate Officer

Kenta Kuribayashi

Director

Ken Morita

Corporate Officer

Tatsuo Mitsuhata*

Corporate Officer

Tamotsu Mizutani

Director

Atsushi Takeda

Corporate Officer

Satoru Moriya*

Corporate Officer

Ichiro Shima

Director

Michio Yoneda

Corporate Officer

Yuji Miyazaki

Corporate Officer

Junichi Uda

Director

Yukiko Araki

Corporate Officer

Kiyohito Hasumi

Standing Audit & Supervisory Board Member

Satoshi Taketsugu

Corporate Officer

Hideaki Takahashi

Standing Audit & Supervisory Board Member

Mitsunobu Kohno

Audit & Supervisory Board Member

Katsusuke Amano

Audit & Supervisory Board Member

Tomoyuki Matsuba

Audit & Supervisory Board Member

Yasuhiro Kitao

12,570Jan. 2016
Jan. 2017
Jan. 2019
Mar. 2019

Joined Toyo Tire Corporation
President, Toyo Tire U.S.A. Corp.
General Manager, Europe Business Unit, Tire BusinessGroup Headquarters, Toyo Tire Corporation
Corporate Officer; Division General Manager, Tire Planning
Division, Tire Business Group Headquarters
Corporate Officer; Vice President, North American
Business Development DivisionCorporate Officer; Vice President, Sales Headquarters
Director; Corporate Officer; Vice President, Sales
Headquarters (current position)

8,751

Jan. 2017
Feb. 2018
Jan. 2019Feb. 2020
Mar. 2021

Joined Toyo Tire Corporation
General Manager, O.E. Tire Development Dept.
General Manager, O.E. Tire Development Dept.; General
Manager, O.E. Tire Technical Service Dept.
Division General Manager, R&D Division No. 1
Corporate Officer; Division General Manager, R&D Division
No. 1, R&D Headquarters
Corporate Officer; Division General Manager, Technology
Development Division, R&D Headquarters; Division General
Manager, Product Development DivisionCorporate Officer; Vice President, R&D Headquarters
Director; Corporate Officer; Vice President, R&D
Headquarters (current position)

Significant
concurrent
positions

Directors and Audit & Supervisory
Board Members

Outside Director, Fuji Pharma Co., Ltd.; Outside Director,
Nakanishi Inc.; Outside Director, Hirose Electric Co., Ltd.

Corporate Officers* Indicates post held concurrently with thatof director

Note 1: Ken Morita, Atsushi Takeda, Michio Yoneda and Yukiko Araki are outside directors.
Note 2: Katsusuke Amano, Tomoyuki Matsuba and Yasuhiro Kitao are outside auditors.

Outside Director

Outside Director

Ken Morita

Atsushi Takeda(Date of birth: October 24, 1948)(Date of birth: February 27, 1947)

Number of shares of the Company held

Number of shares of the Company held0

〇 Major skill / ● Other skill
OutsideandResearch Manufacturing Finance
Legal
Experience
Corporate Sales andDigitalandand quality
andand risk
outsideSustainability Compensation
management marketingtransformation
development assurance accounting management
Japan
Committee

Name

Officer category

Yasuhiro Yamada

Director, Chairman of
the Board〇●

Career summary, positions, assignment and significant concurrent positions

Takashi Shimizu〇〇

Apr. 1971

May 1970
Jun. 2002
Apr. 2006

Representative Director,
President & CEO

Tatsuo Mitsuhata

Director, Corporate
Officer●〇

Satoru Moriya

Director, Corporate
Officer●●

Ken Morita

Director●〇

Atsushi Takeda

Director●〇

Michio Yoneda

Director●〇

Yukiko Araki

Director●●

Jun. 2009
Jun. 2012
Nov. 2015

Joined Matsushita Electric Industrial Co., Ltd. (currently,
Panasonic Corporation)
President, Matsushita Plasma Display Co., Ltd.
Senior Vice President, Panasonic AVC Networks Company(currently, Panasonic Connect Co., Ltd.), Matsushita
Electric Industrial Co., Ltd.
Representative Director and Senior Managing Executive
Officer, Panasonic Corporation
Advisor, Panasonic Corporation
Outside Director, Toyo Tire Corporation (current position)

TOYO TIRE Integrated Report 2023

Jun. 2014
Mar. 2016

Joined Nippon Steel Corporation
Director, Nippon Steel Corporation
President and Representative Director, Nippon Steel
Coated Sheet Corporation
Director and Advisor, Nippon Steel Coated Sheet
Corporation
Outside Director, Toyo Tire Corporation (current position)

Nomination

Area able to exhibit particular expertise

Career summary, positions, assignment and significant concurrent positions

Oct. 2000
Apr. 2006

59

0

Skill matrix

●

●

〇

●

●

●

〇

●

〇

●

〇

〇

〇

〇

●

〇

●

●
●

●
●

●

●

●

●
●

〇

●

TOYO TIRE Integrated Report 2023

60

Data

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Financial Summary (11 years)
FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

Net sales

291,110370,218

393,782

407,789

381,635

404,999393,220

377,457

343,764

393,647

497,213Gross profit

74,031

115,810

132,911

153,500

136,267

136,982

134,169

130,822

123,239

161,041

197,976

Selling, general and administrative expenses

58,38078,56985,401

90,11986,952

91,674

91,77992,374

86,911

107,960

153,930

Operating income

15,65037,24047,51063,381

49,31545,30842,39038,44736,32853,08044,046

Profit (loss) attributable to owners of parent

13,218

11,596

31,2401,674(12,260)

15,476

10,55324,482

11,682

41,35047,956

Capital expenditure

22,95828,99940,711

48,33823,93022,381

29,722

42,633

26,96737,76647,303

Depreciation and amortization

15,125

19,511

21,85824,82824,85625,53825,79525,16221,005

21,46826,748Net cash provided by (used in) operating activities

15,87441,55837,78941,30538,865

13,43019,063

11,22953,796

34,465

15,172

Net cash provided by (used in) investing activities(21,064)(22,504)(30,122)(46,009)(13,785)(10,633)(28,428)(38,271)(27,856)(37,538)(16,712)Net cash provided by (used in) financing activities(1,173)(5,095)(12,680)

19,051(31,317)(13,513)

12,82920,732(12,638)

11,697(16,231)

Total assets

354,285

433,327

481,966

522,937

491,088473,876

469,381468,746445,579

531,229598,889

Total liabilities

247,651

291,817297,327

347,572

345,466

310,061

312,130

244,237

222,885

251,073

277,974

Interest-bearing debt

132,855

129,849

131,780

162,035

132,930

119,963

137,327

118,545

110,578

128,784

135,436

Net assets

106,633

141,510

184,638

175,364

145,621

163,815

157,251

224,509

222,694

280,155

320,915

2,788

3,793

4,062

3,513

4,043

4,735

4,511

1,747

1,918

201

231

103,844

137,716

180,576

171,851

141,578

159,079

152,739

222,761

220,776

279,954

320,683

52.03

45.65

245.9713.19(96.54)121.8783.11

161.41

75.89

268.62311.51

7

12

45

45

45

45

45

45

45

76

80

408.78542.15

1,421.84

1,353.19

1,114.82

1,252.66

1,202.75

1,447.23

1,434.23

1,818.60

2,083.00

Operating income margin

5.4

10.1

12.1

15.5

12.9

11.2

10.8

10.2

10.6

13.5

8.9

Gross profit margin

25.4

31.3

33.8

37.6

35.7

33.8

34.1

34.7

35.9

40.9

39.8

Selling, general and administrative expense ratio

20.1

21.2

21.7

22.1

22.8

22.6

23.3

24.5

25.3

27.4

31.0

Return on equity (ROE)

14.1

9.6

19.6

0.9

(7.8)

10.3

6.8

13.0

5.3

16.5

16.0

Return on assets (ROA)

3.9

9.7

10.2

11.3

8.7

8.3

8.1

7.8

6.8

11.4

9.0

Capital ratio

29.3

31.8

37.5

32.9

28.8

33.6

32.5

47.5

49.5

52.7

53.5

Debt to equity ratio

1.3

0.9

0.7

0.9

0.9

0.8

0.9

0.5

0.5

0.5

0.4

Payout ratio

13.5

26.3

18.3

341.3

－

36.9

54.1

27.9

59.3

28.3

25.7

Consolidated results (millions of yen)

Year-end consolidated financial position (millions of yen)

Non-controlling interests
Equity capital
Data per share (yen)Earnings (loss) per share
Cash dividends per share (annual)
Net assets per share
Financial ratio (%)

61

TOYO TIRE Integrated Report 2023

TOYO TIRE Integrated Report 2023

62

Data

Introduction

Top Message

VisionStrategy

Materiality

Governance

Data

Consolidated Balance Sheets
Millions of yen

Previous fiscal year
(As of December 31, 2021)

Previous fiscal year
(As of December 31, 2021)

AssetsCurrent fiscal year
(As of December 31, 2022)

Liabilities
Current liabilities

Current assets
Cash and deposits

55,61541,601

Notes and accounts payable – trade

34,00442,577

Notes and accounts receivable – trade83,292

109,468

Commercial papers

27,00043,000

Merchandise and finished goods

57,332

78,315

Short-term loans payable

13,19624,780Work in process

3,882

5,091

Accounts payable – other

24,05331,225

Raw materials and supplies

19,73329,477

Income taxes payable

6,774

11,816

Other

17,33425,952

Provision for directors’ bonuses

117

110

(356)

(328)

Allowance for doubtful accounts
Total current assets

236,833

289,579

Fixed assets
Property, plant and equipment

306－

Provision for product compensation

4,460

4,820

Other

25,43632,716

Total current liabilities

135,350

191,048

Provision for sales returns

123,701

140,461

Non-current liabilities

Accumulated depreciation(58,492)(58,960)

Bonds payable

10,00010,000

Buildings and structures, net

65,20981,501Long-term loans payable

75,47651,366

Buildings and structures

354,943

380,917

Provision for directors’ retirement benefits

9

10

Accumulated depreciation(253,042)(264,069)

Provision for environmental measures

88

86

Machinery, equipment and vehicles, net

4,705

1,380

－

1,340

Machinery, equipment and vehicles

101,901

116,847

Provision for product compensation

Tools, furniture and fixtures

70,66473,487

Provision for loss on litigation

Accumulated depreciation(61,247)(63,610)Retirement benefit liability

3,829

3,523

16,868

10,478

4,745

8,740

9,416

9,876

Deferred tax liabilities

Land

19,032

17,972

Other

Lease assets

1,406

1,445

(869)

(1,001)Tools, furniture and fixtures, net

Accumulated depreciation

Total non-current liabilities
Total liabilities

115,723

86,926251,073

277,974

Net assets

Lease assets, net

537

443

Right-of-use assets

6,313

13,256

Shareholders’ equity

Accumulated depreciation(1,809)(5,273)

Common stock

55,93555,935Right of use assets, net

4,504

7,983

Capital surplus

54,33054,341

125,119

159,837

(143)

(132)

235,242

269,981

26,45012,743

Construction in progress

26,00330,426

Retained earnings

Total property, plant and equipment

226,606

265,051

Treasury stock
Total shareholders’ equity

Intangible assets
Software
Other
Total intangible assets

5,882

8,144

442

384

6,325

8,529

Investment securities

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments

Investments and other assets

6,850

5,541

44,71250,702

142

Retirement benefit asset

4,229

1,993

Non-controlling interests

Deferred tax assets

2,510

2,847

Total net assets

Other

4,755

3,643

Allowance for doubtful accounts

(103)

(102)

61,46435,729Total fixed assets

TOYO TIRE Integrated Report 2023

294,395

309,310531,229598,88958
32,359Total accumulated other comprehensive income

27,204150

Total assets(17)
11,428Remeasurements of defined benefit plans

49,921Long-term loans receivable

Total investments and other assets

63

Millions of yen

Current fiscal year
(As of December 31, 2022)

Total liabilities and net assets

201

231

280,155

320,915531,229598,889

TOYO TIRE Integrated Report 2023

64

Data

Introduction

Consolidated Statements of Income
Millions of yen
Previous fiscal year

Consolidated Statements ofComprehensive Income
Millions of yen
Previous fiscal year

Current fiscal year

(From January 1, 2021 (From January 1, 2022
to December 31, 2021) to December 31, 2022)

393,647

497,213

ProfitCost of sales

232,606

299,237

Gross profit

161,041

197,976

Other comprehensive
incomeSelling, general andadministrative expenses

107,960

153,930

Operating income

53,08044,046

Interest income

356

523

Dividends income

1,372

1,084

Foreign exchange gains

5,090

7,736

Equity in earnings ofaffiliates

167

199

Other

1,705

1,741

Total non-operating
income8,691

11,286

Non-operating expenses
Interest expenses

1,458

1,278

Other

4,405

3,018

Total non-operating
expenses

5,863

4,297

55,90951,035

Ordinary income
Extraordinary income
Gain on sale ofnon-current assets

4,280

299

Gain on sale ofinvestment securities

358

18,252Gain on sale of sharesof subsidiaries andassociates
Total extraordinary
income

－

32

4,639

18,583Extraordinary losses
Loss on retirement of
non-current assets

487

395

Loss on sale ofinvestment securities

92

7

1,136

736

Impairment losses
Loss on productcompensation

456

Deferred gains or losses
on hedges
Foreign currencytranslation adjustment

7,363
(20)
13,89847,956

21,46826,74875

Increase (decrease) in
retirement benefit liability

477

(390)

20,912

Decrease (increase) in
retirement benefit asset

68

4,476

Interest and dividend
income(1,729)(1,608)Interest expenses

1,458

1,278

Foreign exchange losses(gains)(2,654)(4,438)Equity in losses (earnings)
of affiliates

(167)

(199)

Loss (gain) on sale ofnon-current assets(4,280)(299)

Loss (gain) on sale ofinvestment securities(265)(18,245)－(32)

Loss on retirement of
non-current assets

487

395

Impairment losses

1,136

736

Loss on productcompensation

1,083

231

Total other comprehensive
income25,1876,020

66,652

53,977(1,309)48(Comprehensive income
attributable to)Non-controlling interests

66,44553,946

206

30

Millions of yen
Previous fiscal year

(From January 1, 2021 (From January 1, 2022
to December 31, 2021) to December 31, 2022)

Purchase of property,
plant and equipment(36,312)(43,030)

Proceeds from saleof property, plant andequipment

524

6,135

Purchase of intangible
assets(2,410)(3,360)Purchase of investments
in securities

(20)

(16)

Proceeds from sale andredemption of investment
securities

1,138

21,623

Proceeds from sale ofshares of subsidiaries andassociates

－

86

(457)

1,849

(37,538)(16,712)Net increase (decrease) inshort-term loans payable(1,742)

7,159

Net increase (decrease) incommercial papers

21,00016,000

Proceeds from long-term
debt

4,500

10,400456

Payments of long-term
debt(18,082)(32,562)－

1,340

10,000－Decrease (increase) innotes and accounts
receivable-trade

Proceeds from issuanceof bonds(5,808)(17,887)

Cash dividends paid

(6,922)(13,228)

Decrease (increase) ininventories

(24)

－

(20,271)(23,794)

Increase (decrease) innotes and accounts
payable-trade

3,568

7,573

(2,146)－

Other, net(2,385)(9,172)

Payments from changes
in investments in capitalof subsidiaries that do not
result in change in scopeof consolidation

Subtotal

49,54933,563

Proceeds from sale andleaseback transactions

6,128

－

Interest and dividends
income received

1,706

1,528

Other, net(1,013)(4,001)

Interest expense paid

(2,050)(1,292)

Net cash providedby (used in) financing
activities

11,697(16,231)(9,419)(3,086)

3,765

5,779

(5,859)(16,067)

Effect of exchange rate on
cash and cash equivalents

539

527

Net increase (decrease) incash and cash equivalents

12,390(11,992)

34,465

15,172

Cash and cash equivalents
at beginning of the year

36,30353,592

4,898－

53,592

41,600Loss (gain) on sale ofshares of subsidiaries andassociates

Provision for loss on
litigation

－

1,340

Loss on COVID-19

385

58

Total extraordinary losses

3,185

2,994

Payments of productcompensation

Profit before income taxes

57,362

66,624

Income taxes paid

Income taxes - current

10,605

20,452

Income taxes refunded
Net cash provided by(used in) operating activities

Other, net
Net cash provided by(used in) investing activities
Cash flows from financing
activities

Dividends paid to
non-controlling interests

Income taxes - deferred

5,292(1,783)

Total income taxes

15,897

18,668

Profit41,46547,956114

0Increase in cash and cash
equivalents from newly
consolidated subsidiary

41,35047,956

Cash and cash equivalents
at end of the year

Profit attributable to ownersof parent

TOYO TIRE Integrated Report 2023

Current fiscal year

Cash flows from investing
activities

Depreciation andamortization

Share of othercomprehensive income ofassociates accounted forusing equity method

Owners of the parent

Cash flows from operating
activities
66,624

3,714

Data

Governance(From January 1, 2021 (From January 1, 2022
to December 31, 2021) to December 31, 2022)

57,362(13,706)

Materiality

Current fiscal year

Income before income
taxes

Remeasurements ofdefined benefit plans, netof taxComprehensive income

Strategy

Millions of yen
Previous fiscal year

Current fiscal year

Provision for loss on
litigation

Profit attributable tonon-controlling interests

65

1,083

Valuation difference
on available-for-salesecurities

41,465

VisionConsolidated Statements of Cash Flows(From January 1, 2021 (From January 1, 2022
to December 31, 2021) to December 31, 2022)

Net sales

Non-operating income

Top Message

TOYO TIRE Integrated Report 2023

66

Data

Introduction

Top Message

Investor Information

Corporate Data

Stock information (As of December 31, 2022)

Overview

154,111,029

Total number of issued shares:

Breakdown by shareholder type

Number of shareholders:

38,885

Stock exchange listing:Tokyo Stock Exchange

Shareholder register administrator
and account management
institution for special account:

Mitsubishi UFJ Trust and Banking
Corporation

Unit: thousands of shares unless otherwise indicatedIndependent auditor:

KPMG AZSA LLC

Fiscal year:

January 1 – December 31

Annual general meeting ofshareholders:March

Number ofshares held
(thousand shares)

Shareholder

Foreign corporations
and others
33,85421.97%

Shareholding
ratio
(%)

Mitsubishi Corporation

30,822

20.02

The Master Trust Bank of Japan, Ltd.
(Trust Account)

23,667

15.37

Custody Bank of Japan, Ltd.
(Trust Account)

10,387

6.74

CEP LUX-ORBIS SICAV

5,867

3.81

Bridgestone Corporation

5,000

3.24

Toyota Motor Corporation

4,774

3.10

SMBC Nikko Securities Inc.

1,775

1.15

THE BANK OF NEW YORKMELLON 140044

1,734

1.12

Toyo Tire Employee Stock
Ownership Plan

1,639

1.06

Tokio Marine & Nichido Fire
Insurance Co., Ltd.

1,569

1.01

*The shareholding ratio is calculated excluding treasury stock (157,970 shares).

Japanese financial
institutions
44,84029.10%

Japanese financial
instrument firms
4,466
2.90%

154,111(yen)
100

Interim dividends

76

80
60
40

45

45

25

25

20

20

20

2019

2020

2021

56

80

Trade nameToyo Tire Corporation

Established

August 1, 1945

Paid-in capital 55,935 million yen
Number of
employees

11,744 (consolidated, including temporary employees)* As of December 31, 2022

Headquarters

2-2-13 Fujinoki, Itami City, Hyogo 664-0847, Japan
Phone: +81-72-789-9100

PlantsSendai Plant / Kuwana Plant, others

Lines ofbusiness[Tire Business] Tires (for passenger vehicles, lighttrucks, trucks & buses)[Automotive Parts Business] Automotive anti-vibration
rubberOther Japanese
corporations

46,11929.92%

Network in Japan
OfficeBreakdown by number of shares held
Unit: thousands of shares unless otherwise indicatedLess than 50,000 shares
3,934
2.55%

154,11150,000 shares or more
143,661
93.22%

50

(55)

30
2022

(20)
2023 (fiscal year)(forecast)

North America

Address
7791 Nelson Road, Unit #120,
Richmond, B.C. V6W 1G3, CANADA
3565 Harbor Blvd, Costa Mesa,
CA 92626, U.S.A.
3565 Harbor Blvd, Costa Mesa,
CA 92626, U.S.A.
3565 Harbor Blvd, Costa Mesa,
CA 92626, U.S.A.

2-2-13 Fujinoki, Itami City, Hyogo
664-0847
19F Shinagawa Seaside ParkTokyo OfficeTower, 4-12-4 Higashishinagawa,Shinagawa-ku, Tokyo 140-0002
3 Syogayama, Uchikoshi-cho,Nagoya Office
Miyoshi City, Aichi 470-0213
13-20 Hikari machi 1-chome,
Hiroshima Office
Higashi-Ku, Hiroshima City,
Hiroshima 732-0052
3-5-1 Fukiage, Iwanuma City,
Sendai Plant
Miyagi 989-2484
2400 Oaza Nakagami, Toin-cho,
Kuwana Plant
Inabe-gun, Mie 511-0294
Hyogo Manufacturing 1183 Rokubuichi, Inami-cho,Complex
Kako-gun, Hyogo 675-1112
Corporate
3-10-1 Yato, Kawanishi, Hyogo
Technology Center
666-01312-2-13 Fujinoki, Itami City, Hyogo
Tire Technical Center
664-0847
Automotive Parts
3 Syogayama, Uchikoshi-cho,Technical Center
Miyoshi City, Aichi 470-0213
Miyazaki Tire Proving 2318 Kawakita, Tsuno-cho,GroundKoyu-gun, Miyazaki 889-1201
Saroma Tire Proving Nishitomi, Saroma-cho, TokoroGroundgun, Hokkaido 093-0504

Toyo Tire Japan Co.,Ltd.
Toyo Tires Logistics
Co., Ltd.
Orient MachineryCo., Ltd.
Toyo Chemical
Industrial Products
Co., Ltd.

Ayabe Toyo RubberCo., Ltd.
Showa Estate Co.,
Ltd.

Address
2-2-13 Fujinoki, Itami City, Hyogo
664-0847
2-2-13 Fujinoki, Itami City, Hyogo
664-0847
2-3-6 Fujinoki, Itami City, Hyogo
664-0847
1183 Rokubuichi, Inami-cho,Kako-gun, Hyogo 675-1112
28 Aza Domae, Miyashiro,
Fukushima City, Fukushima
960-0116
115 Kuri-cho, Sawa, Ayabe City,
Kyoto 623-0222
2-2-13 Fujinoki, Itami City, Hyogo
664-0847

Telephone number
072-789-9100

TOYO AUTOMOTIVEPARTS DE MEXICO,S.A. DE C.V.

03-5780-8151

NT MEXICO S. DE
R.L. DE C.V.

0561-34-5911
082-264-3680
0223-22-2191
0594-86-0100
079-495-1519
072-789-1400
072-775-9000
0561-34-3211
050-3818-0090

Telephone number

Oceania

Asia
TOYO TIRE(SHANGHAI) CO., LTD.
TOYO AUTOMOTIVEPARTS (GUANGZHOU)
CO., LTD.
TOYO TIREZHANGJIAGANG
CO., LTD.
TOYO TIRE(ZHUCHENG) CO., LTD.
TOYO RUBBERCHEMICAL PRODUCTS(THAILAND) LIMITEDTOYO TYRE
MALAYSIA SDN BHD

072-789-9092
072-789-9130
072-787-7651
079-495-1519

TOYO TYRE SALESAND MARKETING
MALAYSIA SDN BHDSILVERSTONEMARKETING SDN
BHD

024-553-1356
0773-48-0001
072-789-9088

EuropeTOYO TIRE HOLDINGSOF EUROPE GMBHTOYO TIRE
DEUTSCHLAND GMBHTOYO TYRE (UK)LTD.
TOYO TIRE
BENELUX B.V.
TOYO TIRE ITALIA
S.P.A.

TOYO TIRE SERBIA
D.O.O.

TOYO TIRE Integrated Report 2023

3660 Highway 411 NE, White,
GA 30184, U.S.A.

Data

Telephone number+1-604-304-1941+1-714-229-6100+1-714-236-2080+1-866-706-4886+1-678-721-7200

3660 Highway 411 NE, White,
GA 30184, U.S.A.
521 Page Drive, Franklin, Kentucky
42134, U.S.A.
521 Page Drive, Franklin,
Kentucky 42134, U.S.A.

+1-270-598-4100

Address

Telephone number+1-678-721-7200

Carretera Estatal 431, Int63 Parque+52-442-221-6183
Tenologico Innovacion Queretaro
El Marques, Queretaro, Mexico, Cp76246
Insurgentes Sur 800, Piso 9
Oficina B, Del Valle, Benito Juarez, +52-55-5998-9558
Cp 03100 Ciudad De Mexico

Address

TOYO TYRE
1a, 2 Culverston Road, Minto
AUSTRALIA PTY LTD NSW 2566, Australia

TOYO TIRE RUS LLC

67

Governance

TOYO TIRE CANADAINC.
TOYO TIRE HOLDINGSOF AMERICAS INC.
TOYO TIRE U.S.A.
CORP.
NITTO TIRE U.S.A.
INC.
TOYO TIRENORTH AMERICA
MANUFACTURING INC.
TOYO TIRE NORTHAMERICA OE SALES LLC
TOYO AUTOMOTIVEPARTS (USA), INC.

Central & South America
Address

Headquarters

Fukushima RubberCo., Ltd.

(35)

20
0

Year-end dividends

Materiality

TMM (USA), INC.

Japanese individuals
and other investors(including treasury stock)
24,832
16.11%

Less than 10,000 shares
1,444
0.94%
Less than 5,000 shares
5,072
3.29%

Strategy

Global network

Affiliated companies(consolidated subsidiaries)

Changes in dividends per share

VisionAddress

Telephone number+61-2-8796-0222

Telephone number

Room 323, Ascendas Innovation+86-21-58820880
Place, No.686 Jiujiang Road,
Huangpu District, Shanghai, China
No.10, St.2, Hefeng Erzong Lu,
Yonghe Economic Zone, GETDD, +86-20-82986828
Guangzhou, China
58,Donghai Road, Jiangsu Yangtze
River International Chemical+86-512-35007100
Industrial Park, Zhangjiagang
City, Jiangsu Province, China
Luhe Industry Area, Zhucheng,
Shandong, China
99/8,30,31 Moo 4 Tambol+66-35-35-2347
Kanham, Amphur U-Thai,
Ayutthaya 13210, Thailand
PT 23101, Jalan Tembaga
Kuning, Kawasan Perindustrian
Kamunting Raya,P.O. BOX 1,34600 Kamunting, Taiping,
Perak Darul Ridzuan, Malaysia
Level 2, Wisma Comcorp No. 37,
Jalan Pelukis U1/46, Section U1,
Temasya Industrial Park Glenmarie, +603-5568-3188
40150 Shah Alam, Selangor Darul
Ehsan, Malaysia
Level 2, Wisma Comcorp No. 37,
Jalan Pelukis U1/46, Section U1,
Temasya Industrial Park Glenmarie, +603-5568-3188
40150 Shah Alam, Selangor Darul
Ehsan, Malaysia

Address

Telephone number

Halskestrasse 3-5, 47877, Willich,+49-2154-8911-111
Germany
Halskestrasse 3-5, 47877, Willich,+49-2154-8911-111
Germany
Shipton Way, Rushden, Northants,+44-1933-411144
NN10 6GL, UNITED KINGDOM
Blauwhekken 1, 4751 XD Oud+31-165-556475
Gastel, NETHERLANDS
via Napoli 33, 57014+39-586-962243
Collesalvetti, Li, ITALY
127055, Moscow, Butyrskiy Val+7-495-987-1835
Street, 68/70, bld. 1, office 26B.
Industrijska 3 no. 5, 22320 Indjija,
SerbiaTOYO TIRE Integrated Report 2023

68