Sustainability Report2023

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

1

Sustainability
Activities
UD
Trucks ata glance
For 88 years, UD Trucks has provided innovative trucks and transportation solutions
the world needs today and tomorrow.

20,988

Sales and servicing in

59

88

truckssold globally in 2022

countries

UD Trucks has an extensive network of dealers offering sales andservicing in 59 countries. The UD Trucks Group provides 24-hour,
365-day support to commercial vehicle operators and drivers,
including a telematics service connecting about 80,000 trucks
around the world.

UD Trucks sold 20,988 trucks globally in 2022, meeting a wide
range of transport needs with its diverse lineup of truck models.

Diverse workforce of(Thousands)

20.6

Asia

MiddleEast

Americas

13

19.9

13

18.9

21.0

15.5

10

In Japan:

6,203

8,333

employees

Outside Japan:

2,130With employees from 40 countries working worldwide, UD
Trucks recognizes that promoting a diverse workplace in which
all employees can make the most of their abilities will lead to its
continued success.
Note: Figures as of April 1, 2023

Africa19

years of history

Founded in 1935 as a diesel engine manufacturer, UD Trucks has
always been a challenger at heart, responding to the needs ofcustomers and the times.

Oceania

4

2018

2019

2020

2021

2022

168

customer centers andindependent dealers in JapanThe Company’s nationwide network of customer centers anddealers provides genuine parts and servicing to help customers
keep their trucks running and maximize uptime.

Kazet light-duty truck

Condor medium-duty truck

Sold in developed markets

Quon heavy-duty truck

Quester heavy-duty truck

Croner medium-duty truck

Sold in emerging markets

Kuzer light-duty truck

Sustainability Report 2023

UD Trucks at a GlanceContents

UD Trucks at a Glance

1

Message from the President

3

Our Purpose

4

Sustainability Activities
 Better for Logistics

7

 Better for the Planet18 Better for People27

 Better for Business

36

About UD Trucks Corporation

42

About this report
UD Trucks publishes a sustainability report every year for the
purpose of providing stakeholders with information about
its environmental, social and governance initiatives.

Scope of the report
This report covers the activities of UD Trucks Corporation.

Reporting period
This report mainly covers results and activities in fiscal 2023
(April 1, 2022 to March 31, 2023). Some sections also referto results and activities in previous fiscal years, activities infiscal 2024, and future plans and forecasts.

Published in January 2024

Contents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation2

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

3

Message from the President

In line with our Better Life purpose, management is working hand in handwith the Company’s diverse employees to bring benefits to our customers
and communities around the world.
The logistics industry is facing major challenges,
including rapidly rising freight transport demandfollowing the end of the COVID-19 pandemic andsubsequent economic rebound, as well as driver
shortages and strict environmental regulations. More
broadly, climate change, high energy prices, andissues related to human rights and labor practices
have been creating new challenges for the industry.
In response, commercial vehicle operators are
exploring ways to increase uptime and improve
working conditions for drivers.
As a provider of trucks and services in thelogistics industry, UD Trucks is addressing these issues
in order to continue playing an indispensable rolefor its customers and society as a whole. From thisstandpoint, we created our Better Life purpose withthe goal of growing together with stakeholders asa sustainability leader among Japanese commercial
vehicle manufacturers. At the same time, we intend
to bring benefits to communities around the world
as we work in support of the UN Sustainable
Development Goals.
Guided by our Better Life purpose, we are
pursuing initiatives that are better for logistics, theplanet, people, and our business. I am happy toreport that the Company has been making steadyprogress in each of these four areas. Starting withlogistics, we have enhanced the safety, comfort, andenvironmental performance of our Quon heavy-duty
trucks. We have equipped these models with UD
Active Steering, which helps reduce driver fatigue,
and lead the industry in developing engines thatmeet the latest fuel efficiency standards. We havealso been conducting autonomous driving trials ofheavy-duty trucks in confined areas to verify thefeasibility of this technology.
Turning to the planet, addressing climate change is
our primary focus. As a member of the Isuzu Group,
UD Trucks is aiming to achieve net zero CO2 emissions
by 2050 in accordance with Isuzu Environmental
Vision 2050. To achieve this goal, we are taking
steps to reduce CO2 emissions from our operations,particularly at the procurement and manufacturing
stages. We are also using renewable energy sources
and have introduced a new system for monitoring
CO2 emissions across the entire value chain.
UD Trucks employs over 8,000 people from 40
countries. We are fostering a workplace that values
diversity and inclusion, instills pride, and encourages
all employees to make the most of their abilities. In

these ways, we want to help build a better futurefor our customers and communities around theworld. As we pursue these endeavors, we lookforward to the continued support of the Company’s
stakeholders.

Kouji Maruyama
President and Representative Director
UD Trucks Corporation

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

Our Purpose

PurposeOur desired position by 2025

Better Life
Better Life is our purpose, the reason why
we exist. Providing the trucks and services
that the world needs today, we arecommitted to Better Life—to make life
better for people and the planet throughsustainable transport solutions

Leadership in sustainability
across four areas
Better for Logistics:

The leader in sustainability
among Japanese commercial
truck manufacturers

Pursuing smarter logistics
to overcome challenges
facing the industry

Better for the Planet:

Better for People:
Creating better
workplaces andsupporting communities

Reducing emissions
and waste

Better for Business:
Building a foundation
for sustainable growth

For over 80 years, UD Trucks has been providing the trucks and services the world needs today.
Now the logistics industry is facing an array of challenges, from a shortage of truck drivers and higher demand fordeliveries driven by the growth in e-commerce, to environmental impacts such as climate change and resource depletion.
To overcome these many challenges, innovation and collaboration are essential for making the world a better place.
We are committed to making life better - for people and the planet. This is our purpose, and we call it Better Life.
Life.
Guided by our Better Life purpose, we aspire to be the leader in sustainability among Japanese commercial
truck manufacturers by 2025.
Customers

Engaging with Stakeholders
By working to make life better for people and theplanet, UD Trucks recognizes the importance ofhelping achieve the UN Sustainable Development
Goals, which were adopted by the United Nations
General Assembly in 2015.

For UD Trucks to be a sustainability leader among Japanese commercial truck
manufacturers, close communication with all stakeholders is essential, including
customers, business partners, and employees. Therefore, the Company creates
opportunities to engage with stakeholders and reflects their views in its management
policies, business activities, and environmental, social, and governance (ESG) initiatives.

Business
partners

Employees

UD Trucks
Industryorganizations

Communities

Regulatory
bodies4

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

5

Our Purpose

Leadership in sustainability across four areas
Better for Logistics:

Better for the Planet:

Pursuing smarter logistics to overcome challenges facing the industry

Reducing emissions and waste

Globally, the logistics industry is facing various challenges, including a shortage of drivers,
increasingly strict regulations, and the need to ensure safer roads. Moreover, the growing
e-commerce sector coupled with intense competition is putting pressure on logistics firms
to cut costs and improve efficiency.
UD Trucks is meeting these challenges head on by staying at the forefront of innovationthat helps improve vehicle efficiency, reduce environmental impacts and maximize driver
comfort. To become a leader in sustainability, UD Trucks continues to develop nextgeneration technologies in the fields of connectivity, electromobility, and autonomous
driving. At the same time, the Company is offering solutions to partners and customers toenhance their business.

Climate change and resource depletion are some of the most pressing environmental issues
facing us today. UD Trucks, together with the logistics industry as a whole, can be part ofthe solution to greatly minimize environmental impacts.
UD Trucks is taking steps to significantly reduce CO2 emissions and eliminate waste
across its operations. Accordingly, the Company is exploring the use of renewable energy
and reducing the CO2 footprint of its products and sites, while collaborating with suppliers
to reduce environmental impacts across the entire value chain.

For more details, please refer to page 7.

For more details, please refer to page 18.

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

Our Purpose

Sustainability Activities

About UD Trucks Corporation

6

Our Purpose

Better for People:

Better for Business:

Creating better workplaces and supporting communities

Building a foundation for sustainable growth

Recognizing that people and communities are a core part of its sustainability strategy,
UD Trucks helps its employees enhance their well-being while fostering a workplace culturethat values diversity, personal development and a strong work-life balance. All employees
are encouraged to make the most of their abilities and given the opportunity to growprofessionally.
In addition, UD Trucks works closely with communities, focusing on road traffic safetyseminars for local schools, disaster relief and other community outreach initiatives.

Pursuing a sustainability strategy that is Better for Logistics, Better for the Planet and Better
for People helps secure the fourth area of sustainability: Better for Business. In short, thismeans the Company’s performance and profitability. UD Trucks invests profits back into its
businesses to lay a path for it to grow together with all stakeholders.

For more details, please refer to page 27.

For more details, please refer to page 36.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Better for Logistics
UD Trucks deploys innovative in-vehicle systems
to provide trucks that maximize driver comfort
and driving efficiency while also helping to
reduce environmental impacts. Working in
partnership with truck drivers and logistics
firms, the Company devises comprehensive
solutions across the entire value chain.
By developing next-generation technologies
in the fields of connectivity, electromobility,
and autonomous driving, UD Trucks is
working to make logistics smarter and moreenvironmentally sustainable.

7

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Sustainability Activities

Better for the Planet

Better for People

About UD Trucks Corporation

8

Better for Business

Sustainability Activities

Enhancing comfort andsafety for drivers
UD Active Steering system
In recent years, Japan’s aging population and shrinking
workforce have greatly impacted logistics, leading toa serious shortage of truck drivers. Moreover, working
hours for truck drivers will be limited when new legislation
on workplace reform takes effect from April 2024, raisingconcerns that freight volumes will exceed transportcapacity.
In response to this, UD Trucks designs its vehicles
to be easy for anyone to drive, regardless of age or skill
level, in order to attract new people to the profession. For
example, the Company equips its heavy-duty Quon trucks
with UD Active Steering, a system designed to help reduce
driver fatigue and make roads safer. Using an electronic
control unit attached to an electric motor installed overconventional hydraulic steering gears, the system monitors
the vehicle direction and driver’s actions while detecting
vehicle movements and road conditions with numerous
sensors at a rate of 2,000 times per second, providing
real-time assistance to the driver. It also reduces steering
wheel resistance by applying an appropriate amount of
torque, providing steering stability regardless of the truck’s
speed, payload, road conditions, or crosswinds. UD Active
Steering was first introduced in the Quon CG and GK
models in 2021, and was added to the CD and CQ models
in 2023.
The Company offers opportunities for drivers tocompare trucks equipped with and without UD Active
Steering. After testing trucks equipped with the system,
drivers reported lower stress levels and reduced levels ofexcess concentration. They also described steering as being
more comfortable, especially when parking or driving onrough roads.
Web

Please refer to the following webpage for information on thedemonstration results
https://www.udtrucks.com/news-and-stories/news/
20210701-ud-active-steering

Five benefits of UD Active Steeringl Low Speed Agility	When turning at low speeds and reversing in tightspaces, additional steering torque automatically feeds
into the system to allow the driver to maneuver witha light touch.
l High Speed Stability	When driving at higher speeds, the weight of thesteering wheel adjusts to provide superior stability.
l Rough Road Dampening	UD Active Steering dampens vibrations on rough roads.
Minute directional adjustments keeps the driver oncourse.
l Cross Wind Correction	UD Active Steering virtually eliminates the steeringcorrections needed in crosswinds, keeping the driver ona straight course.
l Return to Center	Whether turning at an intersection or reversing, thesteering wheel will return to center when released,saving driving effort and bringing the vehicle intoa straight line quickly and easily.
Web

Please refer to the following webpage for details about UD
Active Steeringhttps://www.udtrucks.com/about-us/innovation/udas

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities

UD Active Steering—what drivers had to say

Since the truck steers so easily and smoothly,
I no longer have stiff shoulders and back pain.
Norikazu Tanaka Mizushima Rinkai Tsuuun Co., Ltd. I drive a Quon tractor, and I’m mainly responsible fortransporting freight over short distances. When I firstdrove a Quon with UD Active Steering, the steering
felt really light. I even wondered whether it was safefor the truck to steer so lightly. Once you’ve triedit, though, driving is much easier. We have to turnthe steering wheel many times when driving in tightspaces, and more so when towing a trailer, so I reallyappreciate being able to steer so easily and smoothly.
I don’t even have to worry about how many times
I turn the wheel because it goes back to the center
position automatically.
When pressed for time, I use the highway even for
short distances. I was initially concerned about whether

such light steering would be okay when driving athigh speeds, but it proved to be very stable. Changing
lanes is smooth, and I never notice any steering wheel
resistance. Driving feels natural. On bumpy roads,
tractors tend to shake intensely and some even seemto bounce. That can cause back pain. Now that I drivea Quon with UD Active Steering, I don’t have any moreback pain, and driving on highways is a breeze. I think
my stiff shoulders and back pain disappeared recently
because of this steering system. One of my coworkers
was spot on when he said, “I could drive across thewhole country in this truck.”
About Mizushima Rinkai Tsuuun Co., Ltd.
Headquartered next to the Mizushima industrial
complex in the city of Kurashiki, Okayama Prefecture,
the company mainly transports raw materials andfinished products to and from oil refineries, steel mills,
auto plants, and other large facilities in the area. It hasover 100 trucks, about 70% of which are tractors.

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business9Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities

About UD Trucks Corporation

10

Better for People

Better for Business

Belt-in Seat maximizes driver
comfortA conventional seat belt placespressure on the driver

Sustainability Activities

Improved safety features of Quon
heavy-duty trucks
Quon heavy-duty trucks come with the Company’s
advanced safety features, including its Traffic Eye vehicledistance alarm system, Traffic Eye Cruise Control, Traffic
Eye Brake automatic braking system, and Lane Departure
Warning System. Loaded with advanced technologies,
these systems help drivers operate trucks safely, whichmakes the road safer for everyone. UD Trucks has also
focused on enhancing its driver support systems to help
alleviate driver fatigue, a major cause of traffic accidents.
In 2021, the Company began installing its Lane Departure
Prevention function and UD Active Steering electronicallycontrolled steering system in certain truck models. It also
upgraded Traffic Eye Cruise Control to adjust the truck’s
speed to the vehicle ahead while at slow speeds, making
driving easier in congested traffic conditions.
UD Trucks equipped its 2022 models with new safety
features: Driver Monitor, Smart Blind Spot Information
System, and Smart Lane Change System. Using a camera
mounted on the windshield pillar on the driver seat side,
Driver Monitor detects the driver’s posture, the direction
the driver is looking, and whether his or her eyes are
open. If the driver is looking to the side, slouched over,appears drowsy, or has closed eyes, it alerts the driver totake a break on the dashboard panel. Smart Blind Spot
Information System detects bicycles and other objects on
the left side of the truck when the driver makes a left turn,while Lane Change Support detects oncoming vehicles on
the left side when the driver changes lanes. Both functions
alert the driver via an indicator mounted on the windshieldpillar of the passenger seat side of the cab. If the possibilityof a collision is detected, the indicator flashes, a buzzer
sounds, and a warning appears on the dashboard panel.

While truck manufacturers are required to installa system for detecting blind spots in trucks weighing
over eight tonnes effective from May 2024, pursuant
to international standards set in November 2019, theBlind Spot Information System was the first such system
to be featured in a heavy-duty truck model in Japan,
demonstrating the Company’s success in complying
with safety standards ahead of time. In 2023, UD Trucks
enabled this system to detect blind spots not only on theleft side but also on the right side of the truck, thereby
further improving safety.

Improving comfort for drivers
Truck drivers spend the majority of their working hours
behind the wheel. Therefore, UD Trucks develops highly
functional seats that reduce fatigue and improve comfort.
One of its innovations is the Belt-in Seat system, an option
available on the Quon. For this system, the seat belt isbuilt into the seat itself rather than attached to the cabwall, and connected to the seat suspension. This not only
makes the belt feel more comfortable but also reduces thepressure and rubbing of the belt on the driver if the truck
experiences shaking or jolting on the road.
In addition, UD Trucks designs its seats to maximize
driver comfort in respect to firmness and materials, basedon technologies developed by Isringhausen, a German
company that has earned an excellent reputation for its
long-haul truck seats in Europe. Seats are equipped with
10 adjustment levers and switches, allowing the driver to
set the safest and most comfortable driving position forlong distances, and precisely adjust the seat to perfectly fit
his or her physique and preferences. Heated seats are alsooffered as an option for keeping drivers more comfortable
during cold winter months.

➊ Seat position adjustment lever➋ Seat height adjuster➌ Seat recline lever➍ Double seat recline lever➎ Armrest adjustment dial

➏ Lumbar support switch➐ Shock absorption lever➑ Seat tilt lever➒ Seat cushion position lever➓ Air dump valve switch

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

11

Better for Business

Sustainability Activities

Level 4 autonomous driving trial with
Kobe SteelAs Japan’s logistics industry struggles with a chronic labor
shortage, manufacturers are concerned about how thelack of truck drivers will impact their operations. To help
find new ways to address these issues, UD Trucks has been
focusing on developing fully electric and autonomous
trucks under its roadmap for innovation, “Fujin & Raijin.
Vision 2030.” As part of these efforts, it has been verifying
the feasibility of self-driving heavy-duty trucks used forspecific applications.
For example, in 2019, the Company demonstrated
a self-driving truck equipped with Level 4* autonomous
driving technology in Hokkaido together with the logistics
firm Nippon Express and the Hokuren Federation ofAgricultural Cooperatives. The test verified that the truck
could carry out deliveries on a planned route.

More recently, UD Trucks formed a partnership with
Kobe Steel, Ltd., and conducted an autonomous driving
trial at the steelmaker’s Kakogawa Works from August
to October 2022. During the trial, a Quon heavy-duty
dump truck equipped with Level 4 autonomous driving
technology automatically transported a slag weighing
roughly 17 tonnes to and from multiple points on a test
course within the site. Stopping at the preset points,
unloading the payload, and other complex operations
were also carried out autonomously. The trial verified thefeasibility of autonomous vehicle systems and the potential
for automating transport and unloading operations.

Purpose of the trial
The trial was intended to verify the accuracy ofautonomous driving technology when used under actual
operating conditions, as well as the robustness of various
types of sensors and the reliability of autonomous vehicle
systems.
Results of the trial
The trail showed:l A dump truck fitted with the autonomous driving
system could operate and accurately maneuver undervarious weather conditions, such as rain and fog, and on
rough terrain, including on uneven surfaces and in poolsof water and mud.
l UD Active Steering contributed to the precise and safe
steering of the truck when driven on uneven terrain.
l The truck could stay on its preset course based on
positioning and navigation data generated from GNSSRTK (high-precision GPS) and 3D-LiDAR (laser-equipped
sensors) technologies, even in an environment in whichsatellite signals are easily blocked*The vehicle can fully operate in self-driving mode under predefinedconditions.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

12

Better for Business

Sustainability Activities

Participation in a government initiative
to support the logistics industry
Recognizing that it is not only a manufacturer of trucks
that are essential for commercial transportation but also
a user of logistics services, UD Trucks strives to makelogistics more sustainable. From this standpoint,
the Company is proactively endorsing the Japanese
government’s program for raising the productivity oftrucking, and improving workplace conditions andefficiency in the logistics industry. This initiative (called
the White Logistics Movement in Japan) was launchedin March 2019 by the Ministry of Land, Infrastructure,
Transport and Tourism.

Reducing environmental impacts
Improving the environmental
performance of Quon heavy-duty
trucksWhen UD Trucks debuted its Quon model in 2004,
the trucks were the world’s first to feature a selective
catalytic reduction system for purifying exhaust gases.
Since then, the Company has been improving the fuelefficiency and environmental performance of the Quon by
applying leading-edge technologies, including its ESCOT
12-speed electronically controlled automatic transmission,
designed to help drivers save on fuel, the Foretrack
speed adjustment system, which predicts the road ahead
based on scanned data, and Nenpi Coach, a system thatprovides drivers with fuel-saving advice. The Company
has also made numerous improvements to the Quon’s
aerodynamics, engine, driveline, and core technologies.
In July 2022, UD Trucks released a Quon with an
11-liter GH11 engine that meets new Japanese fuelefficiency standards set to go into effect from 2025. Under
these new standards, which cover many types of vehicles,
fuel efficiency must be improved by over 10% comparedwith standards set in 2015 by the Ministry of Land,
Infrastructure, Transport and Tourism.
In April 2023, the Company introduced the Quon GW
6x4 heavy-duty tractor with a 13-liter GH13 engine that
also meets the new 2025 fuel-efficiency standards forheavy-duty vehicles. Featuring a specially fitted ESCOTVII transmission, the GW 6x4 delivers all the raw power
needed for transporting heavy loads while enabling drivers
to save on fuel.

Heavy-duty Quon puts the environment firstl Vehicle
Quon trucks come with fuel-efficient driving systems,
including the Foretrack speed adjustment system, whichuses scanned data to predict the road ahead and adjust
speed and braking accordingly, and Nenpi Coach, a systemthat analyzes driving habits and provides drivers with
helpful fuel-saving advice on a multi-display. The Company
has also improved aerodynamics with front bumper-fitted
air dams and newly developed wind deflectors, which help
reduce resistance while driving.
l Engines
 GH11This 11-liter engine features an efficient and precise fuelinjection system designed to leverage the benefits of both
unit injector and common rail systems, along with newly
designed combustion chambers that optimally mix fueland air. The combination of these technologies ensures
fuel-efficiency, power, and clean-running performance.
Moreover, the engine runs on low-viscosity engine
oil, which contributes to better mileage and a longer
service life.
 GH13
Built with the same advanced combustion technologies
that the GH11 is known for, the new GH13 engine
runs on low-viscosity engine oil and applies various
technologies for reducing friction, which contributes tomore economical driving, and features a ball-bearing
turbocharger that helps improve fuel efficiency.
 ESCOT-VI and ESCOT-VII transmission
This 12-speed electronically controlled automatictransmission optimizes gear shifting while helping keep
fuel consumption at a minimum.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

13

Better for Business

Sustainability Activities

Quester and Croner models comply
with Euro 5 vehicle emission standards
In September 2021, UD Trucks released Quester heavyduty and Croner medium-duty truck models that comply
with the Euro 5 vehicle emission standard for the European
Union. Now available in emerging markets around theworld, these new models boast features that improve
uptime and fuel efficiency, optimize the total cost ofownership for users, and help lower environmental
impacts.
UD Trucks has released these new models in emerging
markets, which have been rushing to adopt more stringent
emission standards in response to worsening air quality
caused in part by industrialization and rapid economic
growth, as well as to climate change. Since the Euro
5 standard requires NOx emissions to be reduced by
43% compared with the Euro 4 standard, these Euro 5

From left, Croner and Quester model trucks

compliant trucks will help address environmental issues
and reduce related risks.
Besides complying with the Euro 5 standard, these
Quester and Croner models offer substantially higher fuelefficiency because they are equipped with the Company’s
selective catalytic reduction system, which is highly
regarded as the world’s first such system for purifying
exhaust gases. They also come with Nenpi Coach, a systemthat provides drivers with real-time advice on how to
maximize fuel efficiency and optimize driving techniques.
In May 2023, UD Trucks exhibited Euro 5 compliant
trucks at NAMPO Harvest Day, the largest agriculturalequipment trade fair in South Africa, an important market
for the Company. Electricity shortages have caused power
outages in South Africa in recent years, impacting manyindustries and making it difficult for farmers to reliably
supply produce to the market while maintaining quality.

In this context, many visitors attending the trade fair
expressed interest in Euro 5 compliant vehicles that offer
greater fuel efficiency and higher environmental standards
and solutions for improving uptime.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

14

Better for Business

Sustainability Activities

Improving operational efficiency
for customers
Making aftermarket services more
efficient through digitalization
Aiming to offer customers a user-friendly one-stop
service, UD Trucks has integrated its customer relationshipmanagement (CRM) and enterprise resource planning(ERP) into a new system called UD Dynamics, and beganrolling out this system to its service centers throughout
Japan from April 2022. By using UD Dynamics, the service
centers can transform the operational processes of theiraftermarket services to reduce customer wait times,
expand maintenance service capacity, access relevant data
in real time, and optimize the servicing of vehicles thathave broken down on the road, thereby helping customers
increase productivity and uptime.
Looking ahead, UD Trucks plans to use UD Dynamics
as the basis for a comprehensive platform spanning all of
its aftermarket services, enabling the operational status ofevery service center and the vehicles they are servicing to
be checked in real time. By responding to customers withsuch data-driven solutions, the Company aims to enhance
the quality of its services and raise the level of customer
satisfaction.

Deploying vehicle telematic data tominimize vehicle downtime
Trucks are used for over 90% of all goods transported
inside Japan on a tonnage basis. From that perspective,society depends on UD Trucks to help its customers keep
their trucks up and running.
Toward this end, the Company deploys its uniquetelematics service to facilitate safe truck operations forcustomers. Through this service, the Company collects
and analyzes real-time data transmitted automatically
via a telematics system installed inside the vehicle, andremotely provides users with these diagnostic results to
help them operate their trucks safely. The data includes
information on the vehicle’s status, engine condition, fuelconsumption, and location. In the event of a breakdown,
UD Trucks promptly verifies the truck’s condition andinforms the driver of the nearest service center, thereby
minimizing vehicle downtime. The service also provides
users with a fuel efficiency report and a safe driving report,
which are useful tools for facilitating more fuel-efficientdriving.
In addition, UD Trucks has been using various typesof data collected from the trucks for the purpose of
preventative maintenance. By identifying signs of potential
vehicle breakdowns and averting such problems fromoccurring in advance through preventative maintenance,
the Company aims to reduce unexpected breakdowns tomaximize uptime.

UD Road Support
A one-stop service for customers provided by theCompany’s call centers, the UD Road Support team isavailable 24 hours a day, 365 days a year, to immediately
respond to enquiries and requests from truck drivers. If
a truck breaks down on the road or has an accident, theteam checks the vehicle’s condition using data transmitted
in real time via the Company’s telematics service, andshares the information with a mechanic from a service
center nearest to the vehicle. Call center staff thenpromptly dispatch the mechanic to repair the vehicle, andprovide necessary information to the truck driver, such as
the estimated time of arrival of mechanic.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

15

Better for Business

Sustainability Activities

Quality
ISO 9001 certification
UD Trucks complies with the ISO 9001 international
standard for quality management systems. The Company’s
Manufacturing Division acquired ISO 9001 certificationin 2002, followed by the Product Development Divisionin 2016. Both divisions completed the transition to therevised ISO 9001:2015 standard in 2018. The Company’s
Purchasing Division acquired the certification in 2022, andother divisions that have adopted quality management
systems are making improvements in preparation forcertification in the future.
Outside Japan, thecertification has been acquiredby the Bangkok Plant inThailand and the Pretoria Plant
in South Africa. All certified
workplaces thoroughly conduct
a plan-do-check-act (PDCA)
cycle to continuously raise
quality in accordance with thestandards.

Internal and external audits of quality
management
As a rule, UD Trucks conducts an internal audit of its
quality management system every year to ensure that it
functions effectively. During the audits, a team of qualified
audit committee members verify and evaluate whether thesystem is being properly implemented and complies withcompany rules as well as relevant laws and regulations.
Likewise, the quality management system is audited every
year by a third party in order to maintain ISO certification.

Measures for promptly dealing withquality-related issues
To minimize the impact of quality-related issues forcustomers, UD Trucks has established a Quality Action
Group, led by its Quality Assurance Division and spanning
across departments involved in product development,
manufacturing, and aftermarket services. The groupis comprised of teams that handle troubleshooting at
headquarters, teams that provide technical support atservice centers and customer sites, and branch officeteams that directly respond to problems in their respective
areas. These teams coordinate their efforts to quickly
identify root causes and implement solutions. Throughthis arrangement, they promptly share quality-related
information and respond to issues, ultimately leading togreater customer satisfaction.

Product development quality standards
UD Truck’s Product Development Division has established
its own standards for quality assessments. Based on thesestandards, the division specifies checkpoints at each stageof product development and confirms whether targeted
levels of quality are achieved across a broad range ofindicators, including a truck’s performance, functions,durability, and reliability. This process not only ensureshigher quality but also shortens the total time required for
product development.

Recognizing the growing importance of promptly
and efficiently obtaining information relevant for quality
control, UD Trucks has been using wearable cameras
and utilizing various other digital devices to collect
maintenance and repair data on vehicles with defects.
The Company has also begun using business intelligence
tools to digitize analytical processes, enabling it to more
effectively identify quality issues.

Quality assurance in manufacturing
Based on a quality-first approach, UD Truck’s
Manufacturing Division strives to ensure that all of theCompany’s products fully satisfy customers by having all
production plants worldwide follow in-house production
quality management processes and meet targets for
quality. Given the critical importance of highly skilled
personnel for quality management at these plants, thedivision regards human resources development as integral
to product manufacturing, and provides employees withcomprehensive training programs.
Employees at production plants actively participate inquality control circles, which have led to the introductionof many devices and techniques for preventing mistakes
on production lines. These circles have also identified
problems and challenges for workers while making various
improvements involving the adoption of renewableenergy and low-cost methods for reducing environmental
impacts, as well as the creation of simple systems andmechanisms. A quality control circle representing theCompany participates in a competition held by the Union
of Japanese Scientists and Engineers each year. The circle
in the 2021 competition was awarded a silver medal,
demonstrating the Company’s high standards of quality.

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Message from the President

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16

About UD Trucks Corporation

Better for People

Better for Business

Sustainability Activities

To ensure that its quality management evolves instep with next-generation products and to offer higher
technical specifications, the Manufacturing Division is
stepping up its development of advanced production
systems incorporating the latest digital technologies. For
example, it has installed a real-time monitoring system forproduct quality management and equipment maintenance.
It has also developed an app for facilitating communicationand promoting teamwork among personnel involved inquality management.

Reporting on vehicle defects resulting
in recall or requiring improvement orservicingIn the event of a vehicle defect that could potentiallyaffect customer safety or the environment, UD Trucks
promptly discloses all relevant information in accordancewith guidelines issued by Japan’s Ministry of Land,
Infrastructure, Transport and Tourism.
Number of vehicle defects reported in Japan
2020

Improving the skills of aftermarket
service staff
UD Trucks strives to maintain and raise the quality of its
aftermarket services by organizing events that enhance
the skills of staff handling repair work, parts procurement,
and front-office duties at its service centers. Amongthese events, the Company’s annual Uptime Conference
provides aftermarket service staff across Japan withtechnical support and quality-related information about
new products. At the event, best practices are sharedand discussions held not only among staff on the front
lines of aftermarket services, but also members from theCompany’s divisions in charge of product development,
manufacturing, procurement, and logistics.
Another event is the UD Gemba Challenge, a skills
competition for aftermarket service teams from aroundthe world. Held every two years, the event spans over a
period of about six months, during which team members
learn and demonstrate practical skills that are frequently
required on the job. By taking on new challenges, theparticipants gain new knowledge and technical expertise.
In 2022, 2,161 employees of the UD Trucks Group
worldwide participated in the competition.

2021

January–March 2022

April 2022–March 2023

UD Trucks

Volvo Trucks

UD Trucks

Volvo Trucks

UD Trucks

Volvo Trucks

UD Trucks

Volvo Trucks

Defects resulting in recall

8

1

17

1

3

0

4

1

Defects requiring
improvement

0

0

0

0

0

0

0

0

Defects requiring servicing

0

1

3

3

1

0

5

2

Note on the reporting periods
The results above were reorganized due to a change in the Company’s fiscal year period from the calendar year prior to 2022 to the April-to-March period
effective from April 1, 2022.

Sustainability Report 2023

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Message from the President

Better for Logistics

Our Purpose

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Sustainability Activities

About UD Trucks Corporation

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17

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Sustainability Activities

Supporting our customers
Eco-driving and safe-driving seminars
UD Trucks has been holding eco-driving and safe-driving
seminars for truck drivers since 2007. The eco-driving
seminars are designed to equip drivers with practical skills
and knowledge about how to improve fuel efficiency
while driving. During the seminars, truck drivers learn
and practice fuel-saving techniques for maneuveringand decelerating. The seminars also make use of theCompany’s telematics service, a wireless communications
system for collecting and analyzing data on a truck’s
location and movements, enabling evaluations of vehicle
speed, gear changing, and other driving-related factors.
Participants have found this to be very insightful andhelpful for understanding their driving habits and making
improvements accordingly.
The safe-driving seminars cover a broad range of
topics, including safe management systems for transport

operators, the dangers of driving under the influenceof alcohol, blind spots, preventing common accidents,
defensive driving, and reducing human error. The
programs combine lectures with hands-on training so thatdrivers can immediately acquire practical skills. Videos ofactual accidents taken with drive recorders are also used togive participants a better sense of how accidents happen.

Prompt customer service
UD Trucks has established a customer service call center
made available with a toll-free telephone number forcustomers to ask questions, provide feedback and makerequests. It has also prepared a guidebook explaining
responses to all foreseeable inquiries to help the center’sphone operators effectively deal with customer inquiries.
The center’s procedures and operations are regularly
reviewed to ensure that it continues to provide prompt
and helpful customer service. During the 12-month period
from April 2022 to March 2023, the center handled a totalof 3,952 calls, in line with the 3,925 calls handled in 2021.

Number of seminars held annually and participants
2020
Seminars

2021
Participants

Seminars

July 2022 to March 2023
Participants

SeminarsParticipants

Eco-driving seminars

10

288

29

464

67

1,577

Safe-driving seminars

46

2,053

119

7,012

129

2,961

Partnering withindependent dealers
Building good relations withindependent dealers throughinformation sharing and technicalsupportIn addition to its own network of dealers, UD Trucks
supplies products and services to customers throughsix companies that operate a total of 32 independent
dealerships in Japan. UD Trucks implements a variety of
initiatives aimed at building solid relations with thesedealerships while working closely with them towards thecommon goal of improving customer satisfaction. Amongthese initiatives, the Company invites these dealerships
to meetings about its management policies and industry
trends. It also shares information about its businessactivities and products by issuing a monthly magazine forits dealerships and holding product presentations.
With the goal of improving the quality of aftermarket
services, UD Trucks invites the entire dealer network,
regardless of whether dealers are independent or not,to training programs and events designed to help
them acquire more skills and the latest expertise. As aresult, many maintenance and service staff from these
independent dealerships participate in the Company’s
Uptime Conference and UD Gemba Challenge (see page16) each year.

Sustainability Report 2023

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Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Better for the Planet
UD Trucks is taking steps to significantly
reduce CO2 emissions and eliminate
waste. Accordingly, the Company ismaking use of renewable energy sources
and reducing the CO2 footprint of its
products and workplaces, while
collaborating with suppliers to reduce
environmental impacts across the entire
value chain.

18

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Better for Logistics

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About UD Trucks Corporation

19

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Sustainability Activities

Towards decarbonization
Reducing CO2 emissions across businessactivities
In line with its Better Life purpose, UD Trucks regards
decarbonization as an important challenge and, therefore,takes proactive steps to reduce CO2 emissions throughout
its operations. Since its production plants, in particular,
consume large amounts of energy, the Company has beenstreamlining manufacturing processes and centralizing
production lines and equipment, to reduce overall energy
usage and associated CO2 emissions. To accelerate these
efforts, the Company’s Ageo Plant has been improving
productivity, purchasing electricity from renewable sources,
installing LED lighting systems equipped with motion
detectors for automatically turning off lights, switching
to electric vehicles and forklifts while decreasing the total
number of its vehicles, and upgrading to more efficientequipment in general. Outside Japan, UD Trucks has
installed solar panels on the rooftop of its Bangkok Plant,
and is planning to install panels at other production
facilities in the future.
Looking ahead, as a member of the Isuzu Group,
UD Trucks aims to reduce CO2 directly emitted from its
business activities to zero by 2050 in accordance with
Isuzu Environmental Vision 2050. To achieve this goal, theCompany is currently executing an environmental roadmap
extending up to 2030.
Purchasing electricity from renewables
The Ageo Plant has been purchasing electricity derived
from renewable energy sources since May 2019, andincreased the amount from these sources in 2022. Byusing electricity from renewables instead of non-renewablesources, the plant effectively reduced its CO2 emissions by
1,060 tonnes in 2022.
In addition, the Company’s training center, which isadjacent to the Ageo Plant, concluded an agreement in
September 2022 to purchase electricity entirely from net
zero carbon sources.
Installing LED lighting and efficient equipment
The Company’s Ageo Plant and headquarters replaced
obsolescent lighting equipment with about 16,000 LED
lights between 2020 and 2022, and reduced the total
number needed by about 1,500 lights by optimizing
lighting layouts. This initiative will help reduce CO2
emissions and cut down on waste since the LED lights last
a comparatively longer time until replacement is necessary.
Upgrading boilers
UD Trucks installed three new energy-efficient boilers at
its Ageo Plant in December 2022. By using these boilers,
the plant expects to reduce its energy consumption in thefollowing fiscal year.
Adopting on-site solar power
In June 2022, UD Trucks Thailand installed a solar
power system on the rooftop of its Bangkok Plant withcapacity to generate 1,477 megawatt hours annually.
Consequently, around 25% of all energy consumed by theplant now comes from renewables, and its CO2 emissions
can be reduced by approximately 700 tonnes per year.

Saving energy with heat reflective paintIn April 2022, solar heat reflective paint was applied to theroof and exterior walls of the Gunma Parts Distribution
Center, the largest of the Company’s four parts distribution
facilities in Japan. Consequently, the indoor temperature
decreased by as much as 10.5°C during the summer. This
led to a 10% reduction in annual electricity consumption,and helped the center improve the workplace environment
by keeping the average temperature below 30°C.

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Better for Logistics

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About UD Trucks Corporation

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Sustainability Activities

CO2 emissions
Total emissions

Emissions per vehicle(Thousand tonnes of CO2 emissions)(Tonnes of CO2 emissions per vehicle)

60

10

55

48

8

36

6

24

4

24

23

21

20

12

19

0

2
0

2013

2018

2019

2020

2021

2022

CO2 emissions by energy source
Electricity

Heavy oil

Coke

Liquified petroleum gas

Other

Diesel oil

City gas(Thousand tonnes of CO2 emissions)

0.3%
0.02%
37.1%

55
0.2%
0.03%
33.9%

11.6%
7.5%

16.8%

1.5%

19

1.2%

42.0%
47.8%
2013

2022

Scope of operations
Amounts shown in the graph are combined results from the Ageo Plant
and Gunma Parts Distribution Center from 2018 to 2022, and include
results from other facilities in 2013.

Reducing CO2 emissions over the
product life cycle
UD Trucks assesses and works to reduce CO2 emissions
across the entire life cycle of its vehicles, from raw
materials procurement through to the disposal andrecycling of parts and components. The Company places
great importance on these initiatives in consideration of
the fact that commercial-use trucks account for about
7% of total CO2 emissions from all industries in Japan(according to the Ministry of Land, Infrastructure, Transport
and Tourism), as well as the Japanese government’s goal toreduce emissions under its Green Growth Strategy.
Life cycle assessments
UD Trucks has been contributing to the formulationof guidelines on life cycle assessment (LCA) methods(including calculation methods) in Japan’s auto industry
as a member of a subcommittee set up by the Japan
Automobile Manufacturers Association in 2021. The
Company also set up its own LCA working group
comprised of members from relevant divisions. Tasked
with raising and solving environmental issues, this grouphas been meeting periodically to review progress, share
information, and specify responsibilities while collecting
and analyzing data.
Measures for reducing CO2 emissions at eachstage of the product life cyclel Development and design
Recognizing that the majority of CO2 emissions occur
during the usage stage of its trucks, UD Trucks has been
focusing on leading-edge technological development
aimed at reducing the emissions at this stage of the
product life cycle.

	Developing technologies for improving fuel efficiency
The fuel that trucks burn is not only a major expense forcommercial vehicle operators but also a source of CO2
emissions, which is a major contributing factor to climatechange. For that reason, UD Trucks has been improving
the fuel efficiency of its trucks for decades, and regards
these efforts as one of its most important environmental
initiatives. In Japan, trucks and buses will need to improvetheir fuel efficiency by an average of 13.4% by 2025
under new fuel efficiency standards enacted in 2019
(compared with the standards introduced in 2015).
Demonstrating its commitment to better fuel efficiency,
UD Trucks met these standards well ahead of time withan 11-liter engine-powered Quon heavy-duty truck model
released in July 2022, followed by its GW 6x4 heavy-duty
tractor with a 13-liter engine in April 2023.
Related:

Improving the environmental performance of Quon
heavy-duty trucks (see page 12)

The Quon’s 11- and 13-liter engines contribute to better fuel efficiency

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Better for Logistics

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About UD Trucks Corporation

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Major technologies applied in heavy-duty trucks

Vehiclel Nenpi Coach system for advising drivers on
fuel-efficient drivingl Foretrack function for predicting the road ahead
based on scanned datal Aerodynamic designs including front bumper-fitted
air dams and newly developed wind deflectors

Enginel Newly designed combustion chambersl Multi-stage fuel injection systeml Electronically controlled variable-speed oil pumpl Designed to use less engine oil

Power trainl Direct-shift transmissionl ECO mode cruise control Developing next-generation technologies
UD Trucks develops its products in accordance with its
roadmap for innovation, “Fujin & Raijin. Vision 2030.,”
launched in 2018. One of the goals of this roadmap is tomass produce electric trucks by 2030. The Company has
been accelerating its research and development of hybrid
electric, battery electric, and fuel cell electric vehicles in
addition to internal combustion engines that burn lowcarbon fuel. In these ways, it is exploring diverse solutions
for decarbonization in preparation for anticipated market
trends, changes in environmental regulations, and newenergy-related infrastructure in the countries where it sells
vehicles.

l Logistics
UD Trucks focuses on reducing CO2 emissions from theshipment of parts and materials from suppliers to its
production plants in Japan, Thailand, and South Africa,
and from the transport of its new vehicles and parts
to dealers. Since leaving the Volvo Group in 2021, theCompany has been building its own logistics networkand setting up cross-docking* operations in China, India,
and Thailand. At the same time, it has been reducing thenumber of trucks and shipping containers it uses each year
by improving the utilization rate of truck and container
capacity.
As a member of the Isuzu Group, UD Trucks has
integrated its parts warehouse in Dubai, UAE, with alogistics warehouse operated by the Group. It has also
begun joint shipments in Japan with the Isuzu Group,
including shipments to domestic airports of parts forexport and transport of parts to the Kyushu Parts
Distribution Center.
Through all of these initiatives, UD Trucks has been
reducing energy consumption and raising transportation
efficiency across its logistics operations.
* Cross-docking is a process by which various products are received andthen promptly sorted and shipped according to orders by a distribution
docking terminal, instead of being stored in bulk at a conventional
logistics center.

l Sales and aftermarket services
UD Trucks organizes eco-driving seminars for truck drivers
in every region of Japan on a regular basis. The seminars
help drivers acquire practical skills and awareness of how
to maximize fuel efficiency when on the road.
RelatedEco-driving and safe-driving seminars (see page 17)

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Message from the President

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About UD Trucks Corporation

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Sustainability Activities

Waste reduction
Reducing waste at the production anddisposal stages
The final disposal of a truck at a service center’s siteaccounts for the largest amount of waste matter during
the product life cycle. For that reason, UD Trucks has
established its own waste-management system andcreated waste sorting management standards for all of its
service centers in 2014. In accordance with the standards,
each service center has installed disposal facilities andproperly sorts waste materials during truck disassemblyand disposal. In addition, the Company delivers service
parts in returnable packages to the centers to facilitate thereuse of materials, and designs the packaging materials as
simply as possible to help reduce waste.
UD Trucks looks for ways to make disassembly workeasier and use resources more efficiently starting from

Waste reused
and recycled

6,151 tonnes

6,144 tonnes(99.9%)

Percent of total waste
reused or recycled

Target(Tonnes of waste)(Percent)

100

99.7

99.8

99.9

99.9

99.9

32

80

24

60

16

40

17

Recycled asfuel chips

8

Reused as raw
materials for cement

Waste
disposed in landfills

6.68 tonnes (0.1% of total)

Waste disposed in landfills

99.8
Reused iron andnon-ferrous materials

Total waste
generated

Amount of total waste disposed and percent reused or recycled

40

Total waste reused and disposed in 2022

Ageo Plant
Gunma Parts
Distribution
Centerthe product development stage. For example, bumpers
are designed to be simply disassembled into threecomponents, headlights can also be easily dissembled into
interchangeable lens and LED units, and fenders are madefrom recyclable materials.
At the production stage, UD Trucks works to reduceand recycle waste matter with the goal of minimizing theamount of waste it disposes in landfills. As a result of these
efforts, it has kept the proportion of landfill waste to total
waste generated at this stage under 1% for several years.
Aiming to improve its waste management system,
UD Trucks partnered with a company that specializes inwaste disposal in April 2015. Through this partnership,
UD Trucks has been using only highly reputable disposal
firms, administering and submitting all necessary reports to

Recycled as refuse
paper & plastic fuel

14

20

10
7

8

7

2020

2021

2022

0

0
2013

2018

2019

Scope of operations
Amounts shown in the graph are combined results from the Ageo Plant
and Gunma Parts Distribution Center from 2018 to 2022, and include
results from other facilities in 2013.

government agencies, and keeping records on the amountof waste disposed in order to strictly comply with relevantlaws and regulations.
In addition, UD Trucks separates recyclable items fromtrash disposed at its workplaces by setting up recycling
stations and explaining sorting criteria to all employees.

Compliance with the Automobile
Recycling Law
UD Trucks collects automobile shredder residue, air bags,
and fluorocarbon from end-of-life vehicles for recycling, in
accordance with Japan’s Automobile Recycling Law, which
went into effect in 2005.

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Sustainability Activities

Pollutants discharged by the Ageo Plant over a 12-month period

Conserving water andpreventing pollution

Items measured
Total wastewater

Reducing water consumption andstrictly managing water and air
pollutants
UD Trucks carries out routine measures to reduce theamount of water used in its operations. For example,
it periodically inspects and cleans water-consuming
equipment, checks for leaks, and promptly repairs
equipment if leaks are discovered.
At the same time, the Company implements strictmeasures to prevent pollution of the air and nearby bodies
of water. Specifically, it restricts the discharge of pollutants
at levels lower than regulatory requirements, and regularly
cleans and maintains relevant equipment.

Waterpollutants

Measurement
unit

Regulatory
limit

Highestamountmeasured

Lowest amountmeasured

Averageamountm3/Day

—

8,594

0

935

pH

—

5.8–8.6

7.6

6.9

7.3

Biochemical oxygen demandmg/L

25 (20)

2.8

1.3

2.0

Chemical oxygen demandmg/L

160 (120)

5.8

2.8

4.0

Suspended solids

mg/L

60 (50)

<5

<5

<5

n-hexane

mg/L

5

<2.5

<2.5

<2.5

Phosphorous

mg/L

8

0.5

<0.1

0.3

Nitrogenmg/L

120 (60)

3.5

1.2

2.0

Zinc

mg/L

2

0.2

<0.1

0.125

Fluorine and compounds

mg/L

8

<0.8

<0.8

<0.8

Measurement
unit

Regulatory
limit

Highestamountmeasured

Lowest amountmeasured

AverageamountNitrogen oxide

ppm

230

19

13

16

Particulate matter

g/m3N

0.2

0.003

<0.0010.001

Regulatory
limit

Highestamountmeasured

Lowest amountmeasured

AverageamountEmitting equipment
Air pollutants
Drying furnace

Items measured

Water consumption
Total water consumed

Water consumed per vehicle produced(Thousand cubic meters of water)(Cubic meters of water)

800

Pollutants discharged by the Gunma Parts Distribution Center over a 12-month period

80

Items measured

780
600

60

400

40

340

200

310

321

304

342

0

m3/Day

—

13.9

0

3.8

pH

—

5.8–8.6

7.4

6.5

6.8

Biochemical oxygen demand

mg/L

80

7.8

3.6

5.9

Suspended solids

mg/L

20

9.0

1.0

3.7

n-hexane

mg/L

1

<0.5

<0.5

<0.5

Measurement
unit

Regulatory
limit

Highestamountmeasured

Lowest amountmeasured

AverageamountNitrogen oxide

ppm

180

61

47

55

Particulate matter

g/m3N

0.2

<0.001<0.001<0.001

Total wastewater
Water
pollutants

20

Measurement
unit

0
2013

2018

2019

2020

2021

2022

Scope of operations
Amounts shown in the graph are combined results from the Ageo Plant
and Gunma Parts Distribution Center from 2018 to 2022, and include
results from other facilities in 2013.

Emitting equipment
Air pollutants

Three heavy oil
boilers

Items measured

Notes: Figures in parentheses are daily average limits.

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Chemical substance management
Managing chemicals contained in
products
UD Trucks strictly manages the chemical substances usedin its products, specifically those included in the Global
Automotive Declarable Substance List, in accordance withindustry standards and laws concerning the production,
import, management, and recycling of chemical
substances. The Company manages such substances both
before and during manufacturing.

At the product development and design stage, UD
Trucks determines what chemical substances will be
used at the manufacturing stage, including chemicals
used by suppliers. It then registers relevant data with theInternational Material Data System, a database jointly
managed by automobile manufacturers worldwide.
At the production stage, UD Trucks reports to thegovernment each year on its usage of chemicals subject
to Japan’s Pollutant Release and Transfer Register, which
is a system for restricting and controlling the dischargeof designated chemicals into the environment, andcomplies with revisions to relevant laws or regulations.
The Company has also established its own standards forRegulated chemical substances handled at the Ageo Plant in 2022 (Substances included in Japan’s Pollutant Release andTransfer Register)
Kilograms per year
Regulation
numberChemical substance

1
53
80
296
297
300

Zinc (water-soluble compounds)
Ethylbenzene
Xylene (water-soluble compounds)
1,2,4-Trimethylbenzene
1,3,5-Trimethylbenzene
TolueneTotal volume
handled
1,062
16,84930,820
2,866
4,278
6,647

Discharged
toatmosphere
0
6,600
9,347
1,682
631
4,874

to water
11
0
0
0
0
0

to soil
0
0
0
0
0
0

Transferred
Disposed oras wastetreatedmatter
0
308
0
2,066
0
2,208
0
811
0
116
0
1,179

Recycled

Includedin finishedproducts

0
8,130
18,970
0
3,463
119

743
0
0
0
0
0

Note: Amounts for total volume handled, discharged, transferred, disposed or treated, recycled, and included in finished products are equivalent weights of metal.

PCB contaminated items* stored at the Ageo Plant in 2022
Ballasts
Transformers
Crossing gates
Insulating oil
Wiping cloths and other contaminated materials
Condensers
Total

Items with high concentrations
1,240kg
0kg
0kg
0kg
0kg
20kg
1,260kg

Items with low concentrations
0kg
0kg
0kg
0kg
0kg
0kg
0kg

* PCB contaminated items have been registered with the Japan Environmental Storage & Safety Corporation (JESCO).
** Weights of some items include estimates.

Total weight**
1,240kg
0kg
0kg
0kg
0kg
20kg
1,260kgmanaging chemical substances, and takes steps to reduce
its usage of harmful substances such as volatile organic
compounds (VOCs).

Reducing VOC emissions througha more efficient painting process
As a member of the Isuzu Group, UD Trucks has beenworking to increase the performance of its Ageo Plant
by benchmarking it against plants operated by Isuzu
Motors. As part of these efforts, the Ageo Plant adopted
Isuzu’s process for painting truck cabs in October 2022 asa means to reduce the amount of topcoat, which emits
environmentally harmful VOCs. Because this process
is more efficient, the topcoat can be applied just once
instead of twice as previously required. As a result, theplant has reduced the amount of paint usage per vehicleby over 30%, thereby substantially lowering emissionsof VOCs.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

25

Better for Business

Sustainability Activities

ISO 14001 certification acquired
group-wide

Environmental management
systemEnvironmental policy
At UD Trucks, environmental activities are an importantpart of our efforts to provide logistics solutions that help
communities flourish, and to fulfill our Better Life purpose.
Our environmental activities are based on the following
principles.
lW e shall work to contribute to sustainability and thesuccess of our customers by continually reducing
environmental impacts across the entire product life cycle.

l Each of us shall responsibly consider the environment
wherever we conduct our business, and build trust withstakeholders based on our values.
l All of us shall work together to raise awareness ofenvironmental impacts and regulations, help build a
circular economy, and enhance the Company’senvironmental track record.

Environmental management organization

Executive Board
Sustainability Committee
Environmental Group
Administrative Office
Responsible for achievingcarbon neutrality

Responsible for resource
recycling and risk management

Responsible for employee
engagement and education

Facility
Subcommittee

Product
Subcommittee

Recycling
Subcommittee

Environmental
Risks Subcommittee

Workplace Subcommittee

Oversees initiatives
at factories,
workplaces, andlogistics facilities

Oversees productdevelopment andlife cycle
assessments

Oversees measures
to reduce, reuse,
and recycle

Overseesmanagement ofchemical substances
and air andwater pollutants

Promotes regulatory compliance andawareness of internal rules; oversees
employee engagement systems andinformation disclosure

UD Trucks complies with the ISO 14001 international
standard for environmental management systems. The
Ageo Plant first acquired ISO 14001 certification in
1998, followed by the Company’s Product Development
Division in 2002, and other divisions thereafter. All
certified workplaces then completed the transition to
the revised ISO 14001:2015 standard by 2018. Outside
Japan, the certification has been acquired by the Bangkok
Plant in Thailand and the Pretoria Plant in South Africa.
Leveraging the benefits of this group-wide environmental
management system, UD Trucks is currently working toachieve the objectives and targets of its environmental
action plan.

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Sustainability Activities

Better for the Planet

26

About UD Trucks Corporation

Better for People

Better for Business

Sustainability Activities

Auditing of environmental
management system
As a rule, UD Trucks conducts an internal audit of its
environmental management system every year to ensurethat it functions effectively. During the audits, a team ofqualified audit committee members verify and evaluate

whether the system is being properly implemented
and complies with company rules as well as relevant
environmental laws and regulations. Likewise, theenvironmental management system is audited every year
by a third party in order to maintain ISO certification.

Main environmental impacts

Material flow

Input

Input

EnergyRaw materials
and truck parts

Resourcesand energy

Resourcesand energy

EnergyWater,
electricity,oil, etc.

Replacement
tires, fuel, etc.

Electricity andfuel for facilities
and equipment

2022
Total energy used (GJ)Electricity consumption (GJ)
LPG (GJ)

412,038
227,15199

LNG (GJ)

1. Development
and design

We use: technologies that reduce
emissions
 systems for improving mileage
 fewer materials that impact
the environment
 technologies to reduce
vehicle noise recyclable materials andcomponents

2. Procurementof materials
and auto parts

We ensure sustainableprocurement anddeliver parts to
suppliers via energyefficient transport

3. Production

Includes pressing, heat treating,machining, painting, assembly,
and inspections

We reduce the use of resources and hazardous
substances, and operate factories efficiently
to conserve energy

4. Product usage

5. Product disposal
and recycling

133,744

Other energy sources (GJ)

51,044

Raw materials
Steel (t)We provide eco-driving
seminars

We sort materials andparts for reuse andrecycling, and properly
treat and dispose waste

Water usage (thousands m3)

OutputCO2
PM/NOxEffluent

Waste
matterNoise andvibration

CO2
PM/NOxWaste matter(incl. disposed tires)
Noise and vibration

Waste matter
Automotive
shredded residue
Airbags
Chlorofluorocarbons

4,967
342

Output2022
Greenhouse gases (t-CO2)

19,209

Disposed waste matter (t)2,460Landfill waste (t)

CO2
NOx
SOx
Dust
Odor

0

Municipal gas (GJ)

Valuable resources (t)

7
3,798

Recycled resources (t)Ratio of automotive shredder residue recycled (%)

97.4

Ratio of airbags recycled (%)

94.8

VOC emissions (t)52

Wastewater (thousands m3)

336

Scope of operations
Amounts shown in the tables are combined results from the Ageo Plant andGunma Parts Distribution Center. The amounts for recycled resources aredisclosed in accordance with Japan’s Automobile Recycling Law.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Better for People

UD Trucks strives to help employees improvetheir well-being while fostering a workplaceculture that values inclusion, personal
development, and a healthy work-lifebalance. All employees are encouraged tomake the most of their abilities and given theopportunity to grow professionally.
UD Trucks also works closely withstakeholders in a wide range of community
outreach initiatives, with a focus on roadtraffic safety seminars for local schools anddisaster relief.

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Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

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Better for Business

Sustainability Activities

Fostering a workplace in which
inclusion is valued and individuals
can make the most of their abilities
Promoting diversity and inclusion in
the workplace
For UD Trucks, the diversity of its employees is what makes
the Company unique and will be crucial for its growthjourney going forward. It aims to cultivate a culture inwhich each employee can play a part in making changes
that ultimately improve the workplace. Toward thisend, the Company maintains a fair and inclusive work
environment by raising awareness among employees
about all forms of discrimination, including those based onage, ethnicity, gender, sexual orientation, and religion.
To promote diversity and inclusion, the Company has
been holding D&I Week every year since 2014, whichfeatures many events aimed at raising awareness. On theoccasion of International Women’s Day on March 8, 2023,
the Company hosted panel discussions with executives
along with seminars for women on various topics, suchas taking the initiative in the workplace and careerdevelopment.

Fostering an inclusive workplace regardless ofgender identity and sexual orientation
To further promote gender equity and the empowermentof women, a network has been created inside theCompany to support female employees by organizing
interactive events and lectures. In 2022, an online panel
discussion on LGBTQ+ issues was held during D&I Week,
with 522 employees attending globally. The Company’s
internal guidelines and regulations have also been updatedwith gender-neutral language to make them more
inclusive.
In 2023, UD Trucks received Eruboshi certificationfrom Japan’s Ministry of Health, Labour and Welfare inrecognition of its outstanding efforts to promote thesuccess of women in the workplace. The Company
received the highest level of certification by meeting
all five evaluation criteria, specifically the employment
rate of women, average length of their employment,
working hours and conditions, percentage of women in
management, and the diversity of their career options.
The certification program is based on Japan’s law
for promoting women’s workplace participation andadvancement.

Eruboshi certification mark

Promoting employment of people withdisabilities
To provide an inclusive and fair working environment forpeople with disabilities, UD Trucks holds training sessions
and seminars aimed at deepening the understanding of all
employees.
In May 2022 and June 2023, sign language classes
taught by employees with hearing impairments were heldat the Company’s headquarters.

Sustainability Report 2023

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Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

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Better for Business

Sustainability Activities

Promoting job-based employment
In 2015, UD Trucks abolished the seniority system
traditionally practiced in Japan and adopted a job-based
employment system with the aim of promoting diverse
work practices. At the same time, the Company began
recruiting new graduates according to specific job
positions. In these ways, management has been moreaccurately matching the abilities and career plans of

employees with their actual work.
The Company has also been using its internal job
posting system, which it introduced in 2011, to provide
fair employment opportunities to all employees. Thistransparent system allows individuals to pursue theircareer aspirations regardless of their region, workplace, or
personal attributes.

Employee data (as of April 1, 2023)
In Japan

Overseas

Number of employees

Number of employees

6,203

5,716

males

Number of managers

1,000

males

Numbers of hires in 2022
New graduates

190

2,130

487
59

females

1,591

males

539

femalesNumber of nationalities

females

Mid-career373

Number of nationalities

30

Australia, Bangladesh, Brazil, Canada, China, England,
France, Germany, India, Indonesia, Ireland, Italy, Japan,
Malaysia, Myanmar, Nepal, Pakistan, Peru, Russia, Senegal,
Singapore, South Korea, Sri Lanka, Sweden, Thailand, thePhilippines, Ukraine, United States, Uzbekistan, and Vietnam

28

Australia, Belgium, Bosnia, Brazil, China, Columbia, Egypt,
England, France, Germany, India, Indonesia, Japan, Malaysia,
Morocco, Myanmar, Netherlands, Peru, Portugal, Singapore,
South Africa, South Korea, Sweden, Thailand, the Philippines,
Turkey, United Arab Emirates, and United States

Fostering results, growth, and trust
through dialogue
At UD Trucks, leaders and team members regularly
engage in dialogue about a wide range of matters, suchas setting work priorities, confirming progress, proposing
improvements, and developing skills. Through suchdiscussions and feedback, workplaces not only achieve
results but also foster personal growth and build trusting
relationships.
Towards these ends, the Company has been taking
steps to facilitate internal communication, such as holding
workshops on effective ways of giving and receiving
feedback. It also regularly provides training sessions on
setting goals and creating individual development plans.

Sustainability Report 2023

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Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

30

Better for Business

Sustainability Activities

Helping employees continuously learn
and grow
With its ample training facilities and learning management
systems, UD Trucks provides a wide range of training
programs to facilitate active learning and self-development
among employees. These systems and programs aredesigned to develop skills across four areas specified by
the Company as key to its business: leadership, businessacumen, new technology, and entrepreneurship. This
enables employees to develop and refine their expertiseand capabilities while acquiring the skills they need not
only for their current jobs but also for the future.
Leadership development programs
UD Trucks offers a variety of programs for developing
leaders, including programs tailored to differing levels of
responsibility, as well as programs designed for specificleadership roles. Recently, employees from Japan, China,
India, Thailand, Singapore, the United Arab Emirates, andSouth Africa have been participating in a self-discovery
leadership program based on the Company’s global selfdirected learning method.

Occupational health and safety
Measures to prevent the spread of
COVID-19
UD Trucks places the highest priority on ensuring thehealth and safety of its employees. After the first outbreakof COVID-19 in 2020, the Company initiated various
measures to help employees stay safe and prevent
infections. Among them, it frequently monitored thehealth of employees, mandated mask wearing and use ofhand disinfectant, and prohibited close-contact situations
and crowded gatherings in poorly ventilated spaces. To
help enforce these rules, the Company issued guidelines
on workplace behavior and COVID-19 countermeasures.
Based on the guidelines, body temperature was checked
when employees entered buildings, masks weremandatory in offices and cafeterias, seats were adequately
spaced, transparent partitions were set up between desks,
door handles were regularly disinfected, and limits were
set on the number of people using meeting rooms. The
Company also encouraged employees to take advantageof the telecommuting system it had in place so they could
work safely from home.
In July 2021, UD Trucks began offering vaccines to
employees at its headquarters in Japan, and provided
support for employee vaccinations in other countries
where it operates, including South Africa, Thailand, India,
and China.
Following Japan’s downgrading of COVID-19 tothe status of the seasonal flu in May 2023, UD Trucks
began easing the measures it had in place while closely
monitoring ongoing trends.

Helping employees manage stress
UD Trucks routinely provides stress assessments in theworkplace to help employees manage stress. Employees
are encouraged to meet with physicians or counselors
if their results indicate high stress levels, and their job
responsibilities may be reduced based on the advice of thephysicians.

Annual checkup events for employees
In 2022, UD Trucks began offering onsite health checkup
events for employees at its headquarters and Ageo Plant
as a means to help them stay in good health and prevent
illness. The checkups include measurements of physicalstrength, vascular age, and bone density, and the results
are explained by professional counselors, who also offer
advice on healthy lifestyle habits. In 2023, devices formeasuring and displaying vegetable intake were deployed.
The number of employees attending the events totaled
204 in 2023 after being limited to 117 in 2022 due to
COVID-19 restrictions.

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

Better for Logistics

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Creating better working conditions
To help employees maintain a healthy balance between
their working and personal lives, UD Trucks has establishedthe following systems and policies.
Main systems and policies related to work-lifebalancel Annual paid holiday system (hourly units)l Childcare and nursing care leave systems
 Maternity leave (with reduced pay)
 Paternity leave (with reduced pay)
 Childcare leave Nursing care leavel Family care leave system
	Allows accumulated unused annual paid holidays to be
used for treatment of injuries and illness, nursing care,childcare, paternity leave, and infertility treatmentl Telecommuting system with no restrictions
l Flextime system with no core working hoursl	Dignity at work policy on preventing harassment
and related e-learning programl Workplace rules concerning diversity
	Rules for equal and fair treatment regardless of gender,
age, nationality, job position, etc.

Employees using childcare and nursing careleave systems
April 1, 2022, to March 31, 2023
l Employees taking childcare leave
Eligible
employees

Numbertaking leave

Percentage
taking leave

Men

145

83

57%

Women

7

7

100%

l Employees taking nursing care leave1

Note: R
 esults comply with relevant guidelines of Japan’s Ministry of Health,Labour and Welfare

Message from an employee“Childcare leave gave me precious time to carefor my son.”
Shinichi Makino Product designer, Product Development Division 
I took four months of childcare leave because I reallywanted to help take care of my son soon after hewas born. I also believe that more fathers should takechildcare leave. In my workplace, everyone is open to
taking childcare leave as well as time off in general.
When I asked to take the leave, my manager was very
supportive and encouraged me to do so.
During my time off, I helped take care of my son,from giving baths to changing diapers. I had precious
time to spend with him at home as well as take him tomeet the grandparents.

I heard from a childcare support center that men
usually get no longer than a month for childcare leavein Japan. Therefore, rather than just focusing on raising
the percentage of men who take childcare leave, I
think it is importantto allow men to
take leave for longer
periods. By doing
so, UD Trucks would
become an even more
attractive company towork for.

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Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

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Sustainability Activities

Engaging with communities
Road safety instruction for elementary
school students
In Saitama, where UD Trucks is based, traffic accident
prevention is regarded as a major issue, especially since
the prefecture has one of the highest numbers of fatalroad accidents involving medium- and heavy-duty trucks
in Japan. Therefore, improving vehicle safety and raisingawareness of traffic safety among pedestrians are essential
measures for reducing road accidents.
Recognizing its responsibility as a truck manufacturer
to help prevent traffic accidents, UD Trucks has been
conducting a traffic safety program for elementary school
children at its UD Experience Center test course in thecity of Ageo, Saitama, since 2016. The Company makes
the most of its expertise, facilities, and employees, who
help run the program, and develops its own curriculumwith assistance from the city’s education board regarding
teaching methods, materials, and targeted school grades.
The program is unique for having the school children
participate in activities that use actual heavy-duty trucks
to demonstrate their blind spots and the space required
when turning corners (specifically the different arcs takenby the front and rear wheels). The children are also given
an opportunity to sit in the driver’s seat of a truck toobserve what drivers can actually see outside. Teachers
participating in the activities continuously express theirappreciation, saying that experiencing the trucks firsthandcreates a much more lasting impression on the children
than just watching a video, and climbing aboard the trucks
was a fun and valuable learning experience.

Although the program was scaled back following theoutbreak of COVID-19 in 2020, with participants limited togroups of 20 children per session, a total of 2,607 children
and 232 employees have participated as of December 31,
2022.

Introducing disaster relief trucks
Natural disasters such as floods, landslides, and droughts
are expected to become more severe and frequent due toclimate change. In Ageo, Saitama, employees witnessed
a flood first-hand in 2019 when a major typhoon caused
the nearby Arakawa River to overflow, resulting in serious
damage and the evacuation of around 1,000 residents.
The Company then began considering how it could use its
products and human resources for disaster relief measuresand reconstruction.
This led the Company to modify a Kazet lightduty truck into a disaster relief vehicle that can provide
evacuees with private spaces, which are difficult to securein community evacuation centers during times of disaster.

Indeed, evacuees are said to experience additional mental
and physical strain due to a lack of privacy. The truck’s
cargo space contains two private rooms: an infant careroom where mothers can change diapers and breastfeed,
and a room for caring for the elderly and people withphysical disabilities. The rooms are equipped with an air
conditioner, refrigerator, and sink, with electricity provided
by a solar panel, diesel generator, and high-capacity
battery. The electricity can also be used to charge mobile
phones and batteries, which are essential for emergency
communications.
In addition, the Company provides a flat-bed truck
for transporting disaster preparation supplies, such as
sandbags.

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Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

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Better for Business

Sustainability Activities

Sponsoring the Ageo City
Half-Marathon
UD Trucks has been supporting the Ageo City Half
Marathon as a local sponsor since 2013. Held every
autumn, the marathon has long been a popular local eventin the city, with over 7,000 runners participating each year.
After being suspended for two years due to COVID-19, therace was held again in November 2022. UD Trucks offeredoriginal tumblers and cookies to children participating in
the race, and distributed items to runners from its booth.
It also provided three buses for runners to rest in after
finishing their leg of the race. More than 70 employees ran
in the 2022 marathon.

Helping promote community-based
sportsIn 2022, UD Trucks acquired the naming rights for the
Ageo Municipal Baseball Stadium, helping fund the city’splan to promote sports as a means to activate communities
and improve quality of life for local residents. Recognizingthat this plan aligns with its commitment to making life
better for people in line with its Better Life purpose, theCompany acquired the rights and named the facility UD
Trucks Ageo Stadium.
Besides being used for local events, the stadium
hosts the prefectural qualifiers for the annual National
High School Baseball Championship and professional
minor league baseball games, which many city residents
attend. As the naming rights holder, the Company has
been working with the city government to explore new
ways of using the facility to bring more dynamism to thecommunity. For example, it jointly sponsored a baseballgame between two minor league teams in May 2023,
attracting a large number of spectators.

Teaching high school students aboutsustainability
In November 2022, UD Trucks along with 10 othercompanies based in the city of Ageo participated ina seminar on the UN Sustainable Development Goals(SDGs) held at Saitama Prefectural Ageo High School,
where students have been studying the SDGs in an
intensive course. To build on their studies, the seminar
was organized to teach the students about approaches

taken by local businesses to help accomplish the goals andhow they can contribute to the community by becoming
involved in the SDGs.
At the event, employees explained how UD Trucks is
promoting environmental, social, and governance (ESG)
initiatives across the supply chain, and is committed toproviding solutions for communities and the logistics
industry through its products and services. They also
described the Company’s autonomous driving trials withheavy-duty trucks, plans for putting electric trucks on themarket, measures for saving energy at production plants,
efforts to promote diversity and inclusion, and otherinitiatives. Among the feedback from the students, some
said they realized that while trucks come with their own
environmental impacts, product modifications can be
helpful for achieving the SDGs. Others were surprised thatJapan was home to such a diverse company employing
people from 30 countries.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Educating the next generation ofleaders
UD Trucks has an academic partnership program with
Sophia University in Tokyo. The program aims to provide
opportunities for students to learn about the logistics
industry and multinational corporations by observing how
UD Trucks operates, and to assist them with their future
career options. Students are also expected to broaden their
outlook while appreciating the importance of logistics forsociety.
In the fall semester every year, employees of various
nationalities from the Company give lectures in 14
classes, each focusing on a different topic such as productdevelopment, logistics, procurement, manufacturing, sales,
legal affairs, and corporate finance. Classroom lectures
resumed in 2022 after mainly being held online in 2020
and 2021 due to COVID-19. Along with these lectures, theprogram offers a summer internship and scholarships asmeans to support the students.
UD Trucks and Sophia University have been renewing
their partnership program agreement every three years
since the program started in 2014, attesting to theuniversity’s high evaluation of the program.

Message from an intern“I thought about my future more deeply andpractically after learning on the job.”
Student studying in Sophia University’s Department of Engineering and Applied Sciences While in my third year of university, I participated in
UD Truck’s Better Life Internship Program for two
weeks in August and September 2022. I am part of
the automotive section of my department at school
because I am very interested in the automotive
industry, and I decided to participate in this program
because I wanted to broaden my studies by practically
applying what I have learned at a manufacturer andexploring what to research in the future.
I was assigned to the Logistics Division, and mytask was to create a 15-minute video about thedivision. To do that, I learned how logistics works at UD
Trucks by talking with employees in the division’s four
departments about the flow of logistics from upstream
to downstream. I gained practical experience by trying
my hand at managing inventories, and observed how
auto parts are moved around in the manufacturing
process at the factory.
By learning on the job for two weeks, I realizedthat my studies in school were about theory andpurely academic in nature. Factory operations are more
complicated than theory, and various factors otherthan logistics must be considered. Now I understandthat while theory provides a base, the main role of alogistics division is to deal with practical matters in thereal world.
I had planned to go to graduate school but had
not decided on what kind of work to pursue in the
future. Now that I have participated in this internshipprogram, however, I definitely want to work in the
manufacturing industry. No matter how advanced IT
becomes, the process of producing, transporting, andselling products will always be essential for people’s
livelihoods. With that in mind, I hope to find ways togive something back to society by applying my skills
and refining my areas of expertise.

Interns present34

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Sustainability Activities

Donating engines to vocational schools
In 2022, UD Trucks donated two GH11 heavy-duty truck
engines to colleges that train automobile mechanics, one
to Nakanihon Automotive College in Gifu Prefecture andone to Nissan Automobile Technical College in Ehime
Prefecture. Both colleges prepare large numbers ofstudents for successful careers in the automotive industry,
and many of their graduates currently work at UD Trucks.
By maintaining and repairing vehicles, mechanics are
essential for ensuring the stable operations of transportand logistics providers. In recent years, however, Japan has
been facing an increasingly serious shortage of mechanics,
reflecting the country’s aging population and declining
interest in the automotive sector among young people.
Therefore, UD Trucks has been donating engines tovocational schools for many years in order to help attract
more young people to the industry and support theirtraining. Moreover, because students at these schools haverelatively few opportunities to learn about large vehicles,
the Company plans to collaborate with the schools in the
future to provide opportunities for students to work on
heavy-duty trucks equipped with the latest technologies.

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

35

Sustainability Report 2023

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Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation
Better for Business

Sustainability Activities

Better for Business
Aiming to attain the highest level of
performance in the truck manufacturingindustry, UD Trucks prioritizes sustainablegrowth by enhancing organizational efficiency
and productivity, transforming its businesses
through digitalization, and strengthening
corporate governance. The Company
proactively invests profits back into its
businesses to lay a path for future growth forthe benefit of its stakeholders and to support
the logistics industry as a whole.

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Sustainability Activities

Transforming businesses throughdigitalization
Promoting a digital transformation
across all business activities
For UD Trucks, a digital transformation involves notjust IT-related innovation, but also positive changes
to its corporate culture as part of a broader business
transformation. As such, a data-driven digitaltransformation is indispensable for advancements inlogistics, higher operational efficiency and productivity,and improvements in workplace conditions. The Company
has been investing in IT tools and making use of big
data applications, thereby enabling its management tocentralize, analyze, and facilitate the application of awide range of data, from production planning and quality
control to sales and services. This data has also been
made available to employees as a means to generate new
business ideas and stimulate dialogue between employees
irrespective of rank or position.
In addition, UD Trucks has applied digital tools to set
up a telecommuting system for its employees. This hasbolstered the Company’s ability to attract highly skilledworkers from around the world, which is contributing to

the diversity and capabilities of its workforce.

Using data to link the engineering andsupply chains
UD Trucks is building a new system for accelerating data
linkages between its engineering and supply chains. By
pursuing product-related data applications and information
sharing, the Company is aiming to enhance its engineering
capabilities, which are crucial for manufacturing, while
making its supply chain more resilient against various kindsof risks.
The engineering chain is said to account for about
80% of product costs and is a vital factor for productquality. Therefore, to raise efficiency and productivity
at the product development and design stages, theCompany created a digital model that integrates the
Product Development Division’s 3D CAD data andthe Manufacturing Division’s parts-related data. With
the linking of this data, it is possible at the productdevelopment and design stages to detect potential
problems early on, improve quality, and eliminate theneed to redo processes at later stages of production.
The Manufacturing Division and Sales Division havealso established a platform for centralizing data about
production schedules, quality assurance, and the status ofsales negotiations, enabling personnel from each division
to access and share relevant product-related information.
To effectively respond to unexpected changes in
the Group’s operating environment, which is becoming
increasingly difficult to predict, UD Trucks plans tocreate a system for its organizations and subsidiaries
to share important data. Accordingly, the Group will
broaden its use of data with the adoption of Internet ofThings (IoT) platforms at factories and the application ofaugmented reality (AR) solutions in product development,
manufacturing, sales, and aftermarket services. In
cooperation with its suppliers and customers, UD Trucks
will continue using data to seamlessly link and facilitatecommunication between the engineering and supply
chains, with the goals of establishing a resilient supply
chain and a customer-oriented business model that creates
new value.

Digitalizing HR systems
UD Trucks is promoting desk sharing and e-correspondence
in its workplaces to facilitate open communication and afree exchange of ideas among its employees. Furthermore,with the shift to telecommuting during the COVID19 pandemic, the Company has been discontinuing
outmoded work practices and the use of paper documents
by applying digital solutions. For example, it transferredvarious administrative procedures and payroll calculations
to a cloud-based personnel management information
platform. By digitalizing human resources systems inthese ways, the Company aims to foster more diverse andflexible workplaces and attract strategic human resources
going forward.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Sustainability Activities

Better for the Planet

Better for People

About UD Trucks Corporation

38

Better for Business

Sustainability Activities

Strengthening corporate
governanceUD Trucks’ management teamKouji Maruyama

Koichi Ito

President
Senior Vice President of Japan Sales

Chairman

Tetsuya Aiba

Shinya Hasegawa
Senior Vice President,
Strategy and Product LineManagement, Brand andCommunication

Taro Kunifusa

Yoshinao Arai

Director

Auditor

Chief Financial Officer andSenior Vice President,
Human Resources,
Legal and Compliance

Takeya Okajima

Keiki Ka

Jacques Michel

Hiroshi Sasaoka

Senior Vice President,
Operations Modernization

Senior Vice President,
Digital Solutions and IT

Senior Vice President,International Sales

Senior Vice President,
Operations

Shuichi Hayashi

Toshihisa Nakaya

Douglas Nakano

Masayuki Umeda

Senior Vice President,
Purchasing

Senior Vice President,
Logistics

Senior Vice President,
Technology

Senior Vice President,
Quality AssuranceSustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities

About UD Trucks Corporation

Better for People

39

Better for Business

Sustainability Activities

Framework for promoting sustainability
In December 2021, UD Trucks established its Sustainability
Committee to promote sustainability-related activities
throughout the Company. Positioned under the Company’s
Executive Board, the Sustainability Committee adopts anenvironmental, social, and governance (ESG) framework
for its activities (refer to page 4). Accordingly, its
membership is made up of members from three groups:
the Environmental Group, Social Group, and GovernanceGroup. These members engage in inter-committee
discussions, formulate proposals, and submit quarterly
reports to the Executive Board, which then integrates
the proposals into management activities. Within eachof the three groups, teams have been set up to examine
and address specific priorities. They determine current
circumstances, set goals, devise action plans, and monitor
the progress of related activities.

Sustainability Committee
Administrative OfficeEnvironmental

Achieving carbon neutrality

S

Social Group
responsible forProtecting human rights
Promoting diversity and inclusion

Resource recycling
and risk management

Overseeing safety and security
Skills training

Employee engagement
and education

Preventing harassment

The Company created the
UD Trucks Code of Conduct
to promote ethical businesspractices and compliance withlaws and regulations. The code
explains basic principles andstandards for behavior for all
employees to follow.
UD Trucks Code of Conduct
handbook

Executive Board

E Group responsible for

UD Trucks Code of
Conduct

G

Governance Group
responsible forStrengthening corporate governanceOverseeing risk management
Enforcing the Code of Conduct
Overseeing the whistle blower system
Ensuring cyber security
Overseeing personal information security
Enforcing the Supplier Code of Conduct

Topics covered in the UD Trucks Code of Conduct
l Human rights
	Respect for others; prohibition of discrimination;safe and hygienic workplaces; compliance withenvironmental regulations; freedom of association;
working hours and remuneration; prevention of modern
slavery and child laborl Fair and lawful business practices
	Compliance with product-related regulations; faircompetition; prohibition of inappropriate businesscourtesies (including gifts and entertainment);
compliance with import and export controls; preventionof money launderingl	Separation of business activities and personal
interests
Conflicts of interest; political activities; insider tradingl Protection of company data and assets
	Confidential information; intellectual property; tangible
and financial assets; personal information security
l Transparency and assignment of responsibilities
Financial accounting and reportingSustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities

About UD Trucks Corporation

Better for People

40

Better for Business

Sustainability Activities

Measures for ensuring compliance
For UD Trucks, compliance is an important component of
its corporate culture and values. Recognizing that business
transactions must be conducted ethically, responsibly,and in good faith, the Company provides compliancerelated training programs to all employees. It has also
been carrying out various educational campaigns to better
enable employees to act professionally based on a solid
understanding of business ethics.
After joining the Isuzu Group in April 2021, UD Trucks
revised its compliance-related policies and guidelines basedon Isuzu Motors’ compliance system, and, accordingly,
strengthened its management of important compliancerelated risks, including those associated with competition
laws, corruption, import and export controls, and personal
information security. UD Trucks has also set up an internal
whistleblower system for facilitating prompt and proper
responses to any cases of wrongdoing or suspicious
actions, and is developing an online reporting system toimprove usability for users.
In addition, UD Trucks established its Compliance
Committee in October 2021, and periodically conducts
surveys of employees to determine their awareness ofcompliance-related matters. The results of the survey
are reflected in training programs on compliance andharassment prevention, and any incidents of misconduct
reported by respondents are passed on to the Audit
Department.
Compliance with legal requirements concerning
subcontractors
To maintain sound relationships with its suppliers, UD
Trucks has established internal rules for ensuring fullcompliance with Japan’s legal requirements concerning

subcontractors, which include provisions regarding
late payments. It has also created a related training
program, revised its procedures for paying suppliers,
and is periodically conducting business audits of relevant
departments. Furthermore, the Company has set up a
hotline inside its Legal Affairs Department to impartially
respond to enquiries and complaints from suppliers
regarding compliance-related matters.

Risk management
UD Trucks has been working to improve risk management
across the entire organization. The Company routinely
identifies and assesses risks at the managerial andoperational levels, and takes proactive steps to effectively
manage such risks and prevent them from materializing.
The results of these procedures are reported to executive
management whenever necessary to ensure that risk
management systems are functioning properly. Thesesystems aim to ensure the safety of employees and visitors
at workplaces, safeguard confidential information andintellectual property, respond to emergencies such as a fireor natural disaster, and prepare for resuming operationsin the event of a disaster. Thanks to these ongoing
efforts, UD Trucks has been maintaining safe and secure
operations for many years.
In fiscal 2022, the Company expanded the scopeof its risk management systems to suppliers and otherbusiness partners across the supply chain in order toensure production and product quality and to monitor the
impact of their operations on the environment and climatechange.

Information security
UD Trucks has taken measures for ensuring the securityof its information and data, and is maintaining an
information security governance system. To guard against
an information system breakdown caused by a disaster,
the Company stores and manages electronic information
at an earthquake-resistant data center in addition to its
head office. It has also stepped up measures for preventing
data breaches resulting from cyber-attacks, and regularly
provides training sessions on improving information
security to its dealers nationwide. In addition, UD Trucks
strictly manages and protects all personal information it
possesses in accordance with its privacy policies.

Sustainability Report 2023

UD Trucks at a GlanceContents

Better for Logistics

Message from the President

Our Purpose

Better for the Planet

Sustainability Activities
Better for People

About UD Trucks Corporation

41

Better for Business

Sustainability Activities

Ensuring responsible procurement
Strengthening partnerships with
suppliers
UD Trucks recognizes that fulfilling its Better Life purpose
involves making life better for people and the planet
through its entire value chain. From this standpoint, it
has included sustainability as an important criterion in its
procurement process along with quality, performance,
delivery times, and costs, and is bolstering initiatives totackle sustainability-related issues across its supply chain.
As part of these efforts, the Company has included
standards for all of its suppliers to meet in the UD Trucks
Supplier Code of Conduct, as a means to share its
approach to sustainability and expectations for conduct
with its suppliers, and to build stronger partnerships in the
future.
Meanwhile, the Sustainability Committee, establishedin 2021, has been assessing the Company’s environmental
initiatives and business dealings, and identifying andaddressing important issues for the UD Trucks Groupand its suppliers, such as ensuring that human rights areprotected in the supply chain.

Requirements placed on suppliersl	Comply with the UD Trucks Supplier Code of
Conduct	Meet the Company’s standards for sustainability
regarding human rights, environmental protection, etc.
l Produce sustainable products	Assess sustainability using a version 4.0 self-assessment
questionnaire for suppliers in the automotive industryl	Acquire sustainability-related certification fromrelevant organizationsl	Do not use prohibited substances and materials
	Confirm any usage of items listed in international
databases of banned substances and materialsl	Determine CO2 emissions and take steps to reducethem	Conduct self-assessments of business continuity plans,
environmental measures, and ethical conduct to be
selected as a supplier for new projects.

Responsible sourcing of conflictminerals
UD Trucks strives to ensure responsible and sustainablesourcing of conflict minerals, namely tin, tantalum,
tungsten, gold, and cobalt. The Company requires its
suppliers to comply with all relevant laws and regulations,and states this clearly in its Supplier Code of Conduct(specifically in the section on responsible sourcing of raw
materials). Furthermore, suppliers are required to follow
responsible mineral sourcing procedures in high-risk areas.

Sustainability Report 2023

UD Trucks at a GlanceContents

Message from the President

About UD Trucks Corporation

Our Purpose

Sustainability Activities

About UD Trucks Corporation

42

For more information about UD Trucks, please refer to the following websites:• Global website: https://www.udtrucks.com/• Facebook: https://www.facebook.com/UDTrucksJP• YouTube: https://www.youtube.com/user/udtrucksvideos

Since its founding in 1935, UD Trucks has been a key player in Japan’s transport and logistics industry as a commercial truck manufacturer.
The Company currently provides high-performance trucks and services in response to the needs of customers in roughly 60 countries worldwide.

Company overview (As of April 1, 2023)

History

Company name

UD Trucks Corporation

DecadeHistory of the company

Technical development and product launches

Date of foundation

December 1, 1935

1930

Head office address

1-1, Ageo-shi, Saitama 362-8523, Japan

1935 Originally established as Nihon Diesel Industries,
Ltd., in the city of Kawaguchi, Saitama Prefecture1938 First diesel engine
1939 First diesel truck

Capital77.5 billion yen

19401942 Renamed as Kanega-Fuchi Diesel Co., Ltd.
1946 Renamed as Minsei Sangyo Co., Ltd.

Number of
employees

6,203 employees (Japan)
2,130 employees (Overseas)

1950

1950 Renamed as Minsei Diesel Co., Ltd.

Main businessJapanese business
Development, manufacture, export, andsales of heavy-duty trucks; sales of
medium- and light-duty trucks;
manufacture and sales of vehicle
components; maintenance and sales ofservice parts for trucks and buses; importand sales of Volvo brand products.
Businesses outside of Japan
Development, manufacture, and sales ofheavy-, medium-, and light-duty trucks for
growth markets; manufacture and sales ofvehicle components; maintenance andsales of service parts for trucks and buses.

1960

1960 Renamed as Nissan Diesel Motor Co., Ltd.
1962 Commenced operations of the Ageo Plant

Operations in Japan

Headquarters and Ageo Plant; Gunma,
Hokkaido, Sanyo, and Kyushu parts
distribution centers; Volvo Penta Office

1970

1955 Proprietary UD Engine, a powerful lightweight diesel engine
1958 6TW model truck, the first in Japan with a load capacity
exceeding 10 tons

1975 Condor medium-duty truck

1990

1990 Big Thumb heavy-duty truck

2000

2007 Joined the Volvo Group

2004 Quon flagship heavy-duty truck

2010

2010 Renamed as UD Trucks Corporation2013 Quester heavy-duty truck for emerging markets
2014 Kazet light-duty truck
2017 New Quon and Condor truck models
Croner medium-duty truck and Kuzer light-duty truck for
emerging markets

20202021 Joined the Isuzu Group

Products and services provided by UD Trucks

Subsidiaries in Japan New-Mech Co., Ltd.
Operations outsideof JapanUD Trucks Singapore Office; UD Trucks
Thailand, UD Trucks Malaysia, UD Trucks
Middle East / North Africa, UD Trucks
Southern Africa, UD Trucks Latin America,
UD Trucks North America, UD Trucks India,
Thailand Plant, South Africa Plant,
Singapore parts center, South Africa parts
center, Middle East parts center (in Dubai)

UD Trucks

Volvo trucks

Volvo Penta

Sales of Quon heavy-duty trucks, Condor mediumduty trucks, and Kazet light-duty trucks to Japanand other developed markets, and Quester heavyduty trucks, Croner medium-duty trucks, andKuzer light-duty trucks to emerging markets

Sales of imported Volvo brand heavy-duty trucks
to the Japanese market, including Volvo FH 4x2
and 6x4 tractors, 6x2 and 6x4 rigid trucks, and
FMX 6x4 and 8x4 rigid trucks

Sales of Volvo Penta brand industrial andmarine engines for the Japanese market,
including forklift and pleasure craft engines, andinstallation and technical support for original
equipment manufacturers* UD Trucks is a member of the group of companies led by Isuzu Motors Ltd. For more information about Isuzu Motors, please refer to the following website: https://www.isuzu.co.jp/world/company/profile.html