Sustainability
Report2020

UD Trucks at a glance

For 85 years, UD Trucks has provided the trucks andtransportation solutions the world needs today,
forever challenging and innovating for a better tomorrow.

19,911

Sales and servicing in66

truckssold globally in 2019

countries

UD Trucks’ extensive network of dealers offers sales and servicing in 66
countries. In Japan, the Company provides 24-hour, 365-day support
to commercial vehicle operators and drivers, including a telematics
service connecting more than 60,000 trucks.

UD Trucks sold 19,911 trucks in 2019, meeting a wide range of local
transport needs with its diverse lineup of truck models. Japan is thelargest market for UD Trucks.

Number of trucks sold globally

Asia

North
America

MiddleEast

1

1619.8 20.7 20.6 20.6 19.9

9Central andSouth America

21

Africa

13

85

years
of history

Sales breakdown by region(Thousands)

Oceania

42015 2016 2017 2018 2019165

customercenters andindependent dealers in Japan

South
America

North
America

2.2%

0.4%

Africaand
Oceania

81.5%

Asia

15.9%

Diverse workforce of

6,442

employees(Including consultants and temporary employees)
Founded in 1935 as a diesel engine
manufacturer, UD Trucks has always been achallenger at heart, responding to the needs ofcustomers and of the times.

The Company’s nationwide network of customer
centers and dealers provides genuine parts andservicing to keep customers’ trucks running andmaximizing uptime.

With employees from 28 countries based inJapan alone, 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: All figures above are as of December 31, 2019.

1

Message from the President

Towards Better Life,for people and the planet
The impact of the COVID-19 pandemic in 2020 has
been profound. People have been forced to makemajor adjustments to their professional and personal
lives. At the same time, advances in IT and digitalcommunication are changing society rapidly,
allowing people to work more flexibility or virtuallyfrom anywhere.
In the midst of these dramatic changes, what
does remain constant is the vital role of logistics insupporting our way of life. Logistics is indeed thelifeblood of society. At UD Trucks, we have a
responsibility to seek out more sustainabletransportation solutions as we play our part inmoving the goods that society relies on everyday.
UD Trucks is proud to announce Better Life, ourpurpose and reason why we exist. In short, ourpurpose is to make life better for people and theplanet. Better Life will drive our business strategy
towards our wanted position in 2025 and beyond.
Specifically, we have set goals that will steer thecompany towards lower environmental impact,
higher customer satisfaction, a better place to work,and higher profitability. In pursuing these goals weare also supporting the UN Sustainability
Development Goals (see page 3 for details).
We expect the pace of change in society will
only intensify in the future. UD Trucks is committed
to meeting these new challenges and providing
sustainable solutions for today and tomorrow. We
look forward to working closely with all stakeholders,to make a better world together and Better Life.

Takamitsu Sakamaki
President andRepresentative Director

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

Contents

Scope of the report
This report covers the activities of UD Trucks Corporation
primarily in Japan. Some sections also cover our activities inother countries.

UD Trucks at a glance

1

Message from the President

2

Better Life – Our Purpose

3

Sustainability Activities

Reporting period
This report mainly covers results and activities in fiscal 2019
(January 1 to December 31, 2019). Some sections also refer toresults and activities in previous fiscal years, activities in fiscal
2020, and future plans and forecasts.
Published December 20202

Improving customer satisfaction

5

Strengthening our partnerships

9

Empowering our people

11

Engaging with communities

13

Reducing our environmental footprint

15

CSR, Compliance andCorporate Governance

19

About UD Trucks Corporation

21

About the Volvo Group22

Better Life – Our Purpose
Planet Earth is our only home and facing tremendous
challenges, such as climate change and natural
resource depletion to name a few. The logistics
industry is also going through a major transformation from higher shipping volumes propelled by the growthof e-commerce to the introduction of more sustainable

technologies in the areas of automation, connectivity
and electromobility. Within this changing landscape,UD Trucks is committed to Better Life, our purposethat will drive us towards our goal of making life
better for people and the planet.

The forces behind Better Life
Sustainable Development Goals (SDGs)
Better Life is aligned with several UN Sustainable
Development Goals (SDGs). The SDGs are the mostcomprehensive blue print for a sustainable future,and the role of business in supporting these goals is
critical for positive environmental and social change
on a global scale. UD and the Volvo Group haveembraced several SDGs - from promoting educationand health to sustainable cities and climate action.

OvershootDoughnut Economics
Better Life is inspired in part by Kate Raworth’s
Doughnut Economics model, which is also
championed by the Volvo Group as a sustainable pathforward for our business. This model is a way ofvisualizing how we can achieve human development
without damaging earth systems. There are twoboundaries: the inner social boundary and the outerenvironmental boundary envisaged by the social
foundation and the ecological ceiling. Between these
two there is an area representing an environmentallysafe and socially just space for people to prosper in.

Level ofenvironmental
impactEcological ceiling

Shortfall

Regenerative anddistributive economy
Level ofsocietal
resources

Social foundation

SOC I ETY AND
RE S O RCESThe safe andjust space forhumanity3

Better Life as a business strategy
Better Life is a business strategy that integrates sustainability across all of our operations and processes,
touching all stakeholders, including customers, business partners and colleagues. Our wanted positionin 2025 is to be the sustainability leader among Japanese commercial vehicle brands by achieving:• Lower environmental impact • Higher customer satisfaction • A great place to work • Higher profitability

Seven strategic priorities

Customer

Offering

Quality

Productivity

Innovation

Colleagues
Brand

Customer

Offering

Earn the trust and business of customers though
customer intimacy. Identify customers’ needs andprovide integrated solutions.

Develop truly competitive products and services,integrated to create the most appealing offer
for customers.

Quality

Productivity

Continuously secure and improve the quality of
products, manufacturing, and suppliers. Deliver thequality that customers deserve.

Excel as a vehicle manufacturer with fully
integrated and digital end-to-end processes.
Maintain lean, flexible and reliable operations forbenchmark efficiency.

Innovation

Colleagues

Develop new business models and partnerships
in the areas of automation, connectivity
and electromobility.

Develop talent and create a desired place to work,
an environment where everyone feels safe and welltaken care of and can maximize their potential.

Brand
Reach out to stakeholders and impact them, inspire them to support the company’s challenge towards Better
Life and become UD fans.

4

Sustainability Activities

Improvingcustomer satisfaction

UD Quality Month workshops

Customer satisfaction starts with quality

Our approach
UD Trucks always aims to be thebusiness partner of choice forcustomers. Toward that end, theCompany works to maintain andenhance quality across all of its businessactivities, spanning from productdevelopment and manufacturing
through to sales and aftermarket
services, in accordance with the Volvo
Group Quality Policy. That means
supplying innovative products andservices that help commercial vehicle
operators secure enough truck drivers(amid shortages in Japan and other key
markets for UD Trucks), operate
efficiently, comply with environmental
regulations, and maintain profitability.

Quality Month at UD Trucks
UD Trucks designates November of every year as Quality Month to raise awareness ofquality among employees. In 2019, over 550 employees participated in workshops toshare information including the following three initiatives taken within the Company.

Adoption of virtual reality in product development
UD Trucks has adopted virtual reality technology to develop new trucks from thedesign stage through to prototype evaluations. The technology is useful for
identifying problems early on and verifying the effectiveness of solutions, thereby
ensuring the quality of finished products.

Devices for preventing mistakes in assembly work
The Company has begun using devices that have been specially designed to prevent
mistakes when assembling similar parts. Originally created and manufactured by
employees, themselves, the devices reduce workloads while also enabling general
assembly workers to work with the same high level of precision as skilled workers.

Updated truck maintenance manuals
UD Trucks has updated and revised its basic maintenance manual, troubleshooting
guide, and other indispensable manuals for truck mechanics. To complete thisprocess, the Company thoroughly followed up on solutions to problems that could
not be solved using the previous versions of the manuals, updated information to
include the latest repair diagnostic equipment, and reconfirmed the procedures andtime required for repair work. The new manuals are now helping mechanics service
vehicles more smoothly and accurately.

5Qualityroot causes and implement solutions.
Through this arrangement, they promptly
share quality-related information andrespond to issues, ultimately leading togreater customer satisfaction.

Improving the skills of aftermarket
service staff
UD Trucks works to raise the quality of its
aftermarket services by organizing events
that enhance the skills of maintenanceand repair staff. For example, theCompany holds Uptime Conferences for
its dealer network as a venue forproviding technical support andquality-related information about new
products. In 2019, about 350 mechanics
and service parts engineers from thedealers joined the workshops. UD Trucks
also holds a worldwide competition
called the UD Gemba Challenge toenhance the capabilities and teamworkof employees involved in aftermarket
services. The competition tests practicalknowledge and skills needed for solving
problems that can arise at service
centers. By working through such tasks,
the participants individually acquire newknowledge and skills while gaining
experience in efficiently dealing withproblems together with team members.
In 2018, about 1,300 participants from
347 teams—a record-high—from various
countries competed in the event.

Product development quality standards

ISO 9001 certification acquired
UD Trucks complies with the ISO 9001
international standard for quality
management systems. The Company’s
Manufacturing Division acquired ISO
9001 certification in 2002, followed by
the Product Development Division in
2016. UD Trucks also applies aplan-do-check-act (PDCA) cycle tocontinuously raise quality in accordancewith the standards.

UD Trucks carries out productdevelopment projects in collaboration
with various organizations in the Volvo
Group. The Company’s ProductDevelopment Division has established its
own quality assessment standards thatincorporate processes shared throughout
the Volvo Group. In accordance withthese standards, the division specifies
checkpoints at each stage of productdevelopment and confirms whether
targeted levels of quality are achieved
across a broad range of indicators,
including a truck’s performance,
functions, durability and reliability. This
process not only ensures higher quality
but also shortens the total time requiredfor product development.
Quality assurance in manufacturing

Initiatives taken byvarious company divisions
Measures for promptly dealing withquality-related issues
To minimize the impact of quality-related
issues for customers, UD Trucks has
established a Quality Action Groupspanning across departments involved in
product development, manufacturing,
and aftermarket services. The group iscomprised of teams that handle
troubleshooting at headquarters, teams
that provide technical support at dealers
and customers’ sites, and branch officeteams that directly respond to problems
in their respective areas. These teams
coordinate their efforts to quickly identify

Based on UD Truck’s own quality
management procedures, theManufacturing Division conducts daily
inspections of procured parts andmanufactured items to check for quality
defects throughout the production
process and ensure targeted levels of
quality. Refined through continuous
improvement over several years, thesequality management procedures havebeen adopted by all factories in the
Volvo Group.

Recalls and servicing of defects
In the event of a vehicle defect that
could potentially affect customer safetyor the environment, UD Trucks promptly
discloses all relevant information inaccordance with guidelines issued by
Japan’s Ministry of Land, Infrastructure,
Transport and Tourism.

Number of vehicle defects by manufacturer reported in Japan
2017

2018

2019

UD
TrucksVolvo
TrucksUD
TrucksVolvo
TrucksUD
TrucksVolvo
TrucksDefects
resulting inrecall

6

1

9

1

10

5

Defects
requiring
improvement

0

1

1

0

0

0

Defects
requiring
servicing

5

3

7

3

3

2

6

Products

Meeting market demand forlighter trucks
Demand for lighter trucks for short andmedium-length routes has been on therise in Japan in recent years. In response,
UD Trucks began selling a Quon model
heavy-duty truck with an 8-liter engine in
January 2019. This smaller engine allowed
the Company to make the truck’s chassis
about 300 kilograms lighter than those of
conventional 11-liter engine trucks. That
results in a substantial increase in payload
capacity, meaning that commercial vehicle
operators can potentially deploy fewer
drivers, an important factor due to ashortage of truck drivers in Japan. The
model is also equipped with an ESCOT-VI
electronically controlled transmission andadvanced safety functions.
In addition to this model, UD Trucks
has been providing other products tailoredfor market needs, outside of Japan as well.

Equipping trucks withadvanced safety technology
In an effort to improve road traffic safety,
UD Trucks has been developing advanced
safe-driving technology and equipping its

trucks with such systems. For instance,
the heavy-duty Quon comes with aTraffic Eye Brake system for automaticallybraking to avoid a collision, Driver Alert
Support system for detecting steering
irregularities, Lane Departure Warning
System for detecting whether the truck
leaves the lane at high speed, and UD
Stability Control for adjusting engine
output and braking in response toconditions under which the truck could
become unstable. Moreover, UD Trucks
makes sure to incorporate safety in thebasic performance of its trucks byequipping them with disc brakes
designed for outstanding heat dissipation
and resistance to brake fade. All of thesesystems not only help drivers operatetrucks more safely but also make theroad safer for other vehicles.

Services

Renovations and upgrades tocustomer centers
UD Trucks helps customers optimally use
its products by improving its after-sales
services. As part of these efforts, theCompany has been renovating andupgrading its customer centers since2014. Waiting rooms have beenredesigned with welcoming interiors andnew air conditioning systems to provide
more comfortable spaces for customers
to wait during servicing and repairs.
Women-only waiting and shower
rooms have been set up at some centers.
In the repair shops of the centers, theCompany has installed in-ground andhydraulic lifts as well as LED and newceiling lighting systems. These efforts
among others are helping improve
workplace efficiency and comfort forthe mechanics.

After-market service
certification program
UD Trucks certifies its customer centers
nationwide as a means to promote better
customer service and systematically
improve operations. Under this program,the Company sets three levels ofstandards for after-market services, from
one to three stars, and assigns experts to
conduct detailed inspections at eachcenter to assess whether it meets suchstandards. After a center is certified,in-house inspections are carried out
periodically to ensure that the standards
are being maintained. In addition to its
own customer centers, UD Trucks has
been extending the program toindependent dealers that provide
after-market services.

Demonstrating the viability of autonomous, heavy-duty trucks
From August 5 to 30, 2019, UD Trucks jointly conducted a Level 4 autonomous
driving trial with a heavy-duty Quon in Hokkaido, Japan, together with Nippon
Express Co., Ltd., a major logistics service provider, and the Hokuren Agricultural
Cooperative. Government officials, agriculture industry representatives and news
media gathered on August 29 to observe a demonstration of the autonomous vehicle.
During the demonstration, a specially adapted heavy-duty Quon truck equippedwith a network-based RTK-GPS (Real Time Kinematic Global Positioning System)
operated on a typical delivery route from a produce acceptance area to a final
unloading area, diverging only a few centimeters from the designated course at an
average speed of 20 kilometers per hour under varying road surface conditions. A portion of the route included a public roadsurrounding the Nakashari Hokuren Sugar Refining Mill, marking Japan’s first Level 4 autonomous driving trial of a heavy-duty
truck on a public road at the time.

7

Supporting
our customers
Test-driving events forfemale truck drivers
In Japan, while trucks deliver over 90%
of all cargo (on a tonnage basis), a
shortage of truck drivers is a serious
problem facing the country today. Only
2.4% of truck drivers are women in
Japan, so efforts are being made to
attract more women to the industry by
improving working conditions. The
Ministry of Land, Infrastructure, Transport
and Tourism even launched a project in2014 to provide support for women who
aspire to become truck drivers.
Playing a part in these efforts, UD
Trucks has been inviting female truck
drivers to test-driving events at its UD
Experience Center since 2017. In 2019,about 30 female truck drivers participatedin the event, which included test-drivesof the heavy-duty Quon along with afactory tour, group discussion, andworkshop about improving drivability
and working conditions for women in
the transport industry. The participantsevaluated the Quon during the test
drives, noting that the automatictransmission made operations lessstressful and physically demanding. Someof the shorter women also said that thetruck’s design made it easy to drive,
including the positioning of the steering
wheel and seat. Based on this feedback,UD Trucks reaffirmed its conviction thatproviding trucks that are easy to drive,
even by beginners, will help attract new
people to the industry and alleviate theshortage of drivers.

Motivating truck drivers
worldwide to develop
their skills
UD Trucks periodically holds a global
driving skills competition called the UD
Extra Mile Challenge for drivers of its
trucks around the world, with the goalsof motivating the drivers to develop theircapabilities and helping operators makethe most efficient use of their trucks.
The drivers receive training from theCompany’s skilled engineers andcompete across three categories of skills:
inspecting trucks before driving,fuel-efficient and safe driving, andmaneuvering and parking. In the mostrecent UD Extra Mile Challenge, drivers
competed in national qualifiers held from
July 2019. The Company plans to holdthe final round of the competition,
sometime in 2021, after the COVID-19
pandemic subsides.

Instruction on how to drive
more economicallySince 2007, UD Trucks has been holding
eco-driving seminars aimed at equipping
truck drivers with practical skills andknowledge about how to improve fuelefficiency while driving. During theseminars, truck drivers learn and practicespecial fuel-saving techniques formaneuvering and decelerating. The
seminars also make use of the UD
Information Service, a wirelesscommunications system for collecting
and analyzing data on a truck’s locationand movements, which enables
evaluations of vehicle speed, gearchanging, and other driving-related
factors. Participants have found this to bevery insightful and helpful for objectively
understanding their driving habits andmaking improvements accordingly.
In 2019, a total of 1,119 truck drivers
participated in seminars held at 70
locations nationwide (compared with
1,018 drivers at 81 locations in 2018).
Data collected after the seminars
indicated that the drivers improved their8

fuel efficiency by 24.9% on average,
demonstrating how this initiative is
helping customers improve mileage andreduce CO2 emissions.

Providing safe-driving
seminars to customers
UD Trucks has been inviting customers toparticipate in safe-driving seminars since2007. The seminars cover a broad rangeof topics, including safe management
systems for transport operators, thedangers of driving under the influence ofalcohol, blind spots, preventing common
accidents, defensive driving, andreducing human error. The programs
combine lectures with hands-on training
so that drivers can immediately acquire
practical skills. Videos of actual accidents
taken with drive recorders are also used
to give participants a real sense of how
accidents happen. In 2019, 4,261 people
participated in 146 sessions, comparedwith 4,315 people in 145 sessions in theprevious year.

Prompt customer service
UD Trucks has established a customer
service call center made available with atoll-free telephone number for customers
to ask questions, provide feedback andmake requests. It has also prepared a
guidebook explaining responses to all
foreseeable inquiries to help the center’sphone operators effectively deal withcustomer inquiries. The center’s
procedures and operations are regularly
reviewed to ensure that it continues toprovide prompt and helpful customer
service. In 2019, the center handled a
total of 4,004 calls compared with 3,791
in 2018.

Sustainability Activities

Strengthening
our partnerships

Our approach

Volvo Group procurement in 2019

To help commercial vehicle operators
run their businesses successfully, it isessential for an automaker to develop
and manufacture vehicles tailored totheir needs and to provide after-sales
services for the long term. From thatstandpoint, UD Trucks recognizes thatits suppliers and independent dealers
are indispensable business partners.
Accordingly, it strives to forge strong
business partnerships while working toraise customer satisfaction andadhering to Volvo Group policies.

299.6 billion SEK* 51,000of goods and services were purchased.

Tier 1 suppliers

2.5 billion parts for 40 factories
worldwide were delivered.

Of the total, auto parts were procured
from about 6,000 suppliers* SEK refers to the Swedish krona; 1 krona
was worth approximately 12.2 US dollar
as of November 30, 2020.
Percentage of spending on
auto parts from sustainability
self-assessed suppliers

92%

98% in high-risk countries

Percent of purchases by region1%

Africa and Oceania
Asia

7%

South America

7%

North America

21%

9Europe64%

Ensuring responsible
procurement
Working closely with suppliers is essential
for maintaining competitiveness andpromoting sustainability in the transportindustry, which is facing rapid changes
and shorter development cycles.
The Volvo Group requires all of its
suppliers to not only supply high-quality
products but also promote sustainablebusiness practices. By optimizing its
supplier base and geographical footprint,
the Group responds to customer needs
while working to reduce CO2 emissions.
In accordance with the Volvo Group’s
policies, UD Trucks strives to ensure
responsible procurement of raw materials,
components, equipment, and services
necessary for its global operations.

Balancing people, the planet,and profits
The Volvo Group has specified
sustainability as a key criterion for its
sourcing selections along with quality,
features, delivery, and cost.
In 2019, the Group established aSupplier Code of Conduct and redefined
the responsibilities and requirements it
expects of suppliers. Guided by this code,
UD Trucks is helping implement the Volvo
Group’s Sustainable Purchasing Programin an effort to build strong partnerships
with suppliers and effectively managesocial and environmental risks in the
supply chain.

Participating in
Volvo Group’s Sustainable
Purchasing Program
UD Trucks is an active participant in the
Volvo Group’s Sustainable Purchasing
Program, which is made up of fivecomponents. Firstly, all suppliers arerequested to comply with the Group’s
Supplier Code of Conduct, which isbased on global standards such as the
UN Global Compact. Secondly, the Volvo
Group’s Supplier Sustainability
Assessment Program evaluates supplierswith respect to business ethics,
environmental performance, and otherimportant matters by having themcomplete a Sustainability Self-Assessment
questionnaire. Thirdly, Supply Chain
Mapping is deployed to assess andanalyze suppliers with respect toidentified segments and areas. Fourthly,
the Group promotes “innovation
focusing on people and the planet” byoffering internal training and bestpractice sharing about circular economy,
recycling, eco-design, and human rights.
Finally, the Volvo Group encourages
industry collaboration through its
participation in Drive Sustainability, apartnership of 10 automakers (mainly
based in Europe) that promote supply
chain sustainability in the automotive
industry, and the Responsible Minerals
Initiative, an international NGO that
focuses on responsible and sustainable
mineral sourcing in the automotive andelectronics industries.

Main elements of Sustainable Purchasing

Supplier Code of Conduct

Industrycollaborations

Innovation
people andenvironment

Creating
right mindset

Supplier
assessment
program

Supply chain
mapping

10

Sourcing minerals
sustainably
The Volvo Group is working with the
Responsible Minerals Initiative (RMI) withthe aim to ensure responsible andsustainable sourcing of conflict minerals,
namely tin, tantalum, tungsten, gold,
and cobalt. Members of the RMI gain
access to tools and resources that help
improve regulatory compliance andsupport responsible mineral sourcing in
high-risk areas. The Volvo Group also
makes use of reporting templates andguidelines developed by the RMI toensure supply chain transparency andcompliance with the RMI’s rules.

Working in partnership withindependent dealers
In addition to its own network of dealers,
UD Trucks supplies products and services
to customers through six companies that
operate a total of 32 independent
dealerships in Japan. While respecting thecorporate traditions and local businesspractices of each of these dealerships, UD
Trucks works closely with them towards
the common goal of improving customer
satisfaction, and invites them to the same
training programs and events as its own
dealers to help their employees acquire
more skills and expertise.

Helping aftermarket service
personnel improve their skills
UD Trucks routinely holds events
designed for improving the skills of its
mechanics, service parts engineers andother aftermarket service personnel. In
2019, about 50 employees fromindependent dealers joined its annual
Uptime Conference, a training event thatprovides a forum for sharing expertiseand the latest information. In 2018, theCompany invited 11 teams consisting of
41 participants to compete in its
international skills competition called the
UD Gemba Challenge.

Sustainability Activities

Empowering our people

Dialog with female employees during Diversity & Inclusion Week

Our approach
To develop human resources that can
thrive anywhere in the world, UD
Trucks provides effective and practicaltraining programs, and assists
employees with career development
through a fair and transparent
evaluation system. These programs andsystems emphasize the importance ofrespect for individuals,
self-actualization, diversity, teamwork,
taking responsibility for one’s work, andopen communication. The Company
uses employee attitude surveys andother tools in an effort to create an
open and comfortable workplace thatallows all of its members to make themost of their capabilities.

Employee data in Japan (as of December 31, 2019)
Number of employees by gender(directly employed by UD Trucks)
Male

Percentage of total

FemalePercentage of total(Employees)
8,000

92.7

92.6

5,823
5,789
433
422

92.4

(%)
100

6,054
459

4,000

50

5,367

7.3

5,390

7.4

5,595

7.6

0

0
2017

11

2018

2019

Newly hired
graduates

225

Newly hired
mid-career
employees

232
28 nationalities

Australia, Bangladesh, Belgium, Brazil,
Canada, China, France, Germany, India,
Indonesia, Ireland, Japan, South Korea,
Malaysia, Mongolia, Myanmar, Nepal,
South Africa, Singapore, Spain, Sri Lanka,
Sweden, Thailand, the Philippines, Poland,
Ukraine, United States, and Vietnam

Promoting diversity andinclusion in the workplace
At UD Trucks, differences among
employees are embraced and respectedbased on an understanding that diversity
is essential for the Company to succeed
globally. Accordingly, while striving forsustainable growth, UD Trucks actively
promotes diversity and a working
environment that allows each individual
to maximize his or her potential. The
Company assesses how employees feel
about diversity in periodic employee
attitude surveys. The surveys alsomeasure inclusion, such as the extent
that employees feel valued as importantmembers of their teams. The results ofthese surveys are then incorporated indiversity and inclusion management
initiatives. In addition, the Company
holds a Diversity & Inclusion Week every
year in October to share best practices
and raise awareness among employees.
This commitment to diversity andinclusion is reflected in the Company’s
openness to hiring foreign nationals inJapan. In 2019, it recruited 64
non-Japanese college graduates—almost
30% of all graduates hired that year—
further contributing to its
internationalization and diversity.

Helping employees growand develop
UD Trucks has established ample training
facilities, adopted a training
management system, and provides awide range of training programs tofacilitate active learning andself-development among employees. This
enables employees to develop and refine
their expertise and capabilities while
acquiring the skills they need not only for
their current jobs but also for the future.
Since 2018, the Company has been
holding “learning days” as educational
events designed to foster a corporate
culture that values self-development. In
2019, it began organizing careerplanning seminars to provide employeeswith useful information about training
programs and resources for developing
necessary skills for achieving career goals.

Getting results while fostering
personal growth and trustfulrelations through dialogue
At UD Trucks, managers and teammembers regularly engage in dialogue
about a wide range of matters, such as
setting work priorities, confirming
progress, proposing improvements, anddeveloping individual potential. Throughsuch discussions and feedback,workplaces not only get results but also
foster personal growth and build trust
among management and employees.

Maintaining flexible
workplaces
UD Trucks has put in place various
systems and policies designed to help
employees maintain a healthy balance
between their working and personal
lives. They include a flex-time systemalong with childcare and nursing leavesystems. More recently, the Company
initiated a telecommuting system that isavailable to employees and places nolimits on the number of days they canwork at home. It has also established ananti-harassment policy, and is making
ongoing efforts to reduce and eventuallyeliminate overtime work.

Facilitating open
communication
UD Trucks has taken steps to promotesmooth communication in theworkplace, such as holding town hallmeetings, creating time for Swedish-stylecoffee breaks called fika, and providing
company news and information via its
intranet. In 2019, it created an extensive
digital platform that enables employees
to acquire and share useful information
at any time and in any location. With thisplatform, employees can now access

12

work-related systems, which had only
been available via company computers in
the past, using their own personal device
such as PCs, smartphones, or tablets.
This makes it easier for organizations andproject teams to share information andexchange ideas while also facilitatinginteraction among employees, regardlessof their job position or whether theywork at one of the Company’s offices
outside Japan. Moreover, this easy accessto a wide array of information allows
employees to learn more about theworkings of the Company and efforts toadopt best practices.

Ensuring health and safety
UD Trucks regularly holds events
designed to maintain safe workplaces
and assist employees with healthmanagement. In 2019, it held a Healthand Safety Week from July 1 to 7, which
included health seminars, physical fitness
evaluations, and stretching workshops.
The Company also organized training
seminars on preventing work-related
injuries. In addition, it routinely provides
stress assessments in the workplace tohelp employees manage stress.
Employees are encouraged to meet withphysicians or counselors if their results
indicate high stress levels, and their job
responsibilities may be reduced based on
the advice of the physicians.

Sustainability Activities

Engaging with communities

Children receiving meals through hunger relief programs in South Africa

Initiatives in South Africa

Our approach
UD Trucks draws from the expertise andtalents of its people and makes gooduse of its facilities and resources toprovide support and assistance tocommunities. The Company strives toforge strong ties with its many
stakeholders, including the communities
it operates in and its partners in theautomotive industry, through initiatives
aimed at creating shared value. Using its
business for good, UD Trucks is working
to help pave the way for a moresustainable society.

Supporting hunger relief programs
Since 2007, UD Trucks Southern Africa has been offering support to Shoprite
Mobile Soup Kitchens, a program that distributes food to people in disadvantaged
areas of South Africa. The program currently serves an average of 300,000 meals
each month from 19 mobile kitchen trucks—six of which are UD Truck models—that operate six days a week. To date, over 41 million meals of nutritious soup andbread have been distributed, and meals are now also being provided to children inneighboring Angola.
Shoprite Mobile Soup Kitchens has become more important than ever due tothe impact of the COVID-19 pandemic on South Africa’s economy in 2020. Since anationwide lockdown went into effect, the program has provided over 80,000
meals to 145 organizations around the country. As a responsible corporate citizen,
UD Trucks Southern Africa is committed to supporting the program no matter how
difficult the circumstances become.

13

Road safety instruction forelementary school students
Among prefectures in Japan, Saitama
has a comparatively high number offatal road accidents involving mediumand heavy-duty trucks*. As a truck
manufacturer based in Saitama, UD
Trucks recognizes its responsibility tohelp prevent road fatalities, and, towardthat end, has been conducting a traffic
safety program for elementary school
children in the city of Ageo since 2016.
Over four years up to 2019, 1,934
students have participated in the
program and 197 employees have
served as instructors.
Through the program, elementary
school students learn about road safety
and participate in activities with actual
heavy-duty trucks to demonstrate theirblind spots and the space required whenturning corners (specifically the different
arcs taken by the front and rear wheels).
The students are also given an
opportunity to sit in the driver’s seat of atruck to observe what drivers canactually see outside. The program’s
instructors have noted that sitting in thedriver’s seat was a valuable experience
for the children, and the chance todirectly observe the trucks made themmuch more aware of safety.
* Based on data published by the Japan
Trucking Association

Field trips for elementary
school students
In June 2019, elementary school students
with special needs in the city of Ageo
visited UD Trucks to learn about theimportance of trucks for transporting
food. The lesson was part of a field trip
for students in grades one through six tolearn about food, which also included atour of a food wholesale market in
nearby Saitama City prior to the visit.
Held at the UD Experience Center, thelesson covered the past, present, andfuture of trucks, followed by aaddition to the instructors, one
employee for every two participants is
assigned to help, thereby creating a
supportive and enjoyable environment
for learners unfamiliar with IT tools.

Supporting communities
during the COVID-19 pandemic

demonstration of how cargo is handled
at a loading dock. The children weredelighted when the wings of aheavy-duty truck opened automatically,
and could visualize how the food they
saw at the wholesale market could be
unloaded from the truck.
As a member of the local community,
UD Trucks will continue accepting
requests from schools organizing field
trips like this in the future.

Internet classes forsenior citizens
Since 2016, UD Trucks’ employees havebeen offering classes on how to use theinternet for residents of Ageo aged 60
and older. Mainly from the Company’s IT
Division, the employees initiated theprogram with a desire to use their skills togive something back to the city. The
program is intended to improve thequality of life of older residents who arelargely unfamiliar with the internet byteaching them how to access news andinformation related to their personal
interests. Some participants havecommented that they learned to quickly
obtain news on disasters, bus and train
timetables, and other information neededin daily life, while others expressed adesire to make practical use of what theylearned from the informative classroom
materials and lectures.
In 2019, the program switched frompersonal computers to tablets andintroduced easier and more user-friendly
ways of using the internet, including
apps and voice recognition software. In

14

In response to the COVID-19 pandemic
around the world, UD Trucks provided
support for people in various countries
in 2020.
In Japan, UD Trucks donated 5,000
masks to public nursery schools in Ageoin May. The city’s mayor, Minoru
Hatakeyama, expressed his appreciation
to the Company for the donation at atime when masks were in scarce supply,
especially since staff were taking extra
care to prevent the spread of the virus at
the nursery schools, which remained
opened despite the temporary closure ofelementary and high schools. In June, theCompany donated another 5,000 masks
to an elementary school near its head
office in Ageo to help prevent the spreadof infections after the school reopened.
In Thailand, over 50 employees
cooperated with local hospitals to hold ablood donation drive in preparation for aserious outbreak of COVID-19 in the
country. The event was held at a UD
Trucks dealership in the northeastern
province of Khon Kaen in July.
In Indonesia, employees delivered rice,seasonings, and other necessities topeople in need who had lost their jobs dueto the impact of the pandemic.

Sustainability Activities

Reducing ourenvironmental footprint

Ageo Plant

The Volvo Group Environmental Policy

Our approach
The Volvo Group has been working tominimize environmental impacts
throughout its history, and established
the Volvo Group Environmental Policy
for that purpose. Guided by this policy,
UD Trucks has been implementing
initiatives to reduce environmental
impacts across all of its businessactivities with the aim of building amore sustainable world.

Environmental progress is a key element in our mission to drive
prosperity through transport solutions.
The following principles provide direction for the work:• Continually reduce life-cycle environmental impacts as an enabler for increased
sustainability and customer success• Demonstrate responsible care for the environment wherever we operate and build trust
by adhering to our Code of Conduct.
• Minimize resource use, emissions and waste and utilizing means within our sphere of
influence to create change towards a circular economy and to further improve ourcompetitiveness

Environmental management organization
Executive officer in charge ofcompany-wide
environmental management

Chief environmental
manager ofthe Manufaturing Division

Chief environmental
manager of the ProductDevelopment Division

Chief environmental
manager of
the Sales Division

Departmental
environmental managers

Departmental
environmental managers

Departmental
environmental managers

15

ISO 14001 certificationacquired group-wide
UD Trucks has been acquiring ISO 14001
certification for environmental
management at its worksites since 1998,
when its Ageo Plant first acquired
certification. All of its production plants
and affiliated companies had beencertified by 2017, and completed thetransition to the revised ISO 14001:2015
standard by the end of August 2018.
Leveraging the benefits of this group-widesystem, UD Trucks is currently working toachieve the objectives and targets of its
environmental action plan.

Auditing of environmental
management system
As a rule, UD Trucks conducts an internal
audit of its environmental 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

emissions, which are a major
contributing factor to climate change.
For that reason, UD Trucks is constantly
improving the fuel efficiency of its trucks.
Like other truck manufacturers in Japan,
UD Trucks has been subject to stricter
fuel efficiency standards for heavy-duty
vehicles since 2015, with specific targets
set for each weight class. Over 98% of
all trucks sold by the Company in 2019
complied with these targets, reflecting its
efforts to equip trucks with leading-edge
fuel-saving technologies. UD Trucks has
also achieved its own targets for average
fuel consumption since 2012.
In addition to pursuing technicalinnovations for improving fuel efficiency,
UD Trucks has been holding eco-driving
seminars for truck drivers in every regionof Japan to offer practical advice and tips
on driving more efficiently.

and complies with company rules as well
as relevant environmental laws andregulations. The environmental
management system is also audited every
year by a third party.

Reducing environmental impact
over the product life-cycle
UD Trucks analyzes the environmental
impacts of its trucks at each stage of the
product life-cycle, beginning fromproduct development and design
through to the disposal and recycling ofparts and components. Based on the
results of its analyses, the Company
strives to reduce the impact of its
products and operations on theenvironment by using resources
efficiently and producing moreenvironmentally conscious trucks.

Pursuing better fuel efficiency
The fuel that trucks burn is not only amajor expense for commercial vehicle
operators but also a source of CO2

Material flow

Input
1. Development
and design

We use:Energy2. Procurementof materials
and auto parts• technologies that
reduce emissions• systems for
improving mileage• fewer materials that
impact the environment• technologies toreduce vehicle noise• recyclable materials
and components

We ensuresustainableprocurement anddeliver parts to
suppliers via
energy-efficienttransport

OutputCO2
PM
NOx

Raw materials
and truck parts

Resources andenergyResources andenergyEnergyWater, electricity,oil, etc.

Replacement
tires, fuel, etc.

Electricity andfuel for facilities
and equipment

4. Product usage

5. Product disposal

3. Production
Includes pressing, heat treating,machining, painting, assembly,
and inspections

We reduce the use of resources andhazardous substances, andoperate factories efficiently toconserve energy

CO2
NOx
SOx
Dust
Odor

Effluent

Waste
matterNoiseandvibration

We provide
eco-driving seminars

We sort materials
and parts for reuse
and recycling, andproperly treat anddispose waste

CO2
PM
NOx
Waste matter

Waste matter
Automotive
shredded residue
Airbags
Chlorofluorocarbons(incl. disposed tires)

Noise and vibration

The main environmental impacts of trucks over the entire product life-cycle are due to emissions of CO2 andexhaust gases containing particulate matter (PM) and nitrogen oxide (NOx) at the product usage stage.

16

and recycling

Sustainability Activities

Improving fuel efficiency withindustry-leading technologies

Chemical substancemanagement

UD Trucks has continually improved thefuel consumption of its heavy-duty trucks
by equipping them with a wide range ofindustry-leading technologies, including
in-vehicle displays for advising drivers,
optimally designed engine systems, andadvanced functions for precisely
controlling driving speed. Indicating theeffectiveness of these technologies,
compared with Japan’s fuel efficiency
standards for heavy-duty vehicles set in2015, the Company’s flagship Quon
heavy-duty truck exceed targets by over
5% in over 90% of tests.

UD Trucks strictly manages the chemical
substances used in its products,
specifically those included in the Global
Automotive Declarable Substance List, in
accordance with industry standards andlaws concerning the production, import,
management, and recycling of chemical
substances. Such chemical substances aremanaged both before and during
manufacturing.
At the product development anddesign 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 the International
Material Data System, a database jointly
managed by automobile manufacturers
worldwide.
At the production stage, UD Trucks
reports to the government each year on
its usage of chemicals subject to Japan’s
Pollutant Release and Transfer Register,which is a system for restricting andcontrolling the discharge of designatedchemicals into the environment. The
Company also makes efforts to replace
hazardous chemicals with less harmful
alternatives, and properly comply withrevisions of relevant laws or regulations.

The Quon’s driveline is designed to improvefuel efficiency

Major technologies applied in heavy-duty trucks
Vehicle• Fuel Coach system for advising drivers on fuel-efficient driving• Foretrack function for predicting the road ahead based onscanned data
• Aerodynamic designs including front bumper-fitted air dams
and newly developed wind deflectors

Engine• Ultra-high-pressure fuel injection systems• Optimally shaped combustion chambers• Optimally designed induction systems• Variable speed water pumps• Eight-liter engines equipped with low-exhaust emission systems

Power train• ESCOT Roll system for minimizing the decline in speed
when coasting• Acceleration limiter for ensuring gradual speed increases• Soft Cruise Control function for controlling acceleration

Average improvements in fuel efficiency of UD-brand trucks
Comparative improvement in fuel efficiency*(Percentage points)
107
106
105
104
103
102
101
100
99
98
97
0
2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

* The percentages were calculated using the harmonic average of the fuel efficiency achieved bytrucks sold each year, with the base year of 2015 set as 100%.

17

Helping the Volvo Group
reduce CO2 emissions
In 2011, the Volvo Group became thefirst automobile manufacturer to join
Climate Savers, a World Wildlife Fund(WWF) initiative that brings global
corporations together in effort to reducegreenhouse gas emissions. The Groupthen set the goal of reducing CO2
emissions from its factories by an averageof 12% by 2014 compared with its resultin 2008. The Group exceeded its target
early, cutting emissions by 20% in 2013.
Riding that momentum, the Volvo Group
stepped up its efforts and set a newtarget of reducing emissions by 8% overthe 2013 result by 2020.
To help achieve this goal, UD Trucks
has established a number of committees
comprised of members of all relevant
divisions, including a committee charged
with saving energy, to set targets andformulate action plans. In 2013, theCompany succeeded in reducing CO2
emissions by 61.3% compared with the1990 result, beating its target of 39% by
a wide margin. Since then, UD Trucks has
continued to implement various
initiatives for reducing emissions to help
the Volvo Group achieve its 2020 target.
Among these initiatives, theCompany has been purchasing electricity
specifically from renewable energy
sources for some of its facilities since2013, and began procuring such green
electricity for its Ageo Plant in May 2019.
As a result, the plant reduced its CO2
emissions in 2019 by 3% compared withthe level in 2018.
As another initiative, the Ageo Plant
has been replacing obsolescent lighting
equipment with LED lighting systems
since 2017. By the end of 2019, 561 LED
lights had been installed at the plant,
contributing to a 0.4% reduction of CO2
emissions compared with 2018. About
6,000 LED lights are scheduled for
installation in 2020.

Reducing waste matter at
the product disposal stage
The final disposal of a truck at a dealer’ssite accounts for the largest amount ofwaste 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 dealers in 2014. In
accordance with the standards, eachdealer has installed disposal facilities andproperly sorts waste materials duringtruck disassembly and disposal. In
addition, the Company delivers service
parts in returnable packages to dealers tofacilitate the reuse of materials.
UD Trucks looks for ways to makedisassembly work easier and use
resources more efficiently starting fromthe product development stage. For
example, bumpers are designed to be
simply disassembled into threecomponents, headlights can also beeasily dissembled into interchangeablelens and LED units, and fenders are madefrom recyclable materials.
At the production stage, UD Trucks
works to reduce and recycle waste

matter with the goal of minimizing theamount of waste it disposes in landfills.
In 2019, the Company achieved its targetof limiting landfilled waste to under 1%of total waste generated, and has
reduced the volume of waste sent tolandfills by 99.9% compared with theamount in 1990.
In order to improve its waste
management system, UD Trucks
concluded a consulting agreement with acompany that specializes in waste
disposal in April 2015. Through thispartnership, UD Trucks has been using
only highly reputable disposal firms,
administering and submitting allnecessary reports to government
agencies, and keeping records on theamount of waste disposed in an effort tostrictly comply with laws and regulations
concerning waste management.

Working with local governments to combat global warming
UD Trucks achieved its 2019 target for reducing CO2
emissions, which it set in compliance with regulations
enacted by the Saitama prefectural government tocombat global warming. The Company also
cooperates with a carbon offset program initiated by
the city of Saitama, and has contributed carbon
credits in accordance with the prefecture’s
target-based emissions trading system.

18

CSR, Compliance and Corporate Governance

Our CSR framework
For all of us at UD Trucks, helping make the world a better placethrough our business activities is at the core of who we are. The
Company has created a vision for fulfilling its corporate social
responsibility (CSR) by supporting sustainable transportation
solutions for a more prosperous society. Focusing on solutions, inparticular, UD Trucks aims to create shared value with stakeholders
and the communities it serves by working with them to overcome
the challenges we face together. Accordingly, the Company
focuses on its know-how, technical expertise, human resources
and networks to make positive and lasting contributions to theindustry and society at large. Within the industry, it makes
concerted efforts to reduce environmental impacts and promote
safety in partnership with stakeholders. At the same time, UD
Trucks carries out measures to ensure sound corporate
governance and strengthen compliance in accordance with laws
and regulations while closely following the Volvo Group Code of
Conduct and other important group policies to fulfill its basic
corporate responsibilities across all business activities.
Under this framework, UD Trucks encourages all employees tomake a difference and help create a more sustainable world.

VisionUD Trucks shall strive to realize practical solutions that
promote sustainable logistics and help communities thrive.

Approach

Create shared value

Scope

Focus

Fulfill basic corporatesocial responsibilities

Community
engagement

Logistics and transport

Protectthe environment

Promote safety

Work withstakeholders

Respond tocommunity needs• Ensure sound corporate governance• Maintain compliance withlaws and regulations• Conduct thorough risk management• Manage a sustainable supply chain• Comply with ISO 14001 andISO 9001 standards• Enforce the Volvo Group Codeof Conduct• Follow all Volvo Group policies

Active involvement of employees

The Volvo Group Code of Conduct
Aiming to ensure that its business activities are carried out
ethically and in compliance with the laws of every country it
operates in, the Volvo Group has specified basic principles andconduct for all of its employees around the world to follow in the
Volvo Group Code of Conduct. UD Trucks has been implementing
measures to maintain an in-depth awareness of the code among
all of its employees, such as producing and distributing
information including a handbook that explains exemplary cases
related to the code. The Company also provides e-learning
courses for all office workers along with management-led training
courses at factories and dealerships.

A poster promoting the Volvo
Group Code of Conduct

19

The Volvo Group Code of
Conduct booklet

CSR management system
At UD Trucks, community outreach activities are overseen by the
manager in charge of CSR management. This manager along withthe managers in charge of corporate communications and brandmanagement, respectively, comprise the Company’s CSR senior
management team. In addition to coordinating CSR activities
across all divisions and compiling information on those activities,
the team formulates CSR-related strategies and plans as well as
initiatives for raising awareness of the Company’s CSR activities
among employees and the public. To ensure these strategies andplans are consistently implemented company-wide, CSR managers
are appointed in each division, and they jointly hold regularmeetings to share inter-divisional information and plan specificactivities. They report on the progress of these activities to
executive management, and receive direction and approvals fromexecutive managers.

Executive management meetings
CSR senior management team comprising managers incharge of CSR management, corporate communications, andbrand management
CSR manager of the Domestic Sales and Aftermarket Division

CSR manager of the Overseas Sales and Aftermarket Division
CSR manager of the Product Development Division
CSR manager of the Manufacturing Division
CSR manager of the Corporate Governance Division
CSR manager of overseas operations

Systems for ensuring compliance
UD Trucks conducts its business activities in accordance with the
Volvo Group Code of Conduct, which is organized under the fivekey principles of respecting one another, earning business fairly
and lawfully, separating personal interests from business activities,
safeguarding company information and assets, andcommunicating transparently and responsibly. To ensure that all of
its members fully understand these principles of the Volvo Group

Code of Conduct, UD Trucks regularly provides legal compliancetraining and e-learning courses to employees and managers,
along with training programs specifically designed for new
employees and personnel in charge of relevant duties. UD Trucks
has also set up an internal whistleblower system and audit
program for facilitating prompt and proper responses to any casesof wrongdoing or suspicious actions.

Risk management
At UD Trucks, efforts to strengthen risk management are led by
the Security Management Division. Tasked with a diverse range of
responsibilities, the division oversees the safety of employees andvisitors at all workplaces, safeguards confidential information andintellectual property, handles emergency response activities,

formulates crisis management and business continuity plans, andmakes preparations for resuming operations in the event of adisaster. UD Trucks has been maintaining safe and secure
operations thanks to the division’s ongoing efforts to identify risks
and take proactive steps to prevent them from materializing.

Information security
Based on the Volvo Group’s information security policies, UD
Trucks has taken measures for ensuring the security of 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 andmanages 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 fromcyber-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 the Volvo Group’s
privacy policies.

20About UD Trucks Corporation

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

Company overview (As of September 30, 2020, unless otherwise stated)
Company name

UD Trucks Corporation

Date of foundation

December 1, 1935

Head office address

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

Capital77.5 billion yen

Number of employees

6,442 employees including contract and temporary
employees (as of December 31, 2019)

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

Domestic group companies

VFS Japan Co., Ltd.; New-Mech Co., Ltd.

Main locations outside of Japan UD Trucks Singapore Office; UD Trucks Bangkok Plant

Products and services
provided by UD Trucks

UD Trucks
Sales of Quon heavy-duty trucks, Condor
medium-duty trucks, and Kazet light-duty trucks
to Japan and other mature markets, and Quester
heavy-duty trucks, Croner medium-duty trucks,
and Kuzer light-duty trucks to emerging markets

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

Volvo Penta
Sales of imported Volvo Penta brand industrial
and marine engines to the Japanese market,
including forklift and pleasure craft engines, andinstallation and technical support for original
equipment manufacturers

Officers

Volvo Construction Equipment

Joachim Rosenberg
Chairman andrepresentative director

Takamitsu Sakamaki
President andrepresentative director

Jan Gurander
Director

Masahiro Otsuki
AuditorMarketing and support for dealers selling Volvo
brand construction equipment to the Japanesemarket, including hydraulic excavators, wheel
loaders, articulated dump trucks, andrelated machinery

History
DecadeCompany history

Technical development and product launches

1930

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

1940

1942 Renamed as Kanega-Fuchi Diesel Co., Ltd.
1946 Renamed as Minsei Sangyo Co., Ltd.

1950

1950 Renamed as Minsei Diesel Industries, Ltd.

1960

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

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

1970

1990 Big Thumb heavy-duty truck

1990
2000

2007 Joined the Volvo Group

2004 Quon flagship heavy-duty truck

2010

2010 Renamed as UD Trucks Corporation2014 Absorbed sales subsidiary UD Trucks
Japan 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

21About the Volvo GroupUD Trucks is a member of the Volvo Group, a global enterprise headquartered in Gothenburg, Sweden.
The Volvo Group manufactures trucks, buses, construction equipment,
and marine and industrial engines, while also providing financial services.
Employing about 100,000 people worldwide, the Group manufactures its products atfactories in 18 countries and sells them in more than 190 markets.

Volvo products in everyday life

On the roadOff roadIn the city

At seaThe Volvo Group’s vehicles arewidely used throughout thetransport industry, delivering foodto households and materials to
production plants, enabling people
to travel to their destinations, andbuilding roads to drive on.

The Volvo Group’s engines,
machines and vehicles operate inconstruction sites, mines, andforests, while its irrigationequipment is deployed on
agricultural land all over the world.

The Volvo Group’s vehicles play
important roles in daily life andpublic transportation systems.
They include buses that takepeople to work and school, andtrucks used for collecting rubbish
and maintaining infrastructure.

The Volvo Group’s marine engines
are widely used for a diverse range
of vessels at sea, includingtransport ships, pleasure boats,
and rescue boats.

Volvo’s basic approach to CSR• Driving prosperity throughtransport solutions“Driving prosperity through transport solutions” is the
Volvo Group’s mission. To fulfill it, the Group has
formulated a vision backed by specific aspirations for all of
its employees. To foster a corporate culture underpinning
this future direction, the Volvo Group is promoting values
for every employee to share and integrate in all
operations, with a view to grow its business while helping
make the world more sustainable. It has also created the
Volvo Group Code of Conduct to specify basic principles
and conduct for all employees to follow, and clearly
explain business ethics and compliance-related issues
relevant to all business activities.

• Be the most desired and successfultransport solution provider in the world

MissionVisionAspirations
ValuesVolvo Group Code of Conduct• Have leading customer satisfaction for
all brands in their respective segments• Be the most admired employer
in our industry• Have industry leading profitability• Customer success• Trust• Passion• Change• Performance

Results of key performance indicators in 2019
Net sales (SEK bn)

Operating income (SEK bn)
49.5

432

Africa and Oceania

6%

391
313

302

Share of net sales by market

333

38%

Asia

34.5

19%

29.7
23.3

EuropeSouth America

20.8

7%

North America

30%

Share of net sales by revenue type
Financial services
2015

2016

2017

2018 2019

Total number of employees

103,985

Share of women19%2015 2016

2017

3%

2018 2019

Services

Total CO2 emissions

0.8 tons/SEK M

20%Energy consumption

5.1 MWh/SEK M

SEK refers to the Swedish krona; 1 krona was worth approximately 12.2 US dollar as of November 30, 2020.

22

Vehicles77%1-1, Ageo-shi, Saitama 362-8523, Japanudtrucks.com