Year-end press conference 2020 &Mid-Long Term Business Strategy Update

December 22, 2020

Global CEO and
Representative Executive Officer

Shu Ishibashi

Communication Plan
Mid-Long Term Business Plan Framework - July 8

1st half financial results announcement – August 7■ Mid-Long Term Business Plan Framework: Whole picture■ 1st half financial results / full-year forecast■ Mid-Long Term Business Strategy Update:Core Business / Growth Business

Bridgestone 3.0 “Third Foundation”

3rd quarter financial results announcement – November 12

Mid-Long Term Business Strategy Update – September 15■ Mid-Long Term Business Strategy Update:Technology Innovation■ 3rd quarter financial results / full-year forecast■ Mid-Long Term Business Strategy Update：・ Technology Innovation

・ Rebuild earning power・ Bridgestone Innovation Park (Phase 1)

・ HRX*

Bridgestone Innovation Gallery Opening- HR and organizational strategy to execute Mid-Long
Term Business Strategy

Year-end press conference 2020 – December 22

Mid Term Business Plan – February 16, 2021

■ Wrap up of year 2020
■ Mid-Long Term Business Strategy Update:
Sustainability Business Framework■ Mid Term Business Plan Based on
Mid-Long Term Business Strategy Framework (2021-2023)■ Looking toward 2030

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Wrap up of year 2020

2/30

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ItalyIndia

United StatesIndonesia

Collected and provided necessities
to local families in need

Food supplies and other essentials
to truck drivers on highways

Produced face shields and donatedto hospitals and nursing facilities

Donated PPEs (personal protective
equipment) to local government

COVID-19
Community Support

Germany

RussiaDonated food, hygiene products
and vouchers to a local food bank

Donated computers to Red Crossfor education during lockdown

South Africa

Spain

Japan

Vietnam

Provided necessary and crucial
services to delivery vehicles

Provided 24-hour emergency service
for healthcare professionals

Produced masks and donated to
local governments

Produced coloring books forchildren at home during lockdown

3/30

China
Donation to assist COVID-19 relief,
provided masks to distributors, etc.

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Mission

Serving Society with Superior Quality

4/30

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Bridgestone continues to provide

social value and customer value,
as a sustainable solutions company.

5/30

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6/30

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Build our unique business modelC

Mobility
Solutions

Business to provide new value through products,
tire related data and mobility related data

B

Create and sell “value”

Tire Centric
SolutionsA
Value
amplifiedCreate and sell “value as system”

Tire & Rubber

GrowthBusiness

Business to provide added value to products through products andtire related data

Produce and sell “Products”
Produce and sell high-value-added products (Dan-Totsu
products) at an optimum cost and priceCore
Business⇒a base of Bridgestone Business Strategy(Spiral up)

Evolve to solutions business leveraging the strengths and expertise of tire & rubber business
7/30

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Global Mid Term Business Scenario
COVID19
impact

2020

2021

2022

Gradual recovery from 2nd half

Gradual recovery

RecoveryCrisis management

Transformed“Strong” Bridgestone

Rebuild earning power

Stage

2023

Strategic growth investment

Strategic
Focus■“Safety First”

 Rebuild earning power■Cash oriented management

Reformation of expense and cost structure:

Solution business related sales
Tire & Rubber Solutions

A

B/C
15%

(2019 Actual)

Enablers
forexecution

Process
HRX*1■ Reforms

Restructuring of business portfolio (Yr21-22) & manufacturing footprint
Reallocation of resources
Operational excellence: Premium business strategy (EtoE)・ Leaner, flexible to adapt to change
in business environment
・ Core business: Strengthen premium category biz
・ New business portfolio
・ Profitable resilient business structure■ Realize new growth strategy

 Strategic growth investment

・ Growth Business :Expansion of solutions business

Growth Business: Retread / Webfleet Solutions

Global expansion of solutions
Core Competence: Sustainability – Circular Economy Business Model
DX / Innovation

Tire & Rubber Solutions(Plan in 2023 as of Oct 2020)

Global KPI(PDCA)
New management index (ROIC, Adjusted Operating Profit and ROE）
Foundation of financial strategy (“Glocal” investment management）
Core Business*2 -culture transformation, Growth Business*2- new culture creation
Fundamental transformation of org. and HR system, Enhancing recruitment & development*1 HRX: Human Resource Transformation*2 Core Business: Tire & Rubber business, Growth Business: Solutions business

8/30

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Mid-Long Term Business Strategy Update:
Sustainability Business Framework

9/30

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10/30Confidential S2

Mid-Long Term Business Strategy Framework towards
a “sustainable solutions company”

11/30

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12/30Confidential S2

Sustainability Business Framework: Retread centric model■ Core of business and technology, Contribute to improve resource productivity &reduction of CO2 emissions, Service enabling to create both social value and customer value
Dan-Totsu product（New tire）

use

Retread（1st）maintenanceuse

Retread（2nd）maintenance

Monthly subscription package

All in one package includes new tire, maintenance and retread, to maximize usage throughout the life of tire
13/30

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Sustainability Business Framework: Retread centric model■ Contribution to environment through the life cycle of tire
Procurement

Production

Sales

Tire Usage ／ Vehicle Operation

New tire (conventional ) × 3

Resource productivity（Efficient use of resources)

RetreadRecycleGreenhouse gas emissions(calculated based on CO2 emissions)

Fuel efficient new tire ＋ Retread tire × 2＊＊＊Calculated based on Tire LCCO2 Calculation Guideline Ver 2.0 (The Japan Automobile Tyre Manufacturers Association, Inc.), example - Truck & Bus tire (275/80R22.5)

Social
value

14/30

• Contribute to increasing resource productivity,
reducing raw material usage by retreading several times• Reduce CO2 emissions in tire production process

Customervalue

Confidential S2• Contribute customer and partner’s sustainability
activities to realize a more sustainable society

Sustainability Business Framework: Retread centric model■ Social value and customer value creation by Dan-Totsu solutions
Procurement

Production

Sales

Tire Usage ／ Vehicle Operation

RetreadRecycleProvide subscription package to customer- Tire usage + Vehicle operation support + Maintenance + Retread

Subscription package

RetreadTire monitoring

Provide customized retread based ontire X vehicle data
Maximize tire asset by several times retread

Collect tire data by customers, feedback to
customized retread and maintenance

MaintenanceSupport fleet operation

Provide high quality maintenance through
Dan-Totsu solution network

Support transportation with piece of mind and safety
Prevent mobility down ・ Keep optimal operation

Optimize fleet operation by vehicle operation data

Increase resource productivity & Reduce CO2 emission

SafetyProductivity

Optimize total operation cost

Environment
EconomyCreate both social value and customer value, gain competitive advantage, as a core of sustainability business model
15/30

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Sustainability Framework

Sustainability
Business Models

Build trust to propagate
value co-creation
Management Fundamentals
for value creation

16/30

Mobility Contribution Model<Bridgestone T&DPaaS>- Product & Solution Innovation- Mobility System Solutions- Road Safety and Consumer Education

Contribute to
Circular Economy- Resource Productivity- Resource Circularity(Material / Product circularity )Contribute to CO2 Reduction- Accelerate Clean Energy Introduction- CO2 Reduction Contribution

Support to expand businessmodel for value co-creation- People Solutions: AHL (Active and Healthy Lifestyle) business

Build trust
for value co-creation- In harmony with Nature: Water stewardship, Biodiversity- Community Development- Worldwide Olympic and Paralympic Partner

Compliance, Fair Competition

Corporate Governance, Ethics & ComplianceBusiness Continuity,
Risk Management

Business Resilience(incl. Climate Change), Cybersecurity and Data Privacy

Human rights, Labor Practices/ Procurement

Social Supply Chain & HR (HR Due Diligence), Sustainable Sourcing incl.
NR, Diversity & Inclusion, Talent

Quality Management

Product & Solution Safety, Quality and Reliability, Occupational Health,
Safety and Wellness, Air Quality, Waste & Hazardous SubstanceConfidential S2

ESG activities

December 22, 2020
Corporate Sustainability Department
General Manager

Akihiro Inatsugi
17/30

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Environmental Mission Statement, Long-term Environmental Vision and
Mid Term Environmental Targets “Milestone 2030”

18/30

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Progress of Mid Term Environmental Targets: Milestone 2020
In harmony with nature

Value natural resources

Reduce CO2 emissions

Water Withdrawal
Intensity

Resource
Productivity

CO2 Intensity

reduction

improvement

reduction(Scope1,2)

Bridgestone group reached Milestone 2020 goals in 2019, ahead of schedule.
19/30

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Focused Targets for New Mid Term Environmental Targets: Milestone 2030
In harmony with nature

Value natural resources

Reduce CO2 emissions

Improveenvironmental impact

Accelerate circular economy
adoption in our business

Reduce emissions across the productlifecycle and entire value chain

Reduce water risk

Enhance Material Circularity*1

Execute water stewardship plan atmanufacturing facilities in water stress areas

Increase ratio of recycled andrenewable material to 40%*1: A concept to show circularity of raw materials. The Bridgestone Group uses theratio of recycled materials and renewable materials to total raw materials as theindicator for Material Circularity.

20/30

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Reduce absolute CO2 emissions,Contribute to CO2 reduction
Reduce our absolute CO2 emissions (Scope 1and 2)
by 50% (base year: 2011 )Contribute to global CO2 emissions reduction

across the lifecycle and value chain (Scope 3) of our products
and services exceeding five times our operation’s(Scope 1 and 2) CO2 emissions (base year: 2020 )Progress of CO2 Emission Reduction (Scope1,2)
5

Milesto ne 2030

Base year(2011)(Focused Target)

100%

4.5

90%
80%

3.5

70%
3
60%
2.5
50%
2

40%

1.5

30%

1

Long-term Environmental Vision

20%

Contribute towards carbon neutral

10%(2050 and beyond)

0.5
0

2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050

CO2 emissions (Scope 1+2) (Mt-CO2)

4

Scope1: Direct emissions from owned or controlled sources.
Scope2: indirect emissions are from the generation of purchased energy.

21/30

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0%■ Action to reduce CO2 emissions,linked with Mid-Long TermBusiness Strategy■ Maximize energy efficiency- Improvement in manufacturing- Restructure of manufacturing footprint& business portfolio■ Increase use of renewable energy■ Enhancement of circular economy- Reduction of energy consumption at
production by enhancing reuse(retread, etc.)- Improvement of energy efficiency byenhancing resource productivity■ Promote manufacturing andengineering innovation

Increase Use of Renewable Energy■ Renewable Energy Ratio (Electricity)■ Introduction of Large-scale Solar Power Generation Systems to
Manufacturing Sites

10%
8%
6%
4%
2%
0%

2015

2016

2017

2018

Wuxi plant, China (3MW)2019■ Renewable Energy Ratio in EU region (Electricity)
2019

2020

Category

Manufacturing Site

Tire

BurgosBilbaoPuente San MiguelPoznanStargard
Tatabanya

Hungary

Spain

Spain

83%

(Estimate)

0%

22/30

■ Manufacturing Sites with 100% Renewable Energy Use in Electricity

35%(Actual)

20%

40%

60%

80%

100%

Pune plant, India (1MW)

Cord

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Achieved 100%

Spain

2018-

Poland20202018-

Approach for Sustainable Natural Rubber■ Through industrial body

■ As individual company■ Supporting smallholders
Providing rubber tree seedlings and technical training developedfor its own farms

GLOBAL PLATFORM FOR SUSTAINABLE NATURAL RUBBER■ Leveraging big data to implement optimal plantation
for higher yield
The newly developed system seeks an optimal tree planting plan overmore than 30 years, which improves and stabilizes the plantation yield.
This enhanced system contributes to the sustainable and stable supply ofnatural rubber■ Co-creation/collaboration with stakeholders■ Collaboration with WWF forsustainable natural rubber■ Multi stakeholder platform
Actively involved as a founding member and member of
Executive committee■ Joint Development of High-Precision
Para Rubber Tree Disease Diagnosis
Technology
Technology that utilizes artificial intelligence (AI) image analysis to diagnoseand detect disease in Para rubber trees. The initiative is a joint project with
Information Services International-Dentsu, Ltd. (ISID)

Approved at General assembly in 2020
- Members’ sustainability policy framework- New membership category for smallholders
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Approach for Sustainable Supply Chain■ Global Sustainable Procurement Policy■ Implementing the policy■ Conducting third party assessment
50% of tier 1 tire material suppliers completed assessment (as of Nov 2020)
Covered more than 90% of natural rubber suppliers on purchase volume in 201959% of assessed suppliers confirmed compliance with the sustainable procurement
practices.
Percentage of suppliers whocompleted assessment

100%

Suppliers confirmed compliancewith the sustainableprocurement practices

80%
60%

59%

40%
20%

41%

48%

50%

0%
2019
2020
2May
019年
5 月 2Mar0 2 02020
年 3 月 2Nov
020年
11月

Launched by 12 language in Feb 2018
24/30

■ Capacity building for suppliers (in 2019)
Visited three natural suppliers to support their ESG activities
65 suppliers attend sustainable procurement seminars
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Sustainability Recognitions■ Major sustainability indices (as of December 2020)

CDP Climate Change, Supplier Engagement : A
Water Security : A-

DJSI Asia Pacific(11 years in a row)

FTSE4Good Index Series(3 year in a row)

STOXX Global
ESG LeadersEuronext Vigeo
World 120 Index

World’s most
reputablecompanies

Global CSRAwards(2 years in a row)

■ Sustainability indices in Japan (as of December 2020)

GPIF selected ESG idices
・FTSE Blossom Japan Index
・MSCI Japan Empowering
Women Index
25/30

Nadeshiko Brands(7 years in a row)

PRIDE index
Gold(3 years in a row)

Eco-first
programmembers(2011~)

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EcoVadis Gold

(Bridgestone Europe)(29th)(BSCAP: Platinum,
BSTVN: Gold)Towards 2021

26/30

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Global Business Scenario : Looking toward 2030
COVID19
impact2020

2021

Gradual recovery from 2H

Gradual recovery

2022

2023

RecoveryCrisis management

Transformed“Strong” Bridgestone

Rebuild earning power

Stage

Strategic growth investment■ Rebuild earning power■Cash oriented
management

Reformation of expense and cost structure:

Restructuring of business portfolio (Yr21-22) & mfg. footprint
Reallocation of resources
Operational excellence: Premium business strategy (EtoE)

Tire & Rubber

A(2019 Actual)

27/30

Growth Business: Retread / Webfleet Solutions

Solutions

Process
HRX*1

B/C
15%

・ Leaner, flexible to adapt tochange in business environment
・ Core Business:
Strengthen premium category biz
・ New business portfolio
・ Profitable resilient business structure■ Realize new growth strategy■ Strategic growth investment
Solution business related sales

Enablers
forexecution■ Reforms■“Safety First”

Strategic
Focus

2030 and beyond

Global expansion of solutions

Growth Business :Expansion of solutions business
Tire & Rubber

SolutionsCore Competence: Sustainability businessDX / Innovation

Sustainability
at the core
■ Build BS uniquebusiness model・ Expansion and evolution ofsolutions biz with strong Core Biz- Bridgestone T&DPaaS -■ Realization of sustainability
business framework
・ Build biz model including
recycle biz

Target – Environmental contribution

Reduction of CO2 emission(Plan in 2023 as of Oct 2020)

2030: 50% reduction
2050~: Carbon neutral

Global KPI(PDCA)
New management index (ROIC, Adjusted Operating Profit and ROE）
Foundation of financial strategy (“Glocal” investment management）

Resource circulation

Core Business*2 -culture transformation, Growth Business*2- new culture creation
Fundamental transformation of org. and HR system,*1 HRX: Human Resource Transformation*2 Core Business: Tire & Rubber business,
Enhancing recruitment & development
Growth Business: Solutions businessIn harmony with nature

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2030: Increase ratio of recycled andrenewable material to 40%
2050~: 100% sustainable material
2030: Water stewardship plan
2050~: In balance with nature2nd Year of Bridgestone 3.0, the “Third Foundation”

28/30

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Communication Plan
Mid-Long Term Business Plan Framework - July 8

1st half financial results announcement – August 7■ Mid-Long Term Business Plan Framework: Whole picture■ 1st half financial results / full-year forecast■ Mid-Long Term Business Strategy Update:Core Business / Growth Business

Bridgestone 3.0 “Third Foundation”

3rd quarter financial results announcement – November 12

Mid-Long Term Business Strategy Update – September 15■ Mid-Long Term Business Strategy Update:Technology Innovation■ 3rd quarter financial results / full-year forecast■ Mid-Long Term Business Strategy Update：・ Technology Innovation

・ Rebuild earning power・ Bridgestone Innovation Park (Phase 1)

・ HRX*

Bridgestone Innovation Gallery Opening- HR and organizational strategy to execute Mid-Long
Term Business Strategy

Year-end press conference 2020 – December 22

Mid Term Business Plan – February 16, 2021

■ Wrap up of year 2020
■ Mid-Long Term Business Strategy Update:
Sustainability Business Framework■ Mid Term Business Plan Based on
Mid-Long Term Business Strategy Framework (2021-2023)■ Looking toward 2030

29/30

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Statements made in this presentation with respect to Bridgestone's current plans, estimates, strategies and beliefs and other statements that are nothistorical facts are forward-looking statements about the future performance of Bridgestone. Forward-looking statements include, but are not limited to,those statements using words such as "believe," "expect," "plans," "strategy," "prospects," "forecast," "estimate," "project," "anticipate," "may" or "might"
and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. From time to time, oral or
written forward-looking statements may also be included in other materials released to the public. These statements are based on management's
assumptions and beliefs in light of the information currently available to it. Bridgestone cautions you that a number of important risks and uncertainties
could cause actual results to differ materially from those discussed in the forward-looking statements, and therefore you should not place undue reliance onthem. You also should not rely on any obligation of Bridgestone to update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. Bridgestone disclaims any such obligation.

Copyright © Bridgestone Corporation