Annual Report 2009
Year ended March 31, 2009

Turning a New CornerMitsubishi Motors Corporate Philosophy“We are committed to providing the utmost
driving pleasure and safety for our valued customers and our community.
On these commitments we will never compromise. This is the Mitsubishi Motors way.”

01

Consolidated Financial Summary

02

To Our Shareholders and Stakeholders

04

Performance Review and Outlook

06

A clear direction for the development andmanufacturing of Mitsubishi Motors vehicles
The cars that Mitsubishi Motors will manufacture will embody
two major concepts: driving pleasure and safety. Mitsubishi
Motors will manufacture cars that deliver superior driving
performance and superior levels of safety and durability, andas such, those who use them will enjoy peace of mind.

Going the extra mile
Mitsubishi Motors will pay close attention to even thesmallest details in the belief that this approach will leadcustomers to discover new value in their cars, giving them aricher and more rewarding driving experience.

Importance of continuity
Mitsubishi Motors will continue to manufacture distinctive
cars with the passion and conviction to overcome all
challenges.

Forward-looking Statements
This annual report contains forward-looking statements about Mitsubishi
Motors Corporation’s plans, strategies, beliefs and performance. These
forward-looking statements are based on current expectations, estimates,
forecasts and projections about the industries in which Mitsubishi Motors
Corporation operates, as well as management’s beliefs and assumptions.
These expectations, estimates, forecasts and projections are subject to anumber of risks and uncertainties that may cause actual results to differ
materially from those projected. Mitsubishi Motors Corporation, therefore, cautions readers not to place undue reliance on forward-looking
statements. Furthermore, Mitsubishi Motors Corporation undertakes noobligation to update any forward-looking statements as a result of new
information, future events or other developments.

16

Year ended March 31, 2009

Special Feature:
New-Generation Electric Vehicle

Customer-centric approach
Mitsubishi Motors will give the highest priority to satisfying
its customers, and by doing so, become a company thatenjoys the trust and confidence of the community at large.
To this end, Mitsubishi Motors will strive its utmost to tackle
environmental issues, to raise the level of passenger androad safety and to address other issues of concern to car
owners and the general public.

Annual Report 2009

Contents

08

Interview With the President

10

New-Generation Electric
Vehicle i-MiEV

Regional Topics

16

Japan

17

North America

18

Europe19

Asia and Other Regions

20

Quality21

Corporate Governance

22Internal Control Systems and Risk Management

23

Compliance25

Activity Report by the Business Ethics Committee

26

Management27

Responsibility to Society

28“Mitsubishi Motors Group Environmental Vision 2020”

29

Financial Section

66

Consolidated Subsidiaries and Affiliates

68

Principal Plants

69

Investor Information

Consolidated Financial Summary
In millions of yen

In thousands of
U.S. dollars

FY2004

FY2005

FY2006

FY2007

FY2008FY2008¥2,122,626¥2,120,068¥2,202,869¥2,682,103¥1,973,572$20,091,343

Operating income (loss)(128,544)

6,783

40,237

108,596

3,926

39,971

Income (loss) before income taxes
and minority interest(460,906)(82,745)

23,104

48,151(53,717)(546,850)

Net income (loss)(474,785)(92,166)

8,745

34,710(54,883)(558,728)

In yenIn U.S. dollars

For the year:
Net sales

Per share data:¥(194.36)¥(19.75)

¥1.59

¥6.30

¥(9.91)$(0.10)

Diluted

–

–

0.96

3.81

–

–

Cash dividends

–

–

–

–

–

–

In millions of yen

In thousands of
U.S. dollars

Net income

At year-end:
Total assets¥1,589,286¥1,557,570¥1,778,693¥1,609,408¥1,138,009$11,585,153

324,782

268,678

308,304

328,132

223,024

2,270,431

Total net assets

Notes: 1. U .S. dollar amounts in the accompanying consolidated financial statements are converted, solely for convenience, at a rate of¥98.23 = U.S. $1.00, the exchange rate prevailing on March 31, 2009.
2. T he assets and liabilities of truck and bus operations are not reflected in each account because these operations were spun off
and subsequently became an equity-method affiliate of MMC on March 14, 2003. Furthermore, all remaining shares held by
MMC had been transferred to other parties by the end of March 2005.

Net Sales
0Operating Income (Loss)
500

1,000

1,500

2,500

2,000

08

3,000

–100

–50

0

50

05

2,120.105

04

2,122.604(FY)(¥ billion)

2,000(¥ billion)

108.6
40.2

06

2,202.9

150

100

3.9

07

2,682.1

06

–150

08

1,973.607

6.8–128.5(FY)

Net Income (Loss)
–600

–500

08

Total Assets
–400

–300

–200

–100

100

0

(¥ billion)

08
34.7

07

8.7

06
05
04

0

–54.9

07

(FY)

–200

(¥ billion)

500

1,500

1,000
1,138.0

1,609.4
1,778.7

06–92.2–474.805

1,557.6

04

1,589.3(FY)

Annual Report 2009 mitsubishi motors corporation

01

To Our Shareholders and Stakeholders
The Mitsubishi Motors Group’s vision for addressing environmental issues is “Leading the EV era, towards asustainable future.” To realize this vision, we have started mass production of the new-generation electricvehicle i-MiEV and have begun rollout of the i-MiEV in Japan, looking to expand rollout globally.
In fiscal year 2008, the financial crisis that began in the U.S. went
on to have a major impact on other economies worldwide. The
auto industry was impacted directly by the unparalleled speed,
breadth and depth of the crisis. In fiscal year 2009, automobile
sales continue to struggle in markets around the world.
These circumstances notwithstanding, we believe that our
mission as an automaker is to take concrete actions to help
create a low-carbon society.
On June 5, 2009, World Environment Day, we announced the
Mitsubishi Motors Group Environmental Vision 2020. This vision
will guide our environmental activities until 2020 under the policyof “Leading the EV era, towards a sustainable future.”
The vision will propel MMC’s environmental activities in technological development and business operations, with electricvehicle technology leading the way. Our aim is to help build apleasing and low-carbon society in partnership with customers
and communities around the world.

02

mitsubishi motors corporation Annual Report 2009

As the first step to realizing our vision, we have started mass
production of the new-generation electric vehicle i-MiEV andhave begun rollout of the i-MiEV in Japan, looking to expand
rollout globally. Around 100 years have passed since the mass
production of automobiles began. Today, we see electric vehicles
as the pinnacle technology that will play a crucial role in theautomobile’s next 100 years. In this sense, we look forward to“Driving into the Next 100 Years” with customers and stakeholders, as we work to rapidly create a low-carbon society.
August 2009

Takashi Nishioka
Osamu Masuko
Chairman of the Board	PresidentDrive@earth means that automobiles
connect us to the world. Through trust,
Mitsubishi vehicles forge a connection tocustomers, to communities, and ultimately
to the natural world around us.
Drive@earth also means a newemphasis on environmental issues. It is
the simple recognition that no enterprise
makes sense without the context of ahealthy planet, and that automakers havea special responsibility in this regard.
MMC sets as its ideal the synergy
between dynamic and environmental
performance, and will continue todevelop technologies that show asmuch care for the environment
outside as for the occupants within
its vehicles.

Takashi Nishioka
Chairman of the Board

Osamu Masuko
President

Annual Report 2009 mitsubishi motors corporation

03

Performance Review and Outlook
In September 2008, the Japanese automobile industry was confronted by three serious problems triggeredby the collapse of a major U.S. financial institution. The first was rapid deterioration in retail sales volume.
Although, in certain areas, market conditions had been relatively favorable until then, the market rapidly contracted, with demand virtually vanishing, resulting in an unprecedentedly harsh business environment. The
second problem was the credit crunch. For many customers who use auto loans, purchasing an automobile
became difficult. The third issue was the yen’s appreciation against foreign currencies. Because the yen
strengthened not only against the U.S. dollar but also against other major currencies, export industries inJapan, including the domestic auto industry, were severely impacted.

Mitsubishi Motors Corporation’s Approach
Fiscal Year 2008 Financial Results

Response to the Economic Crisis (Emergency Measures)

Secured Operating Profit Amid a Rapidly
Worsening Business Environment

Enacted Rigorous Cost Cuts from October
2008 in Response to the Economic Crisis

Fiscal year 2008 was the first year of MMC’s Step Up 2010
mid-term business plan. During the fiscal year, MMC worked
in earnest to bolster its strengths and generate steady profits.
In response to the unexpectedly severe financial crisis, MMC
implemented emergency measures, including production
cutbacks to curb excess inventories and additional rigorouscost-cutting measures. However, because of the sharp
decline in retail sales volume and the impact of the yen’s
appreciation, all major income statement items, namely net
sales, operating income, ordinary income, and net income,declined year on year.
Retail sales volume dropped 294,000 units, or 22%, year
on year, to 1,066,000 units. Reflecting lower sales volume andthe stronger yen, net sales fell ¥708.5 billion, or 26% year on
year, to ¥1,973.6 billion. Operating income dropped ¥104.7
billion year on year. The main factors behind the decline inoperating income were lower sales volume and the yen’s
appreciation. However, thanks to across-the-board costcutting programs and operational improvements, including
restructuring in the previous fiscal year, MMC posted a positive operating income of ¥3.9 billion. Despite improvement in
net interest income (expenditure) and net foreign exchange
gains (losses), ordinary income decreased ¥100.6 billion year
on year to an ordinary loss of ¥14.9 billion due to the lower
operating income. Furthermore, because of the lower ordinary
income, net income fell ¥89.6 billion year on year to a net lossof ¥54.9 billion.

Since October 2008, MMC has worked to rigorously reduce
costs as emergency measures to address the economic crisis.
In addition to production cutbacks to curb excess inventories,
MMC decided to suspend its long-standing and continuous
participation in the Dakar Rally from 2010, and reexamined its
participation and the extent of its involvement in overseas
motor shows. In addition, to instill a sense of urgency in theentire workforce, MMC deepened corporate officers’ remuneration cuts, reduced salaries of management-level employees, reexamined levels of employee bonuses, and set
furlough days.
Turning to capital expenditures, while freezing nonessential investments, MMC scrutinized investments more
carefully than before from the standpoint of prioritizing
funds, giving priority to allocating funds to future initiatives
centered on environment-related investments.
In addition, MMC is taking steps to increase operational
efficiency, including personnel systems, at production, development, and distribution overseas, including Europe.

Analysis of Operating Income (vs. FY2007 Actual)
FY2007
Actual

FY2008Actual

–1,0471,086(100 million yen)

–720
+174
Volume/ Selling
Mix
Expenses

–761

39
+335

Forex

–123
Financialservice
operations

04

mitsubishi motors corporation Annual Report 2009

–317

+365

Others

Impact of Cost
higher raw reductions
materials
costs

Osamu Masuko
President

Performance Outlook for Fiscal Year 2009Market Outlook for Fiscal Year 2009

Recover from Low Sales and Low Profit
Through Cost Reductions, Aiming for ¥30
Billion Operating Income and ¥5 Billion in
Net Income

Produce Cars that Meet Individual Countries’
Needs in the Midst of Increasing Concern
about the Environment and Fuel Economy

MMC expects inventory levels to normalize within the firsthalf of fiscal year 2009. However, global auto market conditions remain very challenging, except in China and certain
other markets. MMC forecasts a further strengthening of theyen, lower retail sales volume and net sales in fiscal year 2009,
so MMC will not ease off on its emergency cost-cutting measures currently in place. In fact, MMC will step up rigorous
cost reductions, including labor costs, sales costs, and material costs, aiming to achieve a positive operating income of¥30.0 billion and a net income of ¥5.0 billion.

FY2009 Results Forecast Summary (vs. FY2008 Actual)

Analysis of Operating Income (vs. FY2008 Actual)(100 million yen/000 units)

FY2008Actual1

FY2009Forecast2

Change
2–1

Net Sales

19,73615,000–4,736

Operating
Income

39

300

+261

–149

150

+299

Ordinary Income(Loss)In Japan, MMC expects retail sales volume to increase as aresult of policies aimed at stimulating automobile demand,such as the Japanese government’s subsidies for purchasingcertain new vehicles (scrap incentives, etc.). Additionally,
while MMC does not foresee a rapid recovery in retail sales
volume in Europe, the U.S., and markets in other industrialized nations, MMC sees opportunities for growth in retailsales volume in emerging markets. For example, MMC
believes the sales volume in China, where government economic stimulus measures and policies to sustain growth have
proven successful, has the potential to increase. However, in
Russia and the Ukraine, which MMC has positioned as key
markets and where MMC is aggressively working to expand
sales, latent growth potential still looks promising, but MMC
expects market recoveries will take some time. How fast eachmarket’s demand will recover will differ; but MMC will continue to produce cars that meet the needs of each individual
market supported by government stimulus policy.

FY2008Actual

FY2009Forecast+261(100 million yen)

300
39

+571
–570
Others+290

Net Income(Loss)

–549

50

+599

Sales Volume(retail)

1,066

932

–134

USD101
EUR144
AUD81

USD92
EUR116
AUD60

Assumed Forex Rate
(Yen)

Volume/ Selling
Mix
Expenses

–710

+680

Forex Combined impact ofhigher raw material
prices/cost reductions

Note: S ales volume figure excludes OEM supplies.
Annual Report 2009 mitsubishi motors corporation05

Special Feature: New-Generation Electric Vehicle i-MiEV

The Pioneer that Will Open the Door to the
Next 100 Years of the Automobile Debuts on
the World Stage
08

Interview With the President“Driving into the Next 100 Years”
With Customers and Stakeholders

10

New-Generation Electric Vehicle i-MiEV

1 Events Leading to

the Conception of the i-MiEV
2 Features of the i-MiEV
3 Paving the Way for the Popularizationof Electric Vehicles

06

mitsubishi motors corporation Annual Report 2009

The i-MiEV being “quick charged”
at a shopping center in Japan.

Annual Report 2009 mitsubishi motors corporation

07

Interview With the President“Driving into the Next 100 Years”
With Customers and Stakeholders

The June 2009 i-MiEV launch in Tokyo
From left: GS Yuasa Corporation President Makoto
Yoda, Mitsubishi Motors Corporation President
Osamu Masuko, Mitsubishi Corporation Senior
Executive Vice President Hisanori Yoshimura. The
three companies established Lithium Energy Japan, alithium-ion battery producing joint venture in­December 2007.

President
Osamu Masuko

08

mitsubishi motors corporation Annual Report 2009

Mitsubishi Motors Group Environmental Vision 2020

“Leading the EV* era,
towards a sustainable future”*EV (electric vehicle): electric cars, plug-in hybrids, and other electric-powered vehicles.

The newly established Mitsubishi Motors Group Environmental Vision 2020 is a medium-term roadmap foraddressing environmental issues and sets specific targets to be achieved by 2020. These targets include cutting
global lineup CO2 emissions during the use of new vehicles by a weighted average of 50% from the 2005 level
and reducing per-vehicle CO2 emissions during production by 20% over the same time frame. The slogan of the
Mitsubishi Motors Group Environmental Vision 2020 is “Leading the EV era, towards a sustainable future.”
We view EVs—the ultimate eco-cars—as central to our business activities over the medium and long terms,
and as the driving force behind the Environmental Vision 2020.

Market Launch of the i-MiEV“The i-MiEV is the pioneer that will open thedoor to the next 100 years of the automobile”
MMC started developing EVs more than 40 years ago in 1966. Following extensive R&D over the years, werolled out the new-generation EV i-MiEV in July 2009. Today, with global warming becoming an increasingly
serious concern, we believe that automakers must take concrete actions to move today’s motorized society
away from its reliance on fossil fuels to one that enables a sustainable future for people and the planet.
Although EVs have some room to improve in areas of cost, charging time, and cruising range, they represent the ultimate in eco-cars, as they address all environmental issues—air pollution, global warming, and overreliance on fossil fuels. We believe that the launch of the all-electric i-MiEV embodies the challenges ofdeveloping a pinnacle technology and opening a new era for the auto industry and society as a whole.
Nearly a century has passed since the mass production of automobiles began. Today, we see the i-MiEV as
the pioneer that will open the door to the next 100 years of the automobile. We believe that the i-MiEV will playa vital role in broadening the understanding of EVs, promoting technological innovation and charging infrastructure development, and accelerating the widespread use of EVs.
In the i-MiEV’s first fiscal year, we are targeting a sales volume of 1,400 i-MiEV vehicles in Japan and 250
i-MiEV vehicles overseas, mainly in right-hand drive markets. In fiscal year 2010, we will phase in the i-MiEV in
left-hand drive markets, targeting sales of 6,000 i-MiEV vehicles worldwide.

Expanding our EV Lineup“Our target is for EVs to account for at least
20% of total production volume by 2020.”
Going forward, in addition to the i-MiEV, we will work to expand our lineup of EVs designed primarily for urban
driving. Meanwhile, to meet needs for long-distance driving, we will also press ahead with the development ofplug-in hybrids that leverage the advantages of EVs while extending the driving range.
Furthermore, our target is for electric-powered eco-friendly vehicles, including plug-in hybrids, to accountfor at least 20% of total production by 2020, the target year of our Environmental Vision. We will seek to grow
EV operations into a core business of Mitsubishi Motors Corporation.
Recognizing EVs as the pinnacle technology that will play a central role in the next 100 years of the automobile, we look forward to “driving into the next 100 years” with stakeholders and customers, as we help to makea low-carbon society a reality.

Annual Report 2009 mitsubishi motors corporation09

New-Generation Electric Vehicle i-MiEV

1

Events Leading to the Conception of the i-MiEV
MMC has poured all of its achievements in EV technology research, dating back to 1966,
into its new-generation electric vehicle, the i-MiEV. The road to market launch has been
paved with a wide range of rigorous testing, including extended rough road testing, waterresistance testing, and crash testing. Following enhancements to basic vehicle performance,
comfort, and practicality through 500,000 km of proving tests, the i-MiEV was born.

1966

Adoption of Lithium-ion Batteries:
The Challenge of Reducing Battery Weight2009

Until the beginning of the 1990s, lead-acid batteries were the predominant power source for electric vehicles,
but the weight of these batteries was a bottleneck to commercialization, as they accounted for around half thevehicle weight. MMC quickly focused on lithium-ion batteries, which can be made compact and lightweight
while offering superior energy and output density. By utilizing lithium-ion batteries, the i-MiEV became commercially feasible with a battery-to-vehicle weight ratio of less than 20%.
History of EV development at Mitsubishi Motors

1970

1980

1990

Reducing global warming

Reducing atmospheric pollution• U.S. Clean Air Act Amendment• U.S. ZEV Law
Zero-emission vehicle bill in the U.S.

 tart of government/private sector joint
Sdevelopment of EVs

Libero EV

Minica EV/Minicab EV

2000

FTO EV

Lead-acid battery

2010
Reducing oil dependency• Kyoto Protocol becomes operative
Toward a low-carbon society

i-MiEV

Lithium-ion battery

Packaging that Effectively Utilizes a Rear-Midship Layout
The i-MiEV was developed based on the “i” minicar. The long wheelbase, a feature of the “i” minicar’s rearmidship layout, provides space for high capacity lithium-ion drive batteries under the floor and for the power
unit under the luggage compartment. This layout provides a driving range that is ample for everyday use without sacrificing the generous seating and luggage space of the “i” minicar.

Gasoline-powered i

i-MiEV

InverterOn-board charger &DC/DC converter

10

mitsubishi motors corporation Annual Report 2009Engine &transmission

Motor &
transmission

Fuel tank

Drive battery pack

Fleet Tests Under Actual Driving Conditions With Electric Power Companies and Other Partners
Heading toward market launch, in addition to repeated internal testing, MMC conducted joint research withseveral Japanese electric power companies to confirm the i-MiEV’s acceptability as a commercial vehicle forelectric power companies, which are envisioned as fleet customers. These fleet test runs are also aimed at
checking the vehicle’s compatibility with the quick-charge stations being developed by electric power companies and assessing the vehicle’s utility under various conditions in various regions of Japan. MMC is also putting
the i-MiEV through a wide array of other test programs, including fleet tests in police duties with Kanagawa
Prefecture, proving tests with Japan’s Ministry of Environment, and evaluations by Japan Post Service Co., Ltd.,
Lawson, Inc. and other companies.
MMC has made steady progress toward the development of a production model based on data obtained
through fleet tests conducted under various usage and weather conditions.

Roadmap to commercialization

2006

2007

2008

2009

Advance researchMarket launch (Japan)

Joint research
Joint research, fleet
testing with powercompanies

Tokyo Electric Power, Chugoku
Electric Power, Kyushu Electric
Power

Fleet testing
Tokyo Electric Power, Chugoku Electric Power, Kyushu Electric Power,
Hokkaido Electric Power, Kansai Electric Power, Okinawa ElectricPower, Hokuriku Electric PowerThe Pursuit of Safety
The high-voltage system, battery pack included, is located inside the i-MiEV’s body frame and is further protected by a well-crib frame and under cover against damage from bumps in the road surface and from any
direction of impact.
The MiEV OS (MiEV Operating System) integrated vehicle management system constantly monitors battery
status, ensuring safety by cutting-off high-voltage circuits when alerted to a collision, electrical leakage, or otherincident. The advanced management system uses sophisticated integrated control technologies to control theenergy recovered from the regenerative brakes while regulating output to ensure smooth and powerful acceleration from a full stop. As a result, the system minimizes energy consumption while delivering driving performance that is comfortable, safe, and reassuring.

Safety &Reassurance
Battery management system
High-voltage control system
Available range estimation
Traction control

Inverter

EV-ECU:•Battery management system

Combination meter•High-voltage control system•Available range estimation
Permanent magnet
synchronous motor•Traction control•Smooth acceleration control

On-board charger
DC/DC converter•Residual battery charge
estimation

MiEV OS(MiEV Operating System)
Regenerative braking control
Power save control

EnergysavingBattery management
unit•Regenerative braking control
A/C & heater•Power save control

Smooth acceleration control
Residual battery charge
estimation

Lithium-ion battery(Drive battery)Occupant
comfortInputs fromthe following ECUs:

Driver inputs:•Air bags •ABS
•ETACS•Accelerator•Shift selector•Brakes

Annual Report 2009 mitsubishi motors corporation11

New-Generation Electric Vehicle i-MiEV

2

Features of the i-MiEV
In addition to the ultimate in environmental
performance, the i-MiEV, which offers quiet,smooth, and powerful takeoff power,
boasts five distinct features.

Zero drive-time CO2 emissions
The all-electric i-MiEV is a zero-emissions vehicle (ZEV) which produces no CO2 emissions while being driven(Even when the CO2 emissions at power generating stations are taken into consideration, the i-MiEV generates
approximately one-third of the CO2 produced by the gasoline “i” minicar (Calculated in-house based on the
average of electric energy frameworks in Japan)).
Charging-to-driving process

NormalOn-board

charging

charger

Power supply

Drive battery

Inverter

Motor

Transmission

Driving

Quick charging

Charging

Electricity

Regenerative

generation

brakesDriven 100% by electrical power
The only cost the i-MiEV incurs to run it is electricity expense. Also, depending on electric power company ratefees, the running cost can be minimized by charging the battery when off-peak (late night) rates apply. In June
2008, the i-MiEV covered the roughly 860 km from Tokyo to Lake Toya at a power cost of approximately 1,700 yen
at the CO2 Reduction EV Lake Toya Caravan* project held on the occasion of the G8 Hokkaido Toyako Summit.

* held by the Japan Electric Vehicle Club12

mitsubishi motors corporation Annual Report 2009

Quiet, agile, comfortable performance
EVs are intrinsically quiet because they do not run on internal combustion engines. The i-MiEV delivers evengreater quietness through focused improvements in motor noise, drive train noise, and road noise. Also, leveraging its superior response and high low-end torque inherent to its electric motor, the i-MiEV achieves a level of
responsive and powerful performance that surpasses that of the gasoline-powered turbo engine “i” minicar.
External noise comparison

Acceleration from rest comparison
0-80km/h

2dB(A)

0-400m0-80km/h(2WD i-Turbo)(2WD i-Turbo)

0-400mNoise level dB (A)Full acceleration from 50km/hr (In-house measurements)

0

5

10

15

20

25

Time (second)(In-house measurements)

Ample range for everyday use
The i-MiEV has a single-charge cruising range of 160 km in the Japanese 10-15 mode urban driving pattern*1.
While the actual range is affected by such factors as the use of climate control and driving patterns, taking into
account the average Japanese daily driving distance*2, the i-MiEV achieves a range that is ample for everyday use.

Normal charge and quick charge
The i-MiEV’s drive battery can be charged at various locations, whether at home or when out and about. For
normal charging, the drive battery is connected to either a standard 100-volt or 200-volt household outlet.
The i-MiEV’s battery can also be charged at quick-charge stations, which are currently being establishedthroughout Japan.

Normalcharging:
200 volts AC

Normalcharging:
100 volts AC

Quickcharging

MethodNormalCharging
Quick
Charging

Power source

Charge Time* (amount)

200V AC (15Amp)

Approx. 7 hours (full charge)

100V AC (15Amp)

Approx. 14 hours (full charge)

200V 3-phase 50 kW

Approx. 30 mins. (80% charge)(Using a quick-charging station)*Charging time calculated from power-down warning light indication.
These times are to be used as a guide. Actual charging times may vary depending on suchfactors as air temperature and power source status.

Ordinary households, etc.

Quick charge stations*1: 10-15 mode is a specified test standard set by the Japanese Ministry of Land, Transport, and Infrastructure used to calculate cruising range. The actual range differs
according to a driver’s usage environment (weather, traffic conditions, etc.) and driving habits (e.g., sudden takeoffs, climate control system usage).
*2: A nationwide survey in Japan indicates that on average 90% of car drivers cover less than 40 km/day on weekdays and that 80% cover less than 60 km/day atweekends and holidays (in-house research).

Annual Report 2009 mitsubishi motors corporation

13

New-Generation Electric Vehicle i-MiEV

3

Paving the Way for the Popularization ofElectric Vehicles
There are growing expectations for electric vehicles on a global scale as a means of making a
low-carbon society a reality. With a cooperative framework encompassing national and local
governments, and the private sector, MMC, as a leading electric vehicle company, will play a partin popularizing electric vehicles. This will be done by working to broaden the understanding ofelectric vehicles and to promote technological advances and infrastructure development.

i-MiEV Global Evaluation

Iceland

From Fall 2009

CanadaFrom Spring 2009

Europe (15 countries)
From Fall 2008

Japan

From Fall 2006

Hong Kong

United States
From Fall 2008

From Spring 2009

New Zealand

From Spring 2009

EV-related Subsidies and Tax Incentives for Major Countries
Country

Benefits Available at Purchase of Electric Vehicle

Japan

Subsidy (1/2 of the difference in price from the base car)Acquisition Tax and Weight Tax exemptions

Various European
Countries

Either one of the below, or a combination thereof:
Subsidy (1,000€ – 6,000€)
Registration Tax reduction (up to 100%)
Automobile Tax reduction (up to 100%)
Road Tax reduction

United States

Income Tax deduction depending on battery capacity

14

mitsubishi motors corporation Annual Report 2009

As of May 2009

Mass Production of Lithium-Ion Batteries for Electric Vehicles
In December 2007, MMC, GS Yuasa Corporation, and Mitsubishi Corporation established Lithium Energy Japanas a three-way joint venture to mass produce lithium-ion batteries. Lithium Energy Japan will initially produce
200,000 cells annually (the number of cells needed for approximately 2,000 i-MiEVs) to make lithium-ion battery
packs for the i-MiEV at a new plant located in Kusatsu City, Shiga Prefecture, the world’s first facility for mass
producing high-capacity lithium-ion batteries for use in electric vehicles. From there, plans are to increase production capability as necessary.

Initiatives in Japan
Refining and Expanding Charging Infrastructure
The Ministry of Economy, Trade and Industry (METI) is promoting the “EV & pHV Town Concept” for the popularization of electric vehicles under the leadership of local governments as well as supporting charging infrastructure. METI is also working with the private sector to accelerate the build-up of charging infrastructure,including the establishment of quick charge stations and normal charge outlets, such as at parking lots, shopping centers, convenience stores, and gasoline stations.

National and Local Government Subsidy System
The Japanese government, which is working to popularize eco-friendly vehicles, will provide a ¥1.39 million
subsidy within this fiscal year at the time of i-MiEV purchase under a program to promote the sale of clean
energy vehicles. Local governments also have their own subsidy programs. For example Kanagawa Prefecture
has its own EV-focused subsidy program. These subsidy programs will strongly support broader usage of thei-MiEV.

Toward a Global Market
Currently, MMC is conducting surveys and fleet testing for i-MiEV commercialization in Europe, the U.S.,
Canada, New Zealand, Australia, Hong Kong, and other regions in cooperation with electric power companies,
and local governments eyeing global roll-out. Initial market launch is focused on the U.K. and other right-handdrive markets in fiscal year 2009. Plans call for the successive market expansion with the roll-out of left-handdrive vehicles from fiscal year 2010.

Tie-up with PSA Peugeot Citroën
In March 2009, MMC concluded a memorandum of understanding that will allow PSA Peugeot Citroën to partner with MMC for the development of an electric vehicle for Europe based on the i-MiEV, with production carried out by MMC. Plans are to begin supply to PSA Peugeot Citroën from the end of 2010 or beginning of 2011.
Roll-out Schedule for the New-Generation Electric Vehicle i-MiEV

Fiscal year 2009

Fiscal year 2010

Fiscal year 2011

Fiscal year 2009 sales volume target:
Approx. 1,400 vehicles

Japan

Retail sales
July 2009

Fleet sales
Approx.
250 vehicles

Right-hand drive vehicles (Hong Kong, U.K. and others)

Overseas

Fall 2009

Europe (including left-hand-drive markets)
For PSA Peugeot Citroën
Successively expand

Annual Report 2009 mitsubishi motors corporation

15

Regional Topics
In fiscal year 2008, the collapse a major of U.S. financial institution in the second half touched off a global
economic downturn of unparalleled speed, breadth and depth, and automobile retail sales volumes in markets around the world dropped drastically and also registered sharp declines on a full-year basis. In responseto this economic crisis, MMC implemented emergency measures, including production cutbacks to curtail
excess inventories and rigorous cost reductions.
The business environment is expected to remain challenging in fiscal year 2009. In response, we are taking
steps to improve our sales capabilities, especially in emerging markets, to boost sales, as we continue to rigorously cut costs.
Additionally, there is growing interest in the environmental aspects and economic efficiency of automobiles, including stronger support for small, fuel-efficient models in the economic policies of governments
around the world. Against this backdrop, MMC is aggressively investing in small fuel-efficient vehicles, including the i-MiEV and will introduce products that meet the needs of individual nations.

Japan
Market launch of the new-generation electric vehicle i-MiEV. MMC aims to restore profitability
through higher retail sales volumes and rigorous cost reductions.
Fiscal Year 2008 Performance
Retail Sales
Retail sales in Japan dropped 23% year on year to 168,000
units. In Japan, MMC aimed to increase sales through the introduction of new minicar series such as the Toppo in September
2008, and the Galant Fortis Sportback in December. However,these factors were unable to compensate for lower retail sales
due to the sharp decline in demand from the second half of the
fiscal year.

Net Sales and Operating Income (Loss)
In fiscal year 2009, MMC is targeting net sales in Japan of¥440.0 billion, an increase of 10% year on year. Aiming for a
return to profitability, MMC is targeting an operating income of¥19.0 billion, an improvement of ¥34.1 billion year on year. In
addition to higher retail sales, the main factors underlying thistarget are reductions in material costs and other costs, including personnel expenses and selling expenses centered on sales
promotion and advertising costs.

Net Sales and Operating Income (Loss)
Sales in Japan declined 18% year on year to ¥398.4 billion.
Despite lower sales volume, the operating loss shrunk ¥3.8
billion from the previous year to ¥15.1 billion. This improvement
reflected rigorous cost reductions undertaken as part of emergency measures and business restructuring focused on the
integration of consolidated sales companies in Japan.

Net Sales
0

200

100

400

300

500

09

600

(¥ billion)

20(¥ billion)

440.0 (Forecast)

08

398.4

07

488.5

06

506.0

(FY)

Outlook for Fiscal Year 2009
Retail Sales
In fiscal year 2009, MMC is targeting domestic retail sales of
195,000 units, or an increase of 16% year on year. This target isbased on anticipated benefits from new vehicle purchase subsidies, including governmental scrap incentives, and emergency
economic stimulus measures in the form of reduced taxes on
eco-friendly cars.
• New Products
Market Launch of the i-MiEV
MMC launched the new-generation electric vehicle i-MiEV in
Japan in July 2009. In fiscal year 2009, MMC expects to sell
approximately 1,400 units, mainly to corporate users andlocal governments.

Operating Income (Loss)
–50

–10

0

10

–15.1

07

–18.9

06 –43.8(FY)

Retail Sales
0(Thousand units)

50

100

200

150

09
08
06
(FY)

mitsubishi motors corporation Annual Report 2009–20

19.0 (Forecast)

08

07

16

–30

–40

09

250

195 (Forecast)
168
219
247

North America
MMC is working to improve earnings through rigorous cost reductions in the face of a stronger yen
and lower retail sales amid the continuation of a tough market environment.
Fiscal Year 2008 Performance
Retail Sales
Retail sales in the North American market fell 26% year on year
to 119,000 units in fiscal year 2008. Retail sales in Canada rose
6% to 19,000 units, but U.S. retail sales dropped 32% to 84,000
units due to a sharp decline in aggregate demand.

Net Sales and Operating Income (Loss)
Net sales in North America declined 42% year on year to ¥232.2
billion, reflecting lower sales and a stronger yen. The operating
loss deteriorated by ¥21.8 billion year on year to ¥39.6 billion
mainly due to the large impact of the drop in sales volume, theyen’s appreciation, and lower earnings from the sales financebusiness, despite emergency measures to reduce expenses.

Net Sales
0

200

100

400

300

09

170.0 (Forecast)

08

232.2

07

Based on expectations of the continuation of challenging
market conditions, MMC is targeting retail sales of 92,000 units,
or a decline of 22% year on year (59,000 units in the U.S., 19,000
units in Canada, and 14,000 units in Mexico).

(¥ billion)

10(¥ billion)

402.7

06

423.6

(FY)

Operating Income (Loss)
–50

–40

–30

09

–20

–10

0

–25.0

08

(Forecast)

–39.6

07

–17.8

06

Outlook for Fiscal Year 2009
Retail Sales

500

0.6

(FY)

Retail Sales
0(Thousand units)

50

100

09

92 (Forecast)

Net Sales and Operating Income (Loss)

08

119

Factoring in the effects of lower sales volume and the stronger
yen, MMC is targeting net sales of ¥170.0 billion, down 27%
year on year.
MMC is projecting an operating loss of ¥25.0 billion, an
improvement of ¥14.6 billion year on year. MMC expects cost
reductions, such as personnel costs and selling expenses,
including advertising costs; lower materials costs; and reduced
depreciation resulting from impairment losses on North­American production facilities recorded in fiscal year 2008 to
more than offset the impact of lower sales volume and theappreciation of the yen.

07
06

200

150

172
164

(FY)

* Puerto Rico’s results have been classified under “Asia and Other Regions” from 2008.

The Lancer Sportback (Japanese name: Galant Fortis Sportback) was rolled out inthe U.S. in summer 2009.

Annual Report 2009 mitsubishi motors corporation

17

Europe
Despite a temporary downturn in demand, Russia and the Ukraine remain promising markets. MMC
is introducing products that conform to individual governmental policies in support of small, fuelefficient models as part of an overall drive to expand sales opportunities.
Fiscal Year 2008 Performance
Retail Sales
Retail sales fell 20% year on year to 272,000 units. In addition tolower retail sales in Western Europe, where aggregate demandremains weak, retail sales dropped sharply in the second half ofthe fiscal year in Russia, where demand had been strong. (Retailsales were down 10% year on year at 96,000 units in Russia).

Net Sales and Operating Income
Net sales in Europe totaled ¥631.7 billion, down 32% year on
year due to lower sales volume and the yen’s appreciation.
Although MMC implemented emergency measures to reduce
expenses, major impacts from lower sales and the stronger yen
caused operating income in Europe to worsen by ¥74.4 billion
year on year to ¥5.3 billion.

Outlook for Fiscal Year 2009
Retail Sales
In fiscal year 2009, MMC is targeting retail sales of 213,000 units,
down 22% year on year. This target factors in challenging market
conditions in various regions and countries, including Western
Europe, Russia, and the Ukraine. European governments such as
Germany have put in place programs to support purchases ofsmall, fuel-efficient models. The Colt series is at the heart of
MMC’s efforts to boost sales in response to these programs.

• Russia and the Ukraine
Russia and the Ukraine Remain Key Markets
The formerly fast-growing Russian and Ukrainian markets
cooled suddenly in the second half of fiscal year 2008 alongwith the downturn in the global economy. However, for thefollowing reasons, we continue to regard these countries as key
markets: because these markets exceed a certain size; because
demand can be expected to expand in the future; and because
MMC enjoys strong brand recognition in both Russia and the
Ukraine. MMC continues to implement initiatives from a
medium- and long-term perspective while carefully monitoring
demand trends.
• Russia
Construction of a New Production Facility Begun
In MMC’s local vehicle production venture with PSA Peugeot
Citroën, MMC held a groundbreaking ceremony for a vehicle
assembly plant in June 2008. The plant is a strategic base for
the European market and preparations are under way for thetargeted start of production in 2012.

Net Sales
0

Net Sales and Operating Income (Loss)
MMC is targeting net sales of ¥360.0 billion, a decline of 43%
year on year, factoring in lower sales and the appreciation of
the yen. MMC is taking steps to reduce materials costs andother expenses, including personnel costs and selling
expenses, including advertising costs. However, based on
projections for lower sales and the impact of the strong yen,
MMC expects operating income to deteriorate ¥7.3 billion fromfiscal year 2008 to a loss of ¥2.0 billion.

400

200

09

800

600

1,000

(¥ billion)

360.0 (Forecast)

08

631.7

07

931.6

06

662.8

(FY)

Operating Income (Loss)
–10
09

10

0

–2.0

20

30

40

50

70

60

80

(¥ billion)(Forecast)

5.3

08

79.7

07
06

42.6

(FY)

Retail Sales
0
09
08(Thousand units)

50

100

150

200

250

300

213 (Forecast)
272

07
06
(FY)

The Colt ClearTec features an Automatic Stop & Go function that enables low
CO2 emissions.

18

mitsubishi motors corporation Annual Report 2009

350

341
282

Asia and Other Regions
MMC is generating stable earnings from its strong bases in Asia, ASEAN, the Middle East, andAfrica. Despite challenging sales environments, MMC continues to push ahead with the laying offoundations in emerging markets, including China, Brazil, the Middle East, and Africa.
Fiscal Year 2008 Performance
Retail Sales
Retail sales dropped 21% year on year to 507,000 units. MMC
achieved growth of around 20% year on year in the markets ofBrazil, Indonesia, the Philippines and elsewhere, but retail sales
in other regions declined in line with the economic recession.
Sales in Malaysia declined sharply, but this was due to the endof production parts supplies to Perusahaan Otomobil Nasional
Sdn. Bhd. (Proton).

Net Sales and Operating Income (Loss)
Reflecting lower retail sales and the impact of the stronger yen,
net sales in Asia and other regions fell 17% year on year to¥711.3 billion. MMC implemented emergency cost reductions
and benefited from restructuring, such as the closure of the­Australian factory. However, these positive factors were outweighed by the large impact of the drop in sales and the yen’s
appreciation. Consequently, operating income declined 19%
year on year to ¥53.3 billion.

Outlook for Fiscal Year 2009
Retail Sales
MMC is targeting retail sales of 432,000 units, down 15% fromfiscal year 2008, based on challenging market environments invarious nations in Asia and other regions. While there are differences in the degree of impact and seriousness of the economic
slowdown in various regions, MMC will conduct sales activities
while closely monitoring market developments in each region.

• 	Bolstering Sales Structures in the Key Markets of China,
the Middle East, and Africa
In China, MMC established Mitsubishi Motor Sales (China) Co.,
Ltd. (MMSCN), a company for selling imported built-up vehicles
through a joint venture with Mitsubishi Corporation, with operations starting on April 1, 2009. Looking ahead, MMSCN willconcentrate on strengthening marketing, further improving
relationships with dealers, accelerating parts supply, andenhancing after-sales services to boost customer satisfaction.
MMC also established Mitsubishi Motors Middle East &Africa FZE. This new company is centrally overseeing sales,
marketing, parts, R&D, and service/training functions in the
Middle Eastern and African markets and is providing comprehensive support to local distributors.
• 	Deploying New Technologies Tuned to the Characteristics
of Regional Markets
MMC is rolling out its eco-friendly technologies in accordancewith the needs of each region, through the expansion of theflex-fuel vehicle (FFV) lineup to the new Lancer in Thailand, andto SUVs and pickup trucks in Brazil, among other initiatives.

Net Sales
0

800

600

1,000

(¥ billion)70(¥ billion)

530.0 (Forecast)

08

711.3

07

Net Sales and Operating Income
MMC is targeting net sales in Asia and other regions of ¥530.0
billion, down 25% year on year, mainly based on a projected dropin sales. MMC is taking steps to reduce materials costs and otherexpenses, such as personnel costs and selling expenses, including advertising costs. However, MMC expects operating income
to deteriorate ¥15.3 billion year on year to ¥38.0 billion based on
projected lower sales and other factors.

400

200

09

859.3

06

610.5

(FY)

Operating Income
0

10

20

30

09

40

50

60

38.0 (Forecast)

08

53.3

07

65.6

06

40.8

(FY)

Retail Sales
0(Thousand units)

100

200

300

400

500

09

432 (Forecast)

08

507

07
06

700

600

628
537

(FY)

The Lancer (Japanese name: Galant Fortis) is being offeredin various regional markets.

* Puerto Rico’s results have been classified under “Asia and Other Regions” from 2008.

Annual Report 2009 mitsubishi motors corporation

19

Quality

MMC is developing various quality assurance systems to ensure that customers can drive its vehicles withpeace of mind.
Building in Development/Manufacturing Quality• Mitsubishi Motors Development System (MMDS)
MMC has introduced the Mitsubishi Motors Development System(MMDS), which is centered on the concept of quality gates (QGs)in every product development process. MMDS is a comprehensive quality management system that sets and assesses/evaluates
the achievement of specific performance benchmarks for every
quality gate at each stage of operations, from vehicle planning tosales and after-sales services. MMC has adopted a methodologyof advancing to the next stage of operations only after confirming the achievement of benchmarks for each quality gate using
this decision-making system.
MMDS (Mitsubishi Motors Development System)
Start of development
Product
planning

Gate

Designconcept

F

Design approval

Designspecifications

E

D

Market launchCompletion Mass productionofand quality
development verification

Prototype
testing

C

B

Start of mass
production

AZ• Mitsubishi Motors Production Way (MMPW)
MMC has established a unified global quality assurance framework by introducing the Mitsubishi Motors Production Way(MMPW), MMC’s concept and philosophy of manufacturing, to its
plants around the world. One of the basic concepts is to achieve
rigorous quality assurance in each work stage through the incorporation of “stage completion” (only allowing non-defective units
to pass to the next stage).
Basic Concepts of MMPW

Customer Satisfaction
Fundamental manufacturing principle:
build quality goods inexpensively and efficientlyStage
completion

Eliminateoverburdening, redundancy andinefficiency

Human Assets* Development
Building quality products starts with building quality people.
Based on this approach, MMC provides practical, in-house training to enhance the quality of human assets through quality engineering, Failure Mode and Effects Analysis (FMEA) and Fault Tree
Analysis (FTA).

Rapid Feedback of Customer Information• New Quality Information Management System (SQM-BC)
MMC introduced the SQM-BC in 2006 to allow MMC to swiftly
respond to quality-related information from customers. The
SQM-BC manages consolidation of multiple after-service related
systems. The DES (Data Entry System), one of the core systems,
enables sharing of quality-related information from customers
between MMC and distributors to be received in real time, making
possible the further facilitation of the analysis and solution of quality issues and the sharing of information among distributors.
The WAS (Warranty Analysis System), another core system,enables the detailed analysis of statistics for complaint data bymodel, part, production date and other parameters. This information can be effectively utilized by the design, manufacturing, service,and other related departments to quickly respond to complaints.
WAS entered service at plants around the world in 2009.
•	Timely and Transparent Determination Process for Recalls
and Other Issues
Since the recall issue of 2004, MMC has taken diligent steps torestore confidence, including discussions with outside experts.
MMC has established standardized, strict criteria for determining
recalls, and added members with more of a customer’s perspective to recall judgment meetings including those from the Customer Relations Department and labor union members. MMC
has created a more open system by reporting the meeting’s
deliberations to top management for final decision. The transparency of these proceedings is ensured through monitoring by the
CSR Promotion Office.

Quality Management Structure
MMC acquired ISO 9002 certification at the plant level in 1997,
and ISO 9001 certification for the entire company in 2003, covering a range of operations from development to sales and aftersales services. This includes technical centers located nationwide,from Hokkaido to Kyushu. These certifications reflect the concerted efforts of MMC staff to improve quality management
based on the philosophy of putting the customer first.
Notes:* MMC uses the term “human assets” because it sees people as key assets.

20

mitsubishi motors corporation Annual Report 2009

Corporate GovernanceCorporate Governance Framework
MMC employs the Statutory Auditor System pursuant to theJapanese Companies Act. In addition to mandatory organizations and governance systems, the company is improving its
corporate governance by adding an executive officer system andadvisory committees.
MMC’s Board of Directors is responsible for making decisions
concerning important management issues and overseeing execution. In addition, the executive officer system clarifies the roles
and responsibilities of directors and executive officers. Managing
directors’ meetings composed of directors, executive officers, andstatutory auditors make speedy decisions in bi-weekly meetings.

Status of Internal Audits and Statutory Audits
The statutory auditors carry out statutory audits of MMC and its
subsidiaries by attending important meetings of the company
such as Board of Directors meetings, and receiving reports on thestatus of business activities from directors and other corporate
officers. Also, key internal documents and internal audit reports
from internal audit divisions, subsidiaries and accounting auditors
are reviewed.
In addition to the statutory auditors, MMC has established
two departments within the CSR Promotion Office: the Quality
Audit Dept. and the Internal Audit Dept. Both are independent
from operating units and conduct internal audits from an
objective perspective.

The Quality Audit Dept. monitors whether the Quality Affairs
Office is appropriately carrying out operations related to vehicle
development, manufacturing, and post market measures basedon laws and regulations in various countries. The department
conducted a total of 95 audits in the fiscal year 2008. The audit
results are successively reported to top management and to theBusiness Ethics Committee twice a year.
The Internal Audit Dept. conducts regular company-wide
audits, covering areas including subsidiaries and affiliates inJapan and overseas, to verify the appropriateness and effectiveness of internal control systems including compliance and risk
management. The results are reported to the top management at
MMC, its subsidiaries and affiliates.
The Internal Audit Dept. is also actively working to strengthen
corporate governance and internal controls throughout the MMC
Group both in Japan and overseas. It has established internal
auditing divisions at all major overseas subsidiaries and has used
the regional integration of consolidated domestic sales companies to establish CSR divisions at each company.

Guidance From Advisory Committees
The Business Ethics Committee is an advisory body to the Boardof Directors made up of six outside experts. The committee works
to spread an awareness of compliance, and it provides MMC
directors with guidance and advice from an objective perspective.

Corporate Governance Framework(As of March 31, 2009)

Shareholders’ Meeting

ReportAccounting Auditors

Board of Statutory Auditors
Cooperate (5 members, of whom 3 are outside auditors) Audit
Accounting Audit
and
Audit and reportreportBoard of Directors(14 members, of whom
2 are outside directors)

Business Ethics Committee
Report findings andrecommendations

Chairman
Guidance
and advice

President
Managing Directors’ Meetings(21 members)

Executive Vice President(Step up 2010 Office)Quality Affairs Office

Departments

Quality Audit

Internal Audit

CSR Promotion OfficeInternal
Audit

Subsidiaries and affiliates

Annual Report 2009 mitsubishi motors corporation

21

Internal Control Systems and Risk Management

Development of Internal Control Systems
Based on the “Basic Policy on the Establishment of Internal
Control Systems,” MMC is continually working to ensure compliance with laws and regulations and to promote proper, effective business execution, in line with changes in the domestic oroverseas environment.
In April 2008, MMC augmented this Basic Policy with policies
concerning financial reporting and the elimination of criminal orunethical organizations. With regards to ensuring the reliability offinancial reporting pursuant to the Financial Instruments andExchange Act, which came into force from fiscal year 2008, MMC
is implementing company-wide measures under the leadership ofthe Internal Control Promotion Committee.

Development of Risk Management Framework
MMC is establishing infrastructure for company-wide risk management systems centered on the Risk Management Promotion
Team in the Corporate Affairs Office, and is also promoting thesharing of risk information within the company.
To promote systematic risk management and more frequent
initiatives, MMC formulated the “Risk Management Rules” andappointed a total of 19 risk management officers (as of May 31,2009) to each operational group.
Based on the core role of these officers, MMC is working toestablish and bolster its risk management systems.
In addition, from fiscal year 2008, MMC has conducted
repeated cycles of risk identification, evaluation, devising andimplementing countermeasures, and monitoring in each department, while identifying material risks at the company-wide level
and reporting them to senior management.

Internal Control Promotion Framework
PresidentInternal Control Promotion Committee

Evaluation Team

Company Law Subcommittee

Evaluation Department

Evaluation Department

AffiliatedDepartments companies(develop internal

AffiliatedDepartments companies(develop internal

controls)(develop internal
controls)

controls)(develop internal
controls)

Response to the Financial Instruments andExchange Act(Development and evaluation of internal controls
over financial reporting)

22

Personnel in charge

Personnel in charge

AffiliatedDepartments companies

AffiliatedDepartments companies

Response to Company Law(Development of systems in line with basic policies)

mitsubishi motors corporation Annual Report 2009

In addition, to prepare for unforeseen contingencies, MMC
has developed systems that enable the rapid communication of
information to directors and other key personnel, as well as aswift and accurate response. On responding to earthquakes andother natural disasters as well as other crises, MMC provides
regular educational programs and training based on company
rules and standards to ensure safety and minimize damages inthe event of an emergency.

Data Security Management
MMC recognizes that the protection of data assets (information
as well as information systems, machines, media, and equipmentused to handle that information) is vital to fulfilling its social
responsibility and earning the trust of stakeholders.
MMC implements physical, technological, personnel andorganizational measures to maintain and improve data security
management based on its information security policy and internal
rules that conform to ISO 27001.

Protection of Personal Information
MMC formulated a policy for the protection of personal informationin April 2005, and built a management framework to establish internal rules. MMC also appointed a person responsible for personal
information management at each department under the directionof the Personal Information Officer. MMC educates staff on thesubject through ongoing e-learning seminars and other programs,
and makes efforts to safeguard personal information in practice.

Security Trade Control
From the viewpoint of maintaining international peace and security, MMC profoundly believes in the importance of strict tradecontrols to prevent the proliferation of weapons of mass destruction and the excessive accumulation of conventional weapons.
In order to ensure the appropriate trade control, MMC hasestablished an Internal Security Trade Control Standard as amanagement regulation. In accordance with the standard and inorder to ensure compliance with laws and regulations regarding
security trade control the “Supervisory Committee for Security
Trade Control” was established under the direction of the president, who acts as Chief Security Trade Control Officer. Legality ofexport transactions is guaranteed by a management systemcentered on the committee.

Compliance

Development of an Organizational Framework for Promoting Business Ethics

Implementation of the Program to Promote Business
EthicsIn June 2004, MMC established the CSR Promotion Office toensure thorough compliance and promote a new corporate culture, while restructuring the compliance framework (see chart
below). MMC has strengthened the organization to ensure thatawareness of compliance spreads to each and every employee.
The company appointed 19 compliance officers (as of fiscal year2008), under the direction of the Chief Business Ethics Officer(CBEO), and appointed department managers as code leaders ineach department under the compliance officers.
MMC receives guidance and advice from an external perspective from the Business Ethics Committee, which acts as an advisory
body to the Board of Directors and is made up of outside experts.

In fiscal year 2008, MMC held training sessions on compliance led
by instructors from outside the company as part of a training
program for directors and corporate auditors, with a total of 22
corporate officers, comprising full-time directors at the executive
officer level or above and statutory auditors taking part.
Meetings are held three times a year in each workplace atwhich familiar business ethics problems are examined and solutions are discussed. These meetings provide a good opportunity
to enhance ethical awareness and improve communication
through discussion using actual examples.
In addition to these types of discussions at each workplace,compliance measures specific to each department were formulated and implemented under the direction of compliance officers. In these and other ways, MMC worked to promotecompliance with business ethics.

Organizational Framework for Promoting Business Ethics

Offer Opinions and Recommendations

Board of Directors
Chairman

Guidance and Advice

Business Ethics Committee(Made up of external experts)
Chief Business Ethics Officer(CBEO)

President
Direction and Supervision
Department Managers andCorporate General Managers
ReportThorough Compliance with
Business Ethics

Consult
and Report

Thorough Compliance with
Business Ethics

Compliance Officer

Reportand Approval
Direction andGuidance on
Specific
Strategies

Thorough Compliance with
Business Ethics

Employees

Consult on Ethical Issues

Help Line
External Attorneys

Compliance Department

Help Line
Employee Counseling Office

General Manager=Code Leader

Consult on
Ethical Issues

CSR Promotion Office

Various
Consultations

Various Consultations
Employees of Affiliates and Distributors,
Temporary Employees, Former Employees

Annual Report 2009 mitsubishi motors corporation

23

Operating the Help Line
MMC is giving priority to its internal reporting system in order tocreate a highly transparent workplace environment that is notconducive to scandals and promotes their early detection as well
as self-correction. MMC has already established the EmployeeCounseling Office and external counseling channels throughoutside attorneys. In April 2006, in line with the enforcement of
the Whistleblower Protection Act, MMC established operational
criteria related to the internal reporting system, as well as internal
regulations, including those prohibiting the disadvantageous
treatment of whistleblowers.
Furthermore, to create a framework that facilitates internalreporting, MMC is endeavoring to disseminate regulatory information within the company by holding briefings, including information in the company newsletter, and adopting other measures.

Establishment and Dissemination of Regulations
In April 2007, MMC fully revised its “Business Ethics of Mitsubishi
Motors Corporation”—MMC’s corporate ethics standards—toturn them into more practical guidelines for informing employees’
actions. All employees and directors have signed an oath ofcompliance with these standards.
Furthermore, in January 2008, MMC revised the “Behavioral
Standards of Mitsubishi Motors Corporation,” a set of guidelines
for behavior that all employees must keep in mind at all times.
MMC distributed the revised booklet to all staff members, and by
making use of it on a daily basis, MMC aims to ensure thoroughcompliance with business ethics.

24

mitsubishi motors corporation Annual Report 2009

Activities to Spread Compliance Among MMC Group
Companies
Restoring trust in MMC requires a concerted effort by the entire
MMC Group. To this end, domestic Group companies (including
exclusive dealers) have taken the lead in carrying out initiatives
since fiscal year 2005. In fiscal year 2006, almost all companies
completed the establishment of systems to ensure compliancewith business ethics.
Furthermore, MMC continues to regularly conduct training on
resolving corporate ethics problems, developing precedents andrelated topics. Overseas affiliates are also working to develop
compliance promotion frameworks linked with internal controls.

“Safety Pledge Days”
To prevent past errors such as the regrettable recall problems
from being forgotten over time, January 10 and October 19 havebeen designated “Safety Pledge Days,” since two fatal accidents
occurred on those days involving large trucks manufactured by
Mitsubishi Fuso, a former MMC division. All employees observe a
moment of silence on these days, and the previously mentioned
meetings to review business ethics problems are held aroundthese times.

Activity Report by the Business Ethics Committee
The Mitsubishi Motors Business Ethics Committee was established in June 2004 as an advisory body to theBoard of Directors of MMC. At that time, the recall problem had reignited and MMC faced a crisis concerning
the company’s survival due to the loss of confidence and trust of society in MMC. The Business Ethics Committee was established as one of the critical steps to restore trust in MMC and ensure its revitalization. The
aims of this committee, which is made up solely of external experts, are to conduct monitoring, guidance andconsultation from the viewpoint of external oversight and common sense with respect to MMC’s overall activities to restore trust, especially in terms of compliance. The scope of the committee’s activity is not limited tobusiness ethics; but also includes matters broadly related to quality problems and corporate culture.
Review of the Committee’s Activities Since its
Establishment
Since the committee convened its first meeting in July 2004
through to July 2009, it has held a total of 60 meetings and has
considered as many as 139 issues in total. During this period, themembers of the committee have raised frank questions andexpressed candid opinions regarding each of these issues fromthe standpoint of external oversight and common sense. The
general categories of topics considered by the committee areshown below. A variety of issues were considered based on each
topic (the figures in brackets indicate the number or frequency ofthese issues).

The report generally gives high marks to MMC activities
toward restoring trust in the company, concluding that “the initialstage had been accomplished.” At the same time, the report also
pointed out issues and made proposals aimed at providing further support for MMC’s revitalization, indicating that “it is stillnecessary to stay fully committed to activities to restore trust.”
In the report, the committee made 13 policy recommendations. Since the report was received by MMC, the relevant
departments have reported their responses to the policy recommendations to the committee on a case-by-case basis, and havereceived advice from the committee members.

Overview of Activities in Fiscal Year 2008
1. Response to recall problems [23]2. Recall process reform and quality improvement initiatives [17]3. Initiatives to entrench compliance [39]4. Other initiatives, including corporate culture reforms [55]5. Fact-finding visits to plants and dealers [5]
In October 2006, the Board of Directors of MMC consulted
the Business Ethics Committee, requesting a summary of MMC’s
activities toward restoring trust in the company, as well as anevaluation and proposals regarding these activities. MMC
received a report on the committee’s findings concerning thisissue on May 21, 2007.

The committee convened 12 times during fiscal year 2008, andreceived briefings on 25 issues, including the business ethics
compliance promotion program and the business ethics awareness survey. The committee’s views, guidance and advice weresought on these issues. As well as formal committee meetings,
committee members attended the Compliance Officers’ Meetingas observers, at which they were asked for their views and any
queries they may have had. Compliance officers are responsible
for business ethics in each department. In addition, the committee’s views and guidance are requested on any urgent issues,
which are explained to the committee on a case-by-case basis.

Members of the Business Ethics Committee

Kazuko Miyamoto

Nobuyuki Yamamoto

Kazuo Mura

Committee Chairman
Noboru Matsuda

Konoe Kawagishi

Takahiro Fujimoto

Annual Report 2009 mitsubishi motors corporation

25

Management(As of July 1, 2009)

Members of the Board

Takashi Nishioka*

Osamu Masuko*

Makoto Maeda*

Hiizu Ichikawa*

Hiroshi Harunari

Tetsuro Aikawa

Kazuyuki Kikuchi

Shuichi Aoto

Osamu Matsumoto

Seiichi Ohta

Hiroshi Kuroda

Gayu Uesugi

Mikio Sasaki

Hidetoshi Yajima

Shuzo Muramoto

Shigemitsu Miki

Yukio Okamoto

Yujiro Kawamoto

Shuma Uchino

Yoshikazu Nakamura

Shinichi Kurihara

Shiro Futaki

Masahide Konishi

Masao Ohmichi

Hiroshi Noda

Kazuya Matsushita

Ryugo Nakao

Takitaro Fukuda

Yasuo Ohyama

Eiji Kato

Hideo Kimura

Yoichi Yokozawa

Michiro Imai

Akinori Nakanishi

Keizo Fuchita

Chairman of the Board

Managing Director
In Charge of Domestic Sales Group
Headquarters

Director
In Charge of Procurement Group
Headquarters

President

Managing Director
In Charge of Overseas Operations
Group Headquarters B

Director
In Charge of Product Strategy &Development Group Headquarters

Executive Vice President
Corporate General Manager of Step up
2010 Office
In Charge of Russian Project & MiEVBusiness Management

Director
In Charge of Corporate Planning,
Controlling & Accounting Group
Headquarters

Director (Non-Executive Director)

Managing Director
In Charge of CSR, Corporate Affairs &Finance Group Headquarters
Chief Business Ethics Officer

Director
In Charge of Production Group
Headquarters

Managing Director
In Charge of Overseas Operations
Group Headquarters A
Corporate General Manager of Europe& Middle East/Africa OfficeDirector
In Charge of Quality Affairs Group
Headquarters

Director (Non-Executive Director)

Statutory Auditors
Norihide Ujita

Statutory Auditor (Full-time)

Statutory Auditor (Full-time)

Statutory Auditor

Statutory Auditor

Statutory Auditor

Executive Officers
Senior Executive Officer
Corporate General Manager ofCorporate Planning Office and Vice
Corporate General Manager of Step up
2010 Office

Executive Officer
Chief Environmental Strategy Officer
Assistant to President and Vice
Corporate General Manager of CSR
Promotion Office

Executive Officer
Plant General Manager of Nagoya
Plant

Executive Officer
Corporate General Manager of Asia &ASEAN OfficeSenior Executive Officer
Corporate General Manager of CSR
Promotion Office

Executive Officer
Corporate General Manager of
Accounting Office

Executive Officer
Plant General Manager of Mizushima
Plant

Senior Executive Officer
President & Chief Executive Officer,
Mitsubishi Motors North America, Inc.

Executive Officer
Corporate General Manager of Finance
Office and General Manager ofFinancial Planning Department

Executive Officer
Corporate General Manager ofDomestic Sales and After sales Service
OfficeSenior Executive Officer
President & Chief Executive Officer,
Manufacturing - Mitsubishi Motors
North America, Inc.

Executive Officer
Corporate General Manager of ProductStrategy Office

Executive Officer
Corporate General Manager ofOverseas Business Management Office,Assistant to Managing Director andAssistant to Executive Vice President[Step up 2010 Office]Senior Executive Officer
Chairman, Mitsubishi Motor Sales(CHINA) Co., Ltd.

Executive Officer
Corporate General Manager ofDevelopment Engineering Office andGeneral Manager of Cost Reduction
Activity Promoting Office and of Fuel
Economy Improvement Activity
Promoting Office

Executive Officer
Corporate General Manager of North
Asia Office

Executive Officer
Vice President, Mitsubishi Motors
North America, Inc.
*Representative Director

26

mitsubishi motors corporation Annual Report 2009

Responsibility to Society
MMC is actively engaged in community-focused activities to build a sustainable relationship with society as agood corporate citizen.
Corporate Citizenship Activity Policy

MMC is tackling four key themes with respect to corporate citizenship activities: Support for the next generation, Traffic
safety, Environmental preservation, and Participation in local communities. These are being promoted as MMC’s “STEP”
corporate citizenship activities based on our corporate philosophy.
1. Support for the next generation

Supporting the education of the next generation to create a prosperous future.

2. Traffic safety ontributing to traffic safety education and the spread of safe driving to create aCzero-accident society.

3. Environmental preservation

Contributing to preservation of our precious global environment.

4. Participation in local communities

Contributing to the revitalization and development of regional communities.

Main Activities
1. Support for the next generation
Hands-on Lesson Program
The Hands-on Lesson Program began in fiscal year 2005, and isbased on the concept of enabling children to enjoy learning by
experiencing the “real thing.” MMC employees visit children
mainly at elementary schools close to MMC business offices togive hands-on lessons on topics such as the environment centered on test rides in the i-MiEV electric vehicle, and car design,with guidance from designers and modelers.
KidZania
MMC has unveiled an exhibit at KidZania Koshien, which opened
in March 2009, following the success of its exhibit at KidZania
Tokyo since October 2006.
At the Mitsubishi Motors Pavilion, children can experience
the intrinsic attractiveness and fun of automobiles and the pleasure of driving through activities at a simulated “Driver’s License
Testing Office,” “Rent-A-Car Center,” “Auto Factory” (Koshienonly) and “Car Design Studio” (Tokyo only). By encouraging
young people to think and act on their own in the course of
these activities, MMC aims to help young people obtain thequalities needed for success in the context of modern social
frameworks and in social life, such as teamwork, proactivity andcommunication skills.

2. Traffic safety
Car School
The Car School is a driving instruction program in which all participants think, learn and enjoy driving together with instructors in
the course of studying driving techniques, automobiles, safety
and other topics. MMC has been running the Car School program since 1995 as part of its safe driving educational activities.

3. Environmental preservation
The Pajero Forest
MMC has named an approximately three-hectare area of mountain forest in Hayakawa-cho, Yamanashi Prefecture as “Pajero
Forest,” and has been working to preserve and cultivate theforest while deepening exchanges with local residents throughvolunteer activities.
In fiscal year 2008, a troop of volunteers, including employees
and their families, conducted a range of activities in an area
where tree saplings were planted in the previous year. These
activities included cutting undergrowth, installing deer-proof
fences, nature watching and birdhouse construction. The volunteers also built wooden benches from wood obtained from forest
thinning activities as a means of making effective use of theseresources, and supplied the benches to MMC business offices.

4. Participation in local communities
Factory Tours
The Nagoya Plant, Powertrain Plant (Kyoto Plant, Shiga Plant),
Mizushima Plant and Pajero Manufacturing Co., Ltd. have opened
up their production lines and other facilities to local elementary
schools and residents as a place for social study.
In fiscal year 2008, the total number of visitors at all MMC
business sites combined was approximately 42,000.
Other
MMC conducts other kinds of volunteer activities such as regional
beautification, lending of MMC facilities, and cooperation inregional events.

Annual Report 2009 mitsubishi motors corporation

27

“Mitsubishi Motors Group Environmental Vision 2020”—“Leading the EV Era, Towards a Sustainable Future”
Looking ahead to the year 2020, the 50th anniversary of the establishment of the company, MMC has formulated the “Mitsubishi Motors Group Environmental Vision 2020.”
Under the Mitsubishi Motors Group Environmental Vision 2020, MMC’s environmental activities will be
guided by its environmental policy of “Leading the EV* era, towards a sustainable future.” In this context,
MMC is committed to the development of technology—spearheaded by EV technology—and to reducing theenvironmental impact of its business activities in general. The Mitsubishi Motors Group Environmental Vision2020 will also point the MMC Group toward working with its customers and society at large in creating apleasing and low-carbon society. Additionally, the Environmental Vision 2020 more fully embodies the philosophy of the company’s recently announced “Drive@earth” corporate tagline.
*See Page 9.

To achieve the “Mitsubishi Motors Group Environmental Vision
2020” roadmap’s goals and targets, MMC will focus its resources
on a 3-pronged approach based on “Products & Technology,”“Corporate Activities” and “Cooperation with Society.” “Mitsubishi Motors Group Environmental Vision 2020”<
product & technology targets for the year 2020>• Raise the total production ratio of EVs to at least 20%• Cut global lineup CO2 emissions by a weighted average of
50% from the 2005 level.

1. Products & Technology:
As well as pushing ahead with the development of EV technologies and products, MMC will seek to reduce environmental loads
throughout the entire lifecycle of its products, mainly by improving the fuel economy of internal combustion engine-powered
vehicles, and enhancing vehicle recyclability.

CO2 Emissions Reduction Targets for the Year 2020
Vehicle-produced CO2

Improve the fuel economy of gasoline
and diesel vehicles
Total production ratio of EVs

50% Reduction

20%

Factory-produced CO2Raise the efficiency of all plants andfacilities worldwide and introduce
renewable energy, etc.

20% Reduction

Corporate image

3. Cooperation with society:
MMC will collaborate with governments, various industries andother partners to help develop charging infrastructure and new
traffic systems using EVs.
While continuing to promote environmental conservation
activities implemented with local communities, the company will
also work to enhance activities such as the global expansion of
corporate citizenship activities, including tree planting programs,and “eco-driving” support measures.

Government

MMC Group
Products &Technology

Customers

Operations
Other
sectors

Trading
partners

Cooperation withsociety

28

Covering all fields of corporate activities from product planning
through development, production, sales and after-sales services,
MMC will step up its efforts to promote more widespread use ofEVs. In addition, MMC will raise the level of its environmental protection activities throughout the Mitsubishi Motors Group by setting
its own environmental standards for each field of corporate activity.
<“Mitsubishi Motors Group Environmental Vision 2020”
corporate activity targets for the year 2020>• Reduce per-vehicle CO2 emissions during production by
20% from the 2005 level

Near-future goal

Auto industryMedia

2. Corporate Activities:

mitsubishi motors corporation Annual Report 2009

Towards asustainable future

Financial Section
Contents
30

Financial Results and Discussion

34

Consolidated Balance Sheets

36

Consolidated Statements of Operations

37

Consolidated Statements of Changes in Net Assets

38

Consolidated Statements of Cash Flows

39

Notes to Consolidated Financial Statements

65

Report of Independent Auditors

Annual Report 2009 mitsubishi motors corporation

29

Financial Results and Discussion

Operational Review
During the first half of the fiscal year under review, while emerging economies such as BRICs and the markets in resource-richcountries showed robust growth, advanced industrial countries
including Japan experienced a mild slowdown in their economies. This was due to the turmoil in the financial markets in the
U.S. and Europe triggered by the U.S. subprime mortgage crisisand sharp rises in raw material prices, which hovered at highlevels, such as crude oil. In the second half of fiscal 2008, thecollapse of a financial institution in the U.S. caused a global financial crisis and credit crunch, and the global economy worsened at
an unprecedented speed, width and depth. Coupled with thesignificant strengthening of the yen, the environment surrounding the operations of Mitsubishi Motors Corporation (MMC)
sharply deteriorated to an uncharted level.
Amidst this business environment, the MMC Group entered
the first fiscal year of “Step Up 2010,” its mid-term business planannounced in February 2008, aiming to bolster its strengths andsecure steady profits. Concerted efforts have been made toaddress issues such as restoring domestic business profitability,
ensuring the stability of North American operations, establishinga production system capable of timely response to market needs,
and developing environmental technologies. Additionally,­emergency measures were implemented in order to cope withthe current economic crisis, including production adjustments tolower inventories and even more rigorous cost reduction activities.
However, this was not sufficient to offset the negative impact
augmented by the substantial drop in vehicle sales due to thedeteriorating global economy and appreciation of the yen. As aresult, the MMC Group posted declining figures in net sales,
operating income, ordinary income and net income compared tothe previous year’s results.

Retail Sales
0
08(Thousand units)

500

1,000

The overall demand for vehicles was sluggish worldwide, andamidst this environment, retail sales dropped in all geographicalregions (i.e., Japan, North America, Europe, and Asia and Other
Regions). For the year ended March 31, 2009, MMC reported
global retail sales of 1,066,000 units (down 294,000 units or 22%
compared to the previous fiscal year). Unit sales by region arereported as follows.
In Japan, MMC aimed to increase sales through the introduction of new models, including the September launching of new
minicars such as the Toppo, and the December launching of the
Galant Fortis Sportback. However, a sharp decline in overall
demand, particularly from November on, had a negative impact
on sales. As a result, sales fell to 168,000 units (down 51,000 units
or 23%).
In North America, despite increasing sales in Canada, theslump in overall demand in the U.S. resulted in a decline inregional sales to 119,000 units (down 41,000 units or 26%).
In Europe, in addition to declining vehicle sales in Western
European markets where overall demand was low, the solid
growth experienced to date in the Russian market turned negative in the second half of fiscal 2008. All combined, regional sales
totaled 272,000 units (down 69,000 units or 20%).
In Asia and Other Regions, countries such as Brazil, Indonesia
and the Philippines recorded increases in sales. However,­Malaysia, where production parts and components supplies toProton have ended, and other countries experienced declining
sales. Consequently, the combined regional sales totaled 507,000
units (down 133,000 units or 21%).

Net Sales/Operating Margin

1,500

0
08

1,066

07
06

Results of Operations
Retail Sales Volume

1,360

05

1,344

05

04

1,312

04

(FY)

2,000

2,500

1,973.6

4.0

3,000

2,682.1

2,202.9

0.3

2,120.1
2,122.6(FY) 0

mitsubishi motors corporation Annual Report 2009(¥ billion)

1,500

1.8

n Net Sales

30

1,000

07
06

1,230

500

0.2

1
n

2

Operating Margin (%)

3

4

5

(%)

Net Sales and Income
Net sales totaled ¥1,973.6 billion, a year-on-year decrease of¥708.5 billion or 26%, mainly due to declining vehicle sales andthe negative effects of a stronger yen.
Due to lower vehicle sales and the appreciation of the yen,operating income fell by ¥104.7 billion compared to the previous
fiscal year. Even so, MMC recorded an operating profit of ¥3.9
billion owing to the current efforts in implementing cost reduction measures and the improvements achieved through the structural reforms executed in fiscal 2007.
Despite improvements in net interest and foreign exchange
gains/losses, the decline in operating income led to a loss inordinary income, which fell from an ordinary profit of ¥85.7 billion
in the previous fiscal year to a loss of ¥14.9 billion.
Due to the drop in ordinary income, net income fell from a
net profit of ¥34.7 billion in the previous fiscal year to a loss of¥54.9 billion. Extraordinary losses include an asset impairment
loss of ¥27.5 billion.

Segment Analysis
Business Segment Information
1. Automobiles
In fiscal 2008, net sales in the automotive business sector totaled¥1,961.6 billion (down 26.2% compared to the previous fiscal
year), and operating income was ¥3.4 billion, a decrease of ¥92.4
billion compared to the previous fiscal year.
2. Financial Services
In fiscal 2008, net sales in the financial services sector was ¥11.9
billion (a 51.6% decline compared to the previous fiscal year) andoperating income was ¥400 million (a decrease of ¥12.4 billion).

Geographical Segment Information• Japan
In Japan, mainly due to a decrease in vehicle sales, net sales
were ¥1,600.2 billion (a decrease of 20.8% compared to theprevious fiscal year), and operating income fell to ¥2.6 billion(down ¥80.3 billion).
• North America
In North America, a substantial drop in vehicle sales resulted in
net sales of ¥232.1 billion (down 40.9% compared to the previous
fiscal year) and an operating loss of ¥23.6 billion (down from an
operating loss of ¥10.6 billion).

Total Assets
00807(¥ billion)

500

1,000

1,500
1,138.0
1,609.4

06

1,778.705

1,557.6

04

1,589.3(FY)Interest-bearing Debt

2,000

0

100

(¥ billion)

200

300

400

08

353.4

07

353.9

500

06
05
04

600

503.8
447.8
476.0

(FY)

Annual Report 2009 mitsubishi motors corporation31• Europe
In Europe, a substantial drop in vehicle sales resulted in net salesof ¥356.1 billion (down 45.8% compared to the previous fiscal
year) and an operating loss of ¥4.5 billion (down from an operating income of ¥20.3 billion).

Business-related Risks• Asia/Other Regions
In Asia and Other Regions, as a result of lower vehicle sales, net
sales fell to ¥478.4 billion (down 15.4% compared to the previous
fiscal year). On the other hand, operating income rose to ¥21.7
billion (an increase of 42.7%) owing to favorable exchange rates
and improvements stemming from lower fixed costs following theclosure of the Australian factory.

Leasing, financial services and sales incentives

Cash flows
The year-end balance of cash and cash equivalents was ¥154.7
billion, a decrease of ¥206.2 billion from the beginning of the
fiscal year.
Cash flow from operating activities came to a net outflow of¥93.3 billion, an increase in outflow of ¥281.6 billion compared tothe previous fiscal year due mainly to decreased working capitaland increased finance receivables.
Cash flow from investing activities came to a net outflow of¥94.8 billion (an increase in outflow of ¥45.9 billion year-on year)
due mainly to capital expenditures.
Finally, cash flow from financing activities totaled a net outflow of ¥5.0 billion (a ¥127.6 billion decrease in outflow comparedto the previous fiscal year).

Cash Flows from Operating Activities
-150
08

-100

-50

0

(¥ billion)

50

100

150

200

–93.3

07

188.3

06

162.3

05
04

54.4
13.7

(FY)

32

Risks related to MMC’s business, as well as factors that could
possibly affect the judgment of investors are as follows:
Forward-looking statements are based on the judgment of
the MMC Group as of the end of the fiscal year 2008.

Overcapacity in the auto industry, and fierce competition, especially price competition in the North American market, has led to
the necessity of sales incentives in sales promotion efforts.
The sales incentives MMC uses in promotions reduce theselling price of new vehicles. It is possible that the use of incentives will lower resale values in the used car market and residual
values evaluated for vehicles returned at the end of leases. If
vehicle residual values decrease, there could be a negative
impact on future business performance. The decline in residual
values could also put downward pressure on car and lease assets
held as collateral in the sales finance unit.

Issuance of common and preferred sharesand effect on share price
In June and July 2004, March 2005, and January 2006 MMC
issued several classes of convertible preferred shares. The conversion of all Class B shares, series 1 – 3 (issued July 2004), hasalready been completed, but the possible conversion of theremaining Class A & G shares to common shares in the future will
dilute the value of existing common shares, and thus possibly
influence the market price of common shares.

Cash Flows from Investing Activities
–120

–100

08

–94.8

07
05
04

–60

(¥ billion)

–40

–48.9

06

(FY)

mitsubishi motors corporation Annual Report 2009

–80

–46.0
–84.8
–34.2

–20

0

Effect of foreign exchange rate fluctuations

Natural and other disasters

Overseas sales accounted for 79.8% of the consolidated sales of
MMC for the period. MMC endeavors to minimize the risk
involved in foreign currency receivables and payables throughforeign currency derivative contracts.
However, fluctuations in the foreign exchange markets still
may have an impact on MMC results.

The MMC Group maintains production and other facilities in many
parts of the world. The occurrence of a major natural or otherdisaster, such as an earthquake or typhoon, may result in lengthy
halts in operations, etc. and thus have an impact on MMC results.

Effect of socioeconomic situations
The breakdown of the above ratio for overseas sales is 11.8% forNorth America, 32.0% for Europe, and 36.0% for Asia and otherregions. There is a possibility that changes in the socioeconomic
situation in Japan or any of these regions will impact MMC results.

Changes in laws and regulations
MMC abides by laws and regulations regarding the environment,
product safety, etc. in its various markets of operation. If any laws
and regulations were to be changed, or new rules issued, costs
associated with implementing these changes would have an
impact on MMC results.

Effect of interest rate fluctuations on borrowings
The balance of MMC's consolidated interest-bearing liabilities
stood at ¥353.4 billion at the end of March 2009. There is a possibility that fluctuations in interest rates on borrowings resulting
from a change in financial market conditions in the future will
impact MMC results.

Effect of fluctuations in materials prices
The MMC Group purchases materials and finished parts andcomponents from many partners. Increased demand and otherchanges in market conditions may cause materials and components prices to increase, thus raising MMC’s manufacturing costs
and resulting in an impact on MMC results.

Annual Report 2009 mitsubishi motors corporation

33

Consolidated Balance Sheets
Mitsubishi Motors Corporation and Consolidated Subsidiaries
As of March 31, 2009 and 2008

In millions of yen

In thousands of
U.S. dollars(Note 2)

2009

2008

2009

¥  154,666
89,60730,596
189,120608
1,398
82,474(7,528)
540,943¥  360,902
174,076
14,722299,644113
1,040
124,529(10,897)
964,133$ 1,574,533
912,216
311,482
1,925,280
6,191
14,234
839,602(76,637)
5,506,904

Property, plant and equipment, net (Notes 5 and 8)

439,936

453,453

4,478,639

Intangible assets (Note 8)

16,436

31,825

167,322

68,44324,0019,146
8,206
43,218(12,322)
140,693¥1,138,009

93,021
5,580
11,195
9,842
54,907(14,551)
159,996¥1,609,408

696,765
244,337
93,11583,544439,967(125,443)
1,432,286$11,585,153

AssetsCurrent assets:
Cash and cash equivalents (Notes 8 and 13)
Notes and accounts receivable-trade (Notes 4 and 8)
Finance receivables (Notes 4 and 8)
Inventories (Note 8)
Short-term loans receivable
Deferred tax assets (Note 17)
Other (Note 8)
Allowance for doubtful accounts
Total current assets

Investments and other assets:
Investments (Notes 6 and 8)
Long-term finance receivables (Notes 4 and 8)
Long-term loans receivable (Note 8)
Deferred tax assets (Note 17)
Other (Note 8)
Allowance for doubtful accounts
Total investments and other assets, net
Total assets

34

mitsubishi motors corporation Annual Report 2009

Liabilities and net assets
Current liabilities:
Notes and accounts payable-trade
Short-term loans payable (Note 8)
Current portion of long-term debt (Note 8)
Lease obligations (Note 8)
Accounts payable-other and accrued expenses (Note 7)
Income taxes payable (Note 17)
Other (Note 17)
Total current liabilities
Long-term debt (Note 8)
Lease obligations (Note 8)
Deferred tax liabilities (Note 17)
Provision for retirement benefits (Note 16)
Other
Total liabilities
Net assets:
Shareholders’ equity (Notes 9 and 20):  Preferred stock:    Authorized: 3,312,000 shares    Issued or converted:      437,593 shares in 2008      437,593 shares in 2009   Common stock:    Authorized: 9,958,285,000 shares    Issued or converted:      5,537,897,840 shares in 2008      5,537,898,840 shares in 2009   Capital surplus   Accumulated deficit  Treasury stock — 80,373 shares at March 31, 2008  Treasury stock — 83,358 shares at March 31, 2009
 Total shareholders’ equity
Valuation and translation adjustments:   Valuation difference on available-for-sale securities   Deferred gains or losses on hedges   Foreign currency translation adjustment Total valuation and translation adjustments Minority interests
Total net assets
Contingent liabilities (Note 10)
Total liabilities and net assets

In millions of yen

In thousands of
U.S. dollars(Note 2)

2009

2008

2009

¥  155,600
179,635
68,991
7,425
150,139
4,994
53,306620,093
104,779
13,197
18,549106,31152,053914,985¥  423,729
219,597
76,705–
228,829
8,115
73,936
1,030,913
57,606–27,967103,295
61,493
1,281,275$ 1,584,044
1,828,723
702,341
75,591
1,528,450
50,842542,673
6,312,669
1,066,675
134,352
188,833
1,082,275
529,915
9,314,722

218,796

218,796

2,227,389

438,553432,661(770,750)

438,553432,661(702,432)

4,464,557
4,404,575(7,846,385)(14)
319,246(14)
387,564(149)
3,249,988

1,183
789
(107,769)(105,795)
9,573
223,024

10,676
3,157(84,584)(70,750)
11,318328,132

12,052
8,041(1,097,113)(1,077,019)
97,4622,270,431¥1,138,009¥1,609,408$11,585,153

See accompanying notes to consolidated financial statements.

Annual Report 2009 mitsubishi motors corporation

35

Consolidated Statements of Operations
Mitsubishi Motors Corporation and Consolidated Subsidiaries
For the years ended March 31, 2009 and 2008

In millions of yen

In thousands of
U.S. dollars(Note 2)

2009

2008

2009

¥1,973,572
1,663,121
0
310,451¥2,682,103
2,194,741
0487,361$20,091,343
16,930,892
03,160,451

Selling, general and administrative expenses (Note 11)   Operating income

306,524
3,926

378,765
108,596

3,120,480
39,971

Interest and dividends income
Interest expenses
Impairment loss (Note 5)
Other gain (loss), net (Notes 6 and 12)   Income (loss) before income taxes and minority interests

6,485
14,54627,494(22,088)(53,717)

9,633
20,46821,318(28,291)
48,151

66,025148,084
279,895(224,867)(546,850)

4,899(3,788)1,111
55¥ (54,883)

10,9291,558
12,488952¥   34,710

49,880(38,567)
11,313564$ (558,728)

Net sales
Cost of sales
Reversal of unrealized income on installment sales   Gross profit

Income taxes (Note 17):
Current
Deferred
Minority interests in income   Net income (loss) (Note 20)
See accompanying notes to consolidated financial statements.

36

mitsubishi motors corporation Annual Report 2009

Consolidated Statements of Changes in Net Assets
Mitsubishi Motors Corporation and Consolidated Subsidiaries
For the years ended March 31, 2009 and 2008

In millions of yen

In thousands of
U.S. dollars(Note 2)

2009

2008

2009

Shareholders’ equity
Preferred stock:
Balance at beginning of year
 Preferred stock issued or converted
Balance at end of year¥218,796–
218,796¥221,296(2,500)218,796$2,227,389–
2,227,389

Common stock:
Balance at beginning of year
Common stock issued or converted
Balance at end of year

438,5530438,553

436,0462,507
438,553

4,464,556
0
4,464,557

Capital surplus:
Balance at beginning of year
Issuance or conversion of common and preferred stock
Balance at end of year

432,661
0432,661

432,6547
432,661

4,404,574
0
4,404,575

Accumulated deficit:
Balance at beginning of year
Effect of changes in accounting policies applied to foreign subsidiaries
Net income (loss)
Change of scope of consolidation
Change of scope of equity method
Balance at end of year

(702,432)(13,455)(54,883)21–(770,750)(740,454)–
34,710–3,311(702,432)(7,150,896)(136,979)(558,728)
218–(7,846,385)

(14)
(0)
(14)
319,246

(13)
(0)
(14)
387,564

(144)
(4)
(149)
3,249,988

10,676(9,492)
1,183

10,132544
10,676108,691(96,639)
12,052

3,157(2,367)
789

1,393
1,763
3,157

32,141(24,099)
8,041(84,584)(23,185)(107,769)(105,795)(65,272)(19,311)(84,584)(70,750)(861,082)(236,031)(1,097,113)(1,077,019)

11,318(1,744)9,573¥223,024

12,522(1,203)
11,318¥328,132

115,221(17,759)
97,462$2,270,431

Treasury stock:
Balance at beginning of year
Net change
Balance at end of year
Total shareholders’ equity
Valuation and translation adjustments
Valuation difference on available-for-sale securities:
Balance at beginning of year
Net change
Balance at end of year
Deferred gains or losses on hedges:
Balance at beginning of year
Net change
Balance at end of year
Foreign currency translation adjustment:
Balance at beginning of year
Net change
Balance at end of year
Total valuation and translation adjustments
Minority Interests:
Balance at beginning of year
Net change
Balance at end of year
Total net assets
See accompanying notes to consolidated financial statements.

Annual Report 2009 mitsubishi motors corporation

37

Consolidated Statements of Cash Flows
Mitsubishi Motors Corporation and Consolidated Subsidiaries
For the years ended March 31, 2009 and 2008

In millions of yen

In thousands of
U.S. dollars(Note 2)

2009

2008

2009

¥ (54,883)¥ 34,710$ (558,728)

84,585(3,194)
2,445(367)(3,788)55
2,968
27,494–
8,832
63,14457,073(16,368)(229,035)(32,296)(93,335)

75,090(14,664)
2,485(4,447)
1,558
952
2,602
21,318(4,655)
10,154
5,348
52,95531,368(24,114)(2,385)
188,279

861,092(32,519)
24,895(3,737)(38,567)564
30,216
279,895–
89,912642,819581,023(166,636)(2,331,627)(328,780)(950,177)

Investing activities:
Decrease (increase) in time deposits
Purchase of property, plant and equipment (Note 13)
Proceeds from sales of property, plant and equipment (Note 13)
Net decrease (increase) in investments in securities
Decrease (increase) in short-term loans receivable
Payments of long-term loans receivableCollection of long-term loans receivable
Proceeds from liquidation of anonymous association
Other, net
Net cash provided by (used in) investing activities(13,720)(91,224)
16,686(114)(1,027)(811)
714–(5,291)(94,789)

5,523(86,622)
28,5491,289
2,613(1,738)
1,076
5,035(4,592)(48,865)(139,679)(928,684)
169,868(1,161)(10,464)(8,257)
7,272–(53,872)(964,979)

Financing activities:
Increase (decrease) in short-term loans payable
Proceeds from issuance of long-term debt
Repayment or redemption of long-term debt
Cash dividends paid to minority shareholders
Other, net
Net cash provided by (used in) financing activities(28,135)
114,435(82,755)(585)(7,941)(4,983)508
4,542(136,634)
(98)
(911)
(132,593)(286,429)
1,164,978(842,470)(5,964)(80,844)(50,730)(13,793)(206,902)
360,902(10,186)(3,365)364,268(140,420)(2,106,308)
3,674,059

666¥154,666–¥360,902

6,782$1,574,533

Operating activities:
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided (used in)by operating activities:
Depreciation and amortization
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for retirement benefits
Equity in (earnings) losses of affiliates
Income taxes-deferred Minority interests in income
Loss (gain) on sales and retirement of property, plant and equipment, net
Impairment loss
Gain on liquidation of anonymous association
Early retirement expense
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Change in finance receivables (Note 13)
Increase (decrease) in notes and accounts payable-trade
Other, net
Net cash provided by (used in) operating activities

Effect of exchange rate changes on cash and cash equivalents
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Increase (decrease) in cash and cash equivalents resulting from change ofscope of consolidation
Cash and cash equivalents at end of year (Note 13)
See accompanying notes to consolidated financial statements.

38

mitsubishi motors corporation Annual Report 2009

Notes to Consolidated Financial Statements
Mitsubishi Motors Corporation and Consolidated Subsidiaries

1. Significant Accounting Policies(a) Basis of preparation
MMC and its domestic consolidated subsidiaries maintain their books of account in conformity with the financial accounting standardsof Japan. The financial statements of foreign subsidiaries are prepared for consolidation purposes in conformity with generally
accepted accounting principles in the United States or International Financial Reporting Standards, subject to the adjustments requiredby generally accepted accounting principles in Japan.
The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Japan which are different in certain respects as to the application and disclosure requirements of International Financial
Reporting Standards. These financial statements have been compiled from the consolidated financial statements filed with the Financial Services Agency as required by the Financial Instruments Law of Japan.
In addition, the notes to the consolidated financial statements include information, which is not required under generally accepted
accounting principles in Japan but is presented herein as additional information.
Certain reclassifications have been made to the prior year’s financial statements to conform to the current year’s presentation.
As permitted, amounts of less than ¥1 million have been omitted. Consequently, the totals shown in the accompanying financial
statements (both in Yen and U.S. dollars) do not necessarily agree with the sum of the individual amounts.

(b) Principles of consolidation
All significant companies over which MMC has effective control are consolidated. Significant companies over which MMC has theability to exercise significant influence have been accounted for by the equity method.
All significant inter-company transactions have been eliminated in consolidation.
Any differences at the date of acquisition between acquisition cost and the fair value of the net assets acquired are expensed whenincurred or are amortized over periods between 3 to 7 years on the period over which it is estimated to be effective, which is assessedby each investment.

(c) Cash and cash equivalents
All highly liquid and low risk investments with maturities of three months or less when purchased are considered to be cash equivalents.

(d) Inventories
Inventories of MMC and its domestic consolidated subsidiaries are principally stated at cost determined by the first in first out (thebook value in the balance sheet may be devaluated if the deterioration in the profitability is recognized) or specific identification
method (the book value in the balance sheet may be devaluated if the deterioration in the profitability is recognized). Inventories ofthe overseas consolidated subsidiaries are principally stated at the lower of cost or market value. Cost is determined by the specificidentification method.

(e) Investments
Investments in securities are classified either as held-to-maturity, investments in unconsolidated subsidiaries and affiliated companies,
or other securities. Held-to-maturity securities are stated at their amortized cost. No investments classified as held-to-maturity were
held during the years ended March 31, 2009 and 2008. Other securities with a readily determinable market value are stated at fair value
and the cost of such securities sold is computed based on the moving average method. The difference between the acquisition cost
and the carrying value of other securities, including unrealized gains and losses, is recognized in “Valuation difference on available-forsale securities” in the accompanying consolidated balance sheets. Other securities without a readily determinable market value arestated at cost determined by the moving average method.

Annual Report 2009 mitsubishi motors corporation

39

(f) Depreciation and amortization
Property, plant and equipment (excluding the leased assets):
Depreciation of property, plant and equipment (excluding the leased assets) is principally calculated using the declining balancemethod or the straight line method over the estimated useful life of the respective assets for MMC and its domestic consolidated
subsidiaries. Depreciation is principally calculated using the straight line method for the overseas consolidated subsidiaries.
The useful lives of the assets are based on estimated life of assets for MMC and are determined in accordance with the Corporate
Tax Law at its domestic consolidated subsidiaries. The useful lives of the assets are determined based on the expected useful lives forthe overseas consolidated subsidiaries.
Intangible fixed assets (excluding the leased assets):
Intangible fixed assets (excluding the leased assets) are amortized using the straight line method for MMC and its domestic consolidated subsidiaries and using the straight line method primarily over the availability period estimated for each investment at the overseas subsidiaries. Software intended for use by MMC and its domestic consolidated subsidiaries is amortized using the straight line
method over a period of 5 years.
Leased assets:
Assets recognized under finance leases that do not involve transfer of ownership to the lessee, are depreciated using the straight line
method based on the contract term of the lease agreement. If the guaranteed residual value is determined in the lease agreement, thesaid guaranteed residual value is deemed as the residual value of such leased assets. If the residual value is not determined, it isdeemed to be zero.

(g) Allowance for doubtful accounts
The allowance for doubtful accounts has been provided based on MMC and its consolidated subsidiaries’ historical experience withrespect to write-offs and an estimate of the amount of specific uncollectible accounts.

(h) Allowance for product warranties
The allowance for product warranty claims has been calculated based on MMC and its consolidated subsidiaries’ historical experienceand estimations with respect to future costs relating to claims.

(i) Retirement benefits
Accrued retirement benefits for employees at March 31, 2009 and 2008 are calculated based on the retirement benefits obligation andthe fair value of the pension plan assets estimated at year end.
Prior service cost is being amortized using the straight line method over periods of 1 to 21 years. These periods are within theestimated average remaining service years of the employees.
Actuarial gains and losses are being amortized using the straight line method over the periods of 5 to 21 years. These periods arewithin the estimated average remaining service years of the employees.

(j) Accrual for retirement benefits for directors and corporate auditors
Before the termination of the retirement benefits plan for directors and corporate auditors in the fiscal year ended March 2007, certain
directors and corporate auditors of MMC and its domestic consolidated subsidiaries had been customarily entitled to lump-sum payments under their respective unfunded severance benefit plans subject to the stockholders’ approval. Due to the termination of theplan and partial deduction of the provision, further provision has been no longer needed and the outstanding balance of the provision
represents only a portion of benefit payments reserved before the plan’s termination.

(k) Translation of foreign currency accounts
The accounts of the consolidated foreign subsidiaries are translated into Yen as follows:a. Asset and liability items are translated at the rate of exchange in effect on March 31;
b. Components of stockholders’ equity are translated at their historical rates at acquisition or upon occurrence; andc. Revenues, expenses and cash flow items are translated at the average rate for the financial period. Translation adjustments areincluded in “Net assets”.

40

mitsubishi motors corporation Annual Report 2009

(l) Amounts per share of common stock
The computation of basic net income per share of common stock is based on the weighted average number of shares of common
stock outstanding during each year. Diluted net income per share of common stock is computed based on the weighted average
number of shares of common stock outstanding each year after giving effect to the dilutive potential of common stock to be issued
upon the conversion of preferred stock and stock options.

(m) Derivative financial instruments
MMC and its consolidated subsidiaries are exposed to risks arising from fluctuations in foreign currency exchange rates and interest
rates. In order to manage those risks, MMC and its consolidated subsidiaries enter into various derivative agreements including forward foreign exchange contracts and interest rate swaps.
Forward foreign exchange contracts are utilized to manage risks arising from forecast exports of finished goods and related foreign
currency receivables. Interest rate swaps are utilized to manage interest rate risk for loans and bonds. MMC and its consolidated subsidiaries do not utilize derivatives for speculation or trading purposes.
Derivative financial instruments are recorded at fair value, excluding certain instruments described below which are recorded inaccordance with the special hedge provisions of the accounting standard.
Forward foreign exchange contracts related to forecast exports of finished goods are accounted for using deferral hedge accounting. Deferral hedge accounting requires unrealized gains or losses to be deferred as liabilities or assets.
MMC and its consolidated subsidiaries have also developed a hedging policy to control various aspects of the derivative transactions including authorization levels and transaction volumes. Based on this policy, within certain limits, MMC and its consolidated subsidiaries hedge the risks arising from the changes in foreign currency exchange rates and interest rates. Forward foreign exchange
contracts are designated to hedge the exposure to variability in expected future cash flows.
For interest rate swaps accounted for as special hedges, instead of measuring hedge effectiveness, confirmation of the conditions
for special hedge accounting is carried out.

2. Changes in Accounting Policies(Accounting standard for measurement of inventories)“Accounting Standard for Measurement of Inventories” (ASBJ Statement No. 9, issued on July 5, 2006) has been applied from this fiscal
year. Accordingly, the operating income decreased by ¥245 million ($2,499 thousand) and the recurring loss and loss before income taxes
and minority interests increased by the same amount. The impact on the segment information has been described in the relevant
section.
(Accounting standard for lease transactions)
In prior years, MMC and its domestic consolidated subsidiaries accounted for finance lease transactions, which do not involve thetransfer of ownership, using the method of accounting for operating leases. However, following the application of the “AccountingStandard for Lease Transactions” (ASBJ Statement No.13, issued on June 17, 1993 and revised on March 30, 2007 by Business Accounting Deliberation Council), and “Guidance on Accounting Standard for Lease Transactions” (ASBJ Guidance No. 16, issued on January
18, 1994 and revised on March 30, 2007 by JIPCA) in this fiscal year, the method of accounting for finance leases is now applied to suchfinance lease transactions.
If the commencement of the finance lease contract, which does not involve transfer of ownership, is earlier than the beginning of
the first year of adoption of the above accounting standard, the balance of future minimum lease payments (after deduction of theinterest element) as of the end of the fiscal year prior to adoption is deemed as the acquisition cost of the asset, and such leased
assets are recognized as if they had been acquired at the beginning of the year of adoption of the standard.
As a result of this change, property, plant and equipment increased by ¥24,172 million ($246,082 thousand). However, the impact of
this change on operating income, ordinary loss and loss before income taxes and minority interests was immaterial.
Along with the application of the Accounting Standard for Lease Transactions, the balance of the purchased molds not yet depreciated that was formerly included in “work in process” in accordance with the accounting treatment for finance lease is now included in“tools, furniture and fixtures (net)”. As a result of this change, work in process decreased by ¥35,102 million ($357,348 thousand), andthe tools, furniture and fixtures (net) by the same amount.

Annual Report 2009 mitsubishi motors corporation

41

(Practical solution on unification of accounting policies applied to foreign subsidiaries for consolidated financial statements)
From the beginning of this fiscal year, the “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for
Consolidated Financial Statements” (PITF Practical Solution No. 18) has been adopted. Accordingly, the opening balance of retained
earnings decreased by ¥13,455 million ($136,979 thousand). Operating income has increased by ¥1,943 million ($19,789 thousand), andordinary loss and net loss before income taxes and minority interests also decreased by the same amount respectively as compared tothe amount that would have been recorded under the previous method.
The impact on the segment information has been described in the relevant section.

3. U.S. Dollar Amounts
The U.S. dollar amounts in the accompanying consolidated financial statements are included, solely for convenience, at ¥98.23 =U.S. $1.00, the exchange rate prevailing on March 31, 2009. This translation should not be construed as a representation that the Yenamounts represent or have been, or could be, converted into U.S. dollars at that or any other rate.

4. Notes and Accounts Receivable-trade, and Finance Receivables
The outstanding balances of trade notes and accounts receivable sold to others which have been deducted from the respective
accounts amounted to ¥7,600 million ($77,369 thousand) and ¥8,000 million as of March 31, 2009 and 2008, respectively. Such amounts
deducted from finance receivables were ¥29,646 million as of March 31, 2008.

5. Property, Plant and Equipment
Accumulated depreciation of property, plant and equipment at March 31, 2009 and 2008 was ¥1,100,730 million ($11,205,642 thousand)and ¥1,280,402 million respectively.
Impairment losses were recognized in the following asset groups for the year ended March 31, 2009 and March 31, 2008:

In millions of yen
2009

In thousands of
U.S. dollars
2009

Location

Application

AssetsImpairment loss amount

Tsukuba, Ibaragi and
Nerima, Tokyo andothers (37 sites)

Assets used insales operations

Land, buildings and others¥   706$   7,189

Ohta, Tokyo and Soka,
Saitama and others(14 sites)

Idle assets

Land, buildings and others

871

8,870

Illinois, U.S.A. (6 sites)

Production facilities

Machinery and equipment,
furniture and fixtures andothers25,916

263,836¥27,494$279,895

In millions of yen
2008
Impairment
loss amount

Location

Application

AssetsNagasaki, Nagasaki and
Sapporo, Hokkaido andothers (49 sites)

Assets used insales operations

Land, buildings and others¥ 4,345

Koufu, Yamanashi andNagoya, Aichi and others(28 sites)

Idle assets

Land, buildings and others

802

Illinois, U.S.A. andSouth Australia,
Australia (2 sites)

Production facilities

Machinery and equipment,
furniture and fixtures andothers16,170¥21,318

42

mitsubishi motors corporation Annual Report 2009

The groupings of assets are determined as follows:
Assets used in production are grouped either by manufacturing plants or operational sites. Assets used in sales operations are
generally grouped by operational sites. Assets leased to others and idle assets have their own asset groups.
As a result of the worsening market environment and other factors, the book value of some of the assets has been adjusted downwardly to recoverable value.
The recoverable values of assets have been obtained through comparing and then taking the higher of: value in use, which isdetermined by estimating future cash flow with a 5% discount rate; and net realizable value, which is based on an appraisal value
obtained from a professional real estate appraiser or calculated on a reasonable basis by using the estate tax valuations through landassessments and similar methods.
Loss on impairment of fixed assets amounted to ¥27,494 million ($279,895 thousand) and ¥21,318 million for the year ended
March 31, 2009 and 2008, respectively. Losses on land at March 31, 2009 and 2008 amounted to ¥458 million ($4,666 thousand) and¥2,948 million, respectively. Losses on buildings at March 31, 2009 and 2008 amounted to ¥650 million ($6,626 thousand) and ¥2,211
million, respectively. Losses on other assets at March 31, 2009 and 2008 amounted to ¥26,384 million ($268,602 thousand) and ¥16,158
million, respectively.

6. Investments
Other securities at March 31, 2009 and 2008 were as follows:
In millions of yen
2009

Other securities:
Securities with   market value
Securities without   market value
Total other securities

2008

Acquisition
cost

Carrying
amountUnrealized
gains

Unrealized(losses)Acquisition
cost

Carrying
amountUnrealized
gains

Unrealized(losses)¥10,424¥13,312¥5,795¥(2,907)¥10,730¥29,071¥18,394

¥(53)

7,916
¥18,340

7,916¥21,228–¥5,795–¥(2,907)

14,254¥24,985

14,254¥43,326–¥18,394–¥(53)

In thousands of U.S. dollars
2009

Other securities:
Securities with   market value
Securities without   market value
Total other securities

Acquisition
cost

Carrying
amountUnrealized
gains

Unrealized(losses)$106,119$135,521$58,997$(29,595)

80,588$186,708

80,588$216,110–$58,997–$(29,595)

Proceeds from sales of other securities and the corresponding gross gains and losses that are included in other gain (loss), net in
the accompanying consolidated statements of operations for the years ended March 31, 2009 and 2008 were as follows:

In millions of yen

Proceeds
Gross gains
Gross losses

In thousands of
U.S. dollars

2009

2008

2009

¥446
77
(16)

¥482
183
(0)

$4,545784(167)

Annual Report 2009 mitsubishi motors corporation

43

Significant declines in the value of securities with market value are recognized as impairment losses if the decline is not considered
to be recoverable. After the write down of the impaired amount, a new book value is established. Losses recognized on the impairment
of securities with market value totaled ¥0 million ($6 thousand) for the years ended March 31, 2009. Similarly, significant declines in thevalue of securities without market value are recognized as impairment losses. Losses recognized on the impairment of securities without market value totaled ¥43 million ($438 thousand) and ¥45 million for the years ended March 31, 2009 and 2008, respectively.
Investments in unconsolidated subsidiaries and affiliated companies, and investments in securities at March 31, 2009 and 2008 wereas follows:

In millions of yen

Investments in unconsolidated subsidiaries and affiliated companies
Investments in securities

In thousands of
U.S. dollars

2009

2008

2009

¥47,214
21,228¥68,443¥55,450
37,570¥93,021$480,655
216,110$696,765

In millions of yen

In thousands of
U.S. dollars

7. Accounts Payable—Other and Accrued Expenses
Accounts payable-other and accrued expenses at March 31, 2009 and 2008 were as follows:

Accrued expenses and accounts payable
Allowance for product warranties

2009

2008

2009

¥114,578
35,561¥150,139¥178,508
50,320¥228,829$1,166,432
362,018$1,528,450

In millions of yen

In thousands of
U.S. dollars

8. Short-Term Loans Payable, Long-Term Debt and Lease Obligations
Short-term loans payable at March 31, 2009 and 2008 consisted of the following:

Loans, principally from banks

2009

2008

2009

¥179,635¥219,597$1,828,723

The weighted average interest rates on short-term loans payable at March 31, 2009 and 2008 were 3.9% and 4.8%, respectively.
Long-term debt at March 31, 2009 and 2008 consisted of the following:

Loans, principally from banks and insurance companies, due through 2023
at interest rates averaging 4.0% in 2009 and 4.7% in 2008:
Secured Unsecured
3.3% bonds due May 28, 2009 (issued May 28, 1997)
3.3% Euro medium-term notes due July 15, 2008 (issued July 15, 2003)
5.7% to 6.0 % bonds due 2008 through 2009 (issued 2005 through 2006)
1.1% bonds due September 24, 2010 (issued September 26, 2005)
Less current portion

44

mitsubishi motors corporation Annual Report 2009

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

¥ 43,283
104,687
25,600––200
173,770(68,991)¥104,779¥ 75,569
8,682
25,6002,000
22,260200
134,311(76,705)¥ 57,606$  440,632
1,065,736
260,612––2,036
1,769,017(702,341)$1,066,675

(a) 3.3% bonds due May 28, 2009, and 3.3% Euro medium-term notes due July 15, 2008 were issued by MMC.
(b) 5.7% to 6.0 % bonds due 2008 through 2009 consist of notes issued by an overseas subsidiary, Mitsubishi Motors (Thailand)Company Limited. (The balances at March 31, 2008 were Thai B| 7,000,000 thousand).
(c) 1.1% bonds due September 24, 2010 were issued by a domestic subsidiary, Suiryo Plastics Co., Ltd.
The maturities of long-term debt are as follows:Year ending March 31,

2010
2011
2012
2013
2014
Thereafter
Total

In millions of yen

In thousands of
U.S. dollars¥ 68,991
65,34239,018302
82
34¥173,770$  702,341
665,194397,212
3,075
842
349
$1,769,017

In millions of yen

In thousands of
U.S. dollars

Lease obligations at March 31, 2009 and 2008 consisted of the following:

Current
Noncurrent

2009

2008

2009

¥ 7,425
13,197––$ 75,591
134,352

In millions of yen

In thousands of
U.S. dollars¥ 7,425
6,076
2,883
1,932
1,141
1,163
¥20,622$ 75,591
61,861
29,354
19,675
11,616
11,844$209,943

The weighted average interest rates on lease obligations at March 31, 2009 were 4.2 %.
The maturities of lease obligations are as follows:Year ending March 31,

2010
2011
2012
2013
2014
Thereafter
Total

Assets pledged as collateral for short-term borrowings, long-term debt and guarantees (excluding factory related groups of assets)
at March 31, 2009 and 2008 consisted of the following:

In millions of yen

Notes and accounts receivable—trade
Finance receivables and Long-term finance receivables
Inventories
Property, plant and equipment, net
Other (see (i) below)

In thousands of
U.S. dollars

2009

2008

2009

¥   5,142
51,17230,769102,629
48,377¥238,091¥   8,215
14,59459,378134,315
78,325¥294,829$    52,347
520,947
313,237
1,044,792
492,491$2,423,816(i) ¥949 million ($9,663 thousand) and ¥875 million of other current assets were pledged based on a liability in a term lease contract relating to a building with Murata Medical
Services, Ltd. at March 31, 2009 and 2008, respectively. ¥46 million ($468 thousand) and ¥46 million of investments were pledged as collateral for debt of Mizushima
Eco-Works Co., Ltd at 2009 and 2008, respectively.

Annual Report 2009 mitsubishi motors corporation

45

The following groups of assets of MMC, the Okazaki factory, were pledged as collateral at March 31, 2009 and 2008, respectively.

In millions of yen

Buildings and structures
Machinery and equipment
Tools, furniture and fixtures
Land

In thousands of
U.S. dollars

2009

2008

2009

¥12,047
9,949
867
985
¥23,850¥11,215
9,304
820
985
¥22,326$122,650
101,292
8,828
10,035$242,807

The following groups of assets of MMC, the Mizushima factory, were pledged as collateral at March 31, 2009 and 2008, respectively.
The amounts guaranteed for the loan from The Japan Bank for International Cooperation to a consolidated subsidiary EQUUS
Leasing B.V. were ¥8,869 million ($90,291 thousand) and ¥12,183 million at March 31, 2009 and 2008, respectively.

In millions of yen

Buildings and structures
Machinery and equipment
Tools, furniture and fixtures
Land

In thousands of
U.S. dollars

2009

2008

2009

¥ 8,201
33,0971,011
2,008¥44,319¥ 8,653
36,964
1,320
2,008¥48,947$ 83,495
336,938
10,295
20,450$451,178

The following groups of assets of MMC, the Kyoto factory, were pledged as collateral at March 31, 2009 and 2008, respectively.

Buildings and structures
Machinery and equipment
Tools, furniture and fixtures
Land

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

¥ 6,388
15,500609
2,235¥24,734¥ 6,691
12,468587
2,235¥21,983$ 65,038
157,798
6,206
22,754$251,798

The following groups of assets of MMC, the Shiga factory, were pledged as collateral at March 31, 2009 and 2008, respectively.

In millions of yen

Buildings and structures
Machinery and equipment
Land

46

mitsubishi motors corporation Annual Report 2009

In thousands of
U.S. dollars

2009

2008

2009

¥ 2,848
14,401
3,859¥21,109¥ 2,853
14,966
3,859¥21,678$ 28,998
146,605
39,290$214,893

The following groups of assets of a consolidated subsidiary, Pajero Manufacturing Corporation, were pledged as collateral at March
31, 2009 and 2008, respectively.

In millions of yen

Buildings and structures
Machinery and equipment
Land

In thousands of
U.S. dollars

2009

2008

2009

¥2,6793,472
1,540¥7,691¥2,8794,002
1,540¥8,422$27,274
35,352
15,677$78,304

The following groups of assets of a consolidated subsidiary, Suiryo Plastics Co., Ltd., were pledged as collateral at March 31, 2009
and 2008, respectively.

In millions of yen

Buildings and structures
Machinery and equipment
Land

In thousands of
U.S. dollars

2009

2008

2009

¥  984
1,463
194¥2,642¥  9941,210
194¥2,399$10,027
14,894
1,980$26,902

In millions of yen

In thousands of
U.S. dollars

The obligations secured by such collateral at March 31, 2009 and 2008 consisted of the following:

Short-term loans payable
Current portion of long-term debt
Long-term debt

2009

2008

2009

¥ 73,135
26,612
16,670¥116,419¥ 75,341
48,46627,102¥150,910$  744,535
270,919
169,713$1,185,168

9. Net Assets
The Corporate Law provides that an amount equal to 10% of the amount to be disbursed as a distribution of earnings should beappropriated to the legal reserve until the sum of the legal reserve and capital surplus equals at least 25% of common stock. MMC and
its domestic subsidiaries have provided these amounts in accordance with the Corporate Law.
MMC is authorized to issue 3,312,000 shares of convertible preferred stock that are classified as Series A, B and G (3 to 4 times ineach series), and has 437,593 shares outstanding at March 31, 2009.
The holders of each series of convertible preferred stock do not have voting rights, but the holders of Series A and G (except for
Series B) are entitled to preferred stock dividends of ¥50,000 per share each year after April 2009.
MMC also would be required to distribute residual claims to the holders of each series of convertible preferred stock by a single
payment of one million yen per share of preferred stock in order of payment.

10. Contingent Liabilities
Loan guarantees given in the ordinary course of business amounted to ¥4,007 million ($40,796 thousand) and ¥4,699 million at March
31, 2009 and 2008, respectively. Agreements similar to guarantees given in the ordinary course of business amounted to ¥1,424 million($14,500 thousand) and ¥2,028 million at March 31, 2009 and 2008, respectively.

Annual Report 2009 mitsubishi motors corporation

47

11. Selling, General and Administrative Expenses
Selling, general and administrative expenses for the years ended March 31, 2009 and 2008 consisted of the following:

In millions of yen

Advertising and promotion expenses
Freightage expense
Directors’ compensations, salaries and allowances
Pension expenses
Depreciation
Research and development expenses
Other
Total

In thousands of
U.S. dollars

2009

2008

2009

¥ 78,783
44,53066,9795,144
13,79135,80861,485¥306,524¥126,790
44,51074,294
4,975
13,991
34,586
79,614¥378,765$  802,031
453,331
681,866
52,374140,404
364,535
625,935$3,120,480

In millions of yen

In thousands of
U.S. dollars

12. Other Gain (Loss), Net
Other gain (loss), net for the years ended March 31, 2009 and 2008 consisted of the following:

2009

Gain on sales of investments in securities
Loss on sales and retirement of property, plant and equipment, net
Reversal of allowance for doubtful accounts
Gain from affiliates accounted for by the equity method, net
Early retirement expense
Cost related to the closure of the production facility of Australian subsidiary
Litigation expenses
Foreign exchange losses
Gain on liquidation of anonymous association
Reversal of cost related to the closure of the production facilityof Australian subsidiary
Gain on transfer from business divestitures
Other
Total

48

mitsubishi motors corporation Annual Report 2009¥91
(2,968)460
367(8,832)–(3,517)(5,105)
–

1,896
561
(5,042)¥(22,088)

2009

2008

¥

193
(2,602)
2,248
4,447
(731)
(14,641)(5,152)(9,926)
4,655

$

928
(30,216)
4,691
3,737
(89,912)–(35,811)(51,977)–––(6,781)¥(28,291)

19,307
5,714(51,329)$(224,867)

13. Cash Flow Information
Cash and cash equivalents at March 31, 2009 and 2008 consisted of the following:

In millions of yen

Cash and bank deposits
Time deposits with maturities of more than three months
Short-term investments maturing within three months from the acquisition dateCash and cash equivalents

In thousands of
U.S. dollars

2009

2008

2009

¥167,841(13,175)–¥154,666¥355,896
(747)
5,754
¥360,902$1,708,659(134,125)–$1,574,533

Interest paid less interest received and dividends received within operating activities in the consolidated statements of cash flows
for the years ended March 31, 2009 and 2008 amounted to a net expense of ¥5,917 million ($60,236 thousand) and ¥10,480 million,
respectively. Income taxes paid for the years ended March 31, 2009 and 2008 amounted to ¥6,727 million ($68,484 thousand) and¥9,301 million, respectively.
Purchases of property, plant and equipment within investing activities in the consolidated statements of cash flows for the years
ended March 31, 2009 and 2008 include payments for the acquisition of lease vehicles of ¥13,006 million ($132,413 thousand) and¥20,277 million, respectively.
Proceeds from sales of property, plant and equipment within investing activities in the consolidated statements of cash flows forthe years ended March 31, 2009 and 2008 include proceeds from sale of lease vehicles of ¥8,587 million ($87,423 thousand) and ¥17,435
million, respectively.
Changes in finance receivables within operating activities in the consolidated statements of cash flows for the years ended March
31, 2009 and 2008 are primarily the net of payments amounting to ¥68,616 million ($698,528 thousand) and ¥95,514 million, respectively,
and proceeds from collections amounting to ¥52,247 million ($531,891 thousand) and ¥126,882 million, respectively.

14. Leases
As lessee(1) Finance lease transactions that do not involve transfer of ownership to the lessee(a) Description of the leased assets:
Property, plant and equipment
Leased assets principally include, but are not limited to, production facilities for the automobile business (“Machinery and equipment (net)” and “Tool, furniture and fixtures (net)”).
(b) Depreciation method of leased assets:
Leased assets under finance leases that do not involve transfer of ownership to the lessee, are depreciated using the straight line
method based on the contract term of the lease agreement. If the guaranteed residual value is determined in the lease agreement, thesaid guaranteed residual value is deemed as the residual value of such leased assets. If the residual value is not determined, it isdeemed to be zero.

(2) Operating lease transactions
Future minimum lease payments required under non-cancellable operating lease transactions entered into by MMC and its consolidated subsidiaries at March 31, 2009 and 2008 were as follows:

In millions of yen

Due within 1 year
Due after 1 year
Total

In thousands of
U.S. dollars

2009

2008

2009

¥ 4,189
12,628¥16,818¥ 5,337
17,377¥22,714$ 42,651
128,559$171,211

Annual Report 2009 mitsubishi motors corporation49

As lessor
Future minimum lease revenues from non-cancellable operating lease transactions entered into by MMC and its consolidated subsidiaries as lessor at March 31, 2009 and 2008 were as follows:

In millions of yen

Due within 1 year
Due after 1 year
Total

In thousands of
U.S. dollars

2009

2008

2009

¥ 6,559
10,977¥17,537¥ 7,513
12,295¥19,809$ 66,779
111,753$178,532

15. Derivative Financial Instruments(a) Nature of and policy for derivative transactions
MMC and its consolidated subsidiaries utilize derivative financial instruments, including forward foreign exchange contracts, crosscurrency swaps and interest rate swaps to manage their exposure to fluctuations in foreign currencies and interest rates. MMC and its
consolidated subsidiaries do not utilize derivatives for speculation or trading purposes.
(b) Risk
MMC and its consolidated subsidiaries are exposed to the risk of credit loss in the event of nonperformance by the counterparties tothe derivatives, but any such loss would not be expected to be material because MMC and its consolidated subsidiaries enter into
derivative transactions only with financial institutions with high credit ratings. The notional amounts of the derivative financial instruments do not necessarily represent the amounts exchanged by the parties and, therefore, are not a direct measure of MMC’s risk exposure in connection with derivatives.
All the transactions related to derivative financial instruments are for the purpose of hedging. MMC and its consolidated subsidiaries do not enter into derivative contracts for which significant volatility would have any significant influence on its operations.
(c) Control
MMC does not enter into derivative contracts for trading purposes or on the anticipation of gains from short-term market movements.
Derivative transactions are appropriately pre-approved by managing directors in charge of finance group head quarters. MMC
approves derivative transactions of consolidated subsidiaries as appropriate, and in accordance with policies established for eachsubsidiary, which require the appropriate approval of managing directors in charge of finance group head quarters.

50

mitsubishi motors corporation Annual Report 2009

Summarized below are the notional amounts and the estimated fair values (based on the prices provided by counterparty financial
institutions) of the derivative positions, other than those accounted under the special hedge provisions, at March 31, 2009 and 2008:

Forward foreign exchange contracts
In millions of yen
2009

Forward foreign exchange contracts:
Sell:  US $   Euro   £ stg   Australian $   Japanese ¥   Others
Buy:  Thai B|   Japanese ¥Total

Notional
amount2008

Fair value

Unrealized
gain (loss)

Notional
amountFair value

Unrealized
gain (loss)¥ 4,841
9,449––
55,658–¥ 4,933
8,725––
59,025–¥ (92)723––(3,367)–¥ 9,456
37,8858,148
5,703
48,764
6,825¥ 8,846
38,2007,648
5,458
49,8846,880¥ 610
(315)
499
245
(1,119)
(54)

1,158
844

1,224
847

66
2
¥(2,668)

–
171

–
175

–
3
¥ (130)

In thousands of U.S. dollars
2009

Forward foreign exchange contracts:
Sell:  US $   Euro   £ stg   Australian $   Japanese ¥   Others
Buy:  Thai B|   Japanese ¥Total

Notional
amountFair value

Unrealized
gain (loss)$ 49,288
96,195––566,609–$ 50,227
88,831––
600,895–$ (938)
7,364––(34,285)–

11,7898,597

12,462
8,622

673
25
$(27,161)

Annual Report 2009 mitsubishi motors corporation

51

Cross currency swaps
In millions of yen
2009

Cross currency swaps:
Sell:   £ stg   Japanese ¥   Others
Buy:  US $   £ stg
Total

Notional
amount2008

Fair value

Unrealized
gain (loss)

Notional
amountFair value

Unrealized
gain (loss)¥   391
17,912
462

¥   0
821
(0)

¥   0
821
(0)

–
–
–

–
–
–

–
–
–

–
–

–
–

–
–
¥821

¥4,206
337

¥1
0

¥1
0
¥1

In thousands of U.S. dollars
2009

Cross currency swaps:
Sell:   £ stg   Japanese ¥   Others
Buy:  US $   £ stg
Total

Notional
amountFair value

Unrealized
gain (loss)$   3,985
182,351
4,705$    98,361(5)$    9
8,361
(5)

–
–

–
–

–
–
$8,365All cross currency swaps excepting sell-Japanese ¥17,912 million have maturities within one year.

Interest rate options
In millions of yen
2009

Interest rate options:
Buy:
Total

52

mitsubishi motors corporation Annual Report 2009

Notional
amountFair value

¥–

¥–

2008

Unrealized
gain (loss)

Notional
amountFair value¥––¥17,119¥18

Unrealized
gain (loss)

¥18
¥18

Interest rate swaps
In millions of yen
2009

Interest rate swaps: Pay-fixed, receive-floating
Total

Notional
amountFair value¥31,187¥(571)

2008

Unrealized
gain (loss)

Notional
amountFair value¥(571)¥(571)¥3,605¥(62)

Unrealized
gain (loss)

¥(62)
¥(62)

In thousands of U.S. dollars
2009Interest rate swaps: Pay-fixed, receive-floating
Total

Notional
amountFair value$317,495$(5,814)

Unrealized
gain (loss)$(5,814)$(5,814)

In millions of yen
2009

Pay-fixed, receive-floating
Notional amount
Average pay-fixed rate (%)
Average receive-floating rate (%)

2008

Within 1
year

From 1year to 3

Over 3years

Within 1
yea

From 1year to 3

Over 3
years

¥–
–
–

¥9,823
7.5
5.8¥21,364
6.5
4.8

¥204
5.3
4.3

¥3,401
4.5
4.3

¥–
–
–

In thousands of U.S. dollars
2009

Pay-fixed, receive-floating
Notional amount
Average pay-fixed rate (%)
Average receive-floating rate (%)

Within 1
year

From 1year to 3

Over 3
years

$–
–
–

$100,000
7.5
5.8$217,495
6.5
4.8

The method to determine fair values is based on quotations obtained from financial institutions.
Derivative financial instruments, principally forward exchange contracts and interest swaps, which qualify as hedges and are accounted
for using the deferred hedge accounting method, are excluded from the above table according to the disclosure requirements.

Annual Report 2009 mitsubishi motors corporation

53

16. Retirement Benefits
MMC and its consolidated subsidiaries have defined benefit pension plans for their employees. The plans include contributory plans inaccordance with the Welfare Pension Institute Law of Japan, tax-qualified plans, and non-contributory severance plans. Additional
retirement benefits are paid in certain cases upon an employee’s retirement. Certain foreign consolidated subsidiaries have defined
contribution pension plans. At March 31, 2009, MMC and its consolidated subsidiaries have 1 fund for contributory plans in accordancewith the Welfare Pension Insurance Law, and 13 funds for tax-qualified plans. MMC and its consolidated subsidiaries have 16 noncontributory severance plans.
The funded status of multi-employer pension plans included in the above plans which are accounted for as defined contribution
schemes as of March 31, 2009 was as follows:,

Pension Plan assets
Benefit obligations under pension plan rules
Difference

In millions of yen

In thousands of
U.S. dollars¥28,068
25,791
2,277$285,737
262,557
23,180

The ratio of MMC and its consolidated subsidiaries’ payments to total contributions of the multi-employer plans as of March 31,
2009 was 57.4%. This ratio is not equal to the ratio of the amount actually contributed by the MMC group.
Defined Benefit Plans
The discount rates used to determine the retirement benefit obligation were 1.5% – 2.5% for MMC and its domestic consolidated
subsidiaries, 3.7% – 11.7% for its foreign consolidated subsidiaries, and 1.5% – 2.5% for MMC and its domestic consolidated subsidiaries, 5.1% – 7.8% for its foreign consolidated subsidiaries at March 31, 2009 and 2008, respectively. The rates of return on plan assets
assumed were 0.8% – 4.0% for MMC and its domestic consolidated subsidiaries, 4.9% – 8.0% for its foreign consolidated subsidiaries
for the year ended March 31, 2009 and 2008.
Prior service cost is amortized using the straight line method over periods of 1 to 21 years for the years ended March 31, 2009 and2008. These periods are within the estimated average remaining service years of the employees.
The amortization period for actuarial gains and losses starts from the subsequent fiscal year and actuarial gains and losses areamortized by the straight line method over the periods of 5 to 21 years for the years ended March 31, 2009 and 2008. These periods
are within the estimated average remaining service years of the employees.
Unrecognized net obligations and assets at the date of initial application are amortized within one year.
The retirement benefit obligation for MMC and its consolidated subsidiaries’ employees’ defined benefit plans at March 31, 2009
and 2008 are summarized as follows:

Retirement benefits obligation
Pension plan assets at fair value
Unfunded status
Unrecognized actuarial losses
Unrecognized prior service costs
Net recognized retirement benefits obligation
Prepaid pension premiums
Provision for retirement benefits

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

¥(178,133)
47,566(130,566)
27,057
3,190(100,318)
5,993¥(106,311)¥(184,183)
67,122(117,060)
17,327
3,304(96,428)6,866¥(103,295)$(1,813,431)
484,235(1,329,196)
275,452
32,478(1,021,264)
61,011$(1,082,275)

Some of the consolidated subsidiaries adopt the simplified method for the calculation of retirement benefits obligation.

54

mitsubishi motors corporation Annual Report 2009

Pension expenses for MMC and its consolidated subsidiaries’ employees’ retirement defined benefit plans for the years ended
March 31, 2009 and 2008 consisted of the following:

In millions of yen

Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial losses
Amortization of prior service costs
OthersPension expenses

In thousands of
U.S. dollars

2009

2008

2009

¥ 8,668
4,793(3,637)
3,103
260
101
¥13,290¥ 9,265
4,724(4,079)
2,335
692
1,871
¥14,809$ 88,250
48,797(37,031)
31,5902,655
1,033$135,296

In addition to the pension expenses above, additional retirement benefits of ¥8,832 million ($89,912 thousand) and ¥10,154 million
were paid and recorded as other gain (loss), net for the years ended March 31, 2009 and 2008, respectively.
Pension expenses of consolidated subsidiaries, which adopt the simplified method, are included in the service costs.

17. Income Taxes
MMC and its domestic consolidated subsidiaries are subject to corporate, resident and enterprise taxes based on their taxable income.
Income taxes of the foreign consolidated subsidiaries are generally calculated based on the tax rates applicable in their countries ofincorporation. The consolidated tax payment system is applied at March 31, 2009 and 2008.
The effective tax rates reflected in the accompanying consolidated statements of operations for the year ended March 31, 2008
differ from the statutory tax rate for the following reasons:(%)

Statutory income tax rate for MMC
Change in valuation allowance, effect of the losses carried forward and similar items
Dividends received deduction
OthersIncome taxes as a percentage of income before income taxes and minority interests

2009

2008

Due to loss before income
taxes and minority interests,
the information is omitted
from the notes.

40.3(13.5)
(0.1)
(0.8)
25.9

Annual Report 2009 mitsubishi motors corporation

55

The significant components of deferred tax assets and liabilities as of March 31, 2009 and 2008 consisted of the following:

Deferred tax assets:
Net operating loss carry forward
Accrued retirement benefits
Allowance for doubtful accounts
Allowance for product warranties
Accounts payable—warranties
Fixed assets (incl. impairment losses)
OthersLess valuation allowance
Total deferred tax assets
Deferred tax liabilities:
Reserves under the Special Taxation Measures Law Unrealized holding gain on securities
Fair value adjustments relating to land
Accelerated depreciation in overseas consolidated subsidiaries
OthersTotal deferred tax liabilities
Net deferred tax liabilities

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

¥212,748
46,5595,916
14,525
7,812
38,152
61,766(349,819)
37,661¥184,835
44,8997,925
19,07815,451
38,10784,725(351,833)
43,189$2,165,815
473,988
60,231
147,868
79,527
388,403628,793(3,561,231)
383,398

(380)
(803)
(4,557)(23,678)(17,185)(46,605)¥ (8,944)(399)(7,166)(4,552)(28,885)(22,489)(63,492)¥ (20,303)(3,875)(8,178)(46,394)(241,053)(174,949)(474,452)$ (91,054)

Deferred tax assets and liabilities at March 31, 2009 and 2008 are included in the accompanying consolidated balance sheets as follows:

Current assets
Non-current assets
Current liabilities
Non-current liabilities
Net deferred tax liabilities

56

mitsubishi motors corporation Annual Report 2009

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

¥ 1,398
8,206–(18,549)¥ (8,944)¥ 1,040
9,842(3,219)(27,967)¥(20,303)$ 14,234
83,544–(188,833)$ (91,054)

18. Segment Information(a) Business segments
The business segment information for MMC and its consolidated subsidiaries for the years ended March 31, 2009 and 2008 is summarized as follows:

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

Net sales:
Automobiles
Financial services  TotalCorporate and eliminations   Consolidated¥1,961,563
11,891
1,973,454
117¥1,973,572¥2,657,457
24,5902,682,047
55¥2,682,103$19,969,090
121,052
20,090,143
1,200$20,091,343

Operating income (loss):
Automobiles
Financial services  TotalCorporate and eliminations   Consolidated¥    3,388
419
3,808
117
¥    3,926¥   95,777
12,763
108,54055¥  108,596$    34,498
4,273
38,7711,200$    39,971

Total assets:
Automobiles
Financial services  TotalCorporate and eliminations   Consolidated¥1,042,197
82,977
1,125,174
12,834¥1,138,009¥1,530,259
63,484
1,593,744
15,664¥1,609,408$10,609,767
844,725
11,454,493
130,660$11,585,153

Depreciation:
Automobiles
Financial services   Consolidated¥   79,972
4,436¥   84,408¥   69,377
5,493¥   74,871$   814,133
45,160$   859,293

Impairment loss:
Automobiles
Financial services   Consolidated¥   22,121
5,372¥   27,494¥   18,386
2,932¥   21,318$   225,201
54,693$   279,895

Capital expenditures:
Automobiles
Financial services   Consolidated¥   76,310
13,364¥   89,675¥   68,732
21,335¥   90,068$   776,851
136,057$   912,909

Note: 1. Segments are divided by sector and by market.
2.	Major products by business segment
		 Automobiles. . . . . . . . . . . Passenger cars
		 Financial services . . . . . . . Sales-finance products
3. Changes in accounting treatment
		 (1) Accounting standard for measurement of inventories
			 As described in the “Changes in Accounting Policies”, from the beginning of this fiscal year, the “Accounting Standard for Measurement of Inventories” (ASBJ
Statement No. 9, issued on July 5, 2006) has been adopted. Accordingly, the operating income for “Automobiles” decreased by ¥245 million ($2,499 thousand)as compared to the amount that would have been recorded under the previous method.
		 (2)	Practical solution on unification of accounting policies applied to foreign subsidiaries for consolidated financial statements
			 As described in the “Changes in Accounting Policies”, from the beginning of this fiscal year, the “Practical Solution on Unification of Accounting Policies Applied
to Foreign Subsidiaries for Consolidated Financial Statements” (PITF Practical Solution No. 18, issued on May 17, 2006) has been adopted. Accordingly, theoperating income for “Automobiles” increased by ¥1,943 million ($19,789 thousand) as compared to the amount that would have been recorded under theprevious method.

Annual Report 2009 mitsubishi motors corporation

57

(b) Geographical segments
The geographical segment information for MMC and its consolidated subsidiaries for the years ended March 31, 2009 and 2008 issummarized as follows:

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

Net sales:
Japan
North America
EuropeAsia
Other areas  TotalCorporate and eliminations   Consolidated¥1,600,176
232,063356,143305,006
173,395
2,666,785(693,212)¥1,973,572¥2,021,524
392,765
657,169
358,339
207,172
3,636,971(954,867)¥2,682,103$16,290,101
2,362,447
3,625,611
3,105,019
1,765,199
27,148,379(7,057,035)$20,091,343

Operating income (loss):Japan
North America
EuropeAsia
Other areas  TotalCorporate and eliminations   Consolidated¥    2,561(23,605)(4,461)
20,618
1,055(3,831)
7,757¥    3,926¥   82,891(10,586)
20,25519,894(4,711)
107,743853¥  108,596$    26,080(240,303)(45,420)
209,896
10,746(39,000)
78,971$    39,971

Total assets:
Japan
North America
EuropeAsia
Other areas  TotalCorporate and eliminations   Consolidated¥  932,233
166,008
120,420
201,727
53,0081,473,399(335,389)¥1,138,009¥1,203,966
221,339
212,843
218,923
101,256
1,958,329(348,921)¥1,609,408$ 9,490,315
1,690,002
1,225,901
2,053,624
539,637
14,999,480(3,414,327)$11,585,153

Note: 1. National and regional groupings are classified by geographical proximity and mutual relevance of business activities.
2.	Main countries and regions outside Japan are grouped as follows;		 (1) North America. . . . . . . The United States
		 (2) Europe . . . . . . . . . . . . . The Netherlands		 (3) Asia. . . . . . . . . . . . . . . . Thailand, Philippines		 (4) Other . . . . . . . . . . . . . . Australia, New Zealand, UAE, Puerto Rico
		 National and regional groupings have been classified by “geographical proximity and mutual relevance of business activities”. However, for the consistency within-house management, Puerto Rico, which had been included in “North America” until the previous fiscal year, is included in “Other” from the beginning of thisfiscal year.
		 As a result of this change, as compared to the amount that would have been recorded under the previous groupings, net sales for “Other” increased by ¥22,152
million ($225,512 thousand); same for “North America” decreased by ¥20,801 million ($211,764 thousand); and same for “Corporate and eliminations” decreased by¥1,350 million ($13,747 thousand). In addition, operating income for “Other” increased by ¥592 million ($6,032 thousand); same for “North America” decreased by¥594 million ($6,052 thousand); and same for “Corporate and eliminations” increased by ¥1 million ($20 thousand).
3. Changes in accounting treatment
		 (1) Accounting Standard for Measurement of Inventories
			 As described in the “Changes in Accounting Policies”, from the beginning of this fiscal year, the “Accounting Standard for Measurement of Inventories” (ASBJ
Statement No. 9, issued on July 5, 2006) has been adopted. Accordingly, the operating income for “Japan” decreased by ¥245 million ($2,499 thousand) as
compared to the amount that would have been recorded under the previous method.
		 (2)	Practical solution on unification of accounting policies applied to foreign subsidiaries for consolidated financial statements
			 As described in the “Changes in Accounting Policies”, from the beginning of this fiscal year, the “Practical Solution on Unification of Accounting Policies Applied toForeign Subsidiaries for Consolidated Financial Statements” (PITF Practical Solution No. 18, issued on May 17, 2006) has been adopted. Accordingly, the operating
income for “Asia” increased by ¥1,943 million ($19,789 thousand) as compared to the amount that would have been recorded under the previous method.

58

mitsubishi motors corporation Annual Report 2009

(c) Overseas sales
Overseas sales, which include export sales of MMC and its domestic consolidated subsidiaries and sales (other than exports to Japan)of the foreign consolidated subsidiaries for the years ended March 31, 2009 and 2008 are summarized as follows:

Overseas sales:
North America
EuropeAsia
Other areas  TotalConsolidated sales

In millions of yen

In thousands of
U.S. dollars

2009

2008

2009

¥  232,202
631,658
216,561494,769¥1,575,192¥1,973,572¥  402,650
931,618
242,677
616,613¥2,193,560¥2,682,103$ 2,363,861
6,430,399
2,204,640
5,036,851$16,035,753$20,091,343(%)

Overseas sales as a percentage of consolidated sales:
North America
EuropeAsia
Other areas  Total

11.8
32.0
11.0
25.0
79.8

15.0
34.7
9.1
23.0
81.8

Note: 1. National and regional groupings are by geographical proximity and mutual relevance of business activities.
2.	Main countries and regions outside Japan are grouped as follows:		 (1) North America. . . . . . . The United States
		 (2) Europe . . . . . . . . . . . . . The Netherlands, Italy, Germany, Russia, Ukraine		 (3) Asia. . . . . . . . . . . . . . . . Thailand, Malaysia, Taiwan
		 (4) Other . . . . . . . . . . . . . . Australia, New Zealand, Puerto Rico
		 National and regional groupings have been classified by “geographical proximity and mutual relevance of business activities”. However, for the consistency within-house management, Puerto Rico, which had been included in “North America” until the previous fiscal year, is included in “Other” from the beginning of thisfiscal year.
		 As a result of this change, as compared to the amount that would have been recorded under the previous groupings, overseas sales for “Other” increased by¥22,152 million ($225,512 thousand); same for “North America” decreased equivalently.
3. Overseas sales are classified by the region of the wholesaler or end users. The figures consist of sales outside of Japan of MMC and its consolidated subsidiaries.

19. Related Party Transactions
MMC entered into the following transactions with related parties during the years ended March 31, 2009 and 2008:(Additional Information)
Effective for the year ended March 31, 2009, “Accounting Standard for Related Party Disclosure” (ASBJ Statement No. 11, issued on
October 17, 2006) and the “Guidance on Accounting Standard for Related Party Disclosure” (ASBJ Guidance No. 13, issued on October 17,2006) has been adopted.
Notwithstanding, there is no change in the scope of disclosure compared to the previous fiscal years.

Annual Report 2009 mitsubishi motors corporation

59

Related Party Transactions
Transactions between MMC and the Related Parties(a) Transaction with the parent or major shareholder (major corporate shareholder) of the reporting company (MMC)
March 31, 2009

Party type:
Party name:
Address:
Capital:Business:% of voting stock held:
Relationship with the Related Party:

Detail of transaction:
Transaction amount:
Account title:
Balance at year end

Major shareholder
Mitsubishi Corporation
Chiyoda-Ku, Tokyo, Japan¥202,816 million
Wholesale trading
Direct 14.0 Indirect 0.0
Sales of passenger cars and import ofmaterials for production/
Interlocking directorates
Sales¥251,381 million($2,559,111 thousand)Accounts receivable¥7,476 million($76,113 thousand)(b) Transaction with the company who has the same parent as the reporting company (MMC) and/or the subsidiary of other­affiliate of the reporting company
March 31, 2009

Party type:
Party name:
Address:
Capital:Business:% of voting stock held:
Relationship with the Related Party:
Detail of transaction:
Transaction amount:
Account title:
Balance at year end

Majority-owned company by a major
shareholder of MMC
MC Automobile (Europe) N.V.
Amsterdam, The Netherlands€107,572 thousands
Controlling company of automobile
business operations in Europe
N/A
Consignment sales of products
Sales¥230,327 million($2,344,780 thousand)Accounts receivable¥880 million($8,962 thousand)Notes: (i) Consumption tax is excluded from transaction amount and included in the balance at year end.
(ii) Contract terms and the policy to determine the contract terms:
		 Sales price of products is determined based on market price and overall cost.

60

mitsubishi motors corporation Annual Report 2009

March 31, 2008

Party type:
Party name:
Address:
Capital:Business:% of voting stock held:
Concurrent board appointment:
Business relationship:
Detail of transaction:
Transaction amount:
Account title:
Balance at year end

Major shareholder
Mitsubishi Corporation
Chiyoda-Ku, Tokyo, Japan¥201,825 million
Wholesale trading
Direct 14.0
1 concurrent member, 3 formallytransferred to MMC
Sales of passenger cars and import ofmaterials for production
Sales (see (i) below)¥292,441 million
Accounts receivable¥24,369 million

March 31, 2008

Party type:
Party name:
Address:
Capital:Business:% of voting stock held:
Concurrent board appointment:
Business relationship:
Detail of transaction:
Transaction amount:
Account title:
Balance at year end

Subsidiary
Heart Beat Reds LLC
Chuo-Ku, Tokyo, Japan¥3 million
Holding and sales of beneficial interestin trust
Direct 100.0–
Investment in anonymous association(1) Proceeds from liquidation(2) Gain on liquidation(1) ¥5,000 million (see (ii) below)(2) ¥4,659 million (see (ii) below)––

Equity method affiliate
Jatco Ltd.
Fuji, Shizuoka, Japan¥29,935 million
Development, manufacturing and salesof transmission and automotive parts
Direct 15.0
1 concurrent member
Purchases of auto parts
Purchase(1) ¥90,259 million) (see (iii) below)
Accounts payable¥18,796 million

Notes: Contract terms and the policy to determine the contract terms:(i) Sales price of products is determined based on market price and overall cost.
(ii)	The proceeds in the form of liquidation dividends were from dividend distributions due to the end of anonymous associations’ operations.
(iii)	The purchase price is determined based on the estimated cost, the price for current model production and market price.

Annual Report 2009 mitsubishi motors corporation

6120. Income and Equity per Share
Net income and equity per share of common stock for the years ended March 31, 2009 and 2008 are summarized as follows:

Net income (loss) per share of common stock
Basic
DilutedStockholders’ equity per share of common stock

In yenIn U.S. dollars

2009

2008

2009

¥ (9.91)–(40.47)¥ 6.30
3.81(21.81)$(0.10)–(0.41)

Diluted amounts per share of common stock are not included for the year ended March 31, 2009 due to the net loss recorded.
The computations of net income per share of common stock for the year ended March 31, 2009 and 2008 are as follows:

In millions of yen

In thousands of
U.S. dollars

2008

2009

2009

Numerator for basic net income (loss) per share of common stock:
Net income (loss)
Income not available to common stockholders
Income available to common stockholders¥ (54,883)–¥ (54,883)¥34,710–34,710$ (558,728)–$ (558,728)

Denominator for net income (loss) per share of common stock:
Weighted average number of shares (in thousands)
Number of dilutive potential common shares (in thousands)(Preferred stock)(Number of stock options exercised)

5,537,816–––

5,509,309
3,598,366(3,598,316)(50)

5,537,816
–
–
–

¥

In numbers of stock, 966 and 975 thousand shares relating to stock options were outstanding at March 31, 2009 and 2008, respectively.

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mitsubishi motors corporation Annual Report 2009

21. Stock Option Plans
Information regarding subscription, size and fluctuation of stock options as of March 31, 2009 and 2008 are as follows:(1) Subscription of stock options
March 31, 2009

Date of approval by shareholders’meeting:
Grantees:
Date of granted:
Class and number of shares granted:
Condition of settlement of rights:

Required service period:
Exercise period:

June 25, 2002
5 directors, 25 executive officers and 80
employees
June 2, 2003
Common stock 1,994,000
Limited to directors, executive officers,
employees of the company or its
subsidiaries at exercise date (except for
those who no longer hold the above
positions due to termination of terms,
retirement, or other valid reasons)
No provisions
From July 1, 2004 to June 30, 2009(2) Size and fluctuation of stock options
Outstanding stock options during the year ended March 31, 2009 converted to numbers of shares are as follows.
March 31, 2009Non-vested (number of shares):
Outstanding at the beginning of the year:
Granted during the year:
Forfeited during the year:
Vested during the year:
Outstanding at the end of the year:
Vested(number of shares):
Outstanding at the beginning of the year:
Vested during the year:
Exercised during the year:
Forfeited during the year:
Outstanding at the end of the year:
Exercise price:
Weighted-average market price at exercise date:
Fair evaluation price on grant date:

–
–
–
–
–
975,000
–
1,000
8,000
966,000
¥173
¥183
–

Annual Report 2009 mitsubishi motors corporation

63

(1) Subscription of stock options
March 31, 2008

Date of approval by shareholders’meeting:
Grantees:
Date of granted:
Class and number of shares granted:
Condition of settlement of rights:

Required service period:
Exercise period:

June 25, 2002
5 directors, 25 executive officers and 80
employees
June 2, 2003
Common stock 1,994,000
Limited to directors, executive officers,
employees of the company or its
subsidiaries at exercise date (except for
those who no longer hold the above
positions due to termination of terms,
retirement, or other valid reasons)
No provisions
From July 1, 2004 to June 30, 2009(2) Size and fluctuation of stock options
Outstanding stock options during the year ended March 31, 2008 converted to numbers of shares are as follows.
March 31, 2008

Non-vested(number of shares):
Outstanding at the beginning of the year:
Granted during the year:
Forfeited during the year:
Vested during the year:
Outstanding at the end of the year:
Vested(number of shares):
Outstanding at the beginning of the year:
Vested during the year:
Exercised during the year:
Forfeited during the year:
Outstanding at the end of the year:
Exercise price:
Weighted-average market price at exercise date:
Fair evaluation price on grant date:

–
–
–
–
–
1,088,000–
85,00028,000975,000
¥173
¥198
–

22. Business Combinations
During the year ended March 31, 2008, in order to achieve “top level customer satisfaction in the industry and the improvement of profitability” and “rapid turnaround of the results of the domestic business”, MMC reorganized and integrated its domestic sales subsidiaries.
No business combination transactions have occurred during the year ended March 31, 2009.

23. Subsequent Event
N/A

64

mitsubishi motors corporation Annual Report 2009

Annual Report 2009 mitsubishi motors corporation

65

Consolidated Subsidiaries and Affiliates
As of March 31, 2009

Company

Incorporated in

Hokkaido Mitsubishi Motors Sales Co., Ltd.

Japan

Higashi Nihon Mitsubishi Motors Sales Co., Ltd.

Japan

Kanto Mitsubishi Motors Sales Co., Ltd.

Japan

Niigata Mitsubishi Motors Sales Co., Ltd.

Japan

Chubu Mitsubishi Motors Sales Co., Ltd.

Japan

Nishi Nihon Mitsubishi Motors Sales Co., Ltd.

Japan

Mitsubishi Motors Parts Sales Co., Ltd.

Japan

Consolidated subsidiaries

Higashi Kanto MMC Parts Sales Co., Ltd.
2

Japan

Shikoku MMC Parts Sales Co., Ltd.*Japan

Pajero Manufacturing Co., Ltd.

Japan

Mitsubishi Automotive Accessories & Products Co., Ltd.

Japan

Mitsubishi Automotive Logistics Technology Co., Ltd.

Japan

Mitsubishi Automotive Engineering Co., Ltd.

Japan

Suiryo Plastics Co., Ltd.

Japan

Mitsubishi Motors North America, Inc. (MMNA)

U.S.A.

Mitsubishi Motors R&D of America, Inc. (MRDA)

U.S.A.

Mitsubishi Motor Sales of Canada, Inc. (MMSCAN)

CanadaMitsubishi Motors Credit of America, Inc. (MMCA)

U.S.A.

Mitsubishi Motor Sales of Caribbean, Inc. (MMSC)

Puerto Rico

Mitsubishi Motors Europe B.V. (MME)

Netherlands

Mitsubishi Motor R&D of Europe GmbH (MRDE)

Germany

Mitsubishi Motor Sales Netherlands B.V.

Netherlands

Mitsubishi Motors Deutschland GmbHGermany

Mitsubishi Motors France S.A.S

FranceMitsubishi Motors Belgium nv

Belgium

MMC International Finance (Netherlands) B.V.

Netherlands

Netherlands Car B.V. (NedCar)

Netherlands

Mitsubishi Motors Australia, Ltd. (MMAL)

Australia

Mitsubishi Motors New Zealand Ltd. (MMNZ)New Zealand

Mitsubishi Motors (Thailand) Co., Ltd. (MMTH)

Thailand

MMTh Engine Co., Ltd.

ThailandMitsubishi Motors Philippines Corp. (MMPC)

Philippines

Asian Transmission Corp. (ATC)Philippines

Mitsubishi Motor Parts Sales of Gulf FZE

U.A.E.

Note: MMC has 18 other subsidiaries outside Japan in addition to the above.

Equity method affiliates
Muroran Mitsubishi Motors Sales Co., Ltd.

Japan

Tokachi Mitsubishi Motors Sales Co., Ltd.

Japan

Ibaraki Mitsubishi Motors Sales Co., Ltd.

Japan

Meihoku Mitsubishi Motors Sales Co., Ltd.

Japan

Mie Mitsubishi Motors Sales Co., Ltd.

Japan

Kagawa Mitsubishi Motors Sales Co., Ltd.

Japan

Miyazaki Mitsubishi Motors Sales Co., Ltd.

Japan

MMC Diamond Finance Corp.

Japan

Mitsubishi Motors do Portugal S.A.

Portugal

Vina Star Motors Corporation

Vietnam

Note: MMC has 10 other affiliates outside Japan in addition to the above.

Other Associated Companies
Company

Capitalization (In millions of yen)

Mitsubishi Heavy Industries, Ltd.

265,608*1 Figures in parentheses represent indirect shares.			
*2 Although MMC's equity holding is less than 50%, this affiliate is listed as a subsidiary because MMC exercises effective control over the company.

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mitsubishi motors corporation Annual Report 2009

Capitalization (In millions)

Business Lines

MMC Share of Voting Rights (%)*1

JPY 100

Automobile sales

100.0

JPY 100

Automobile sales

100.0

JPY 100

Automobile sales

100.0

JPY 100

Automobile sales

100.0

JPY 100

Automobile sales

100.0

JPY 100

Automobile sales

100.0

JPY 100

Automobile parts sales

100.0 (31.5)

JPY 100

Automobile parts sales

56.0 (10.0)

JPY 100

Automobile parts sales

50.0 (8.0)

JPY 610

Automobile and parts manufacture, sales

100.0

JPY 300

Sales of automobile accessories, air conditioners

100.0

JPY 436

Automobile inspection, maintenance, transport, storage and packaging

82.8

JPY 350

Design and testing of automobiles and parts

100.0

JPY 100

Manufacture, sales of automobile parts

100.0

USD 398.8

Automobile importing, manufacturing, sales

100.0

USD 2.0

Product development, design, testing, certification

100.0 (100.0)

USD 1.3

Automobile importing, sales

100.0 (100.0)

USD 260.0

Automobile financing, leasing

100.0 (100.0)

USD 47.5

Automobile importing, sales

100.0

EUR 1282.9

Importing, sales of automobiles and parts

100.0

EUR 0.8

Product development, design, testing, certification

100.0 (100.0)

EUR 6.8

Automobile importing, sales

100.0 (100.0)

EUR 30.0

Automobile importing, sales

100.0 (100.0)

EUR 10.0

Automobile importing, sales

100.0 (100.0)

EUR 3.0

Automobile importing, sales

100.0 (100.0)

EUR 0.1

Procurement of funds, group company financing

100.0

EUR 250.0

Manufacturing, sales of automobiles and parts

100.0 (15.0)

AUD 1,789.9

Automobile importing, sales

100.0

NZD 48.0

Automobile importing, sales

100.0

THB 7,000.0

Automobile importing, assembly, sales

100.0

THB 20.0

Manufacturing of automobile engines

100.0 (100.0)

PHP 1,640.0

Automobile importing, assembly, sales

51.0

PHP 420.0

Manufacturing of automobile transmissions

94.7 (89.4)

UAD 10.0

Importing, sales of automobile parts

100.0

JPY 100

Automobile sales

29.0 (29.0)

JPY 60Automobile sales

35.0

JPY 30Automobile sales

40.0

JPY 70Automobile sales

28.6

JPY 58Automobile sales

24.8

JPY 50Automobile sales

23.0

JPY 60Automobile sales

38.8

JPY 3,000

Auto sales financing, leasing, rentals

47.0

EUR 16.5

Automobile importing, sales

50.0 (50.0)

USD 16.0

Manufacture and marketing of automobiles and parts

25.0

Business Lines

Share of Voting Rights in MMC (%)

Relationship

Shipbuilding & ocean systems development, power systems, machinery & steel
structures, aerospace, mass and medium-lot manufactured machinery and others

15.7 (0.5)

Supplier of parts for MMC products

Annual Report 2009 mitsubishi motors corporation

67

Principal Plants

8

r
e
123
456

7

q
wt
90 y

Country/Region

Name

Major ProductsJapan

1 Nagoya Plant–Okazaki

Outlander, Colt, Colt Plus, Grandis

2	Mizushima Plant

Lancer (Galant Fortis), i, eK Wagon, Minicab

3	Pajero Manufacturing Co., Ltd.

Pajero (Montero), Delica D:5

4	Powertrain Plant–Kyoto

Engines5	 Powertrain Plant–Shiga

Engines

6	Powertrain Plant–Mizushima

Engines, transmissions

U.S.A.

7	 Mitsubishi Motors North America, Inc. (MMNA)

Eclipse, Galant, Endeavor, Eclipse Spyder

Netherlands

8 Netherlands Car B.V. (NedCar)

Colt (European model), Outlander

Thailand9	Mitsubishi Motors (Thailand) Co., Ltd. (MMTh)

Triton, Pajero Sport, Lancer, Spacewagon (Grandis)

0	MMTH Engine Co., Ltd. (MEC)

Engines-	 Mitsubishi Motors Philippines Corporation (MMPC)

Adventure, L300 (Delica)

Philippines

China= Asian Transmission Corporation (ATC)Transmissionsq	 Hunan Changfeng Motor Co., Ltd. (CFA)

Pajerow South East (Fujian) Motor Co., Ltd. (SEM)

Galant, Lancer, Zinger

e Shenyang Aerospace Mitsubishi Motors Engine Manufacturing, Co., Ltd. (SAME)

Enginesr	Harbin Dongan Automotive Engine Manufacturing, Co., Ltd. (HDMC)

Engines, transmissions

Taiwant China Motor Corporation (CMC)

Colt Plus, Galant Fortis, Grunder, Zinger

Vietnamy	 Vina Star Motors Corporation (VSM)

Zinger, Grandis

68

mitsubishi motors corporation Annual Report 2009-=

Investor Information
As of March 31, 2009

Company NameMITSUBISHI MOTORS CORPORATIONHead Office

5-33-8, Shiba, Minato-ku, Tokyo 108-8410, Japan
Telephone: +81-3-3456-1111

Established

April 22, 1970

Capital¥657,350,013,926

Number of Employees

31,905 (Consolidated) 12,664 (Non-consolidated)

Stock Listings

Tokyo Stock Exchange and Osaka Securities Exchange

Securities Code7211

Share Trading Unit

1,000 common shares; 1 preferred share

Number of Shares Outstanding 5,538,336,433
Number of Shareholders

Type

Number of issued shares

Number of shareholders

5,537,898,840

418,409First Series Class A

73,000

4

Second Series Class A

25,0007

Third Series Class A

1,000

1

First Series Class G

130,000

2

Second Series Class G

168,393

3

Third Series Class G

10,2001

Fourth Series Class G

30,000

1

COMMON SHARESPREFERRED SHARES

Major Shareholders

Name

Number of shares held
(thousands)% of total

839,942

15.17

Mitsubishi Corporation

774,768

13.99

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

268,763

4.85

Japan Trustee Services Bank, Ltd. (Trust account 4G)

192,372

3.47

MLPFS Custody(Standing proxy: Merrill Lynch Japan Securities Co., Ltd.)86,855

1.57

Japan Trustee Services Bank, Ltd. (Trust account)

71,157

1.28

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

51,7220.93

Mitsubishi UFJ Trust and Banking Corporation(Standing proxy: The Master Trust Bank of Japan, Ltd.)

32,106

0.58

MMC Supplier Holdings Stock Association

23,7380.43(Common Shares)
Mitsubishi Heavy Industries, Ltd.

CBLDN Legal + General Assurance Pensions
Management Limited(Standing proxy: Citibank Japan Ltd.)
Total

Transfer Agent and Register

23,3170.42

2,364,740

42.70

Mitsubishi UFJ Trust and Banking Corporation
1-4-5, Marunouchi, Chiyoda-ku, Tokyo, Japan(Contact)
Mitsubishi UFJ Trust and Banking Corporation Transfer Agent
7-10-11, Higashisuna, Koto-ku, Tokyo, Japan
Toll-free telephone 0120-232-711

Annual Report 2009 mitsubishi motors corporation

69

Annual Report 20095-33-8, Shiba, Minato-ku, Tokyo 108-8410, Japan
Public Relations Department
Tel : +81-3-6852-4206 (IR)+81-3-6852-4274 (Corporate PR)
Fax : +81-3-6852-5405
http://www.mitsubishi-motors.com
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