◯ I would like to talk about our business strategy inAutomotive & Industrial Systems (AIS) Company.

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◯ Here are what I would like to talk today.

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◯ First, FY2015 progress.

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◯ In FY2015 IH, both sales and OP increased.
◯ Sales increase in infotainment systems, electric systems,
sensors, switches and li-ion battery for Tesla Motors
contributed to the company-wide sales growth. Inaddition, yen depreciation gave us a favorable effect,
resulting in the sales +2% y-y.
◯ Sales increase and restructuring benefit done in theprevious year raised OP of 4.2 billion yen from last year
to 52.2 billion yen.
◯ FCF decreased to 17.2 billion yen, since we increased
CAPEX on automotive li-ion battery business andcontinued to have restructuring cash out from theprevious year.

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◯ We have drastically progressed on our restructuring.
◯ In semiconductor business, we transferred three diffusion plants tothe JV, transferred the assembly lines in Southeast Asia andintegrated R&D, production and sales forces into the newcompany.
◯ In circuit component business, we transferred SAW filter businessthrough absorption-type company split.
◯ You can see what we have done on printed circuit board andelectromechanical component businesses in this chart.
◯ We plan to complete most of our restructuring on unprofitablebusiness in this fiscal year.

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◯ This chart shows the sales ratio between profitable andunprofitable products in AIS’s 53 product categories.
◯ In FY2013, the unprofitable products accounted for 42%of the whole sales, and we expect it will come down to
17% due to the restructuring.
◯ We will continue to improve profitability.

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◯ We have developed new applications on li-ion battery toimprove its profitability.
◯ In FY2013, the profitability was negative because half of oursales were for ICT application such as note PCs andsmartphones where the market has been commoditized andfurther competitive.
◯ We returned to black in FY2014 since we started to focus on
automotive and industrial applications with our advantage ofhigh capacity, safety and long-term trustworthiness to regain
sales growth and profitability. In FY2015, we expect sales
increase of 34% (vs FY2013) with 70% of sales coming fromautomotive and industrial applications.
◯ In other business, we accelerate application shift with ouradvantageous technology.

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◯ Next, midterm business plan and automotive businessstrategy.

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◯ These are our target figures towards FY2019.
◯ We plan to achieve sales of 3.6 trillion yen in FY2019,focusing on automotive and industrial areas.
◯ The sales target in automotive area is 2 trillion yen inFY2019, which we currently expect 1.3 trillion yen inFY2015 comparing with 1.2 trillion yen in FY2014 and willcontinue to concentrate on automotive area to achieve
our target in FY2019.

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◯ We focus on ‘environment,’ ‘comfort’ and ‘safety’ when
we make a decision of CAPEX and R&D to be essential
in each business area.
◯ We concentrate on automotive battery in ‘environment’business area, next-gen cockpit systems in ‘comfort’ andadvanced driving assistance systems (ADAS) in ‘safety.’◯ We expect 1.8 trillion yen sales in FY2019 with organic
growth and plan to have M&A and business alliance in‘comfort’ and ‘safety’ area to achieve 2 trillion yen sales.
◯ Now I would like to talk what we work in each businessarea.

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◯ We expand ‘environment’ business area with automotivebattery.
◯ We established Panasonic Energy Corporation of North
America, 100% owned by Panasonic, a li-ion battery
manufacturing company at Tesla Gigafactory in Nevada,USA, in October 2014.
◯ The primary purpose of this company is to work with Tesla
to increase our production capacity, sharing auto
production plan with them and wisely investing phase byphase.
◯ We also work on cost reduction with them, targeting at
30% of module cost reduction with the efficiency frommass and integrated production and distribution costreduction.

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◯ As our another strategy in ‘environment’, we accelerate
lead-acid battery business.
◯ We will establish a JV with our local partner, MINDA
Industries Limited, in December 2014, owned 60% by
Panasonic and 40% by MINDA.
◯ We minimize startup period utilizing their existing plants.
◯ We collaborate with them to have their skills, knowledge
and established clientele in automotive component
business. We develop, produce and sell lead-acid battery
for two-wheeled, four-wheeled and UPS to capture
growing demand with local production.

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◯ In ‘comfort’ business area, we focus on next-gen cockpitsystems.
◯ We launched head-up displays (HUD) which customers
can install by themselves last year and received firstorder from an European automaker on genuine HUDs onwindshield.
◯ HUD is a product which displays information to assist safe
driving such as navigation and speed on windshield sothat a driver can minimize range of viewpoint whiledriving.
◯ Our product which the automaker ordered is the smallest
HUD in the industry with our miniaturization and opticaltechnology originally from digital still cameras andprojectors.

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◯ Another strategy in ‘comfort’ focuses on electronicmirrors.
◯ We agreed with capital and business alliance withFICOSA, a Spanish tier 1 manufacturer, who maintains
the third place in a global exterior rear-view mirror
industry.
◯ We accelerate launch of electronic technologicallyadvanced automotive mirror, combining our image andtheir mirror technology.
◯ We believe electronic mirror is essential as part of nextgen cockpit systems like HUDs, which improve range ofrear viewpoint while driving. We expect international
regulatory is revised to expand its global market.

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◯ In ‘safety’ business area, we expand business as a Tier 2
in sensors such as camera modules and angular rate
sensors where we maintain high market share. Inaddition, we offer systems supporting ‘cognition andjudgment while driving’ combining with ECU where wehave advantages in image processing andcommunication technology.
◯ In automotive camera module, we maintain the topmarket share and are highly evaluated by automakers.
We will continue to expand business capturing demand
for advanced driver assistance systems.

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◯ We established ADAS R&D center in April 2014 to expand
advanced driver assistance systems (ADAS) business,
integrating our device and image processing technology.
We accelerate R&D under group-wide collaboration in
AVC Company and R&D Division.
◯ We have accelerated development in the past six months.
We developed ECUs suitable for sensing devices andreceived orders of systems such as backwardapproaching object detection and emergency brake.
◯ We continue to work together with automakers andincrease the number of orders of lane change assistanceand anti fore-collision systems.

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◯ We have expanded sales by region, since the businessenvironment globally becomes more competitive.
◯ For Japanese automakers, we strengthen businessfocusing on ADAS and other new products to support
their global expansion. In the US and Europe, wecontinue to accelerate business with Southern European
automakers collaborating with FICOSA adding toAmerican and German automakers. We integrated AIS
sales companies in Europe to strengthen business.
◯ We also develop business in China and devices selling toTier 1 and 2.

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◯ We will continue to prioritize profitability and achieve 2
trillion yen sales in FY2019, our 100th anniversary.
◯ Thank you for your cooperation.

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Copyright (C) 2014 Panasonic Corporation All Rights Reserved.

Copyright (C) 2014 Panasonic Corporation All Rights Reserved.