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Issued on January 6, 2014
Sumitomo Wiring Systems, Ltd.

Summary of New Year speech of 2014 (for employees)

It is predicted that the demand for automobiles in the world will continue growing steadily, including signs of a slow recovery in the European market. But yet, there are many unclear factors. Although it is anticipated that the SWS group will receive orders at a good rate for the time being, the order volume may fluctuate greatly depending on changes in market environments. I ask you to obtain accurate information quickly and share it globally. I also ask you to assume there may be environmental changes and prepare appropriate options so that we can respond to any changes flexibly and quickly.

In light of the above, I will make three requests this year.

The first request is to advance 'Reduction 10'.
While our customers are enhancing their global competitive edge in emerging countries, it is inevitable that the SWS Group will be involved in more intense price competition than ever before, and it is most probable that the profitability will worsen even if we do receive orders. In preparation for this, I asked you last year to implement the ""Reduction 10"" cost reduction activities. This year, I ask you to advance these activities by setting clear target values with a definite timeline. Permanent cost reduction cannot be achieved through conventional activities only. I urge all divisions involved in manufacture, development, sales, procurement and others to cooperate closely to achieve the targets.

The second request is to enhance development/suggestion capabilities and speed.
As the customers' prime markets have moved to emerging countries, the life cycle of products and technologies that our customers desire have become shorter and shorter. In addition to this, it is assumed that new competitors will appear as emerging countries grow, and development competition of new products and new technologies will become more intense. To continue providing these at appropriate times, I ask development divisions and sales divisions to work together to extract our customers' needs at the earliest time possible, propose ideas earlier than competitors, and develop new products at overwhelming speed so that we can readily release them in the market.

The third request is to enhance global marketing capabilities.
To achieve ""Vision 2017"", it is an absolute requirement to expand businesses with current customers or potential customers in Europe, America, and emerging countries such as China. To keep up with customers that are expanding their businesses globally, we must strengthen the foundation where SWS and group companies can work together systematically and organically with clear respective roles and responsibilities. To meet this end, cultivation of human resources is imperative. It is necessary to appoint local personnel to responsible positions and cultivate more local personnel. It is also imperative to cultivate global-minded leaders with competent communication skills. I ask you to promote human resource development programs on a worldwide scale to create personnel capable of supporting our global businesses.

Osamu Inoue, President


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