Management Policies and Medium-term Management Goals
As stated in our corporate commitment, “Clarion strives to improve society by seeking to develop the relationship between sound, information and human interaction, and by creating products to meet those needs” and carries out activities accordingly.
Clarion is dramatically shifting its business from an in-vehicle device manufacturer to an “In-Vehicle Information Solution Provider”. Setting our eyes on the medium to long term, we are striving to lay a firm foundation for future growth through “business portfolio transformation”, “expanding operations in growth markets” and “realizing low-cost operations”.
The Clarion Group emphasizes consolidated operations in order to enhance corporate value, and accordingly, promotes greater consolidated earnings power and consolidated cash flow management, targeting an adjusted consolidated operating profit margin in excess of 5%*.
The value of net sales, cost of goods sold and also distribution costs and general and administrative expenses will be subtracted to give an "adjusted operating profit margin" for indicating profitability in order to give an appropriate representation of the true state of operations from March 2017 onward.
Signs of a shift in the business model are emerging in the automotive industry. Besides the evolution of Internet technology and artificial intelligence, moves to implement automatic driving are gaining momentum, and car sharing services have spread along with deepening smartphone-vehicle connectivity, among others. Meanwhile, competition with mega-suppliers is becoming more intense as automobile parts manufacturers continue to expand their operations through global M&A and capital alliances.
In this market environment, as an In-Vehicle Information Solution Provider, Clarion is stepping up the global development of its Safety & Information business (aimed at achieving a safer and more secure automotive society) and its Connectivity business, which enables customers to “connect” through Smart Access (cloud-based information network infrastructure for vehicles), and we will continue to lead the world in the provision of products and services.
Next fiscal year, Clarion will strengthen its product lineup for commercial vehicles including buses and trucks, focusing on services that utilize our mainstay systems SurroundEye (overhead view monitor system) and Smart Access. Additionally, system solutions that integrate hardware and software are becoming increasingly important as a means of ensuring safety in automatic driving. We will continue to pursue convenience and comfort within the customer's cabin space through safety support functionality that transforms large volumes of complex data into information that is simple and easy-to-understand, utilizing our core peripheral view monitoring technology.
Furthermore, in order to achieve sound and continuous growth while also enhancing our corporate value, Clarion plans to introduce nominating committees by a resolution of the General Meetings of Shareholders scheduled for June 24, 2016 in order to ensure flexible management and strengthen governance by separating the management supervision and business execution functions.
Amid drastic changes in the surrounding business environment, we will continue to fulfill our corporate social responsibilities as a member of the Hitachi Group and aim to achieve growth as a company in line with what is truly needed by society.