Governance

Economic Performance

Each business location and department Our position and Targets Review of FY 2022 Activities

Responsible Department

Each business location and department

Our position and Targets

Why is “Economic Performance” a critical issue to be addressed?
Explanation of the reason and background

The Yokohama Rubber Group has launched its new medium-term management plan, Yokohama Transformation 2023 (YX2023), which will guide the group during the three years from fiscal 2021.
The tire market actually is composed of two distinct markets - the consumer tire market centering on passenger car tires and the commercial tire market, which includes tires for trucks, buses, agricultural machinery and other commercial-use vehicles. At present, these two markets are about equal in scale. However, as the CASE※1 and MaaS※2 etc. trends accelerate, individual ownership of cars will decrease, and we expect the number of infrastructure-related vehicles devoted to moving people and goods to increase.
  • 1 CASE: Acronym for Connected, Autonomous, Shared & Services, and Electric.
  • 2 MaaS: Mobiliy as a Service (integration and provision of mobility services)

Vision (attainment goal) / target

YX2023 is positioned to "exploitation" of core strengths in existing businesses and "exploration" of new growth opportunities in response to the needs of an era of great change, while simultaneously promoting "transformation" for the next generation of growth.
Our initial financial targets for the medium-term management plan were set at 700 billion yen in sales revenue, 70 billion yen in business profit, and a business profit margin of 10% in fiscal 2023.
However, as announced in the "Notice Regarding Completion of Acquisition of Shares in Trelleborg Wheel Systems Holding AB" on May 2, 2023, the financial targets have been revised as the company will become a consolidated subsidiary.
The revised financial targets are revenue of 1,000 billion yen, business profit of 84.5 billion yen, and business margin of 8.5% in FY2023.
At the end of FY2023, we target a D/E ratio of 0.73x, ROE: 9%, ROIC: 5.2%, operating cash flow of 230 billion yen (3-year cumulative total), and capital investment within depreciation.

Quantitative targets for 2023

Sales revenue 1,000 billion yen
Business profit 84.5 billion yen
Business profit margin 8.5%
Operating income 87.0 billion yen
Operating margin 8.7%

Measures for vision achievement

In the Consumer Tire Business, we will "exploitation" our efforts to expand sales of high value-added products, while in the Commercial Tires Business, we will "exploration" ways to capture market changes in line with the four themes.
Consumer Tires

Raise High Value-Added Tire Sales Ratio

We are focusing on the theme of maximizing the sales ratio of the following Main Products, which are high value-added tires.
(1) ADVAN, our global flagship tire brand; (2) GEOLANDAR, our tire brand for SUVs and pickup trucks; and (3) winter tires.
To achieve this target, we will implement the following three measures.
1. Expanding OE use of ADVAN & GEOLANDAR
2. Strengthen sales in replacement market and Expand size lineups including for WINTER tires
3. Strengthen sales of tires suited to local market needs
Commercial Tires

Respond to Market Changes

We will be "Searching" for opportunities to create new value by capturing major market changes, such as CASE and MaaS, and will work on the four themes. We will also further accelerate the growth of our OHT and TBR businesses.

＜Cost competitiveness＞
To meet the expected growth in demand for lower cost tires, we are positioning India’s passenger car plant as the most cost-competitive passenger car plant in the Yokohama Rubber Group, as the aim of establishing a new low-cost model in tune with the tire market of the future.

＜Service＞
With expected to increase corporate ownership of vehicles, we believe the value demanded from the tires themselves to tire-related after services. We have leveraged our sales and logistics network with locations in all of Japan, and we will strengthen our services to corporate customers with expand our fleet of service vehicles.

＜DX※3＞
We are accelerating the development of advanced tire sensors, and plan to add functions to the sensors to gradually increase the services and customers that can take advantage of these tires. We will use this system to create new value-added services related to tires.

  • 3 DX：Digital Transformation
＜Product Lineup＞
In the transportation and logistics industry, as vehicles become electrically powered and unmanned, it is expected that tires of various varieties will be required to meet the needs of operating distances and usage conditions. To meet this logistics revolution, we will continue to broaden our product lineup, which is one of our strengths, to strengthen our competitive advantage in the market.

■OHT Business is Future Growth Driver
We plan to further accelerate the growth of this business in 2021, and have begun to integrate the OHT businesses of Yokohama Rubber, ATG and Aichi Tire.
On May 2, 2023, we acquired all shares of Trelleborg Wheel Systems Holding AB (TWS). Including the brands owned by Y-TWS (Yokohama TWS), which became a subsidiary, we will strengthen our business by leveraging our strength in product development and customer responsiveness with a full lineup of basic, standard, and premium products.
■TBR Business Strengthening Foundation for Future Growth
We are working to secure stable supply from our Mississippi plant and create the infrastructure needed to fulfill demand.
Expecting demand for TBR tires to continue expanding, we plan to invest to further boost capacity at our TBR plant.
Multiple Business We are committed to shift our portfolio to products with highly stable earnings and strong growth potential.
We plan to solidify the MB segment’s ability to generate stable earnings while also enhancing its growth potential by concentrating resources in the segment’s two core product areas - hoses & couplings and industrial materials.
Management Foundation： Human Resources Strategy & ESG initiatives
In human resource strategy, we will strengthen our management corps and management by reforming our personnel management system, create an organization that can respond more flexibly to the dynamic changes in our operating environment, and facilitate our continued efforts to promote work-style reforms.
In ESG management, in line with our CSR slogan, "Caring for the Future," we will strive to provide environmentally friendly products, promote initiatives to achieve carbon neutrality, and support activities that are rooted in local communities. We also aim to further strengthen corporate governance and create a safe, secure and comfortable workplace.
New Medium-term Management Plan YX2023

Review of FY 2022 Activities

Distribution of economic value to stakeholders

Move the screen to the left or right to see the table information

  Distribution amount
(million yen)		 Calculation method
Stakeholders FY 2022 FY 2021 FY 2020
Business partners and suppliers 323,773 246,427 208,408 Cost of sales + SG&A expenses (excluding personnel expenses)
Employees 52,153 53,204 50,805 Cost of sales + SG&A expenses (personnel expenses)
Shareholders 10,603 10,277 10,431 Dividends paid
Creditors 890 2,158 2,747 Interest paid
Government and administration 28,444 12,951 11,427 Corporate taxes, etc. paid
Society 198 214 17 Donations (entertainment expenses), etc. [High school and university laboratories]
Internal 30,911 29,682 18,658 Net income - dividend amount
Total 448,972 354,913 302,493  
  • The figure for “Creditors” and “Government and administration” are for Yokohama Rubber on a consolidated basis, while the other figures are on a non-consolidated basis.

Considerable financial assistance received from government

The amount of financial assistance in taxes and subsidies received from national and municipal governments was 65.4 million yen.