Corporate Strategy - Mitsubishi Electric 1. Corporate Mission The Mitsubishi Electric Group will continually improve its technologies and services by applying creativity to all aspects

Corporate Strategy

November 2012

11

Contents1. Corporate Mission

2. Corporate Governance

3. Management Policy:Balanced Corporate Management

4. Strengthening Management Foundation

5. Essential Growth Strategies

6. Direction of Growth Strategies

7. Strengthening the Global Strategy

8. Technological Development: Strong Businesses Stronger

9. Forecast for FY2012

10. Management Targets

Notes:FY2007: April 1, 2007 – March 31, 2008FY2008: April 1, 2008 – March 31, 2009FY2009: April 1, 2009 – March 31, 2010FY2010: April 1, 2010 – March 31, 2011FY2011: April 1, 2011－March 31, 2012FY2012: April 1, 2012 – March 31, 2013

22

1. Corporate Mission

The Mitsubishi Electric Group will continually improve its technologies and services by applying creativity to all aspects of its business. By

doing so, we enhance the quality of life in our society.

Corporate Mission

Seven Guiding PrinciplesTrustTrust

QualityQualityTechnologyTechnology

Citizenship Citizenship

EthicsEthicsEnvironmentEnvironment

Growth Growth

Encourage Fulfillment of Social Responsibility through Our Business Activities

3

Executive Officers

President & CEO

Executive Officers

Board of Directors

Auditing Committee

Each Business and Management Division

General Shareholders’ Meeting

Appointment / Dismissal / SupervisionBusiness Execution Authorization Transfer

Reporting to

Execution Supervision

*More than 50% of members composing each of the three committees shall be outside directors.

Reporting toReporting to

Appointment

Actual practices at Mitsubishi Electric

Increased Flexibility and Transparency of the Management, Reinforced Supervisory Function over the Management

Nomination Committee

Compensation Committee

Appropriate response to revisions of legislation and other external factors

Increase Corporate Value

Appropriate disclosure to shareholders and other stakeholders

• Thorough separation of execution and supervision• Majority of board of directors NOT assuming

responsibility as executive officer• Minimal number of executive officers (21 members)

responsible for day-to-day operation of each business division and corporate administrative sections

• Multi-phase risk management by executive officers meeting

• Implement global internal control system to ensure compliance with the Corporation Law and J-SOX Act (Financial Instruments and Exchange Law)

• Maintaining systems to respond to companywide risks

Chairperson

2. Corporate Governance

Dire

ctor

s

4

Robust Management Foundation and Sustainable Growth

SoundnessSoundness

GrowthGrowth

Two Frameworks for Implementing Balanced Corporate

Management

TwoTwo FrontFront--lineslines

Four SynergisticFour SynergisticCorporate NetworksCorporate Networks

Production and SalesBusiness divisionsBusiness divisions and CorporateGlobal

3. Management Policy: Balanced Corporate ManagementIncrease Corporate Value

“Manufacturing Craftsmanship”(Quality, costs, manufacturing technologies, R&D, IP)

Sales and services

Integration synergies between

Growth strategies Victory (VI) & Advance (AD)Agility to changes in the business environment

Persistently strengthening the business foundation:・“Manufacturing Craftsmanship”・Sales and services・Human resources

Financial standingEthics and compliance CSR

Profitability,Efficiency

5

0

1,000

2,000

3,000

4,000

5,000

03 04 05 06 07 08 09 10 110

100

200

300

• Enhance activities that focus on built-in quality from development and design stages

• Encourage self-initiated and continuous improvement at all the business processes

• Cultivate quality consciousness by sharing quality information as examples through the intranet systems

• Concentrated development in line with growth strategies; promote development of key parts; promoting commercialization

• Reinforce product competitiveness by accelerating the development of more compact, lightweight and energy-efficient products that contribute to a reduced environmental burden

• Reinforce product competitiveness through the synergy of development and manufacturing capabilities while promoting innovation through stronger industry-government-academia tie-ups

• Reinforce strategic IP activities (create competitive IP rights,promote ISO conformity, etc.)

Promote R-SIGMA 21 Activities • Further strengthen cost planning and VE activities (expand raw

material VA for steel/non-ferrous metals, use advanced and high-functional components, etc.)

• Optimize overall global procurement (expand overseas procurement, increase procurement capacity of overseas bases, etc.)

• Supplier selection and focus (classify suppliers , bolster partnerships directly connected to business strategies, etc.)

• Minimize lifecycle cost through green procurement activities (respond to compact and lightweight components and energy conservation, etc.)

*IPR: Intellectual Property Rights, RΣ: Relation-based Strategic Integration for Global MArkets, VE: Value Engineering, QCD: Quality/Cost/Delivery

• Improve manufacturing structure; broaden Just-in-Time (JIT) activities resulting in improved QCD; promote in-house manufacturing of key parts; grow ties btw parent factories/overseas facilities, promote JIT in logistics etc.

Prod

uctiv

ityQ

ualit

yR

&D

and

IPPr

ocur

emen

t

JPY/EUR

JPY/USDNet Sales(Left)

(Billions of Yen)

Operating Income(Right)

133

110114

79

(FY)

162

114

GrowthGrowth

SoundnessSoundnessProfitabilityEfficiency

ProfitabilityEfficiency


(Billions of Yen)

Create higher value, mainly driven by environmental performancesStreamline all the business processes Promote local production/procurement for local consumptionUpgrade FOREX responsiveness in procurement, sales and financing

Continuously Enhance Profitability by Strengthening the Manufacturing Craftsmanship

【Operating Income Ratio to Net Sales】Compared to the 6.5% in the FY07, in the FY11 a same profit level, 6.2%, has been achieved amid the appreciating yen at more than 30% over a 4 years-period

6

0

50

100

150

200

250

05 07 09 110.001

0.01

0.1

1

10

70

72

74

76

78

01 03 05 07 09 11

Reduce waste and loss by raising the level of visualization and clarificationShorten lead timesImprove quality

Augment improvement efforts throughout all business processes

EnvironmentalLoad ReductionEnvironmental

Load Reduction

Cost ReductionCost Reduction

Production

SalesSales

LogisticsLogistics

Quality ControlQuality Control

Development, DesignDevelopment, Design

ProcurementProcurement

AffiliatedCompaniesAffiliated

Companies

Cost of Sales Ratio(%)

(FY)

FY01:77.9%

FY11:72.2%

• Promote standardization and reductions in size and weight

• Engineering-driven efforts for cost reductions

• To be reflected in production design • Small-lot and just-in-time delivery

• Cost reduction

• Improve quality inspection technology

• Use feedback as new insight toward improving the upstream production chain

• 100% adherence to contract delivery terms

• Improve global PSI • Minimize product inventories

• Shorten distribution lead times• Reduce waste and loss with a

greater level of visualization in distribution

• Increase direct-to-production-site rate (Target: 100%)

• Strictly enforce standard procedures

(%)

(FY)

(Thousand Ton)Final Disposal Ratio

Total Disposal(Left)

0.002%

0.02%

FY11:1.6%FY05:6.1%

2.4%

0.3%

GrowthGrowth


ProfitabilityEfficiencyImproving Productivity with Just In Time (JIT) Activities


• Encourage a group-integrated JIT improvement activities

• Provide education and training to key persons

*Final Disposal Ratio = Waste to be buried in landfill just after its generation / Total quantity of waste generated in a factory

Mitsubishi Electric

Affiliates(Japan)

Affiliates(Overseas)

7

-300-200-100

0100200300400

07 08 09 10 11

0

50

100

150

200

07 08 09 10 11 120

50

100

150

200

07 08 09 10 11 12

Generate stable cash flow by raising profitability and streamlining assets

Increase Asset & Cash Turnover

Invest in Growth Field(Billions of Yen)

Capital Investment

179.2

Free Cash Flow(Billionsof Yen)

Cash flow from Cash flow from operating activitiesoperating activities

Cash flow from investing Cash flow from investing activitiesactivities

Focus investment on growth fields

Increase profitability by strengthening businesses

--33.833.8

• Promote inventory reduction mainly through Just In Time activities and securitization of accounts receivable, etc.

• Enhance Group finances (Global CMS: yen, dollars, euros, baht, yuan, etc.)

Improve Profitability

• Structural reforms for improved profitability• Stronger focus on quality, cost, production

technologies, development, intellectual property, marketing and services

• Termination of businesses, strategic alliances

Free Cash FlowFree Cash Flow

160.0168.7

182.0182.0

--80.980.9

(FY)

191.9

R&D(Billions of Yen)

(FY)

144.4

181.8

151.7148.7

(FY)

Enhance and strengthen risk tolerance through the balanced application of funds (Improve financial standing, return value to

shareholders, invest in growth fields)

126.5126.5

133.7

167.7169.6

91.9

195.7195.7

GrowthGrowth



: Energy and Electric : Industrial Automation : Information and Communication: Electronic Devices : Home Appliance : Other


0

2

4

6

8

10

12

14

07 08 09 10 11 12

Shareholder returns(Cash dividends)(¥/share)

(FY)

¥6

¥12 ¥12

FY12Mid-term

¥5

¥13

¥4

0

500

1,000

1,500

2,000

97 07 08 09 10 110

10

20

30

40

(Billions of Yen) (%)

Debt

Debt to Debt to asset ratioasset ratio

Debt Reduction(At the March 31)

(FY)

40.6％

1,769.3

14.5％

542.2

16.0％

484.3550.7

15.8％677.8

20.3％

537.5

16.7％

8

Product competitivenessthrough technological

synergy

Solution businesses through product synergy


EV/HEV automotiveelectrical equipment

Home AppliancesHome Appliances

Satellites/Satellite Communication SystemsRadar/AntennasElectronic SystemsWireless Communications SystemsOptical Broadband Access SystemsInformation System EquipmentSI

Power Devices (IGBT/IPM) High-Frequency and

Optical Devices Automotive/Industrial-use

LCD Panels

Air Conditioners/Heaters/Coolers/CompressorsHousing products

(ventilation, etc.)Photovoltaic systemsHousehold EquipmentDigital Media Equipment

(LCD TVs, DLPs, BDs)

Small satellites Cell production

robotsSiC

MEMS

EMC: Electro-Magnetic Compatibility, NC: Numeric Controller, ECU: Engine Control Unit, DLP: Digital Light Processing, BD: Blu-ray Disc, MSC: Micro Spark Coating, EV/HEV: Electric Vehicle/Hybrid Electric Vehicle, NGN: Next Generation Network, SiC: Silicon Carbide, MEMS: Micro Electro Mechanical Systems, LD/PD: Laser Diode/Photo Diode,

Particle BeamTreatment Systems

Information Technology

Information Technology

Display & Imaging Technology

Display & Imaging TechnologyMedia TechnologyMedia TechnologyEnergy TechnologyEnergy Technology Optical & Electrical

Wave TechnologyOptical & Electrical Wave Technology

Communications Technology

Communications Technology

Device TechnologyDevice TechnologyMechanical TechnologyMechanical TechnologyElectric TechnologyElectric TechnologyPower Electronics Technology

Power Electronics Technology Materials TechnologyMaterials Technology Sensor TechnologySensor Technology

Quality Engineering, EMC Technology, Simulation Technology, Systemization Technology, Design Technology, Intellectual Property Rights, StandardizationQuality Engineering, EMC Technology, Simulation Technology, Systemization Technology, Design Technology, Intellectual Property Rights, Standardization

PON Laser TVs Femtocell wirelessbase-station

Recycling 40G LD/PD

Energy & Electric SystemsEnergy & Electric Systems

Power Systems (Power generation, Transmission

& Distribution) Transportation SystemsWater Environment SystemDisaster Prevention SystemsLarge Display DevicesBuilding Systems

(Elevators and Escalators, Security,Building Management Systems)

Quantum Cryptography Air-to-WaterHigh-speed

elevators

Industrial Automation SystemsIndustrial Automation Systems Information & Communication Systems

Information & Communication Systems Electronic DevicesElectronic Devices

Factory Automation Systems (PLCs/Display equipment, servomotors

/Inverters, NC equipment)Processing machines

(EDM/ lasers) Alternators/StartersECUElectric Power SteeringCar Multimedia

GrowthGrowth



Tech

nolo

gypl

atfo

rms

AD

Gro

wth

Str

ateg

yVI

Gro

wth

Str

ateg

y

LCD system solution

Air conditioners with SiC inverters

Next-generation SiC inverter for railcars

Ex.Device TechnologyDevice Technology

Power Electronics Technology

Power Electronics Technology

Motor systems with built-in SiC inverters

Imaging SolutionsImaging SolutionsEnergy

ConservationSolutions

EnergyConservation

SolutionsTotal Security

SolutionsTotal Security

SolutionsSmart GridSmart Grid

Smart CommunitySmart Community

9

Human ResourcesHuman Resources

FinancialsFinancials

Marketing and ServicesMarketing and Services

ProcurementProcurement

R&D andIPR&D andIP

Productivity and QualityProductivity and Quality

Victory (VI) and Advance (AD) Growth StrategiesVI Growth StrategyVI Growth Strategy

“Make strong businesses stronger”

GrowthGrowth



“Reinforce solutions business centered on strong businesses through internal/external cooperation”

AD Growth StrategyAD Growth Strategy


ImagingImagingSolutionsSolutions

SmartSmartCommunityCommunity

Smart GridSmart Grid

Energy Energy Conservation Conservation

SolutionsSolutions

Total SecurityTotal SecuritySolutionsSolutions

Air Conditioning Air Conditioning and Housing Productsand Housing Products

Network SecurityNetwork SecuritySystemsSystems

Optical Broadband Optical Broadband Access SystemsAccess SystemsSatellitesSatellites

Power DevicesPower Devices

AutomotiveAutomotiveEquipmentEquipment

Factory Factory Automation Automation

ProductsProducts

Power SystemsPower Systems

ElevatorsElevatorsand Escalatorsand Escalators

Transportation Transportation SystemsSystems

10

6. Direction of Growth StrategiesAiming to become a global, leading green company

that contributes to the creation of a prosperous society

Environment and Energy Social Infrastructure Systems

Global DevelopmentMake strong businesses stronger globally Product development meeting regional needsPromote cross-business regional strategies

Eco-friendly power systems R&D for effective utilization of natural resources Power electronics technology

High degree of reliability supporting social safety and securitySystem development utilizing varied technological platformsHigh degree of linkage between image/information communication and machinery controls

Pursue ever Higher Growth

GrowthGrowth



11

Air Conditioning SystemsAutomotive Equipment Power Devices

Factory Automation SystemsBuilding SystemsPower Systems Transportation Systems

Overseas Net Sales / Ratio

34%34%33%32%

102 92 86 79

147130

113 110

0

500

1,000

1,500

08 09 10 110

50

100

150

200(Billions of Yen)

(FY)

(JPY/USD)(JPY/EUR)

JPY/EUR

JPY/USD

Make strong businesses stronger globally7. Strengthening the Global Strategy

0

400

08 09 10 11 … 15

GrowthGrowth



Japan

Overseas

Net

sal

es

Increasing global demand and “eco-friendly” needs

Increase turbine generator production capacityNew transformer plant in U.S.

Expanding demand in emerging countries and broaden business domains in the Japanese marketPenetrating into newly emerging countriesPartnerships and collaboration with rail car manufacturers

Cyclical business model: new installation maintenance

modernizationNew installation businesses in China and emerging marketsSurging demand for modernization

0

600

08 09 10 11 … 15

Strengthen sales/service structure and reallocate resources to become

No. 1 globallySolutions based on collaboration Continuous investments in China

Localization to serve automakers worldwide

Penetrating into emerging marketsIT/eco-friendly technologies

Business expansion in Europe, China and U.S., and next-

generation product developmentEV/HEV-related businessesDifferentiation through low power loss/high reliability

Strategic resource investment and global development and

productionRegional needs (energy conservation, design)Penetrating into emerging

markets

Create synergy by strengthening cross-business cooperation in each region (including Japan, Europe, the United States, China and Southeast Asia)Strengthen business support to promote regional strategies

(FY)

(Billi

ons

of Y

en)

(FY)

(Billi

ons

of Y

en)

(FY)

(Billi

ons

of Y

en)

(FY)

(Billi

ons

of Y

en)

(FY)

(Billi

ons

of Y

en)

(FY)

(Billi

ons

of Y

en)

(FY)

(Billi

ons

of Y

en)

0

230

08 09 10 11 … 150

470

08 09 10 11 … 15

0

650

08 09 10 11 … 150

190

08 09 10 11 … 150

720

08 09 10 11 … 15

1212

Main bases for Business operation

Established a production and sales company for FA systems(Changshu, China) Scheduled start: December 2012•Servomotors•Numerical controls (NCs)

Established a production and sales company for FA systems(Changshu, China) Scheduled start: December 2012•Servomotors•Numerical controls (NCs)

Established a power transformer factory (Memphis, Tennessee, U.S.A.)Scheduled start: April 2013• Increased demand in North

America for transmission and distribution equipment

• Strengthening global production of transformers

Established a power transformer factory (Memphis, Tennessee, U.S.A.)Scheduled start: April 2013• Increased demand in North

America for transmission and distribution equipment

• Strengthening global production of transformers

Established a production and sales company for automotive equipments(Changshu, China)Commenced in May 2012• Equipment for electric power steering • Car multi-media products

Established a production and sales company for automotive equipments(Changshu, China)Commenced in May 2012• Equipment for electric power steering • Car multi-media products

Established a production and sales joint venture for automotive equipments(Changchun, China)Commenced January 2012• Car multi-media products • Partnership with QiMing Information

Technology Co., Ltd.

Established a production and sales joint venture for automotive equipments(Changchun, China)Commenced January 2012• Car multi-media products • Partnership with QiMing Information

Technology Co., Ltd.

Acquisition of MESSUNG Group(Pune and others, India)Merged with Mitsubishi Electric India in May 2012• Expanding product lines

(PLCs, human machine interfaces) • Bolstering operations in sales,

manufacturing, and development

Acquisition of MESSUNG Group(Pune and others, India)Merged with Mitsubishi Electric India in May 2012• Expanding product lines

(PLCs, human machine interfaces) • Bolstering operations in sales,

manufacturing, and developmentEnergy and Electric SystemsIndustrial Automation Systems

Electronic devices

Home appliances

General sales company

R&D bases

Established an assembling and testing joint venture for power devices(Hefei, China)Production began in January 2012

Established an assembling and testing joint venture for power devices(Hefei, China)Production began in January 2012

Recently established entities

GrowthGrowth


ProfitabilityEfficiencyMake strong businesses stronger globally

7. Strengthening the Global Strategy

Established a developing and manufacturing joint venture for low-voltage switchgears(Xiamen, China)Scheduled start: October 2012• Circuit breakers• Magnet switches• Partnership with Shihlin

Electric & Engineering Corp.

Established a developing and manufacturing joint venture for low-voltage switchgears(Xiamen, China)Scheduled start: October 2012• Circuit breakers• Magnet switches• Partnership with Shihlin

Electric & Engineering Corp.

Established an NC service division in the Vietnamese sales company（Ho Chi Minh, Vietnam）

Commenced in October 2012• Replacement/sales of service parts

for Numerical Controllers (NCs)

Established an NC service division in the Vietnamese sales company（Ho Chi Minh, Vietnam）

Commenced in October 2012• Replacement/sales of service parts

for Numerical Controllers (NCs)

Established a new company （Seoul, Republic of Korea）

Commenced in Aug 2012•Procurement/export of materials,

components• Representative function on

Group companies operating in Korea

Established a new company （Seoul, Republic of Korea）

Commenced in Aug 2012•Procurement/export of materials,

components• Representative function on

Group companies operating in Korea

Established a new engineering service company for the Industrial Automation（Dalian, China）Commenced in October 2012• Servicing for Electric discharge

machine (EDM), Laser processing machines, Numerical controllers （NCs）

Established a new engineering service company for the Industrial Automation（Dalian, China）Commenced in October 2012• Servicing for Electric discharge

machine (EDM), Laser processing machines, Numerical controllers （NCs）

Established a new factory for Railroad HVAC（Beaver, Pennsylvania, U.S.A.）Commenced in June 2012• Reinforcement of global business of

Railroad HVAC• Local testing, repairs and overhauls

Established a new factory for Railroad HVAC（Beaver, Pennsylvania, U.S.A.）Commenced in June 2012• Reinforcement of global business of

Railroad HVAC• Local testing, repairs and overhauls

Established a new engineering company for FA systems（Boituva, Brazil）Commenced in July 2012• Numerical controllers （NC）

• Reinforcement of sales/technical services

Established a new engineering company for FA systems（Boituva, Brazil）Commenced in July 2012• Numerical controllers （NC）

• Reinforcement of sales/technical services

Established a sales company（São Paulo & Barueri, Brazil）Commenced in October 2012• Sales/Technical services for FA systems products• After sale services for power plant and industrial

plant equipments

Established a sales company（São Paulo & Barueri, Brazil）Commenced in October 2012• Sales/Technical services for FA systems products• After sale services for power plant and industrial

plant equipments

13

１

0

100

200

300

07 08 09 10 11

(Billion Yen)

(FY)

Energy & ElectricIndustrial Automation

Electronic DevicesHome Appliance

China: Harness collective strengths between operating bases and between businesses

Sales in China

0

50

07 08 09 10 11 … 15

India: Strong market development based on strong businesses

Establishment of new companies• Power device assembling and testing (Hefei)• Energy saving, FA system development/design

(Shanghai) • Automotive equipment manufacturing

(Changshu, Changchun) • FA equipment manufacturing (Changshu) • Low voltage switchgear manufacturing (Xiamen)

Upgrade, strengthen, restructure business promotion systemsBolster sales infrastructure systems Augment risk Management system Reinforce partnerships with leading local corporate groups

Bolster production structures• Air conditioner compressors (Guangzhou)• Elevators and escalators (Shanghai), etc.

Strengthen sales/service operational structures• Mitsubishi Electric Automation Solution

Center (Shanghai)• New engineering service company for

industrial automation systems (Dalian)

：Common areas：Energy and electric：Industrial automation：Information and communication

：Electronic devices：Home appliance

---1-1India411795China

HomeAppliance

ElectronicDevices

Information&Communi

-cationIndustrial

AutomationEnergy

& ElectricCommon

【Affiliated Companies】

GrowthGrowth



7. Strengthening the Global Strategy(1) China Strategy / India Strategy

Sales in IndiaStrengthen links with India-based Japanese companiesExpand business through local capital and deeper partnershipsBolster sales and service systems based on regional characteristics

Note: Includes Taiwan (excludes equity-method companies)Measures bolstering businesses

Principal Business Basis

Strengthen an integrated business prowess within markets, in which demands are expanding for

“Environment & Energy Saving”, “Security & Safety”, and “Social Infrastructure Development”

Measures bolstering businesses

(Billion Yen)

(FY)

Energy & ElectricIndustrial Automation

Reinforcement of sales/servicing structures• Establishment of a general sales company

- Sales and service businesses (Air conditioners systems, Factory automation systems, Visual information equipment, Power devices)

- Business support & Marketing (Social infrastructure-related business, others)• Integration of the former MESSUNG Group

14

Provide high-efficiency, low-environmental load total systems, from power generations and transmission & distribution

Strengthen highly efficient thermal power generation businesses•Boost global production structure•Accelerate development of

new models

Expand the nuclear power generation businesses based on energy measures undertaken by individual countries

Address new and renewal demand across all regions•Strengthen competitive edge and market entry through

collaboration between domestic and overseas bases•Address new demand that targets a low-carbon society

【Japan】• Exuberant and steady

demand for renewal• Upgrade production

capacity （generators, transformers)

• Smart grid experiment

【United States】• Green New Deal

policies in force• New power

transformer factory (Memphis, Tennessee)

【China】• Expanding demand for

power grid• Utilize local production

bases

【Europe】• Utilize local bases

【India and the Middle East】

• Electricity demand• Utilize local bases

(Dubai, Abu Dhabi, Kuwait)

Transmission & Distribution Business

Power Generation Business

Transformers Transformers SwitchgearSwitchgear Power Transmission Power Transmission Supervisory Control Supervisory Control

Systems Systems

Electric Power-Related Business

(Particle Beam Treatment Systems)

7. Strengthening the Global Strategy(2) Power Systems Business

Global Business Promotion Structure and Regional Strategies

GrowthGrowth



• Orders received from 8 of 14 domestic locations (as of Oct 2012)

• Global rollout of domestically cultivated technology

: Production and engineering bases

: Priority markets

TurbineTurbineGenerators Generators

Upgraded production capacity to 60 units per year in Kobe (formerly 45 units), for high-efficiency generation plants, including combined cycle generationExpanded global supply capacity to 80 units per year, leveraging external procurement, including overseas contract production of Mitsubishi Electric design equipmentAccumulated production of turbine generators reached 2,000units in October 2012

New TurbineGenerators Factory

15

Air ConditioningBraking and Safety

Propulsion and Driving

The only manufacturer capable of providing driving, braking and controlling as a single company

• A wide range of applications, from high-speed rail to new transportation systems

• Safety enhanced with high reliability

• Adapts to needs for energy conservation and high functionality

• High shares of domestic and overseas markets

• Using Mitsubishi Electric-manufactured power devices

• Energy saving through inverter control

• Strengthening of production structure

【Europe】• Cooperation with rail car

manufacturers • Expand air conditioning

systems

[Central and South America]• Regional marketing in

cooperation with rail car manufacturers

【North America]• Secure orders in urban

transportation• Maintenance business

【Asia】• Strong demand for railway

infrastructure (such as in India)

[China]• Utilize local production

bases• Maintenance business

[Japan]• Next-generation rolling

stock systems• Ground control systems

and equipment• Environment-related

business

On-Board Information• Integrated information

control aids in operation• Multimedia information

provision to enhance customer service

GrowthGrowth



7. Strengthening the Global Strategy(3) Transportation Systems Business

SiCSiC inverter for rail carsinverter for rail cars


: Production and maintenanceoperating bases

: Priority markets

Ground Control Systems

• Total support for rail transport, including drive control and power management

• Abundant experience in wide range of distribution devices

Concentrated resources from 3 facilities (Kobe, Itami, Nagasaki) to the single facility at the Kobe Worksso that R&D and production capability be streamlined

New Factory forGround Control Systems

(Commenced October 2012)

16

【The Americas】• Enhanced product lineups: penetrating

into markets in Mexico, Central and South America

【Middle East and India】• Penetrating into new markets: stronger

collaborations with local partners

【Asia】・New installation and maintenance:

increased sales of new models・Marketing prowess for modernization・Cross-cooperation between

elevator/escalator, and building management systems

【Europe】• Optimal products for European market

【China】・Capture the top share of the new

installation market・The world-fastest elevators

(Shanghai Tower, scheduled in 2014)・Maintenance: high-quality services

【Japan】・New installation: standard elevators・Modernization: safety & security features・Building management system: wider systems and services realizing energy conservation

Bolster the maintenance business• safety/security, and reliabilityPromote the modernization business• Modernization menu related to:

environment, energy conservation, delivery, and costs

Expand the business based on “Safety/Security” and “Reliability”Expand the new installation business• Global development, sales and

production, and installation systems • New products that anticipate

changes in environmental, energy saving and other markets

Elevator and escalator business

Bolster the building systemsbusiness

： Production bases： Priority markets

*Number of countries already penetrated by the Company: 90

Strengthening global production systemsLaunch the new standard overseas elevator model, NEXIEZ-MRL

Strengthen medium- to high-speed elevator production capacity for the Chinese market

Mitsubishi Elevator Asia Co., Ltd. (Thailand) Mitsubishi Electric Shanghai Electric Elevator Co., Ltd. (China)

Building management systems business Expand sales of products based on Facima&DIGUARD (environment friendly and secure)

• Total solutions by linking such systems as air conditioning, lighting, security

7. Strengthening the Global Strategy(4) Building Systems Business

High degree of safety and reliability shown by abundant experience Energy-saving solutions through advanced drive and control technology

GrowthGrowth



Expand sales of interrelated products with a view to an entire building

New InstallationSales

MaintenanceService

Repairs and MaintenanceModernization

Cyclical business model: new installations maintenance modernization


17

【Central and Eastern Europe, Russia】

• Support to Japanese clients

【Brazil】• New engineering service

company established

【Taiwan and South Korea】

• Smartphone-related capital expenditure

【India】• Acquisition of

MESSUNG Group

【China】• FA integration solutions:

the global priority market

【Japan】• Overwhelming top share• Global strategic

management

GrowthGrowth



Field equipment compatibility and strengthen system construction based on partnership strategies

Upper information layers collaboration Partners: NEC, SAP, Oracle

Software collaborationPartners: NIPPON DENNO, Wind River,

ICONICS, AdroitField equipment M&A/compatibility

• CC-Link partners• Capital alliances with key partners• Technological advantage through

disclosure of technical specifications

Supply capacity and quick delivery by undertaking production close to markets

China: Dedicated production baseIndia: Inverters and low-voltage

switchgear production capabilityASEAN: Smart meter production

New business fields: Process automation (PA), building automation (BA) and energy conservation

Bolster Singapore baseStrengthen the PA business by investing to system integrators

Bolster Solutions

Upgrade Production System

Bolster overseas sales capacity

【ASEAN】• Global strongholds for

PA Business: Solutions, intraregional projects

• Strengthened support to Japanese clients

7. Strengthening the Global Strategy(5) Factory Automation (FA) Systems Business

Integrated solutions from productivity to energy management and global technological support capabilities

: Global FA centers：Satellite FA centers

/Marketing bases: Priority markets


Strengthen the China Business【Establish dedicated production base】• Mechatronics and FA control:

Mitsubishi Electric Dalian Industrial Products Co., Ltd.• Motor drive controllers:

Mitsubishi Electric Automation Manufacturing (Changshu) Co., Ltd.• Low-voltage switchgear:

Mitsubishi Electric Low Voltage Equipment (Xiamen) Co., Ltd.【Bolster solutions business】• Establish an FA total solutions center• Energy-saving SI: Mitsubishi Electric & Electronics

(Shanghai) Co., Ltd

【Key product market share】

Laser processing Laser processing machinesmachines(Printed circuit (Printed circuit board processingboard processing))Global 60%Global 60%China 75%China 75%

PLCsPLCsGlobal 19%China 25%

AC servomotors AC servomotors Global 17%China 22%

* Market shares are based on the company’s estimation

18

Meet the need for high-efficiency equipment and power electronics technology, and image and information processing technology

Bolster R&D in Environment/Energy Saving and Information Communication

IPU (Integrated Power-drive Unit)• Boost product competitiveness in

the expanding EV/HEV market through synergy of semiconductor and automotive equipment technologies

Alternators/Starters• Develop and launch products that meet

demand for such fuel-efficient features as ISS, energy regeneration, high efficiency and low weight in a timely manner

Environment/Energy Saving

Car Multimedia • Reinforce in-vehicle and inter-vehicle

communication functions in line with the evolution of car navigation systems into on-board information navigators

Japan, United States and Europe:• Launch energy-efficient products based on advanced technologies in line with the

spread of electric-powered vehicles and the increasing popularity of fuel-efficient cars that realize automotive safety and comfort

China and India :• Promote global R&D and production strategy aimed at

enhancing competitiveness in emerging markets that favor reasonably priced cars

EPS• Create competitive

products meeting demand for fuel-efficient features

* ISS: Idle Stop and Start, HEV: Hybrid Electric Vehicle, EV: Electric Vehicle, EPS: Electric Power Steering System, ETC: Electric Toll Collection System

StartersStartersAlternators

EPS

ETC

IPU


Information Communication

: Production bases: Priority markets

GrowthGrowth



7. Strengthening the Global Strategy(6) Automotive Equipment Business

Upgrade manufacturing bases in response to market expansion

・United States・The Philippines・Indonesia・Thailand・India・The Netherlands

・Czech Republic(two companies)・Brazil・China

・China (two companies)Mitsubishi Electric Automotive Mitsubishi Electric Automotive (China) Co., Ltd.(China) Co., Ltd.(EPS, car multimedia) (EPS, car multimedia) Changchun Changchun QimingQiming LingdianLingdianAutomotive Electronics Co., Ltd. Automotive Electronics Co., Ltd. (Car multimedia)(Car multimedia)

1987 2000 2010Car navigation systems

Electric PowerSteering

Market share 16%Market share 16% Market share 1Market share 177%%

Market share Market share 2020%%

** Market shares are based on the company’s estimation

19

Established an assembling and testing joint venture

IPM for EV･HEV inverter• Significant trends of growing demands

in European and Asian markets, subsequent to Japan/Unites States

Air Air Conditioners Conditioners

DIPIPM for inverter-type home electronics

• Global top share• Growing demand mainly in Asia,

inverter-type air conditioners, refrigerators and other household appliances

Rolling Stock Rolling Stock

HV-IGBT• Meeting expanding demand

as railway networks around the world advance

FA FA EquipmentEquipment

IGBT/IPM for industrial equipment, IPM • Growing capital expenditure for

manufacturing, particularly in Asia• Regarding low-capacity devices, expand

product lineups through Vincotech Holdings S.à r.L. (particularly in the European market)

Photovoltaic (PV) Photovoltaic (PV) InvertersInverters

Offer abundant product lineups utilizing high-performance, high-reliability components and power electronics technology

* IPM: Intelligent Power Module, DIP: Dual In-line Package, HV: High Voltage, IGBT: Insulated Gate Bipolar Transistor

Automotive Automotive EquipmentEquipment


GrowthGrowth



:Production and sales bases:Priority markets

For renewable energy equipment•Increase in demand for renewable energy equipment especially in Europe and North America

•Make better use of Vincotech Holdings S.a.r.l. for European PV systems

7. Strengthening the Global Strategy(7) Power Devices Business

Mitsubishi Electric GEM Mitsubishi Electric GEM Power Device (Hefei) Co., LtdPower Device (Hefei) Co., Ltd.

In January 2012, a China-based joint venture commenced production of consumer and industrial power modulesExpected to double its 2011, China-based assembly and test operation capacity by 2015

Launched commercial samples of SiC power

modules (Jul 2012)

IndustrialIndustrialConsumerConsumer

20* RAC: Room Air Conditioner, PAC: Package Air Conditioner

Expand regional strategies for product developmentEurope China United States

Japan

Southeast Asia

7. Strengthening the Global Strategy(8) Air Conditioning Systems Business

GrowthGrowth



Consistently pursuing energy conservation through high-efficiency compressors and advanced inverter control/sensing technology

Strengthen Air Conditioning Systems Business

Strengthen global development/production systems • Strengthen the development of

environmental and energy saving differentiation

• Accelerate development of regionally responsive models

• Bolster overseas sales capabilities

Multiunit airConditioner

systems for buildings Store and office

use air conditioners

Strengthen Air-to-Water Businesses

Business expansion through collaboration with local partners in Europe• Augment sales and service systems • Accelerate initiatives to meet needs

through local production and strengthen engineering support

Compressors

Strengthen development of models that conform to the energy conservation systems of various regions • Improve performance of air

conditioners and help expand sales by bolstering high-efficiency development and production capabilities

: Production bases: Priority Markets


【Europe】• Focus on environment and energy

conservation• Heat pumps and heater demand• PAC for heaters et al.; marketing of

new clients • Penetrating into emerging markets:

Eastern Europe, Russia, Turkey

【United States】• Applications responsive to U.S.

markets: multiple-use, energy-saving feature, ductless

【Asia, Middle East】• Cost reduction: local (Thailand)

production • India & emerging markets: further

sales channels

【Japan】• Requirements for energy conservation,

and replacement• Further energy saving• New fields: heat dissipation or cooling

of equipment/facility

【China】• Competitiveness of CITY MULTI,

POWER MULTI, etc.• Floor-mounted inverter unit, RAC and

floor-installed inverter unit• Operational investments

DesignCold resistance/heating performance

European design European design modelmodel

KirigamineKirigamine ““ZenZen””

DesignDesignHighHigh--added added valuevalue

FloorFloormodelmodel

InstallabilityInstallability(Compatible with duct-type models,etc.)

CeilingCeiling--installationinstallationmodelmodel

UprightUpright--installationinstallationmodel (for hotels)model (for hotels)

CoolingCooling--specific modelsspecific models(Inverters)

Energy saving Energy saving performanceperformance

Room air conditioners

Wall ModelWall Model

21

Expand space utilization infrastructure globally, from satellite systems to ground installations

Superbird-C2

Himawari-8 and 9

[Commercial communications Satellite]

©NAOJSubaru Telescope ALMA Telescope

[Commercial communications satellite successfully launched

in May 2011]

ST-2

Türksat 4A/4B

[Commercial communications satellite scheduled to be

launched in 2013 or 2014]

Superbird-C2

Launched in August 2008Launched in May 2011

ST-2

No.7 launched in 2006Nos.8 and 9 planned for launch in 2014 and 2016, respectively

Himawari-8 and 9

Himawari-7

[meteorological tracking satellite]

Expand entry into the global commercial satellite market via the strategic model DS2000 standard satellite bus

• Increase sales in global markets, mainly targeting commercial communications/broadcast satellites

• Maintain zero defect in orbit• Provide uniform, in-house manufacturing encompassing design, assembly and

testing• Enhance satellite fabrication capacity (from 4 to 8 satellites per year)

Superior reliability recognized by European and American satellite

manufacturers• Satellite bus equipment (Global share(%))

• Communication Equipment

• Related systemsUsed in NASA spacecraft

• Participated in over 450 different satellite systems worldwide

Satellite systems

Satellite components

Ground installations

Scheduled to be launched in 2013 or 2014

[Commercial communications satellite]

Türksat-4A/4B

Wide variety of product lines that support satellite operations

Solar ArraySolar ArrayPanels (40%)Panels (40%)

LithiumLithium--ion ion BatteriesBatteries

(35%)(35%)

Solar Array Solar Array SubstratesSubstrates

(30%)(30%)

LowLow--noise noise amplifiersamplifiers

ReceiversReceiversPower Power amplifiersamplifiers

TransmittersTransmitters



GrowthGrowth



HelisatHelisat

7. Strengthening the Global Strategy(9) Space Systems Business

Satellite communications Satellite communications earth stationsearth stations Satellite communicationsSatellite communications

maritime antennamaritime antenna

* Market shares are based on the company’s estimation

22

Compatibility between a low-carbon society and affluent lifestyles

Ongoing R&D that Supports Enhanced Competitiveness

EV/HEV Automotive Equipment

Smart CommunitySmart Grid

SiC Power Devices

Optical communications technology

Rare earth-less technology

Optical transmission system that realizes next-generation 100Gbps super high-speed, long-distance transmissionMain businesses

・Information transmission systems

・Optical devices

High-performance motors that realize elevated torque without using rare earth magnetsMain businesses

・Automotive equipment・FA equipment・Air conditioning equipment

EV/HEV rare earth-less motor*Wavelength

multiplexing transmission systems

*Conducted under the auspices of NewEnergy and Industrial TechnologyDevelopment Organization (NEDO)

Optical submarine cable (40Gbps)

Advanced control technology

Elevators

High-speed, high-precision processing machine controllers that achieve superior productivityElevator controllers that maintain both super high speed and comfortMain businesses

・FA systems・Building systems・Space systems

Laser processing machines

GrowthGrowth



8. Technological Development: Strong Business Stronger

23

• Community power supply

Next-generationdistribution networks

・Coolers/Heaters, Ventilation, Lighting, Hot water supply,Cocking

・PV (photovoltaic systems)・Energy Measurement

・Air conditioners, Lighting

・EMS

・Railcar propulsion system・Power storage system

・FEMS ・PV (photovoltaic systems)・Energy conservation support equipment・Energy Measurement・Air conditioners, Ventilation, Lighting,

Hot water supply, Heating・Heat pumps ・Smart meters

・BEMS ・Building management systems・PV (photovoltaic systems)・Energy conservation support equipment・Energy Measurement

・Power generation systems

・Security systems・Heat pumps ・Heat storage・Smart meters・Demand response facilities

Grid InformationNetwork

・EMS

Smart grid• Supply & Demand Control System• Power System Stabilization System• Power System Stabilizer• Distribution Control system• Distribution Devices• Advanced Metering Infrastructure

Realize optimal energy control that integrates Mitsubishi Electric’s expertise in all areas, from power systems to consumer electronicsOptimizing overall community energy use (including maximizing eco-friendly energy ),

improving daily safety, security, comfort and convenience, and pursuing higher energy conservation

Compatibility between a low-carbon society and affluent lifestyles:Smart community and Smart grid

GrowthGrowth



* xEMS: Energy Management System (B: Building, C: Community, F: Factory, H: Home), PV: Photovoltaic

・HEMS ・PV (photovoltaic systems)・Smart meters ・Home gateways

・PV-EV Link Power Conditioners

Eco-electricity communityCOMMUNITY

BUILDING

HOUSESOCIAL INFRASTRUCTURE

FACTORY

ROADRAILROAD PUBLIC・EMS

・PV(photovoltaic systems)

・Battery Information Service for EV

・ITS・Disaster-prevention

facility

・Disaster-preventionfacility


・Regenerative energyutilization system

・Demand response facilities

・Air conditioners, Ventilation, Lighting, Hot water supply, Heating

• CEMS

24

Applicable products/systems Develop wide-ranging

applications by maximizing device functionality

Promoting low power loss

HybridReduce power loss by applying SiC diodes Commercialized SiCinverters for railcars

(October 2011)

First in the world to release SiC inverter-mounted air

conditioners(November 2010)

Features both low power loss and high reliability

Home appliances

Electric power

Automobiles

0.1

1

10

100

1000

10000

100000

Rolling stock

Cap

acity

(kV

A)

10000100010010Voltage (V)

Full SiCFurther reductions in power

loss by applying SiCtransistors

Verified 98.0% conversion efficiency by utilizing power conditioners for PV systems

(January 2011) Developed EV motor system

with built-in SiC inverters (March 2012)

IPM

Industry・renewable energy

Rail car propulsion system, utilizing

the Full SiC inverterThe world first demonstration of its energy-

saving function by way of railcar commercial operation

（September 2012）

SiCSiC Inverter for Rail CarsInverter for Rail Cars

High Efficient Enclosed Type Traction MotorHigh Efficient Enclosed Type Traction Motor

Electricity consumption reduced by 38.6%(compared to the conventional systems; a design change in the regenerative braking should be considered as well)Regenerative ratio, upgraded to 51.0%(The conventional system: 22.7%)

8. Technological Development: Strong Business StrongerCompatibility between a low-carbon society and affluent lifestyles:

SiC Power Devices GrowthGrowth



25

【IPU】Pursue size reductions and high performance by utilizing power device technology, including SiC, and by developing high-efficiency heat dissipation mounting technology

【EV-ECU】Maximize power and power cost efficiencies through leading energy management technology Establish functional safety technology that ensures the safety of vehicles

【BMU】Develop vehicle charge/discharge control systems in cooperation with battery manufacturer

【Motors】Construct basic structures that realize size/weight reductions and high efficiency Develop standard platforms capable of adapting to a wide range of applications

【Vehicle-mounted chargers】Pursuing high efficiency by incorporating proprietary power transformer technology, including gradation controllers Total system optimization to achieve size/weight reductions Motors

Inverters

Battery control unit

(BMU)

High-voltage battery cells

14V battery

Boost DC/DC

convertersVehicle-mounted

chargers

Cell monitoring

unit

Engines

IPUIPU

Depressor DC/DC

converters

External power source

Controller units (EV-ECU)

GrowthGrowth



Compatibility between a low-carbon society and affluent lifestyles: Automotive Equipment for EV/HEVRealize high-efficiency EV/HEV systems utilizing the integrated technological capabilities

* ECU: Engine Control Unit, BMU: Battery Management Unit


26

0

1,000

2,000

3,000

4,000

5,000

0

100

200

300

400

(Operating Income Ratio)

45.0

65.0

4.7%

80.0

1,710.0

6 MonthsForecast(Apr 2012)

120.0

180.0

5.3%

200.0

3,740.0

Forecast(Apr 2012)

FY2011

112.0

224.0

6.2%

225.4

3,639.4

Actual

43.6

72.7

5.3%

89.6

1,696.0

6 MonthsResult

(Oct 2012)

FY2012

120.0

180.0

5.5%

200.0

3,640.0

Forecast(Oct 2012)

Net Income

Income before Income Taxes

Operating Income

Net Sales

157.9

244.1

6.5%

264.0

4,049.8

Actual

FY2007

12.1

43.9

3.8%

139.7

3,665.1

Actual

FY2008

28.2

64.2

2.8%

94.3

3,353.2

Actual

FY2009

124.5

210.2

6.4%

233.7

3,645.3

Actual

FY2010

3,639.44,049.8

225.4

139.7

3,665.1

233.73,353.2264.0

3,645.3

94.3

3,640.0

200.0

(Billions of Yen) (Billions of Yen)

*Refund and other payments related to the electronic systems business are not included in results forecasts.

Energy & ElectricSystems

IndustrialAutomation Systems

Information &Communication Systems

Electronic Devices

HomeAppliances

Net Sales (Left)

Operating Income(Right)

9. Forecast for FY2012 GrowthGrowth



27

225.43,639.4

20.3611.622.3

849.23.5

200.721.3

516.3101.1978.384.9

1,027.1

Actual

FY2011

200.03,740.0

17.0620.029.0

890.02.0

190.012.0

520.095.0

1,020.073.0

1,050.0

Forecast(Apr 2012)

FY2012

233.73,645.3

14.4609.442.0

924.45.9

175.913.7

487.9100.0927.083.0

1,027.7

Actual

FY2010FY2009

Forecast(Oct 2012)

94.33,353.2

3.2552.9

4.8824.6

-7.1138.918.6

526.126.1

733.174.7

1,039.6

Actual

FY2008

139.73,665.1

12.3596.034.7

915.7-29.8166.924.8

582.149.9

851.674.5

1,043.6

Actual

FY2007

200.03,640.0

17.0600.029.0

850.00.0

180.017.0

540.076.0

940.088.0

1,060.0

Actual

1,017.5Net SalesIndustrial Automation

Systems 129.2Operating Income/Loss

644.3Net SalesInformation & Communication

Systems 2.3Operating Income/Loss

192.0Net SalesElectronic Devices 8.3Operating

Income/Loss

1,057.9Net SalesEnergy & Electric Systems 68.5Operating

Income/Loss

1,000.2Net SalesHome Appliances 65.7Operating

Income/Loss

Operating Income/Loss

Net Sales

Operating Income/Loss

Net Sales

264.04,049.8

Total

16.9660.8

Others

(Billions of Yen)

9. Forecast for FY2012: Segment Forecast GrowthGrowth



28

Integrate vast variety of our competitive electric-electronic businesses; enjoy the maximum synergetic effect

Management Targets to be Continuously and Stably Achieved

5% or more5% or moreRatio of operating income to net sales

10% or more10% or more

15% or less15% or less

ROE

Ratio of the interest-bearingdebt to total assets

Achieved in FY07: 15.1%, FY08: 1.3%, FY09: 3.1%, Achieved in FY10: 12.4%, Achieved in FY11: 10.3%

Achieved in FY07: 6.5%, FY08: 3.8%, FY09: 2.8%, Achieved in FY10: 6.4%, Achieved in FY11: 6.2%

FY07: 15.8%, FY08: 20.3%, FY09: 16.7%, Achieved in FY10: 14.5%, FY11: 16.0%

Pursue ever Higher Growth

GrowthGrowth



10. Management Targets

29

Cautionary StatementsThe expectation of operating results herein and any associated statement to be made orally with respect to the Company’s current plans, estimates, strategies and beliefs, and any other statements that are not historical facts are forward-looking statements. Words such as “expects,” “anticipates,” “plans,” “believes,” “scheduled,” “estimated,” “targeted,” along with any variations of these words and similar expressions are intended to identify forward-looking statements that include but are not limited to projections of revenues, earnings, performance and production. While the statements herein are based on certain assumptions and premises that the Company trusts and considers to be reasonable under the circumstances to the date of announcement, you are requested to kindly take note that actual operating results are subject to change due to any of the factors as contemplated hereunder and/or any additional factor unforeseeable as of the date of this announcement. Such factors materially affecting the expectations expressed herein shall include but are not limited to the following. As such,additional factors may arise at any given time.

1. Any change in worldwide economic and social conditions, as well as laws, regulations, taxation and other legislation

2. Changes in foreign currency exchange rates, especially yen/dollar rates3. Changes in stock markets, especially in Japan4. Changes in balance of supply and demand of products that may affect prices and volume, as well as material

procurement conditions5. Changes in the ability to fund raising, especially in Japan6. Uncertainties relating to patents, licenses and other intellectual property, including disputes involving

patent infringement7. New environmental regulations or the arising of environmental issues8. Defects in products or services9. Litigation and legal proceedings brought and contemplated against the Company or its subsidiaries and

affiliates that may adversely affect operations or finances10. Technological change, the development of products using new technology, manufacturing and

time-to-market11. Business restructuring12. Occurrence of large-scale disasters including earthquakes, typhoons, tsunami, fires and others 13. Social or political upheaval caused by terrorism, war, pandemic by new strains of influenza and other diseases,

or other factors.

“Change is progress.Continuous change is the wellspring of new value.”

Documents

Corporate Strategy - Mitsubishi Electric 1. Corporate Mission The Mitsubishi Electric Group will continually improve its technologies and services by applying creativity to all aspects