Tokyo, January 8, 2019 - Mitsubishi Heavy Industries, Ltd. (MHI) President and CEO Shunichi Miyanaga delivered an address to employees, commencing the New Year. The following is a summary of the main points of his remarks.
Exemplary efforts made for a year of many successes in 2018
Last year, MHI Group took its first steps toward a future of substantial growth with the launch of the 2018 Medium-Term Business Plan. We also demonstrated MHI Group's technological capabilities and reliability to customers in Japan and around the world with a series of high-profile achievements. The Mitsubishi Regional Jet (MRJ) had its first demonstration flight at the U.K. Farnborough Airshow in July, while the space division built and launched a series of rockets in a short period of time, increasing our launch success rate and putting overseas observation satellites into orbit. MHI also helped deliver solutions around the world with projects to meet various needs in regions of the United States, Europe, and Asia. Furthermore, 2018 was a year in which MHI Group employees achieved remarkable success through persistent individual efforts, including winning gold medals at the World Skills Competition, and strong performances in amateur baseball tournaments. These achievements make me proud to be a member of MHI Group.
Secure structural reforms and tackle business challenges
As we greet the new year of 2019, we must also commit to ensuring that the structural reforms we have been pursuing are put firmly in place. We need to remain conscious of the cash flows generated from the reform process, and instill a commitment to operational efficiency that prioritizes earnings. Let us also foster a corporate culture in which everyone works with self-confidence and in cooperation to embrace new challenges.
At the same time, it's essential that we move swiftly to address the challenges we face in certain businesses. In the thermal power systems business, looking ahead to 2020 and beyond, we will focus on a structural shift to a business more in line with emerging social demands. We will pursue further advances in hardware such as gas-fired and hydrogen-powered gas turbines, distributed power systems, and CO2 recovery plants. It's also important to expand the services that support these systems, such as remote monitoring and operational optimization, utilizing AI (artificial intelligence). In the MRJ business, we will focus on securing type certification, and steadily overcoming each challenge as it arises in order to ensure deliveries begin in 2020.
A new type of conglomerate management
At the beginning of this year, MHI Group headquarters, the division that formulates global and group management strategies and allocates management resources, moved to Tokyo's Marunouchi district. MHI Group is pursuing a new type of conglomerate management aimed at achieving both growth and stability in the international marketplace. To develop personnel to sustain and bolster our growth potential, and strengthen our technology base, we will cultivate global managers from a longer-term perspective. We are also classifying operations into Japan-centered and global businesses based on such factors as market and regional trends, in order to achieve a balance of autonomous management, with each business able to quickly orient itself to activity, and group synergy. Further, to respond to next-generation needs from a long-term perspective, we will continue to modify our business portfolio through strategic allocation of technologies, personnel, capital, and other management resources, in an effort to sustain growth potential.
MHI Group is changing and evolving to better anticipate and meet the needs of the future. To achieve this, all MHI Group employees are encouraged to embrace entrepreneurship, enhance their individual capabilities, and generate solutions by leveraging expertise and teamwork. Let's make a collaborative effort towards growth and building a brighter future for both MHI Group and the world.