Katsunobu Kamei President of ORIX Auto Corporation Responsible for Corporate Financial Services and Maintenance Leasing Segment.

Transcription

1 Future Growth Strategy t of ORIX Group s Auto-Related Business Katsunobu Kamei President of ORIX Auto Corporation Responsible for Corporate Financial Services and Maintenance Leasing Segment 30 November, 2015 Copyright 2015 ORIX Auto Corporation All rights reserved.

4 Ⅰ. Business Overview Company History Jun 1973 Feb 1985 Feb 1997 Oct 1999 Jul 2001 Sep 2001 Orient Auto Lease Co. was established (name changed to ORIX Auto Lease Co. in April 1989) Commenced car-rental business Commenced fuel card (AMS Card) business X Rent-A-Car acquired by ORIX Group Senko Lease acquired by ORIXG Group IFCO and IFCO Rent-A-Car acquired by ORIX Group Apr 2002 Became the first company to introduce car sharing service in Japan Jul 2002 Oct 2003 Jul 2004 Jan 2005 Dec 2005 Apr 2006 Apr 2013 Nittetsu Leasing Auto acquired by ORIX Group Rent-A-Car Japaren acquired by ORIX Group Started introducing ORIX ETC Card towards corporate customers 7 affiliates* engaged in auto-related business merged and formed ORIX Auto Corporation Rex Lease acquired by ORIX Group Started offering ORIX Telematics services 3 separate rent-a-car brands consolidated into ORIX Rent-A-Car brand *ORIX Auto Lease, Senko Lease, IFCO, Nittetsu Leasing Auto, ORIX Rent-A-Car, ORIX Rent-A-Car Hokkaido, Japaren Copyright 2015 ORIX Auto Corporation All rights reserved. 3

5 Ⅰ. Business Overview Presence in the ORIX Group ORIX Auto is grouped under Maintenance Leasing segment Segment profits for FY at 40.4bn yen, accounted for 12% of total segment profits Corporate Financial Services 7% Overseas Lending, Leasing, fee businesses Leasing, Lending, Investment in 12% bonds, Investment banking, Asset 31% (40.4bn yen) management, Ship/Aircraft-related operations Total Segment Profits 336.5bn yen (FY ) 12% Maintenance Leasing 1% 13% ORIX Auto ORIX Rentec* *ORIX Rentec offers Precision measuring equipment and ITrelated equipment rentals and leasing services Real Estate Retail Life insurance, Banking, Card loan business 36% Investment and Operation RE development/rental/ facility operation, REIT asset management, and others Environment and energy-related business, Principal investment and Loan servicing Copyright 2015 ORIX Auto Corporation All rights reserved. 4

6 Ⅰ. Business Overview Segment Assets and ROA Pursue segment assets growth and cost reduction, and maintain high ROA (JPY Bn) Segment Assets and ROA (Maintenance Lease Segment) % 2.4% 3.1% 4.1% 4.1% 3.9% 4.0% 4.5% 5.0% 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 10% 1.0% 0.5% ORIX Auto /3 2010/3 2011/3 2012/3 2013/3 2014/3 2015/3 2016/3 1H 0.0% Copyright 2015 ORIX Auto Corporation All rights reserved. 5

7 Ⅰ. Business Overview Segment Profits Despite impacts from Lehman Crisis and Great East Japan Earthquake, stable profit growth was achieved through business diversification (JPY Bn) 50 Segment Profits (Maintenance Lease Segment) (6 months) ORIX Auto /3 2010/3 2011/3 2012/3 2013/3 2014/3 2015/3 2016/3 1H Copyright 2015 ORIX Auto Corporation All rights reserved. 6

9 Ⅱ. Business Characteristics One stop solution provider for customers diverse car usage and needs Market Share No.2 Car Rental Usage time Long Market Share No.1 Auto Lease Fleet size: 58,791 Lease Fleet size: 1.2 million Car Rental Usage Frequency Light User Heavy User Car Sharing Market Share No.2 Car Sharing Short Fleet size: 2,209 (Data as of the end of September 2015) Copyright 2015 ORIX Auto Corporation All rights reserved. 8

10 Ⅱ. Business Characteristics Auto Lease Leading company in the auto lease industry No.1 player with the largest fleet under management Sales Locations: Fleet Size: Repair Shops under Contract Lease Agents: Used Car Auction Sites: (Operated by ORIX Auto) ) 50 1,212,000 9, Business commenced since 2013 Used Car Shops: 10 (Data as of the end of September 2015) ORIX Auto provides used-car lease with vehicles previously used under car rental or car leases selected under stringent quality standards Copyright 2015 ORIX Auto Corporation All rights reserved. 9

11 Ⅱ. Business Characteristics Car Rental (Rent-A-Car) Largest fleet size and no. of locations among non-auto manufacturer affiliate leasing companies Diverse vehicle lineup from passenger cars to commercial vehicles such as vans and trucks Location: Fleet Size: Coverage: 1,008 (with 60 locations offers truck rentals) 58,791 Nation-wide in all 47 prefectures Competitor A (auto manufacturer affiliate) Peer Comparison (Unit: No. of vehicles) 107,076 ORIX Rent-A-Car 58,791 Competitor B (non-auto manufacturer affiliate) 28,211 (Data relating to ORIX Auto as of the end of September Data relating to competitor A and B as of the end of March 2015, based on 2015 Auto Rental Lease Year Book ) Copyright 2015 ORIX Auto Corporation All rights reserved. 10

12 Ⅱ. Business Characteristics Car Sharing As the pioneer of this business in Japan, ORIX Auto has developed over 1,300 stations centered in major metropolitan areas, with over 2,000 cars for sharing No. of Stations: 1,365 Fleet Size: 2,209 No. of Members: 139,092 Business Areas: Tokyo Area Tokyo, Kanagawa, Saitama, Chiba, Ibaraki Chubu Area Aichi, Gifu, Mie Kansai Area Osaka, Kyoto, Hyogo, Nara, Shiga Okinawa Okinawa One IC card allows access to all ORIX CarShare vehicles (Data as of the end of September 2015) Copyright 2015 ORIX Auto Corporation All rights reserved. 11

13 Ⅱ. Business Characteristics Value-Added Service Menu Providing value-added services based on high level of expertise Fleet Management g BPO Telematics Service Fuel Card (AMS) ETC Card Risk Consultingg Service Accident/Breakdown Support WEB Info. Service Used Car Buy/Sell Service Copyright 2015 ORIX Auto Corporation All rights reserved. 12

14 Ⅱ. Business Characteristics Fuel Card/ETC Card We provide services that enable a control system that not only enhance work/cost efficiency but also contributes to better compliance Fuel Card AMS Card No. of cards issued: 582,000 Accepted by 65% of gasoline stations in Japan Standardized fuel price nation wide (Benefits) Minimizes risk of non-compliance Data feedback allows customers to identify abnormality and potential non-compliance Prevent non-fuel purchases by disabling credit-card function ETC Card ORIX ETC Card No. of cards issued: 363,000 Corporate Card is available for high volume customers (Benefits) Eliminate cumbersome admin. work Minimizes risk of non-compliance Provision of admin. data and records for cross- checking on potential abuse Prevent abuse by disabling credit-card function (Data as of the end of September 2015) Copyright 2015 ORIX Auto Corporation All rights reserved. 13

15 Ⅱ. Business Characteristics Earning Trend Further strengthen Finance and Automobile related expertise, expand services income and the overall earning scale 黎明期 ORIX Auto Earning Breakdown and Trend 節税資金調達 Lease Revenues Services Income (Revenues relating to peripheral services and fleet management services) 35% 3% 19% 19% 28% 28% 97% 81% 72% 72% 65% (Earnings are after operating expenses and before SG&A) ) Copyright 2015 ORIX Auto Corporation All rights reserved. 14

17 Ⅲ. Growth Strategy Core Competence and Future Direc on Capitalize ORIX Auto s core competence to further expand operation scale and maintain existing profitability Core Competence of ORIX Auto Top-class market share in the industry Optimization of asset growth and costs Line up of value-added services Increase services income Achieve high ROA with a non-capital intensive business model Comprehensive offering of auto-related services Identify customers latest needs and enter into such new areas Advanced fleet management know-how Expansion of auto-lease business among overseas group companies Copyright 2015 ORIX Auto Corporation All rights reserved. 16

18 Ⅲ. Growth Strategy Market Approach customers already engaged in leasing transactions with car-rental, carsharing and other value added services services/products Focus on small client, non-fleet, and retail customer segments where potential of transaction expansion is large No. of Vehicles (000 ) Leasing Penetration Non-Fleet (<9 vehicles) Retail Customers Large Client Mid-Size Client Small Client (>100 vehicles) (30 to 99 vehicles) (10 to 29 vehicles) 1,800 1,850 37,500 17,600 53,500 75% 51% 9% 3% 0.3% Lease unit Non-lease unit Growth Strategy Expand customer base with value-added services and fleet management service Enhance product line-up and sales channel (Approximation by ORIX based on report Auto Leasing Industry and outlook in 2015 published by YANO Research) Copyright 2015 ORIX Auto Corporation All rights reserved. 17

19 Ⅲ. Growth Strategy-Customer Needs and Business Expansion - In response to diversifying customers needs, we have been providing various highly specialized services from peripheral services to fleet management High Specializa tion of Serv ice Low Small Clients Maintenance Lease Finance Lease Customers Needs Funding Mid-Size Clients Small Clients Risk-consulting service Support on emission reports WEB information service(e-erg) Accident/breakdown support Fuel Card (AMS Card) ETC Card Car Rental Rationalization of Administration Costs Car Sharing Mid-Large Clients BPO of Fleet Management Telematics Service (e-telematics) Optimization of vehicle usage (Lease/Car Rental/Car Sharing) Compliance Environmental Management Safety Copyright 2015 ORIX Auto Corporation All rights reserved. 18

20 Ⅲ. Growth Strategy Total Services We differentiate from our rivals and provide the best solutions to our customers needs, covering the entire vehicle life cycle from vehicle purchase to maintenance and usedcar sale Usage Vehicle purchase Optimal purchase proposal (new cars) Certified used cars Lease Car rental Car sharing One-Stop Auto-Consulting Service Maintenance management Maintenance Fuel card ETC card EMS Used vehicle sale Buy/sell of used vehicles Vehicle operation Accident/breakdown support E-Telematics Copyright 2015 ORIX Auto Corporation All rights reserved. Copyright 2015 ORIX Auto Corporation All rights reserved. 19

21 Ⅲ. Growth Strategy e-telema cs(1) Enables customers to minimize vehicles emission and promote safer driving by equipping vehicles with devices for data communication, GPS and internet(iot) connections No. of vehicles installed with e-telemactics increased from 60,000 units (2013/3) to 121,000 units (2015/9), a twofold increase in 2.5 years Copyright 2015 ORIX Auto Corporation All rights reserved. 20

22 Ⅲ. Growth Strategy e-telema cs(2) e-telematics enhances our proposal to improve customers drivers habits, improve their driving fuel efficiency and reduce their CO2 emission, and ultimately contribute to a decrease in road accidents Environmental Impact of e-telematics Safer Driving Effects of e-telematics * *Based on actual data of the 13,000 installed with e- Telematics ** No. of risky driving behavior per vehicle per month (Speeding, sudden acceleration/deceleration) Copyright 2015 ORIX Auto Corporation All rights reserved. 21

23 Ⅲ. Growth Strategy e-telematics(3) e-telematics and e-telematics PRO received Grand Prize (Corporate Division) at the 17 th Green Purchasing Award on 4 November 2015 The following points were made in relation to the award e-telematics provides concrete data that enables companies to implement eco-friendly driving and safe driving, and reduce environmental impact Users have direct access to the data generated by the devices Consulting services are provided in addition to fitting devices to vehicles that naturally encourage eco-friendly driving through visualizations These initiatives are valuable from the perspective of spreading eco-friendly driving and for their impact on society The Green Purchasing Awards are given to organizations that attempt to spread and expand green purchases, which are preferential purchases from businesses that seek to reduce their environmental impact through environmentally conscious goods and services The Green Purchasing Awards aims to encourage further wide recognition and qualities of green purchases by awarding outstanding green purchases cases Host:Green Purchasing Network (GPN) Copyright 2015 ORIX Auto Corporation All rights reserved. 22

24 Ⅲ. Growth Strategy Car Leasing for Retail Customers Strengthen our car lease offering to expand our presence in the retail market Efficient market development via both Internet and face-to-face sales activities Products Product offering that accommodates customers diverse needs in both new or used cars Sale Channels Internet:Car Lease Online New Car Lease Online Initial quotation to application all done online Retail Ma arket Face-to-face:Business Partners Strong auto-lease sales agent network (700 partner agents nation-wide) id Copyright 2015 ORIX Auto Corporation All rights reserved. 23

25 Ⅲ. Growth Strategy Ageing Popula on/depopula on/bcp Capitalizing on its know-how in vehicle procurement and extensive industry network, ORIX Auto develops special purpose vehicles in its product offering Background Greater needs for special purpose p vehicles Ageing population Depopulation BCP during crises Strengths of ORIX Auto Mobile ATM Vehicle procurement Know-how in handling special purpose vehicles gained through truck lease and truck rentals (ATM) (Power Generator) Copyright 2015 ORIX Auto Corporation All rights reserved. 24

26 Ⅲ. Growth Strategy Overseas Market Development ORIX Group conducts auto-lease business in 19 countries/regions worldwide With advanced fleet management knowhow accumulated in Japan, ORIX aims to further expand its auto-related business abroad Auto-repair in India Auto-maintenance in Malaysia Countries where we conduct auto-leasing business Among the highlight countries above, where we intend to further expand our auto leasing business Copyright 2015 ORIX Auto Corporation All rights reserved. 25

27 Ⅲ. Growth Strategy Overseas Market Development ORIX s Auto-Lease Business ranks no. 3 in the world and no.1(estimate) in Asia Pacific in terms of the scale of the fleet under its management Asia is expected to be an important driver for the business future growth Global Auto-Lease Company Ranking ORIX s Market Share Position Overseas 1. GE Capital (U.S.) 2. Lease Plan (Netherlands) 3. ORIX (Japan) 4. ARI Fleet (U.S.) 5. ALD Automotive (France) Philippines #1 Thailand d #2 Malaysia #2 Indonesia #4 Australia #5 Taiwan #5 (Source: HSBC Report (2014)) (Based on ORIX Internal Research) Copyright 2015 ORIX Auto Corporation All rights reserved. 26

28 Ⅲ. Growth Strategy Overseas Market Development To establish business model with high quality and high profitability overseas, we will provide technical support to our overseas group companies Strengthen Platform Strengthen Product Development (E.g.) Act Adjust Accumulate Plan Investigate and Plan Vehicle Procurement Pricing competitiveness through economies of scale Check Progress Control Do Improve Proposal Maintenance/ Management WEB Info. Service Safe Driving Management Telematics Improve customer satisfaction Develop value added services Utilize data and improve profitability Enhance system and process efficiency Vehicle Sales Open stores for retail business Put the know-how gained in Japan into practice while considering each country s inherent market characteristics 27 Copyright 2015 ORIX Auto Corporation All rights reserved. 2

29 IV. Summary ORIX Auto is group under the Maintenance Leasing segment which accounts for 12% of the Group s total segment profits and maintains a high ROA at around 4%. This segment will continue to contribute to the Group s stable growth and development in the future Enhance specialization in Finance and Automobile, expand services income and the Group s overall earning expansion Increase market shares in corporate market with a wide range of value-added services. Strengthen presence in retail market with diverse product lineup and multifaceted sales channels Develop various new products and services using ORIX Auto s expertise and know-how in addressing social challenges such as ageing population/depopulation/bcp as well as technology advancement Collaborate with overseas group companies for further business expansion abroad Copyright 2015 ORIX Auto Corporation All rights reserved. 28

30 Disclaimer These materials have been prepared by ORIX Corporation ( ORIX or the Company ) solely for your information and are subject to change without notice. The information contained in these materials has not been independently verified and its accuracy is not guaranteed. No representations, warranties or undertakings, express or implied, are made as to, and no reliance should be placed on, the accuracy, fairness, or completeness, or correctness of the information or the opinions presented or contained in these materials. These materials contain forward-looking statements that reflect the Company s intent, belief and current expectations about future events and financial results. These statements can be recognized by the use of words such as expects, plans, will, estimates, projects, intends, or words of similar meaning. These forward-looking statements are not guarantees of future performance. They are based on a number of assumptions about the Company s operations and are subject to risks, uncertainties and other factors beyond the Company s control. Accordingly, actual results may differ materially from these forward-looking statements. Factors that could cause such differences include, but are not limited to, those described under Risk Factors in the Company s most recent annual report on Form 20-F filed with the US U.S. Securities and Exchange Commission and under Business Risk of the securities report (yukashouken houkokusho) filed with the Director of the Kanto Local Finance Bureau. Some of the financial information in these materials is unaudited. The Company believes that it will be considered a passive foreign investment company for United States Federal income tax purpose in the year to which these consolidated financial results relate and for the foreseeable future by reason of the composition of its assets and the nature of its income. A U.S. holder of the shares or ADSs of the Company is therefore subject to special rules generally intended to eliminate any benefits from the deferral of U.S. Federal income tax that a holder could derive from investing in a foreign corporation that does not distribute all of its earnings on a current basis. Investors should consult their tax advisors with respect to such rules, which are summarized in the Company s annual report. Nothing in this document shall be considered as an offer to sell or solicitation of an offer to buy any security, commodity or other instrument, including securities issued by the Company or any affiliate thereof. Copyright 2015 ORIX Auto Corporation All rights reserved. 29

31 Additional Information For annual and more historical data please access our website. A list of major disclosure materials is given below. ORIX Website: IR Website: URL: URL: If you would like to be included on our list for major news announcements, please send your request to the address below. ORIX Corporation Corporate Planning Department World Trade Center Building., 2-4-1, Hamamatsu-cho, Minato-ku, Tokyo , Japan Tel: Fax: chun_yang@orix.co.jp Copyright 2015 ORIX Auto Corporation All rights reserved. 30