[Foreign Language] [Foreign Language] [Foreign Language] FY2024 financial results press conference [Foreign Language] Director, President and Representative Executive Officer. I'm Mibe, and thank you very much. [Foreign Language] Shinji Aoyama, Director, Executive Vice President and Representative Executive Officer. I'm Aoyama, thank you. [Foreign Language] Eiji Fujimura, Managing Executive Officer and CFO. I'm Fujimura, thank you very much. First, Mr. Mibe will give a summary of the results, followed by Mr. Aoyama, who will present the FY24 results and FY25 forecast and shareholder returns. Mr. Mibe, please. Once again, good afternoon. I'm Mibe. I would like to first thank all of you for taking time today and providing generous support to Honda's business. As a mobility company, Honda upholds its value proposition of zero environmental impact and absolute safety. Through the social values of environment and safety, we aim to realize our vision of future mobility and an attractive mobility society. This will enable us to manifest a new corporate path of growth. We seek for continuing understanding and support towards Honda's initiatives. Now, I would like to review our FY24 financial results and explain our forecast for FY25. FY24 operating profit was a historical high, JPY 1,381.9 billion. Operating profit margin was 6.8%. In FY25, we will steadily dedicate resources to electrification and aim for operating profit of JPY 1,420 billion, operating profit margin of 7%, one year ahead of our original plan. FY24 cash flows from operating activities, the source for future investment excluding R&D expenses, was roughly JPY three trillion, up JPY 1 trillion year-on-year. We have the foundation to support future investment for growth. Shareholder returns are regarded as our top priority management issue. FY24 dividend was JPY 68, up JPY 28 year-on-year. In FY25, we will acquire a record high JPY 300 billion of the company's shares and realize a stable, continuous dividend policy. Next, I will review the initiatives we have taken towards establishing earnings base. Motorcycle business, in addition to our dominant position in Asia, we have expanded large motorcycle sales in advanced nations and expanded product lineup in South America to further strengthen our business structure and build a well-balanced global income structure. Regarding automobile business, where profitability was an issue, we increased the commonality ratio of core models such as CR-V, Civic, and Accord, reduced hybrid system costs, and enhanced product appeal to steadily improve our business structure. We will further evolve the performance and cost of a hybrid system targeting the second half of this decade. Next, initiatives for enhancing corporate value. Currently, the PBR remains less than one-fold. We believe there are three reasons, as shown. To address this, we will optimize capital through proactive shareholder returns, build and maintain earnings base, and work out the granularity of the electrification strategy. As for FY25, we will acquire JPY 300 billion of our company's shares and aim for an operating profit margin of 7%. The details of our electrification strategy and capital allocation will be explained at the 2024 Honda Business Briefing on May 16th. Through these initiatives and continuing dialogue with stakeholders, we will aim for an early achievement of a more than 1 PBR. Next, Mr. Aoyama will present the details of our financial results. Let me explain about the actual results of FY24, followed by FY25 outlook and shareholders' returns. With regard to the updates of the main markets of automobiles, the market declined in China, but an increase in the United States due to the stable demand has led to the overall sales exceeding same period last year. For motorcycle businesses, the market in Vietnam declined because of the economic slowdown. However, the unit sales increased in India and Brazil due to the solid demands, contributing to the overall market almost similar to last year. Regarding Honda Group's unit sales of motorcycles, mainly due to incremental units in Europe as compared to last year, we achieved 18.819 million units sales. For automobiles, 4.109 million units sold mainly due to an increase in North America. For Power Products business, we achieved 3.812 million unit sales due to the decline in North America. This is the summary of the consolidated financial results. On top of the additional automobile unit sales, thanks to the improvements of the model profitability, we achieved the operating profit of JPY 1.3819 trillion, up by JPY 601.2 billion. We accomplished the highest-ever results in operating profits, profit before income taxes, and profit for the year attributable to owners of the parent. ROIC was 9.1% and ROE 9.3%. Let me explain the factors of ups and downs of the profits as compared to last year. There were some impacts by inflation and so on. However, due to the effective pricing scheme that reflects improved commercial value of the products and incremental automobile unit sales, we achieved a JPY 1.3819 trillion operating profit, up by JPY 601.2 billion year-on-year. Profit before income taxes was JPY 1.6423 trillion, up by JPY 762.8 billion year-on-year. Regarding operating profits by business segments, motorcycle businesses are JPY 556.2 billion, the highest-ever result. Automobile businesses are JPY 560.6 billion. Financial services businesses are JPY 273.9 billion. And for Power Products and other businesses, it was negative JPY 8.8 billion. Free cash flow of business companies, excluding financial businesses, was JPY 1.4609 trillion, with JPY 3.7616 trillion of net cash balance at the end of the period. Next, let me explain the financial forecast of FY2025 on a consolidated basis. Regarding expected unit sales of Honda Group, comparing to the last year for motorcycles, we expect 19.8 million units, reflecting the growth mainly in Asia. 4.12 million units of automobiles are expected, reflecting the incremental units mainly in Japan and North America. For Power Products, we expect 3.66 million units, reflecting the decline mainly in Europe. Unit sales volume on a consolidated basis will increase in motorcycle and automobiles businesses. Moving on to the outlook of the consolidated financial results of FY2025, operating profit will be JPY 1.42 trillion, with the operating profit ratio of 7%. The profit for the year attributable to owners of the parent will be JPY 1 trillion. Foreign exchange assumption is set for 140 JPY per dollar throughout the year. Factors behind loss profit before income taxes forecast are as follows. R&D and other expenses will increase. However, thanks to the pricing scheme that reflects the commercial value of the products, profit before income taxes will be JPY 1.5 trillion, down by JPY 142.3 billion year-on-year. Operating profit will be JPY 1.42 trillion, up by JPY 38 billion year-on-year. These are the outlook of capital expenditures, depreciation, amortization, and R&D spending for FY2025 on the slide. Lastly, let me touch upon shareholder returns. Annual dividends for FY2024 are JPY 68 per share, JPY 28 more from the year before, and JPY 10 higher than our previous projection. Dividend at the end of the year is JPY 39 per share. Annual dividend for FY2025 is expected to be JPY 68 per share, same as FY2024. In the Board of Directors meeting today, we made a decision to execute share buybacks, up to JPY 300 billion. That concludes my presentation. Thank you very much. Now, we would like to proceed to Q&A. We have provided you with the Zoom function, so please ask the question through Zoom. In the interest of time, please limit your questions to two per person. When you ask your question, please turn on both your microphone and camera. We seek for your cooperation. Anyone have any questions? Please raise your hand. The first question comes from Yomiuri Shimbun newspaper, Mr. Nakamura. Can you hear me? Yes, please. Nakamura from Yomiuri Shimbun newspaper. I have two questions. First, about your China business. Each of the manufacturers, they are having difficulty challenging the Chinese EV companies. Meanwhile, I think that there are a lot of fans for ICE vehicles. So, what is your marketing strategy going forward? And what about the optimization of excessive production capacity? And secondly, to Mr. Mibe, I think it is the first time since you became president that you are attending the financial results presentation meeting. So, what is the reason for your attendance? Is there any message that you would like to deliver directly to us? If so, please introduce them to us. First, thank you for your question. Mr. Nakamura, first about the Chinese business, I, Aoyama, would like to explain. Yes, there are a lot of Honda fans, ICE fans, and I do agree with you on that. And as for our future marketing strategy, at the Beijing Motor Show and also prior to that, there was an announcement that we made. But the e:N Series, the second of the series, will be introduced. And this will be done in the first half of this fiscal year. Furthermore, in the second half of this fiscal year, as we have already announced, the Ye Series the first of the series will be as the first battery EV platform in China released, the P7, S7 will be launched. And therefore, the e:N Series will be expanded. And this is how we want to expand our business in China, especially the battery EV. We want to introduce competitive products. And this is our basic marketing strategy. Meanwhile, about the overall production capacity and the excessive capacity, with our joint venture partners, we will consult. We are currently examining what can be done. For this fiscal year, within our budget for FY25, we have included some expenses towards that purpose. About the specifics of how to optimize, we would like you to wait until we can make the announcement. Next, I, Mibe, would like to explain why I'm here today at the background. Well, it is my first time. In the past, our presidents have not attended this meeting. So I'm the very first in the history of Honda that I'm attending as president. Well, this is because we are faced with a lot of challenges at this time of transformation. I, as president, want to explain about the current management situation and also our short- to mid-term plans. I thought it was important that I directly communicate this. As I mentioned today, for this 2025, we want to achieve the ROS. But we, one year in advance, would like to achieve this margin profit margin of 70%. So, this is something that I personally have led. And I want to demonstrate my leadership this fiscal year as well to achieve this goal. And as in my presentation, yes, we have a less than one PBR. And I think that this is a major challenge that we currently face. And as of the end of March, about 60% of the Prime Market companies listed in the market have exceeded one. But Honda, we have a 0.76-fold. So, this is a major challenge on the part of Honda. As I said, shareholder returns, we have to look at the investment balance and consider this. But what's most important is for us, in order to well, first of all, we have to make clear our growth path. In particular, we want to make clear what our plans are for electrification, our future vision of electrification. And that included, we would like to update you on the progress we're making. And I think that there will be opportunities at the financial results meetings to present this. I don't know if I will be attending all the quarterly meetings. But at the final full-year announcement, I would like to attend this meeting in the future. Now, about making clear the granularity of our electrification strategy. Well, on May 16th, we are going to have a meeting, a briefing session, to elaborate on our strategy. And I will talk about our outlook for electrification and all the other details. So, please wait until the 16th for the details. I will continue to attend this meeting. Thank you. Thank you very much, Mr. Nakamura. So, next question, please. From the Japanese newspaper, Mr. Okinaga, please. Please ask your question. [Foreign Language] [Foreign Language] That is going to be the highest as well, R&D spending, in order to strengthen the shareholder returns. How do you manage that? And also, what is the backdrop of having to reinforce your R&D efforts? So, let me explain about its positioning over the overall situation, rather than the each-quarter situation. As we said before, electrification and software and intelligent use of that. We said that we are going to invest JPY five trillion by 2030. Then I'm going to explain more of the details on the 16th of May. But in the meantime, we actually changed our strategy a little bit. For instance, in terms of electrification, specifically speaking of the batteries, we had explained about Canada before. We are going to be shifting to the vertical type system in order to sustain the total electrification businesses. To do that, we need to have the investment development as well. We have to internalize those technologies. That will be on the increase as well. For the software too, the core of the software has to be supported by Honda itself. R&D menus will be toward more of the internal kind of efforts. Therefore, we have more spending on that. Fujimura-san is going to give us more details about the spending. Thank you for the question. As for the R&D spending, it is going to be the highest ever. As we said now, JPY 1 trillion spending for that would include the upcoming electrification-related model development expenditures. Also, in the first place, we have to support a foundation for the electrification going forward. We call it DR, which is the functionality and its evolution. In our R&D efforts, we have to put more efforts in the process before the development of the vehicles to strengthen that part. Specifically for the model year 2027, there will be still more efforts of the ICE model based on the hybrid, basically. For those ICE models, toward 2030, there will be still 60% of the ICE model to be run. Therefore, we need to earn from those businesses. Therefore, we need to allocate some resources through that as well. So, we have to spend on both ends, which will be in the next three-year efforts. Those will be important. We will keep up with the higher level of R&D spending going forward for the growth going forward. We will be more aggressive on that part. The rationale for that effort is such that now, after the R&D adjustment, we have this operations cash flow. That is a new kind of indicator. For this past fiscal year, we had JPY three trillion. Two years before, it was JPY two trillion. So, we are adding JPY 1 trillion more to that part. That means we try to improve the profitability of the ICE models that we have supported so far. That is going to be earning more going forward. That is why we can justify such spending. Then we are going to spend JPY one trillion R&D again. The cash flow after the R&D adjustment will be staying around JPY three trillion or so, based on our earnings strength. Then we would like to be based on such a stronger earnings structure and then spend more on the R&D. At the same time, we are going to strengthen our shareholders' return as well. That is our financial strategy. In terms of the capital allocation, as we said, up until 2030, as we said before, we are going to give you more communication in the business update scheduled on the 16th of May. We will give you more details on that point on that day. Thank you very much. One more. Do you have one more question? Or what is your second question, please? Okinaga-san. May I ask a second question? Sure, please. So, unit sales in China declined from the previous year. Is that what you expect again? You are going to provide a new series, right? What are your expectations? And you also said that you are expecting growth in North America. Is that because of the HEV growing more? So, unit sales per regions, Aoyama speaking. And for China, as we said before, the Ye Series is going to be the very highly expected model. And it is going to be launched in the second half of FY 2025, second half of this year. Therefore, it will be effective after that. And we plan to provide 50,000 units of those, in addition to the existing ICE and HEV products. Therefore, compared to the previous year, it is going to be on the decline. For North America, Civic Hybrid, which is not yet launched. However, we are going to add Civic Hybrid, which will be added to the growth. And in terms of the incremental units, battery EVs in May and April this year, we are adding BEV. And that part will be the incremental portions in North America. That is the plan. Thank you. The next question. Shinji Aoyama, Mr. Yokoyama, please. This is Yokoyama from Weekly Toyo Keizai. Can you hear me? Yes. Thank you. I also have two questions. The first, about hybrids and competitiveness and product appeal. I'd like to ask one question about this. Yes, in your material, you did refer to this slightly. But in North America and Europe, your competitors, Japanese competitors, are also doing well. But also, you say that you're going to invest in ICE. But the earning base, I think hybrid will be a very important contributor. So, within your electrification strategy, what is the positioning of hybrid? That's my first question. Yes. Aoyama, would you like to respond to this question? Yes. Hybrids' competitiveness. First of all, volume-wise, we believe that in FY 2024, about 800,000 units were sold. That is hybrid. But in FY 2025, this fiscal year, we are aiming for one million. Well, it's 4.12 million in total. So, one out of four vehicles will be hybrid. That's our plan. About our earning power. Well, currently, looking at our current situation, well, how we position hybrid will make a difference in terms of our profitability. And there's a variance in profitability in how we position hybrid. But ICE and hybrid, these two are expected to bring about more or less the same profit. And FY well, the 2018 model year and 2023 model year, if you compare these two system-wise, it is more efficient. And also, the performance is higher. Despite that, we've seen that cost-wise, we are trying to make it more affordable. And therefore, in FY, well, rather, the 2027 model, we are currently developing the model. But here, again, we want to increase our competitiveness, not just in terms of cost, but also in terms of performance. That is how we are addressing this. In the second half of this decade, we will increase battery EV. And therefore, the volume will fall. But the earning power per unit will increase so that we can earn profit. And this will be happening also in the second half of this decade. And this is going to be the source for injecting resources into electrification of battery EV, that is. Mibe, if I may add? Well, hybrid, yes. We have one hybrid that we're focusing on. And yes, so we have been reducing the cost. In the past, from the perspective of profit, ICE was much more competitive, as Aoyama has just said. Now, it's at par, more or less. And so, if we had, for example, this fiscal year, in the automotive business, if EV-related development expenses were excluded and if it were only hybrid and ICE alone, if we carve out just these two, operating profit margin-wise, we can expect 8%. So, competitiveness-wise, including cost, it is quite strong. But in addition to that, in the second half of this decade, it will further evolve. We have one evolution planned. And therefore, the current hybrid is doing quite well. But up until 2030, we want to be able to compete in North America with the current competitiveness we have. Unit volume is one million this fiscal year, by 2030, if things go well. And then I think we'll come close to two million units. And that is one plan that we have, including our suppliers. We are trying to meet this increase so as to be able to achieve a scale of two million units. That is how we are preparing for hybrid. And if we can lead this, then I think we will have more power to generate cash. And thereby, we will be able to make a transition to electrification. So, hybrid was, to begin with, a strong weapon. And we want to enhance this technology, this technology that we are already strong in. That is how we want to do our business. Thank you. Second question, about the profitability of your automotive business. Well, in the fourth quarter, I think the margin compared to the third quarter, I think, has gotten worse. I think you mentioned that there's an addition of the expenses here. But looking at the profit margin of the current automobile business, and I think that you will also have to support the suppliers. So, how about you said I think it's about 5% or a little less than 5%. But including the support to suppliers, how are you going to try to increase the operating margin of your automotive business? Thank you. Well, about the fourth quarter. Yes, there is a tendency for the expenses to increase. And therefore, if you look at the full year, I think it's better to talk about the full year, not just the fourth quarter. As you pointed out, yes. There's been a 4% or so ratio at the end of the fiscal year. After the first quarter, as I've been explaining, this fiscal year—well, last fiscal year—there was an increase in the quality-related expenses. It used to be 1% versus the sales. We are seeing that the warranty has increased. In this fiscal year, based on that, we are accounting for 1.2% warranty expense ratio. So, that is the ratio. Also, the support to suppliers. Because of the restructuring, there was impairment. So, excluding those, it's a little less than 5%. Last fiscal year, rather, I've been saying this. Sorry, it's last fiscal year. I think that is the actual result that we obtained. Then, going forward, how are we going to improve this? Well, those areas that we have been trying to work on, the profitability and also the fixed cost part, we want to continue to work hard on those things. So, we've tightened. Therefore, the top line, where possible, will be raised for this fiscal year in the United States and in Japan. I think these were the major markets. But in those areas, we want to post a positive. Also, we'll reduce the incentives, et cetera. I think that our product appeal has increased. Therefore, we can do this. Based on that and also the pricing, though we'll be more prudent, we think that in each of the domains, we will try to price in line with the value that we're offering our customers. Now, about the support to suppliers, for our suppliers, especially in Japan and the U.S., there is the impact of UAW. It's not just in-house production, but also our suppliers, at the same time, have to give consideration to this. It's on a negotiation basis. So, it's one by one. But still, there's the inflation part that we have to take into account. So, we have budgeted so that we can provide support for inflation. Now, what's different from prior to COVID? We have stable production. And we're doing monozukuri together with our suppliers, manufacturing. So, we have to think about where we can improve our cost competitiveness together with our suppliers. So, we want to do co-creation with our suppliers. That is the sort of budget that we have compiled this time. That is all. Thank you. Thank you. Yokoyama-sama, thank you very much, Mr. Yokoyama. Next question. From NHK, Mr. Obe, please. Then, in this context, what is your impression, reaction to this good business today? And the second question is a bit away from the financial results today. Speaking about yen depreciation today in Japan, it is quite commonplace today, 155 yen per dollar today, as of today. However, that may be good for you. That is quite supportive for the businesses for you. But for Japan on the whole, what is your thinking about the current exchange rate situation today? What is your thought about it? So, first question I'd like to address. In the second part of the 2010s, we said that we would envision six million cars, six million units. We were on expansion of the businesses mainly. Then, we needed to shift our directions. And then, we said that we would solidify our basic businesses with efficiency. For instance, we would optimize the surplus capacity by fixed cost reductions. And then, less derivatives, more commonality of the parts, components, and system cost reduction of the hybrid cars with a better performance to enjoy the cost reduction effectiveness. This way, we could improve the value of the commercial vehicles with the appropriate prices. With those initiatives in, the automobile businesses have improved a lot. And if you look at the EV businesses alone, we are reaching near 8% today. In addition to that, for the motorcycles, we were relying on the Asian markets quite heavily. But we now have expanded our profitabilities in other areas too. In Europe, 20%, Asia 80%, and South America, 20%, and Asia 60%. And then, for both motorcycle and automobile businesses, both together, we have improved our structure of the businesses quite nicely. And then, altogether, we were successful in that regard. Because of that, now, for 2030, for instance, we can envision two million EVs in the air. That is our vision. Plus, our businesses are 5% EV. That is our targets. We will keep spending for research and development so that EV businesses in 2030 will be something like that. We have solidified our foundation to achieve that vision, finally. In terms of the yen depreciation situation today, of course, we are in the manufacturing businesses. We are reliant on the facilities and equipment heavily. Therefore, abrupt changes of the forex is not really welcome. But recently, of course, it is related to the policies of the U.S. and the Japanese government, Bank of Japan's initiative, U.S. counterpart, when they're going to move to reduce the rate and so on. Of course, they're all related. And then, the fundamentals behind such ups and downs of the forex situation today is actually related to the actual demands for the yen currency. I think that is my thought. And the true actual demands for the yen today will be related to the export from Japan, because it was export-oriented so far heavily. But now, in this situation, we would have more internal domestic demands, meaning that we could repatriate our manufacturing businesses back in Japan. And then, Japanese stocks, the share prices are now appreciating too, reflecting that. That probably indicates that demands for yen will be improved going forward. And then, our expectation or assumption is 140 yen for the time being in this budget. You might take it quite conservative, perhaps. The reason behind 140 yen is maybe in the first half, it will be something like 145 yen per dollar in the first half of the year. Then, in the second half, 135 yen because of the interest rate changes and so on. That is the expectations. But in the long run, as I said before, the power of the Japanese businesses will be appreciated better with the better actual demands within Japan. Therefore, it would not go to 150 or 160. I wouldn't think it will be the case. However, of course, it is not possible to project. However, the abrupt changes of the currency are difficult for us. In the April-May situation of the forex, it is not really favorable to us. However, we have to adapt to the changes out there in terms of how we operate on an everyday basis. Thank you very much. Thank you very much for your answer. Thank you. This is Mizutori from Japan Automotive Daily. Can you hear me? Yes, thank you. I have two questions. First, FY25 forecast. About this forecast, operating profit increase, you say the selling price and cost impact is a positive of JPY 502 billion. Can you give the breakdown in relation to that? I want to know. About the price increase impact, I think it was a positive last fiscal year. But the price increase itself, has it completed the cycle? Or is it the case where this fiscal year again, you want to continue and try to increase the profit through the price increase? And that's the first question. And the second is about the business in Japan. In FY25, your forecast says that 660,000 units, I think you said. But Honda, to begin with, in Japan, your annual unit sales is around 700,000. I think that's more or less the target. But the shortage of semiconductors has ended. And I think the fact that you cannot reach 700,000, what is the reason? And also, to Mr. Mibe, once again, how do you position your business in Japan? Can you explain about that as well? Thank you. Allow me to talk about the operating profit and increase and decrease. And so, there is an impact of JPY 502 billion. And what is the breakdown of this? That's your question. But I think that was mentioned earlier. But in Japan and the United States, there's an increase in labor cost. I think this is true also for the suppliers. And so, this is included. We have been working to increase the cost together. And we can reflect this in our motorcycle business. So, we have offset that. But mainly, it's the selling price, the positive impact of the selling price. It's about JPY 407 billion worth. And well, the inflation part, well, we have to try to introduce competitive products to increase their price. But there are some special factors included. In the United States, with the upcoming electrification, and we, the manufacturers, we have to change the roles that we play. I think that we have to factor in this change. The dealer margin, therefore, on our part, we have done a lot of consultation. And we have reduced the dealer margin. In other words, the profit was allocated to the dealer, has been allocated to us. For the new car business, it will be like that. But in the future, the maintenance and those parts as a touchpoint for the customers, the dealers will be a very strong business partner for us. So, that will continue to be the case. So, that profit, within the JPY 470 billion, I think about JPY 100 billion is included. And therefore, if you subtract that, that will be the price increase. And that has been budgeted. Meanwhile, recently, North America especially, we have been reducing our inventory. And we're trying to reduce the incentives. That's our operation. But prior to COVID, well, we have not yet reached the level of the prior to COVID. And I think that the competition is more fierce these days with competitors. And therefore, we have to budget more the incentive. And in the operation, the pricing and incentive, we are trying to reduce this. Hold this down. But we have to offset where needed. So, JPY 500 billion, this is a large number. But these factors are included here. So, please understand this number to mean that. And this fiscal year, where we can continue to raise our price, as we said earlier, we have to comply with the inflation and also introduce appealing products and try to tap on these strengths that we have. That's all. But business in Japan, Mr. Aoyama will first answer. Yes, 700,000 has been the benchmark in the past. That is true. So, 700,000 units. At one time, we were selling that much. And so, that was regarded as more or less the benchmark. So, you are correct in saying so. But in the mid- to long-term, we think that the Japanese automotive market is declining, unfortunately. We have to admit this overall. And therefore, for FY25 as well, the market itself, there will be a marginal increase. That is how we look at it. So, we have the 655,000 units listed here. But the registration is about 700,000 units. For the share-wise, if you calculate this in terms of the share this fiscal year, 15% or so is what we're aiming towards. Therefore, 15% share is what we want to gain. And this is the highest in history. This is a plan that we have already. We are receiving bookings in advance, the new Freed before launch. So, we want to sell this. Also, in addition to that, at the end of last fiscal year, we launched WR-V. So, this product, plus the Vezel, minor model change. All these included, we want to introduce competitive products so as to achieve this 15% high share. That is how we are looking at this fiscal year. And I'd like Mibe-san to talk about our positioning of our Japanese business. Well, looking at the current situation, as Aoyama has already explained, well, at the beginning of this year, at the CES, we announced that Honda 0 Series, well, this is a new EV. And this also, within the global market, we want to introduce this to Japan too as a global market. The product lineup also, the N-Series included, we have the smaller minivans. And we are shifting more to the smaller size models. But, and therefore, this is one of the reasons why we're seeing a slightly slow increase in unit volume. Electrification is a keyword that we're using. This is a new direction that we're aiming towards. And this is a good opportunity for us. And within this process of electrification, once again, of course, we are a Japanese company based in Japan. The Japanese market is a very important market for us. Therefore, in addition to what we were doing in the past, newly, we want to introduce a new lineup so as to be able to raise our appeal of the appeal of Honda in Japan. Currently, we are working on the details. Therefore, we cannot make any announcements today. But it will not be the same as the past. That is as far as I can say for now. Please expect that we will be making changes. Look forward to our strategy in Japan. Thank you. Thank you. Thank you. Yes, please. We are away from the financial results. Because of the president being here, I'd like to ask this opportunity. As of today, what do you think about the status of the battery markets and Honda's position today in terms of your negotiation with the other companies and development and sales plans of that? Please tell us your frank view on that. And as for the Canadian plant, for instance, recently, for your EV sales goal, for instance, you have today, you are probably having those steps done solidly. But other companies are facing with a bit of a decelerating trend of the EVs. And also, discount is being seen quite in competitive markets. In that above slowing down trend today, reminding that, do you think it is a kind of good time for you to take advantage to accelerate yourself away from others being in slowdown situations? Or do you think you have to accelerate further the businesses you have today? What is your position today of your company in the current EV situation? The second question is about collaboration potential with the Nissan. I understand it is still under consideration. But I'd like to ask Mibe-san, what are the topics that you are talking about with them today in the negotiation process? Maybe as fast as you can, could you share with us? In the topics with them, would you talk about EV sales goals and so on? Maybe you would tell us about it in the business update opportunity. But do you have changes on your strategy and so on with regard to the talks with them? For the first question above, businesses, the EV demand is a little bit down according to what you said. Of course, it is what we are seeing today globally. But since I became the president, our goal is to achieve 40% by 2030 and 80% in 2040, 100% FCV or BEV by 2040. And of course, that is the kind of backcasting goal based on the CN in 2050. And it's been three years since I became the president. And those goals still stand, no change at all. So, for the goals of 2030 and 2035, of course, EV-related regulations and laws in different countries might change as we go toward those goal years. And that was something we were expecting already. And this is what we experience today. For instance, to achieve two million cars in 2030. And we'd like to establish the foundation for that businesses in order to be able to achieve it. And then, we are making plans now, including the investment plans and so on. Based on the current EV situation, we still keep up with our original strategy, no change. And in terms of the investment, maybe the opportunities, the timing of the investments of those might be a little bit shifted within the range that we would anticipate. But there is no change to the goal, no strategy changes at all. And in terms of the hybrid, it is a good technology as a tentative solution. And we have the businesses of that today with hybrid. And we are not denying a hybrid business at all. But after 2030, the global regulations and so forth would require battery EVs for sure in order to achieve a carbon neutrality. And then, we have been working on the small mobilities today. The battery EVs could be the best solution for those small mobility runs. And then, we have those milestones one after another. We'd like to take on achieving those steps as we go. With regard to the collaboration with Nissan, we've announced it on March 15th. Since that time, we've had frequent discussions between the two companies with different groups of people. As was announced by Mr. Uchida of Nissan the other day, actually, I've checked the progress participating in some of those meetings. What sort of values can we provide by this collaboration? We are actually discussing about it right now. I cannot disclose what is being discussed at the moment. However, we are coming to a good conclusion nearly. Once that is well summarized, we can share with you. As we said on March 15th, basically, it will be in the area of electrification and software and also complementary product supplies and so on. For the growth in the future, it will be in the electrification software. Those two will be very important for the growth purpose. Software, especially with AA included and the semiconductor together, the development cost will be enormous. That area is one of the potential collaborative areas. Also, for the scalability for the electrification, scalability can be quite advantageously obtained with the collaboration, I suppose, with the electrification efforts. We are having discussions closely on those points. Once we find and identify the benefits, we will start working together. I cannot give you much today. However, we are having discussions in the very broad scopes in front of us. On the 16th of this month, I don't think I can give you the clear answers or the discussion items we did today. But of course, the discussion will not go forever. Sometime very soon, I can give you some ideas about the collaborative talks between the two. So, by summer, maybe, can you give us a kind of a first round of the sharing with us of the information by summertime? What is your goal? For instance, I wouldn't think it will be until the end of this year. It is but long. Summertime, maybe by then, I'd like to come up with some sort of idea that we can share with you. That is what I think. And we will focus on the discussions, really. So that, of course, including whether or not we go for that or not go for that, we will be able to summarize the talks sometime very soon. Thank you. Thank you. I apologize, but in the interest of time, next will be the last question. Asahi Shimbun newspaper, Matsuoka-san, please. Can you hear me? Yes, Matsuoka-san of Asahi Shimbun. But North America, your automotive business is growing. The unit volume is increasing. Is it because of the foreign exchange rate? Is it because the selling price has been reduced because of the exchange rate? Or is it because people are returning from EV? What is the reason for the increase in unit volume? Well, the reason why we're seeing an increase in not just volume but profit, I understand. Sorry. Yes. Well, exchange rate is one factor. But it's not the case where the exchange rate is the dominant factor, especially in the FY24 result. I'm looking at the FY24 results. FY23 was a time in which, due to the semiconductor shortage, we could not fully supply or we could not fully produce. That was the situation. Therefore, FY24 or FY25 as well. In North America, the factory, the utilization rate is, well, 100% or even slightly more than 100%. That is the utilization rate at the U.S. factories. Therefore, as a result, we are being able to raise the price, selling price, in line with the appeal of our products. I think that this is the major contributor. Plus, there was also, as I've answered in the separate question, hybrid. After the 2023 model year, the performance increased. Also, the business competitiveness increased, including cost. Therefore, the profit rate ratio is equal to ICE. But in terms of the profit amount, it is slightly more. That included hybrid is doing very well. So, further boosting our profit, I think. Page 10, you talk about the historical operating income and give the reasons and selling price cost. I thought that this was a big contributor. Can you elaborate on this? Page 10, did you say? Profit before income tax? The change in profit before income tax FY24 results. Yes, you're talking about FY24, right? Okay. So, there is the price cost impact, sales impact. It includes the gross profit. Well, motorcycle and other regions are included here. But yes, for automotive, JPY 317.9. Yes, underneath, it says that the. There is this number of 4,487 for the revenue model mix. This is coming mainly from North America. Well, in the previous fiscal year, we had difficulty acquiring semiconductors. This year, we have seen an increase. There was a 420,000 unit increase in North America. I think that this has contributed mainly to North America. And about the price cost impacts, well, roughly speaking, of the JPY 524.7 billion motorcycle or automobile, it's about JPY 328 billion something. But the supplier and also the wage increase, these are negative, included here. But the raw material cost, this is big. So, I said JPY 360 billion for automotive. But still, I think the raw material cost, this includes some precious metal and steel too, but is about JPY 490 billion or JPY 200 billion. So, this is the material-related. And so, this is a positive. And the selling price increase, it's about JPY 360 billion. And so, minus JPY 200 billion, so it's about JPY 160 billion that remains. The cost increase, the supplier, the wage increase, the cost increase factors are also factored in. And we believe that the price impact was that much. This is not just North America, by the way. But for automotive, that is the situation. Have I answered your question? Thank you. Thank you, Mr. Matsuoka. So, thank you. Thank you very much. Now, I can conclude the press conference for the financial results presentation today. And those slides and materials will be available on our website. Thank you very much for your participation today.