14/33 - Cost Management

◎This slide shows cost management. ◎Our unit cost of the Air Transportation Business in fiscal 2010 was around 10 yen per ASK but over the 6 years since fiscal 2011, we have reduced it by approximately 10 percent by implementing Cost Restructuring Initiatives equivalent to a total of 138.0 billion yen. During this corporate strategy period, we will promote the full-scale utilization of AI, IoT, robots, etc., as well as promote workstyle reforms to increase productivity and further improve our cost competitiveness. ◎We are preparing to utilize new technology in innovative and unconventional ways. For example, automated airport vehicles, voice recognition technology to improve call center quality, and AI to manage aircraft parts and maintenance tools. Needless to say, promoting the deployment of fuel efficient aircraft will help control fuel cost increases. We will utilize these technologies not only to simply reduce costs but also to innovate products and services and support human resource development. This will lead to increased revenue and improve basic quality. ◎At the bottom of the slide, we show transitions in unit cost based on this policy. To continue investments in safety and human resources, in fiscal 2018 we anticipate a temporary increase in unit costs but by fiscal 2022 we will lower this by 0.6 yen to 8.8 yen. We will pursue unit cost reductions by implementing appropriate cost management. ◎Please turn to page 15.