Mid-Term Business Plan 2024 (FY2022-FY2024) May 13, 2021 Isuzu Motors Limited Overview of Mid-Term BP 2024 Expand current businesses & improve their profitability Axes of innovation ・Enhance products, sales and services ・Carbon neutral strategy ・Innovate Monozukuri ・Contribution to logistics evolution as a CV OEM Outcomes of previous mid-term BP: Robust business base & Strategic alliances Customer-oriented approach / Quality well accepted by customers Evolve management from ESG perspectives ・Emphasize shareholder value ・Improve governance & disclosure ・Professional group that creates innovation 01 Efforts in Previous Mid-Term BP Bore Fruit Isuzu, regarding this era of profound transformation as a big chance, aggressively led various initiatives. Isuzu has successfully established business bases stably earning net sales of 2.5 tril. yen or more, and also formed strategic alliances for addressing various challenges in the future. ① Collaborative business innovation ・Uptime support & collaborative activities bore fruit (JPN CV) ・Set in place Monozukuri & services based on closer-to-market approach, and raised Current business market shares across the globe (Overseas CV) ② Expand overseas CV business deepening: ・Formed a holistic alliance with Volvo Group & acquired UD Trucks (HD truck) improve profitability in ・Successfully carried out full model change on LCV (D-MAX/MU-X) ③ Strengthen LCV business core businesses ・Established operations to stably supply products at footprints in India & South Africa (LCV) Seven key ④ Enhance powertrain business ・Entered into a powertrain partnership agreement with Cummins (PT) challenges New ⑤ Accelerate advanced technology ・Formed the holistic alliance with Volvo Group (autonomous driving, connected, EV) engagement ・Promoted collaboration with Honda for HD FCV ⑥ Implement digital innovation ・Agreed with Toyota & Hino on collaborations in CASE fields mainly for LD trucks for next generation: ・Started renewal of mission-critical core IT systems sow the seeds of future ・ growth ⑦ Create new businesses Created new services for logistics customers, utilizing data of cargoes and rear bodies 02 Mid-Term BP Financial Targets Isuzu will aim to achieve net sales of 2.75 tril. yen and operating income (OPI) of 250 bil. yen for FY2024 ending Mar. 2024. OPI including synergies with UD Trucks & Volvo Group: expected to include EBITDA of 33 bil. yen for FY2024 and 50 bil. yen for FY2026 ending Mar. 2026. 3,000 Mid-term BP target ： Net Sales 2,750 ： ROE 2,500 300 (unit: bil. yen) 2,300 250 Operating Income 1,908 15.0％ 170 12.5% Average 10.6% FY19-21 95.7 12.0% 4.3% FY’21 ended Mar. ‘21 FY’21 FY’22 ending Mar. ‘22 FY’24 ending Mar. ‘24 FY’26 ending Mar. ‘26 (previous mid-term BP target) (incl. pandemic impact) 03 Measures to Expand Business & Improve Profitability Isuzu will address challenges below, fully utilizing the base for growth we built during the past mid-term BP periods. Measures contributing to this mid-term BP period Measures contributing to expansion Measures to implement (through FY2024 ending Mar. 2024) in FY2025 ending Mar. 2025 & beyond Collaboration with UD Trucks Utilize each other’s products & after-sales services networks LCV business HD trucks: Expand sales of new LCV models worldwide / Expand sales channels for Develop common platform for Isuzu & UD Trucks Products, sales, workhorse models Utilize technologies developed by Volvo Group and services Overseas CV business Get far closer to markets, utilizing networks of Isuzu Group companies MD & LD trucks: PT business Expand customers globally Implement full model change during this mid-term BP period Launch them globally Synergies with UD Trucks Collaborate in the fields of development, logistics, production and purchasing Invest in business base in Japan Renew mission-critical core IT systems LCV production Fujisawa Plant (for substantially more efficient operations) Monozukuri Leverage 3 production footprints in Thailand, South Africa and India Effects derived from strategic alliances CASE area: joint development/Traditional technology area: complement each other in terms of component units, etc. Capex 300 bil. yen for 3 years during this mid-term BP 04 Axes of Innovation As trends toward carbon neutrality accelerate and social expectation for enhanced logistics infrastructure mounts, it is duty of CV OEMs to respond to these societal issues. Accelerated trends toward Increased expectation for electrification/decarbonization uninterrupted logistics infrastructure ・Carbon neutrality is the highest-priority social issue ・Logistics infrastructure becomes more & more important ・Trend of passenger cars shifting away from internal combustion engines is ・Logistics efficiency becomes a big social issue accelerating recently ・CV OEMs are required to contribute to addressing these challenges by The same expectation will mount in CV space as well utilizing connected function and putting autonomous driving to practical use Carbon neutral strategy Contribute to logistics evolution as a CV OEM ・Firstly identify appropriate technologies through demonstration experiments for social implementation of BEV & FCV ・Encourage improved convenience of connected services by making them ・Start to launch some models while working on product improvement toward OEM-free, preparing for 5G era volume sales ・Verify autonomous driving technology under limited use scenarios and seek ・Continue development of high-efficient ICE (*1) for a period of CN fuels (*2) to put it to practical use as early as possible being widespread *1 ICE: internal combustion engine *2 CN fuels: carbon neutral fuels such as bio fuels and synthetic fuels derived from renewable energies. 05 Carbon Neutral Strategy Establish a full product lineup by 2040 that is able to deal with carbon neutrality. Expand sales of EV (*1) models of our major products in the 2030s. Fossil fuels Carbon neutral Determine appropriate technologies Expand EV volume-production models & Further spread EV use in society & establish product life cycle Start volume production for some models refine them for further spread in society EV area 2022: start mass-producing LD BEV 2022: selected customers start using HD FCV on experimental basis Promote spread of EV use globally Demonstration tests for LD FCV are being discussed within CJPT (test schedule to be defined) ? ICE vehicle area (*2) Development of high-efficient ICE & utilize CN fuels Ratio of ICE vehicles & EV in brand-new CV space (JPN, US, EU) 2020 2025 2030 2035 2040 2045 2050 *1 EV: electrified vehicles, including battery EV (BEV), fuel cell vehicle (FCV) and hybrid EV (HEV), etc. *2 ICE vehicles: vehicles powered by fuels such as diesel, gas and CN fuels. 06 Contribution to Logistics Evolution as a CV OEM 1) Connected Isuzu will seek to contribute to improving customers’ productivity and decarbonization, through strengthening connected services such as uptime support and operation management tool. Uptime support Connected service base Evolve uptime support services by adding failure prevention function CV connected information platform concept (in Japan) (domain where individual CV OEMs manage development by themselves) - Leverage collaborative networks of Isuzu & its service sites OEM-free services Working with third-party (incl. UD Trucks) systems/apps Big data (*) Services Data Start to study on Operation management (“OM”) common platform Make vehicle data & communication systems available to third-party developers of OM systems/apps for logistics industry (domain where OEM-third party collaboration is openly encouraged) Hino/Toyota/Isuzu - OEM-free OM systems/apps necessary Joined by body builders (open organization) Collaborate with other OEMs to create a common platform * Big data: data we use as collective intelligence by anonymizing and statistically processing individual data (i.e. information on operation management, traffics, etc.) stored at each company's server. 07 Contribution to Logistics Evolution as a CV OEM 2) Autonomous Driving Isuzu will accelerate autonomous driving initiatives through co-development with alliance partners. ＜Previous mid-term BP period＞ Tests under various use scenarios 2030s Autonomous driving expertise accumulated To promote spread of autonomous driving use in actual life scenes Verify effects and safety of unmanned truck operations On-highway transportation and promote them in logistics and other use scenarios Port Expressways x x Demonstration test for truck platooning low-speed drive HD trucks & parking Buses operated Road sweepers Contribute to creating Level 4 Demonstration test by UD Trucks in limited areas in urban areas optimized social infrastructure Urban transportation Demonstration test for autonomous urban Advanced-level demonstration test inside Fujisawa Plant by end of 2021 delivery trucks using NVIDIA technology Urban delivery trucks Prototype running in the experiment inside Fujisawa Plant Demonstration test in closed space by end of 2022 08 Evolve Management from ESG Perspectives Evolve management culture upon benchmarking global leading manufacturers. Norm change In the new era Cross-industry competition/collaboration becomes the norm. To be accepted by society and survive this new era, Stakeholders also become diversified and globalized. we must evolve our management from ESG perspectives. Emphasize shareholder value Improve governance & disclosure Professional group that creates innovation Capital efficiency: Transition of corporate governance structure to: Diversity: ROE target: 15% for FY2026 ending Mar. 2026 A company with an audit & supervisory committee