Strengths of the Division

External Environment

Growth Strategy

Global aircraft demand is expected to grow, as is infrastructure demand in emerging countries. At the same time, however, the structures affecting industry continue to change. Examples of this change include instability in international trends and the introduction of environmental regulations.

Medium-Term Management Plan 2023 calls for the Aerospace & Transportation Project Division to step up its response to the volatile operating environment in its aviationrelated businesses while also bolstering its functions and expanding the scale of railway maintenance, repair, and overhaul (MRO) businesses in the transportation field. Specifically, the plan puts forth the three policies of build upon global partnership with Boeing, expand business in jet-related functions, and broaden North American railway operations. As we enact these policies, we will continue to grow existing operations while pursuing increased earnings in airport management businesses through our in-flight catering operations, exploring new shipping-related businesses, and developing distribution and other operations aimed at connecting harbors and freight railways.

The COVID-19 pandemic caused a sharp decline in aircraft (passenger) demand. Although we are finally seeing improvement in demand for domestic flights in Japan, it is likely that it will still take more time for international flight demand to make a full recovery. This reality will have an undeniable impact on the operations of the Aerospace & Transportation Project Division. Regardless, we will continue to pursue higher earnings in North American railway businesses, which were relatively unaffected by the pandemic, while also incorporating new demand in business jet and other businesses. At the same time, we will implement measures in preparation for the recovery in demand to be seen moving forward.

Businesses

Business Map

■Part-Out Business Using Retired and Aging Aircraft

We will expand business activities by leveraging our accumulated networks and expertise to further strengthen our earnings foundation with the aim of scaling-up our part-out business, which uses retired and aging aircraft. In Europe, we will focus on growing operations through TDA Holdings B.V. of the Netherlands, in which investment was commenced in 2020, while priorities in the Americas will include building and acquiring robust business platforms through M&A activities. We thereby aim to secure the capacities needed to capitalize on the demand to emerge after the COVID-19 pandemic.

■In-Flight Catering Business

Through its capital and business tie-up with Royal Holdings Co., Ltd., Sojitz entered into the in-flight catering business in April 2021 via consolidated subsidiary Sojitz Royal In-flight Catering Co., Ltd. This company is not only Japan’s first in-flight catering company, it also boasts world-leading levels of quality. Our in-flight catering business is currently suffering the impacts of the COVID-19 pandemic. Nevertheless, we are working to explore non-airline sales channels while taking advantage of the rising business opportunities in domestic airports with the aim of growing Sojitz Royal In-flight Catering into one of the top in-flight catering companies in Asia in the future.

■Business Jet Business

Sojitz invested in Phenix Jet International, LLC, in 2017, and began collaborating with ANA HOLDINGS INC. in 2018. Business jet demand has remained strong, even amid the COVID-19 pandemic, and we also look to capitalize on the new demand projected to emerge after the pandemic. In addition, we are examining the possibility of conducting M&A activities for the purpose of enhancing functions so as to supply higher-value-added services that accommodate a more diverse range of customer needs and to thereby expand earnings in this area.

Sojitz Business Jets website

■Transportation Infrastructure Business

Our EPC initiatives, exemplified by our Indian railway project, are performing steadily, and the Canadian MRO company in which we invested in 2015 is also continuing to ensure steady earnings for our North American railway business. Sojitz also invested in a North American railcar leasing company in March 2021. Our goal going forward is to stabilize our earnings while broadening our scope of operations in North America so that we can leverage our accumulated expertise in a variety of ways.

■Airport Management Business

We are actively involved in the airport management business, both overseas (Palau and Khabarovsk) and in Japan (Shimojishima, Kumamoto, and elsewhere), and we are using the experience gained from these businesses to strengthen our airport management and operation functions. We are also working to grow the earnings of airport-related and non-airportrelated businesses through in-flight catering operations advanced via coordination with other divisions as we seek to expand our earnings foundation through synergy with other Sojitz Group businesses.