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In the Car Electronics business, the largest business segment in which both JVC and Kenwood participate and the segment expected to be most affected by the management integration, the JVC Kenwood Group on June 24, 2009 renamed J&K Technologies Corp., a joint venture of both companies that had been engaged in technological development, design, procurement and production, to J&K Car Electronics Corporation (“J&K Car Electronics”). The Group also integrated the product planning and marketing functions of both companies into J&K Car Electronics to turn the company into a virtually independent company. Furthermore, the Group sweepingly realigned the organization of J&K Car Electronics, and promoted thorough personnel exchange between both companies, aiming to further fuse the organizations and strengthen their business structures. These measures will allow the two companies’ management teams to cooperate and evolve into a completely integrated business unit that can maximize the integration effects as soon as possible through a merger of the development, production, product planning and sales functions, including integration of platforms for car audio and car navigation systems. The newly integrated management team also promotes sales activities by optimally leveraging the strengths of both companies’ brand products.

Based on the above measures, the Group is further enhancing its market competitiveness in car audio products in the consumer sector by improving them through the use of cost synergy effects and common platforms, as well as by offering an expanded product lineup, centering on AV-integrated car navigation systems through collaboration with Garmin Ltd., a PND^* market leader, in pursuit of the top global position. In the OEM sector, we are completing structural reforms, commercializing a new car navigation system using an engine jointly developed based on the Group’s management resources, and developing devices for car-mounted equipment such as CD/DVD mechanisms.

* PND stands for “portable/personal navigation device.”