TRINITY INDUSTRIAL CORPORATION

The automotive industry accounts for a significant portion of the Group's sales, and fluctuations in vehicle sales volumes and capital investment plans in this industry may directly affect the Group's business results and financial condition. Given the high degree of dependence on a specific industry, a downturn in the automotive market or restraint in capital investment could severely impact performance. As countermeasures, the Group is working on developing competitive equipment with low environmental impact and expanding sales outside the automotive industry.

Raw materials such as resin materials and steel materials, which account for a large proportion of procurement costs, may fluctuate significantly due to international commodity market conditions, potentially affecting business results and financial condition. Rising raw material costs pose a risk of directly squeezing profit margins. As countermeasures, the Group is working to pass costs through to product prices and reduce material costs by improving yield rates.

Fluctuations in foreign exchange rates may affect the yen-converted amounts of overseas transactions and the yen-converted amounts of foreign-currency-denominated financial statements of overseas subsidiaries, thereby affecting consolidated results. As overseas operations expand, there is a risk that the scale of transactions affected by exchange rate fluctuations will increase. As countermeasures, the Group is working to reduce the impact through optimization of overseas trade flows and, as necessary, utilizing forward exchange contracts to avoid future exchange rate fluctuation risk.

In the event of a large-scale disaster such as an earthquake, manufacturing lines may be interrupted or suspended, potentially having a material impact on business results and financial condition. Given the nature of manufacturing operations, damage to production facilities poses a risk directly linked to the responsibility of supplying customers. As countermeasures, the Group conducts regular equipment inspections and has formulated a business continuity plan (BCP), establishing safety measures and an early recovery system.

If the spread of an infectious disease or similar event occurs on a scale exceeding expectations, business operations may become difficult, potentially having a significant impact on financial condition and business results. There is a risk that securing personnel and continuing production at manufacturing sites could become difficult. As countermeasures, the Group has formulated basic policies and response manuals for infection prevention and is promoting necessary preventive and infection control measures.