<Japan>
The total demands of domestic passenger cars was 4.88 million units for the first increase in four years, a 3.8% increase from the previous fiscal year, due to the efficacy of the eco-car tax reductions and purchase subsidy, both introduced in the beginning of the year. Under these conditions, domestic sales of the Legacy, this underwent a full-model change in May of 2009, increased by 8 thousand units, or 41.4% from the previous fiscal year to 29 thousand units. This served to boost total vehicle sales together with the beneficial effects of the eco-car tax reduction and purchase subsidy resulting in total Subaru domestic sales of passenger vehicles of 75 thousand units for an increase of 5 thousand units, or 7.1%, over the previous fiscal year. On the other hand, the number of domestic minicars sold was 96 thousand units, a decrease of 13 thousand, or 11.5% from the previous fiscal year, due to the slowdown in total demands, as well as factors such as reduced units sold of the Stella flagship model resulting from the prolonging of the current model, and the effects of the end of production of the Pleo Van in the middle of the year. As a result, the sales in Japan were 171 thousand, a decrease of 8 thousand, or 4.2% from the previous fiscal year.

<Overseas>
Contributing factors to increased unit sales included the strong sales in North America due to the effects of the scrap incentive programs (cash for clunkers) and the new Legacy model, and healthy sales in China, mainly of the Forester model. Additionally, in the second half of the year, the new Legacy model contributed to sales in all markets, and we started to see the signs of the recovery of sales in all markets in addition to the healthy sales in North America and China. As a result, the sales overseas were 392 thousand, an increase of 15 thousand, or 4.0% over the previous fiscal year. By region, sales continued strong in North America, up by 43 thousand (20.6%) over the previous fiscal year to 250 thousand, and in China, up by 23 thousand (86.9%) to 49 thousand. However, sales were down in Europe (including Russia) by 39 thousand (49.8%) to 39 thousand, down in Australia by 2 thousand (4.7%) to 35 thousand, and down in other regions by 10 thousand (35.0%) to 19 thousand.

As a result, the combined sales volume for Japan and overseas markets amounted to 563 thousand, an increase of 8 thousand, or 1.4% over the previous fiscal year, but overall net sales for the Automobile Division was down ¥21.9 billion, or 1.7% from the previous fiscal year to ¥1,294.5 billion due to the influence of the losses on currency exchange generated by a strong yen. Operating income was up ¥30.9 billion over the previous fiscal year to ¥21.7 billion due to the effects of a reduction of parts cost, SG&A and other expenses, and so on.

Net sales of products to the Japan Ministry of Defense were up over the previous fiscal year, due to increased sales of unmanned systems such as unmanned aerial vehicle system and "Forward Field Observation System." Additionally, net sales of civilian products were up over the previous fiscal year due to the recovery of sales of the Boeing 777, which had suffered from the effects of a strike at Boeing in the previous fiscal year, as well as the contribution of increased sales of mass production models of the Boeing 787. As a result, overall net sales were up ¥12.3 billion, or 15.3% over the previous fiscal year to ¥93.2 billion, and operating income was up ¥3.2 billion, or 205.5% from the previous fiscal year to ¥4.8 billion.

Although there was an increase in net sales due to the inclusion of two new subsidiaries in the scope of consolidation, net sales were down ¥11 billion, or 31.5% from the previous fiscal year to ¥23.9 billion, and operating loss was increased ¥0.8 billion from the previous fiscal year to ¥2.4 billion resulting from decreased engine sales, not only within Japan but also in Europe and the Middle East, due to sluggish demand following the financial crisis, as well as the losses on currency exchange generated by the strong yen.

Although sales of the Fuji Mighty sanitation truck decreased, net sales were up ¥3.4 billion, or 24.9% over the previous fiscal year to ¥17.1 billion due to the delivery of large-scale wind-power systems which contributed to the increase in sales and the inclusion of one new subsidiary in the scope of consolidation. Operating income was down ¥0.6 billion, or 17.9% from the previous fiscal year to ¥2.6 billion.