January 1, 2005
New Year's Message
Itaru Koeda, Chairman
Happy New Year to all.
In 2004 Japan's economy showed a steady recovery owing to rises in production, exports and corporate earnings in the first half of the year. However, the latter half of the year was marred by unease over a number of trends including rising crude oil prices, the depreciating dollar and a stagnant stock market. There is still considerable concern with respect to the future course of the national economy.
Domestic demand for passenger cars and commercial vehicles reached a total of 5.83 million units last year, driven by aggressive new model launches among other factors. This is about the same level as in 2003, which saw market growth for the first time in three years. Motorcycle sales, meanwhile, declined 8.7% to 727,000 units.
With the sound economic trends that are anticipated in 2005 in the United States and Asia and the positive growth forecast for the Japanese economy, passenger car and CV sales should rise to 5.87 million units, while motorcycle demand is expected to drop to 712,000 units. Overall, the business climate for the automobile industry remains challenging, particularly in view of the uncertainty regarding crude oil prices and currency fluctuations.
The Japanese automobile industry occupies a core position in the national economy, and as such has a major role to play in contributing to social and economic welfare. Market activation is of course one of its key concerns.
Road safety and environmental protection are top-priority social issues for the industry. Last spring Japan's automakers officially launched their "Working Towards a Sound Automotive Future" initiative, focusing on efforts to increase road safety as well as improve air quality and curb global warming in order to minimize the environmental impact of motor vehicles.
JAMA will actively contribute to the achievement of the Japanese government's target-announced in January 2003-to reduce road traffic fatalities by 50% over the next ten years. In addition to introducing advanced vehicle safety measures and promoting greater road safety awareness on the part of the public, the automobile industry is also contributing to the creation of an infrastructure that will integrate roads, road users and vehicles through the effective use of ITS (Intelligent Transport Systems) technologies.
Global warming and air quality are also being addressed. In response to the need to reduce CO2 emissions, the Japanese automobile industry is working hard to achieve further increases in fuel economy and to promote improved fuel quality, more efficient goods distribution and smoother traffic flow. With respect to air quality, automakers continue to develop and encourage the practical use of a wide range of clean-energy (including fuel-cell) vehicles and are making strenuous efforts to ensure compliance with new exhaust emission regulations for both diesel and gasoline-powered vehicles.
Japan has long promoted resource conservation and waste reduction, and over the years automobile manufacturers have made significant advances in these two areas. This month sees the enforcement of Japan's Automobile Recycling Law, in preparation for which comprehensive groundwork was carried out jointly by government and the private sector. While vehicle users will be required to share the cost burden involved, automakers will make every effort to ensure optimal efficiency in the operation of the recycling infrastructure. A continuing, parallel effort will be the design and development of vehicles that are easier to recycle.
In view of their ever-expanding global operations, automakers must operate in today's international business environment with maximum effectiveness and responsibility. For the benefits they will bring to the industry and to consumers alike, JAMA welcomes the establishment of free-trade areas (FTAs) that complement WTO initiatives towards multilateral free-trade and investment agreements. In the wake of the FTAs launched with Singapore, Mexico, and the Philippines, the Japanese automobile industry will continue to promote liberalization through the creation of additional FTA treaties with, for example, Thailand, Malaysia, and Korea.
Two special events are on JAMA's calendar this year: First, the opening of "Expo 2005 Aichi" in March featuring JAMA's Wonder Wheel Pavilion, the first world-expo pavilion ever to integrate a 50 meter-class Ferris wheel in its design. Second, in October, the 39th Tokyo Motor Show for Passenger Cars & Motorcycles which will once again feature hands-on, interactive displays for visitors. Plans are also being made to mark this year's 50th anniversary of the Tokyo Motor Show.
The Japanese automobile industry always seeks to better serve society and vehicle users by delivering products that can be operated in safety and security. By the same token, it seeks to prevent any recurrence of product defects and to ensure that recall operations are properly implemented, and it is working with government to meet those objectives.
JAMA also systematically petitions the authorities for a reduction of the tax burden on vehicle users and a streamlining of Japan's complex automotive tax structure. In addition to specific requests for auto tax reform, JAMA regularly submits to the Japanese government proposals targeting the most effective use of tax revenue in the maintenance of the nation's road infrastructure.
I take this opportunity to thank all our friends and colleagues for their continued support in advancing the activities of the automobile industry.
