January 1, 2016
From JAMA and its member manufacturers, best wishes to all for a happy and fulfilling 2016.
Japan’s economy saw moderate recovery in 2015, marked by generally favorable corporate results—reflecting, in particular, the status of the yen and the decline in the price of crude oil—and improvements in the areas of employment and income stemming from the implementation of specific government policies.
Incorporating a vast array of supporting industries, automobile manufacturing holds a core position in the national economy and thus has a critical role to play in the promotion of growth, employment, and a sound future for Japan.
In 2016, with numerous challenges facing the automobile industry, JAMA will continue to focus on the following three priorities: revitalizing the domestic market; improving the business environment; and achieving safe, comfortable and sustainable mobility.
Revitalizing the domestic market
The prolonged slump in Japan’s domestic vehicle market as a result of the hike in the national consumption tax in April 2014 was compounded by the increase in the mini-vehicle tax in April 2015. With demand levels throughout 2015 lagging behind those of the previous year and with an equally severe forecast for 2016, the revitalization of the domestic market will be critical to the overall progress of the Japanese automobile industry.
JAMA member companies are therefore working to supply the market with products of ever higher value, in a concerted push to convey the appeal of automobiles and motorcycles to a broad consumer base.
A major highlight for our industry last year was the 44th Tokyo Motor Show—the first Tokyo Motor Show to be held following the milestone passage of 60 years since its inauguration in 1954—in autumn, where the automakers showcased fuel cell, electric and plug-in hybrid vehicles as well as automated driving and other cutting-edge technologies. We are pleased to announce that total attendance exceeded 810,000 visitors from Japan and overseas, attesting to the high level of interest in the event.
Although the next edition of the biennial Tokyo Motor Show will be held in 2017, the Japanese automobile industry will in the meantime be building on the momentum generated by last autumn’s show to buttress the appeal of their product lineups.
Facilitating motor vehicle ownership and use is another key factor in the revitalization of the home market. Japan’s automobile-related tax structure comprises various taxes that, in their totality, are far more onerous than counterpart taxes in other countries. With Japan’s consumption tax scheduled to be raised again in April 2017, reducing the tax burden imposed on vehicle ownership and use will be crucial to invigorating domestic demand.
In December last year, Japan’s ruling coalition took the early decision to approve only a new, fuel efficiency-based tax scheme for motor vehicles, to be levied from April 1, 2017. JAMA finds it regrettable that this decision was made before taking into consideration the full scope of Japan’s automobile tax structure, particularly in view of the consumption tax increase also scheduled to take effect in April 2017. We recognize, however, that more motor vehicles will thus be eligible for exemption or a lower tax rate than are so now under Japan’s current acquisition tax incentive scheme for eco-friendly vehicles, and appreciate the fact that the new scheme therefore represents, in effect, a tax cap for vehicle owners.
Furthermore, although no measures were taken in 2015 to ease the burden of the so-called automobile tax on vehicle owners—an initiative which JAMA has long been calling for—we nevertheless welcome the Japanese government’s intention to include in its fiscal 2016 tax system reform package a specific reference to lowering the tax burden during vehicle ownership.
This year JAMA will continue to promote the “Roadmap for Motorcycle Industry Policy,” compiled in 2014 in collaboration with related industry groups, local governments and other stakeholders, which calls for the implementation of educational programs on the safe operation of motorcycles, simplified requirements for their licensing, an expanded availability of parking bays, more appropriate expressway tolls, and other initiatives to facilitate motorcycle ownership and use. The overall objective of this effort is to encourage a wider segment of the Japanese public to use motorcycles as convenient “partners” in the conduct of daily activities.
Improving the business environment
A strengthened industrial sector with greater international competitiveness is critical to the sustained growth of Japan’s economy. For the Japanese automobile industry to thrive amid increasingly fierce global competition and maintain a high profile worldwide, the automakers must, among other initiatives, raise their research-and-development capacity and bolster their Japan-based operations so that parent plants can work more closely and more productively with their overseas subsidiaries.
Accordingly, we look forward to sustained government efforts to implement progressive corporate tax reform, further to its introduction of an initial rate cut, and improve the R&D investment environment, among other measures that will contribute to the auto sector’s international competitiveness.
Because our industry is deeply committed to global-scale business development, the creation of economic partnerships and the achievement of freer trade and investment based on the formulation of common rules are essential. Last October a general agreement was reached on the Trans-Pacific Partnership (TPP) trade pact. We take this opportunity to reiterate our deep appreciation to the Japanese government officials involved in the two-year-long negotiation process leading to that agreement. In line with the TPP trade accord, the Japanese automobile industry intends to provide a more extensive range of high-quality products and services to meet the needs of both domestic and international consumers. In so doing, it hopes to contribute not only to the Japanese economy but also to the forging of closer intraregional economic ties.
We hope, too, that the TPP trade pact agreement will help accelerate the conclusion of ongoing talks on the EU-Japan Economic Partnership Agreement, the Asia-based Regional Comprehensive Economic Partnership, and other trade accords now being negotiated by Japan.
The ASEAN Economic Community was launched at the end of last year, boosting expectations for the increased international competitiveness of the ASEAN region as an integrated market. Japanese automakers, many of which have extensive business operations in the region, will be working to strengthen their ties in that market while contributing to local economic growth.
Creating safe, comfortable and sustainable mobility
For the Japanese automobile industry, achieving optimally independent and sustainable mobility that is safe and comfortable for all road users is its primary mission. Safety and environmental issues will thus remain the leading priorities for JAMA and its member manufacturers.
With respect to safety, the automakers are increasingly equipping their vehicles with advanced driver-assistance systems and other active safety features which enable, through the application of cutting-edge Intelligent Transport Systems (ITS) technologies, vehicle-to-vehicle and road-to-vehicle communication. On the subject of automated driving, JAMA compiled a document in November last year entitled “Creating the Automotive Future Today” (soon to be available in English on the JAMA Web site) which details its view of and priorities for mobility in the present and coming decades. Targeting “zero” road accidents and “zero” congestion, optimally independent and stress-free mobility and efficient freight transport, our goal is to boldly pursue the introduction of automated driving technologies serving the needs of all road users, including motorcycle riders, bicyclists and pedestrians. JAMA’s roadmap envisions the wider introduction of automated driving functions in the lead-up to 2020; between 2020 and 2030, the expanded application of automated driving technologies in various driving environments; and a full deployment of advanced levels of automated driving by 2050. The commercialization of automated driving will be predicated on its acceptance by society and will necessarily be incremental, requiring collaborative efforts among all the stakeholders involved.
In tandem with those advances, and with the common objective of making Japan’s roads the safest in the world, JAMA and its members will meanwhile continue to conduct their road safety awareness promotional campaigns and educational programs as well as their lobbying activities for improvements in the road use environment.
With respect to environmental issues, the 21st Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21), which convened late last year in Paris, adopted a new framework, the Paris Agreement, under which all nations and regions, including the developing countries, will work together to reduce global greenhouse gas (GHG) emissions. For its part, the Japanese automobile industry will strive to meet the Japanese government’s GHG emissions reduction targets for 2030 by advancing the development and commercialization of next-generation alternative-energy vehicles including fuel cell, electric, plug-in hybrid and clean diesel vehicles; by further improving the performance of conventional internal combustion engines; and by promoting smoother traffic flow through the implementation of an integrated approach that includes ecodriving. JAMA and its members are and will be working with related industries and petitioning for greater government support in expanding the infrastructure required for the wider use of fuel cell, electric and plug-in hybrid vehicles.
Improving air quality through reductions in particulate matter (especially PM2.5) emissions and advancing end-of-life vehicle recycling processes are among the other issues which the Japanese automobile industry will be addressing in the interest of greater environmental protection.
Tokyo’s hosting of the Olympic and Paralympic Games in 2020 provides Japan with the highly welcome opportunity to exhibit its technical prowess to the world. In preparation for that landmark year, the Japanese automobile industry is joining forces with government, industry partners and the other stakeholders concerned to achieve genuinely innovative and eco-friendly mobility for 2020 and thereafter, for a brighter and sustainable future.
As we enter a new year of hope and promise, JAMA and its members look forward to your continued support and input throughout 2016.