May 17, 2012

Outline of JAMA Business Activity in Fiscal 2012

Although projections for Japan’s economy in fiscal 2012 (ending March 31, 2013) favor a continued gentle pick-up fuelled by sustained recovery demand following the events of March 11, 2011, numerous concerns remain, including the risk of a downturn in the world economy triggered by the European debt crisis, the high value of the yen, and curbs on domestic electric power supply.

As a mainstay of the national economy and citizens’ livelihoods, Japan’s automobile industry will, meanwhile, continue to contribute to their advancement.  In so doing, it will draw from lessons learned over the past year, during which JAMA and its member companies worked jointly to surmount the tough challenges posed by the triple disaster of March 11 and its consequences, the massive floods in Thailand, and other developments.

While many issues will need to be addressed in the process, the three basic areas of focus outlined below, reflecting continuously evolving conditions for the industry, will underpin JAMA’s activities during the current fiscal year.

1. Promoting Japan’s Manufacturing Craftsmanship
 Japanese manufacturing craftsmanship has long been the dominant factor in the success of Japanese automakers’ products both in the home market and overseas.  Sustaining production activities in Japan today is, however, becoming increasingly difficult against the backdrop of unprecedented yen appreciation, delays in Japan’s entering into economic partnerships and free trade agreements, and a high corporate tax rate, among other major challenges.  As a result, there is a growing trend to shift production activities abroad.
  The auto industry is determined to halt this “hollowing out” of Japan’s manufacturing tradition by taking every possible step to withstand yen appreciation, while at the same time urging the government to expedite Japan’s entry into free trade agreements so as to help level the playing field in terms of international competition.

2. Revitalizing the Domestic Market
  Revitalization of the home market is a key element in the effort to bolster the foundations of Japan’s manufacturing expertise.  To that end, Japan’s automakers will focus on strengthening domestic vehicle demand not only by supplying innovatively appealing models but, along with JAMA, by dynamically promoting the pleasures of automobile use. 
  Market invigoration will also be served by the Japanese government’s three-year extension of tax incentives and subsidies for the purchase of eco-friendly vehicle models and by the partial reductions applied to the automobile tonnage tax.  Meanwhile, JAMA will continue its longstanding initiative of soliciting the government’s complete abolition of both the tonnage tax and the automobile acquisition tax, which can no longer be construed as in any way viable.
  Japan’s automakers are committed to further advancing the environmental performance of their products.  Those efforts will be accompanied by demands for new incentive measures to help achieve the government’s challenging goal of increasing the share of next-generation “green” cars in new car sales in Japan to 80% by 2020.

3. Achieving Greater Safety and Convenience in Vehicle Use
  Targeting further reductions in road accident occurrence and in the number of fatalities and injuries resulting from those accidents, JAMA members will continue their pursuit and application of cutting-edge technologies in the areas of active safety (accident avoidance) and passive safety (injury mitigation) in order to supply world markets with ever safer and more user-friendly vehicles.
  A complementary pursuit is JAMA’s energetic promotion, in the global arena, of the establishment of International Whole Vehicle Type Approval (IWVTA).  IWVTA will be instrumental in accelerating international harmonization of automotive technical standards for the purpose of expediting the certification process, which will bring significant benefits to consumers in a number of ways.
  In addition, to help meet the government’s goal of making Japan’s roads “the safest in the world,” Japan’s automakers will continue to submit proposals and lobby for improvements in road infrastructure (including traffic management) and measures promoting a greater awareness of road safety on the part of all road users.
  Throughout fiscal 2012, JAMA and its members will, furthermore, be working to better support the lifestyles of Japan’s growing number of senior citizens and otherwise address the rapidly diversifying mobility needs of the nation.
  The overarching goal of these broad-ranging activities is to augment the value of motor vehicles as social infrastructure that works hand in hand with key aspects of energy supply and advances in telecommunications technologies to provide society with safe, comfortable and convenient mobility.