JAIA Chairman Press Meeting (July 17, 2019)

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Chairman's Press Conference July 17, 2019

JAIA held a Chairman’s Press Meeting on July 17, 2019.
Following is the keynote speech by Chairman Kintaro Ueno.

Kintaro Ueno

1. New imported vehicle sales in first half of 2019

To begin with, looking back at 2018, the sales of foreign-brand four-wheelers reached 309,405 units, exceeding the 300,000 mark for the second consecutive year. It was the second highest record.

For the first half of 2019, the number of newly registered foreign-brand imported vehicles was slightly lower than a year earlier (i.e. minus 1.8%) in terms of percentage change, but the recorded total number was 149,010 units which was the 5th highest number for a first half year. In addition, the total number including the Japanese-brand imported vehicles stood at 176,125 units.

In the background, basically, the sales continued to be high of the vehicles equipped with broad-ranging advanced safety technologies, the environmentally friendly vehicles with a variety of powertrains including Hybrid Electric Vehicles and Clean Diesels, as well as SUVs and Crossover Utility Vehicles, although there were several cases of temporary delay in supply of several models.

2. Outlook for sales of imported vehicles in second half of 2019

In terms of market conditions, the Consumption Tax hike is scheduled from October 1, 2019. But at the same time, as the permanent cut of the Automobile Tax, “measures to level demand” etc. are planned to be started, it is expected that the “reactionary decline of consumption after the last-minute buying before Consumption Tax hike”, which was experienced in the past, will not be repeated. JAIA plans to cooperate with the government by providing customers with the accurate information on the automobile-related tax changes and the policy measures in order to level demand. The JAIA member companies plan to further carry out such sales promotion programs as a range of finance plans with low interest rates and residual value setting–type loans. In addition, the JAIA members will further steadily expand the supply of various new models such as those equipped with voice interactive systems utilizing artificial intelligence (AI), remote control door lock/release and parking functions operated by drivers outside vehicles using smartphones and various safety features that employ sensing technologies including Emergency Driving Stop System, accident avoidance steering functions and reverse collision warning and prevention capabilities, as well as vigorously introduce newest attractive models equipped with cutting-edge technologies. Considering such positive factors, it is expected that the imported vehicle market will grow steadily in the second half of 2019.

3. Key activities of JAIA

3.1 Activities for market revitalization

First, concerning taxation, which is one of the important market conditions, in the short-term towards the planned changes of the auto-related taxes scheduled for October 1, 2019, JAIA will cooperate with the government by providing customers with the accurate information on the automobile-related tax changes and the policy measures to level demand.

In the mid-term towards the taxation revision of the fiscal year 2020 onwards, we will intensify our activities for strongly requesting further reductions and fairness of the tax burdens on users, which are excessive compared with other countries, in collaboration with other organizations concerned.

The reason for our strong request is that the planned rates of reductions in Automobile-Tax from October are limited and there will still remain the gap in tax burdens for registered vehicles as more than twice as high as kei-cars, although the first step of the Automobile Tax cut is planned to be taken from October 1, 2019. In addition, the drastic review for eventual abolition of the Tonnage Tax, which has lost the rational for levying, is necessary.
Secondly, in order to revitalize the market, JAIA will continue to be a co-organizer of the Tokyo Motor Show 2019 slated for the coming autumn. After TMS 2019, JAIA will support the efforts of our member companies to take part in the regional motor shows to be held in Osaka, Nagoya, Fukuoka, Sendai and Sapporo, as well as the local imported car shows and motorcycle shows.

3.2 Activities in environmental and technical areas

First, with respect to the automated driving, which many countries of the world are developing at an accelerated pace, the Government of Japan is working on various projects to realize Level-3 automated driving on motorways and Level-4 in limited areas in time with the Tokyo Olympics and Paralympics 2020. SIP-adus plans to move onto the Phase-2 large-scale field operational tests from October 2019. As in the case of the Phase-1, JAIA will support its interested members’ participation in Phase-2.

In addition, in order to establish legal framework for Level-3 automated driving, the Road Transport Vehicles Act and the Road Traffic Act were amended in May of 2019 and preparatory work is ongoing for implementing the amended Acts within one year.

JAIA will be submitting the comments in order to ensure that the laws and regulations to be implemented should be internationally harmonized and fair for all parties concerned. In specific, concerning requirements of automated driving systems such as data recording devices, procedures for checking conformity with regulations and cybersecurity, it is essential that various legal schemes of Japan should be in line with the ongoing deliberations at the UN and without any discrepancy from future international standards.

Furthermore, social needs are growing for zero traffic accident society, and JAIA will further cooperate with other relevant organizations for this goal. The ratio of AEBS-equipped vehicles sold by the JAIA members is, for instance, increasing year by year, while UN WP29 has just adopted new regulations on AEBS for passenger car.

Also, the share of models having Level-2 performances by Adaptive Cruise Control and Lane Keep Assist Systems, and others equipped with more advanced functions such as AEBS vehicles to cyclist and Automated Emergency Call Systems (AECS), will increase steadily.

In addition, JAIA will further work together with other relevant organizations towards zero traffic accident, actively participating in the JNCAP Study Group, ASV Promotion Committee, etc.

In making policies for that goal, JAIA expects that an international harmonization and the potential of various technologies shall be fairly and comprehensively reflected.

Going onto the next topic, the JAIA members will further promote Connected Cars with various functions including checking vehicle location and conditions from outside vehicles using smartphones, remote control door lock/release, remote control parking, etc.

Also, we are now keeping our eyes on the progress toward the practical application of 5G. In Japan, radio frequencies for 5G were allocated in April this year, and in future, base stations for 5G are expected to be developed at an accelerated pace. 5G will speed up the development of automated driving in the future including application for V2V and V2I communication, while improving performances of in-vehicle entertainment. JAIA members will further promote advancement of connect technologies for motor vehicles, taking opportunities in IOT era.

Let me move onto our activities for promoting Electrifications. After the Paris Agreement has come into effect, international efforts to reduce greenhouse gases are progressing on a global scale.

In Europe, in April this year, a very ambitious goal was set to cut, by 2030, CO2 emissions from passenger cars by 37.5 percent from the 2021 levels. To achieve this, EU member states should implement the effective policy measures to dramatically expand economic incentives and charging infrastructures, while automobile industry should further introduce and expand the sales of BEV.

In Japan, in June this year, a final report has just been issued on the formulation of the Fiscal Year 2030 Passenger Car Fuel Efficiency Standards. The new standards call for improvement of 44.3 percent on average from the current FE standards, which is one of the most stringent standards in the world as the European regulations. The JAIA members plan to vigorously introduce and expand EV and PHEV, etc. to achieve the new standards. JAIA calls on the Government of Japan to drastically expand economic incentives and charging infrastructure.

And there remains a few issues to be tackled under the mid-term review in the years to come in the next Fuel Efficiency Standards such as flexible measures to be considered in judging the achievement. JAIA is willing to provide information on the experiences in foreign markets and our viewpoint in order to cooperate establishing better solutions for the future.

Next, I would like to emphasize that JAIA is aiming to achieve “complete IWVTA”, which is the ultimate international harmonization of regulations.

Looking back on the progress in international harmonization of recent years, the application of the UNR0 can be accepted in April this year, for which JAIA has been working over years. Also in February, the Japan-EU EPA went into force. On behalf of JAIA, I would like to express our respect for the efforts of the government of Japan. We highly appreciate that the international harmonization on a number of regulations has been realized through EPA negotiations.

Hereafter, JAIA will call for effective implementations of the EPA as agreed. Then, it should be ensured that there will not be any amendment or new formulation of Japan-unique regulations. We will be working on the important issues, which are international harmonization of regulations for automated driving, fuel efficiency and exhaust emissions, and the scheme relating to completion inspection.

In the middle- to long-terms, JAIA will further work together with the Government of Japan for the “achievement of complete IWVTA”.

3.3 Activities for imported motorcycles

The first pillar is the “activities for market revitalization” and our prime activity is the JAIA Motorcycle Test Ride. At the Fifth Test Ride held in early April this year, the JAIA members provided 88 motorcycles, and in total, 134 participants of 49 media joined. As a results, JAIA was able to widely demonstrate the attractiveness of imported motorcycles that are diversified and ‘something different’. In the next year onwards, JAIA will continue to be holding the Test Ride.

Secondly, the “Motorcycle Touring Plans”, which started in 2017, are now underway between April 26 and the end of November this year, with the subjected areas expanded including Hokkaido, as requested by JAIA and other organizations concerned.

Thirdly, JAIA will continue participating in the Bike Love Forum (BLF), which will be held in Yamanashi Prefecture in fall this year.
On another pillar of the “activities for international harmonization of safety and environment-related regulations”, JAIA will vigorously carry out activities for realizing further harmonization.

4. Closing

In closing, taking opportunities in the midst of progress of CASE, JAIA will further contribute to sustainable development of the motor vehicle market of Japan, by providing more advanced and attractive imported cars and motorcycles with cutting-edge technologies to wider customers, in collaboration with the other organizations concerned.