Recently, momentum is growing for the achievement of carbon neutrality. In order to provide Japanese customers with varieties of imported automobiles from all over the world that are equipped with leading-edge safety and environmental technologies, such as xEVs, JAIA members are taking on challenges to solve new problems stemming from technological progress. By delivering imported vehicles with various appeals to Japanese customers, we will spare no effort for revitalizing Japan’s motor vehicle market and contributing to the development of Japan’s sustainable mobility society.
For Japan’s motor vehicle market as a whole, the 2024 first half saw the first year-on-year decline in two years, with registrations standing at about 1.4 million units. Registrations of foreign-brand vehicles were also down 7.1 percent from a year earlier to 113,887 units, marking the first year-on-year decrease in the 1st half of the year in two years since the 2022 first half.
On the other hand, the imported EV segment is performing well. Overall in Japan, monthly new EV sales have been down for eight consecutive months since November 2023; however, imported EVs were up four months in a row since March 2024. As a result, new registrations of imported EVs in the first half of 2024 were up 16.7 percent from a year earlier to 10,785 units, exceeding the 10,000-unit mark for the first time for a first half and posting record high figures for the first half sales five years running since 2020 1H. The share of EVs to the overall foreign brand vehicles is also rising steadily to 9.5 percent for the first half of 2024.
Such results were made possible by the government support with uninterrupted and continuous subsidies and the like, and the efforts of the JAIA member companies to actively enhance their lineups of EV models to meet the needs of customers.
As to the lineups of imported-brand EVs, in 2020, there were 20 models of 10 brands, which have grown to be 133 models of 17 brands as of the end of June 2024, including commercial vehicles. As the lineups expand to include more diversified models, from compact to large cars, SUVs, luxury and sports models, users’ choices are expanding. As the imported-EVs have played an active role in the segment, JAIA has been making specific efforts to solve the issues related to electrification, including charging infrastructure. Those issues, we believe, are steadily headed to be solved. I will elaborate on these issues later.
Concerning the impact of delay in vehicle supply, although the situation varies from importer to importer, it is recovering overall, with few impacts remaining, so we see that severe market conditions will continue. However, against such a backdrop, our member companies will continue actively launching new models in the second half of the year.
Particularly for imported EVs, in addition to tax benefits, the central government continued to provide support through subsidies, etc. Furthermore, local governments, such as the Tokyo Metropolitan Government started providing support. Thanks to such government support, combined with active launches of imported EVs in Japan by the JAIA member companies, their sales will likely continue growing steadily, potentially surpassing 25,000 units for the entire year. At the time of the press conference in January this year, I said, “Soon there will be a day when one in ten foreign-vehicles sold will be an EV”. We expect that the share of imported EVs will top 10 percent.
Also, looking at overseas, we are well aware of various policies of various countries for decarbonization as well as the market trends. For example, in Germany, the share of EVs in the first half of 2024 stood at 12.5 percent , whereas in Japan it is still just 1.6 percent even for the whole market. In addition, as the government support for the spread of EVs is expected to continue, there is still room for growth for EVs in Japan.
Under these circumstances, we have great hopes that imported-brand EVs will continue to grow steadily, posting year-on-year growth six straight years.
First is, our activities for market revitalization and the fields of environment and energy. At first, I will describe our activities for xEVs, as activities that span across the two areas. In order to further promote xEVs, we at JAIA focus on four pillars: (1) request activities to the government for subsidy programs, etc.; (2) organizing events to promote the spread of xEVs; (3) putting in place better conditions for charging infrastructure development, such as considering deregulation of the charging voltage, etc.; and (4) lithium-ion battery recycling.
First, I’d like to express our gratitude for the government’s measures of xEV subsidies, implementing them continuously without interruption, and for securing considerable sum of 129.1 billion yen for the FY 2023 supplementary budget.
Next, I’d like to introduce our efforts to further increase awareness of imported-brand xEVs. JAIA has been serving as a platform for the promotion of the spread of imported-brand xEVs since 2021. Last year in July, we held an imported-brand xEV promotion event in Kobe followed by booth exhibition exclusively featuring xEVs at the Japan Mobility Show held in October.
JAIA will again hold a two-day event on November 15 and 16 this year at multiple venues in the Marunouchi area, the heart of Tokyo, following the one last year, we would like to add further innovations such as projects featuring events in which each company has participated, etc. to help the general public understand the attractiveness of imported-brand xEVs. In addition, towards electrification as an important matter to realize carbon neutrality, we plan to make this an exhibition and hands-on event to introduce issues such as charging infrastructure and maintenance personnel, as well as solutions and initiatives for these matters. We look forward to seeing you all there.
For the 2050 carbon neutrality, we believe that it is important to take mid- to long-term steps for the development of new social systems surrounding xEVs, including charging. JAIA, together with its member importers, will promote activities with an eye on the future of electrification.
Let me go on to improving conditions for charging infrastructure, such as considering deregulation of charging voltage. JAIA believes it is necessary to increase the capacity of the basic, en-route and destination charging, and further upgrade charging infrastructure in terms of both quantity and quality.
For the spread of xEVs, charging infrastructure is needed that is easy for anyone to use.
Positioning charging infrastructure as an important task, in order to deal with broad ranging issues of late related to charging infrastructure, JAIA has conducted studies by launching a cross-functional team within the organization. In the “Charging Infrastructure Road Map for 2030”, formulated by METI in October last year, many of JAIA’s requests are reflected. Currently, they are making swift moves for actions. I would like to express our gratitude to METI and other organizations concerned.
The parties involved have started making specific moves, such as revising the JARI certification to allow the application of subsidies to ordinary chargers with a capacity of up to 10kW and easing regulations for higher voltage. JAIA continues to make further effort to solve these issues.
Particularly as of the present, high-voltage charging like in Europe and the United States is not possible due to the country’s voltage regulations. For some of the models developed in Europe, it is necessary to develop and install voltage converters only for the Japanese market to match the lower charging voltage to the vehicle’s high-voltage battery, creating big challenges in terms of vehicle development, such as finding right spot to install converters, in addition to cost.
e-Mobility Power and TAKAOKA TOKO have announced the development of 350kW ultrafast quick chargers. Against such backdrops, we have high hopes that a number of high-voltage chargers will be installed at many locations by 2025. We also hope that the government will subsidize the installation of high-voltage chargers.
For the charging infrastructure on expressways, we hope that installing high-voltage chargers leads to faster charging in terms of quality and quantity and that discussions will progress among the parties concerned for institutionalizing temporary exit from expressways without heavy burdens on charging businesses for effective use of charging facilities nearby expressways.
At the same time, it is necessary to create an environment that promotes the installation of chargers in public parking lots and apartment houses, as seen in the case of Tokyo Metropolitan Government. It is also important to roll it out to other regions than Tokyo.
Field operational testing of charger installations on public roads was carried out in Yokohama City for the first time in Japan. Fast chargers were installed in Aoba-ku in 2021. In 2023, they were installed in Tsuzuki-ku in February and in the Minato Mirai area in December. Subsequently from April 2024, the FOT turned into government programs. The Tokyo Government started operating public road chargers in Shiba Koen and Daikanyama areas in March 2023 and in Shinanomachi in June. We believe all these efforts will lead to improved convenience of users.
There still remain issues with the charger installation in mechanical parking lots, etc. We will continue asking for support of the parties concerned.
We believe, as such, when the charging voltage is raised and more public road chargers installed, as I have said before, high-voltage quick chargers will realize a society available for anyone to use easily, as seen in Germany, cutting down the charging time to meet users’ need for short-time charging
In the area of recycling, with respect to the reuse and recycling of lithium-ion batteries, which are indispensable for the promotion of electrification, the number of JAIA members participating in the joint LiB recovery system – which also embraces domestic vehicle manufacturers – is increasing steadily.
We will continue exchanging views with battery recycling companies and providing support to the members to be able to obtain the latest information of the industry as needed and appropriately recover onboard batteries.
Next, I would like to explain our efforts for the matters of tax reform requests and fuel efficiency standards.
First, concerning the tax reform requests, as written in the ruling party tax reform outline, by the end of FY 2025, at which the current Eco-Car Tax Incentives are set to end, auto-related taxes will be drastically reviewed. JAIA will continue the request activities calling for further reductions of excessive burdens of auto-related taxes and for simplified and fair taxation. In particular, as it will be necessary to accelerate the spread of xEVs that can contribute to the achievement of carbon neutrality, any change of the tax system that would increase burdens on users should be avoided and we will be calling on the government to consider tax revisions for accelerating the spread of xEVs, such as BEV, PHEV and FCEV.
In the fields of environment and energy, the FY 2030 Passenger Car Fuel Efficiency Standards require significant improvement of 44.3% on an average Fuel Efficiency basis from FY 2020 standards. JAIA will continue to request the introduction of flexible measures such as off-cycle credits that evaluate energy-saving technologies that improve actual fuel efficiency and encourage their widespread use.
Next, I will explain the activities related to safety and regulation harmonization we are implementing so that JAIA member companies can smoothly introduce to the Japanese market leading-edge vehicles that adopt ever-advancing technologies.
First, in order to provide imported cars that ensure safety and environmental performance to Japanese consumers without incurring additional costs, we have been working for many years with the relevant authorities to promote the harmonization of international standards and the utilization of the mutual recognition system based on the 1958 UN Agreement on Certification. As a result, the IWVTA, an international vehicle type approval system for the complete vehicles, was established in 2018.
Since then, the IWVTA has been expanded year by year, for example, with the addition of UN-R154 for exhaust emission, fuel efficiency, and electric power consumption. It is now possible to obtain IWVTA, which encompasses type approvals for major safety and environment-related devices for passenger cars. JAIA will continue to work through JASIC activities and other means to further promote international harmonization of vehicle regulations and to expedite the realization of a more complete and highly valuable IWVTA.
In addition, for the regulations for other individual devices, UN-R171 for Driver-Control Assistance Systems (DCAS), which assist drivers with the vehicle’s longitudinal and lateral behavior, is scheduled to come into effect in September. The UN-R48-09, for lamp installation which incorporates Japan’s unique regulations for answer-back lights while parked as an international standard based on requests of JAIA, is also scheduled to come into effect in September. As such, International harmonization of vehicle regulations is progressing steadily year by year, and JAIA welcomes this trend. JAIA will continue to work to eliminate the remaining unique Japanese requirements through international harmonization, etc.
Furthermore, for the certification procedures for vehicle compliance checks, in November of last year, JAIA requested the MLIT to further streamline and improve the efficiency of the vehicle certification application procedures based on the IWVTA application procedures. JAIA hopes that procedures will be further streamlined while ensuring safety and environmental protection performance of imported vehicles. While continuing to hold discussions with MLIT, JAIA intends to work to achieve the necessary streamlining and efficiency while complying with laws and regulations.
In addition, to ensure vehicle safety in the recent trend of connected cars, we will work with our home country OEMs and MLIT to ensure that our members cope appropriately with new regulations related to cybersecurity and software updates for vehicle systems.
Also, JAIA has set up a specialized working group in the field of communications to advance discussions.
We will continue to hold discussions with relevant agencies regarding frequencies and communication methods, etc. We believe that technological trends toward further advances in automated driving are extremely important. JAIA will continue to collect information through the Mobility DX Study Group and others. The Mobility DX Strategy was announced by the government in May, and we will also be keeping a close eye on developments, such as the Mobility DX Platform that will be launched this fall. Through these initiatives, JAIA will continue to contribute to the member companies in providing customers with greater safety and more convenience through their products.
For automobile fair trade, JAIA will actively participate in the Automobile Fair Trade Council’s working groups and will continue to promote activities aimed at thoroughly informing JAIA members of the Automobile Fair Competition Code and ensuring fair trade.
For after-sales, we will take measures to ensure that member companies can take appropriate actions, including preparations for the electronic vehicle inspection system using on-board diagnostic systems, also known as the OBD inspection system, which is scheduled to be gradually applied to imported type-designated vehicles from October 2025 onwards, and the implementation of recall-related procedures in compliance with laws and regulations.
Also, as I mentioned at the beginning of the year, a shortage of mechanic personnel is an urgent issue common to the entire automotive industry. JAIA has been engaging in concrete activities such as the establishment of the Auto Mechanic Human Resources Information Liaison Meeting to share information, and with member companies to overcome challenges.
For instance, in a survey on dealerships of our members conducted by JAIA last year, approximately 60% of respondents said they had experience hiring foreigners or expected to do so in the future. We also hear some members saying that the activities of the liaison meeting have triggered a new trend in the recruitment of foreigners. Also, in exchanging opinions with people involved in auto maintenance schools, we found that the percentage of foreign students is increasing, and the number of schools offering courses for foreign students is gradually increasing. JAIA will provide support through its members to address the issue of a shortage of mechanic personnel at member-affiliated dealerships, including these areas.
In the first half of 2024, new registrations of small imported motorcycles were 13, 930 units, up 0.04 percent from a year earlier at 13,925 units for the fifth consecutive half-year period of increase. We think that the new post-covid lifestyle is contributing to the increase in new motorcycle registrations. Also, new models have been launched that can be ridden with medium-sized motorcycle licenses. Wide variety of unique imported motorcycles attracted attention.
Now, one of the major pillars of our motorcycle activities is “activities to revitalize the market.” As part of this, we held an imported motorcycle test ride event at Oiso Long Beach on April 10 and 11 this year. Thanks to strict safety measures, the event was a great success without any major accidents. A total of 153 members of the press from 47 media attended the event.
In addition, the 3rd Nagoya Motorcycle Show was held at the Aichi International Exhibition Center for three days from April 5 to 7, with nine JAIA motorcycle member companies exhibiting. As with the previous event, measures were taken to further attract young people and families, such as offering free admission for high school students and younger and women.
JAIA secretariat also plans to participate in the “12th BIKE LOVE FORUM in Nangoku Miyazaki”, which will be held in Miyazaki City on September 27, where participants will have discussion on the future of motorcycles among the government, industry and other stakeholders. By the event, we also look forward to further progress in realizing environmental improvements.
For two days on September 28 and 29, a vehicle exhibition event will be held in the Sakae Station area in Nagoya aimed at the general public as a measure to revitalize the market. As to motorcycle events for the general public solely organized by JAIA, it’s been ten years since the “Imported Motorcycle Show in Hamamatsu” was held in 2014. The venue, Oasis 21, easily accessible and a fascinating multi-story park, so it is a lively place that is familiar to local people. We hope that many visitors will be able to experience the appeal of imported motorcycles.
JAIA is calling for the introduction of separate highway toll fees for motorcycles, the expansion of motorcycle parking lots, and a review of the motorcycle license system. In cooperation with other organizations, primarily through the Bike Love Forum, we have been calling for the separation of expressway toll categories and the rationalization of toll fees at government and political party motorcycle-related meetings and other forums. As a result, road operators such as NEXCO East Japan continued to offer a “fixed rate motorcycle discount” in 2024, offering a fixed rate discount on tolls to motorcycles equipped with ETC units that use expressways on weekends and holidays.
With regard to “activities to promote international harmonization of regulations”, which is another pillar of our motorcycle activities, we will continue to support our member importers.
JAIA will continue to work to further spread imported motorcycles and revitalize the domestic motorcycle market.
The purpose of supporting membership system is to promote cooperation between our members and support members to solve problems by sharing issues and problems that cannot be solved only among our members with related companies, etc.
We sought supporting members in three areas that we recognize as those of common issues for our members – charging infrastructure, battery recycling, and mechanic personnel, A total of ten companies have joined us: charging infrastructure providers, ABB Corporation, Bell Energy K.K., e-Mobility Power Co., Inc., Enegate Co., Ltd., Nitto Kogyo Corporation, Plugo Co., Ltd., PowerX Inc., Takaoka Toko Co., Ltd., Terra Charge Corporation, Ubiden Co., Ltd., and, battery recycling company DOWA ECO-SYSTEM Co.,Ltd. and Oono Development Co., Ltd.
We hope that many more business operators, which are interested in our activities in these three fields, will become supporting members.
JAIA member companies will continue to provide attractive imported vehicles with excellent environmental and safety performance, and JAIA will work with the Japanese government, the automobile industry, and all organizations involved in retail market to reduce the burden on users and contribute to the realization of a carbon-neutral society.
