EURU held a Chairman’s Press Meeting on January 21, 2019.
Following is the keynote speech by Chairman Kintaro Ueno.
First of all, on behalf of EURU, I would like to express our heartfelt sympathy to all the people affected by the Osaka Earthquake in June 2018 and torrential rains in Western Japan in July, as well as Typhoon Jebi and the Hokkaido Eastern Iburi Earthquake in September. I sincerely hope the quickest reconstruction this year.
As of 2019, three years have been passed since the time when “CASE” was introduced as a keyword that represents a new trend and strategy of the world’s automobile industry and we project that the CASE – in other words “Connected”, “Autonomous”, “Shared & Services” and “Electric” – will globally accelerate. In line with such “global trend that expands the meaning of existence of the conventional motor vehicles”, in Japan, with an eye on the Tokyo Olympics and Paralympics of 2020, steady progress will likely be made on the efforts relating to CASE, aiming at achieving “safe, comfortable and sustainable mobility for everyone”.
Also, as one of the points of international interest of this year onward, an agreement was reached at last year’s COP24 on implementation guidelines for the Paris Agreement which will establish an international framework to cope with global warming. Towards the start of implementation from 2020, all sectors will be making preparations of various kinds.
The auto industry in Japan will move for achieving the Post-2020 Fuel Efficiency Standards to be established.
Meanwhile, as one of key points in Japan this year, in terms of taxation, the Consumption Tax will be hiked to 10 percent as of October 1. EURU hopes that the “permanent reduction in the Automobile Tax” and the “tax measures for leveling demand”, which are included in the Taxation Revision Outline of the Ruling Parties approved in the end of last year, will be carefully implemented to avoid significant adverse impacts on motor vehicle sales in Japan. At the same time, the EURU member companies, on a basis of “customer first”, will be sparing no effort for providing customers throughout the country with vehicle and motorcycles equipped with leading edge technologies and systems, as well as brand-new values, meeting diversified needs.
2. Results of 2018 Imported New Vehicle Sales
Looking back on the result of 2018, sales of foreign-brand four-wheelers were 309,405 units, exceeding the 300,000 mark for the second consecutive year. The figure represents a year-on-year growth of 1.1 percent and was the second-highest record surpassing the result of 2017. And the sales of all imported vehicles including Japanese brands were 366,266 units, up 4.3 percent from the previous year.
The sales of imported passenger cars were 308,389 units, which is historically the highest record. Concerning the share of foreign-brands in the overall market of passenger cars including kei cars in Japan, however, the share in 2018 was 7.0 percent, which remains considerably lower than in other countries.
The main reasons for foreign-brand vehicle sales to have exceeded the 300,000 mark for the second consecutive year are as follows: The EURU member companies vigorously introduced connectivity technologies including 24/7 emergency call systems, remote control of vehicles using smartphones including remote door lock and parking assist, and driver support services via communication with operators, launched a larger number of new models equipped with broad-ranging advanced safety technologies including lane change assist, automatic emergency steering and night vision, and further offered vehicles with various powertrains, which is a distinct feature of imported vehicles, including PHEV, BEV, HEV and clean diesels. In addition, the foreign brands expanded and enhanced their product lineups, including SUVs, to meet diversifying lifestyles and needs of customers.
3. Prospects for 2019 Imported New Vehicle Sales
On prospects for the imported vehicle sales in 2019, first, in terms of market conditions, EURU expects the Japanese government to appropriately and effectively implement the permanent reduction in the Automobile Tax and measures for leveling demand to avoid “reactionary declines” after the Consumption Tax hike in October.
While we need carefully monitoring various market conditions, we are positive about the prospects for the imported vehicle sales in 2019, considering that EURU members are ready to launch new models more actively than last year, further promote electrification including PHEV and BEV, as well as further enhance their lineups of products to meet diversifying lifestyles and needs of customers.
4. Key Activity Plans of EURU
In the new year, EURU will further focus on two pillars, namely the “activities for revitalizing vehicle market” and the “activities for achieving internationally harmonizing safety and environmental regulations”.
4.1 Activities for Revitalizing Vehicle Market
As the first activity for revitalizing the market, EURU will update our requests seeking taxation revision, which is an important condition of the motor vehicle market.
Over years, EURU has continued to request reduced tax burdens, streamlining and ensuring fairness for the users in coordination with other auto-related organizations.
In response to such requests for taxation revision for the sake of users, permanent reduction in the Automobile Tax for private-use passenger cars of all engine sizes was included in the “Taxation Revision Outline of the Ruling Parties”, which was finalized in the end of last year. The Outline also contains a measure to reduce the rate of the “environmental levy” by 1 percent for one year from October of this year.
For the fiscal year 2019, EURU expects the government to thoroughly disseminate among the users the permanent reduction in the Automobile Tax and measures for leveling demand. For the fiscal year 2020 onwards, EURU will further make efforts for reducing tax burdens and for achieving more streamlined and fairer automobile-related-tax system for user, cooperating with other relevant organizations.
EURU will do our best to further receive the customers’ support for precious values of those vehicles offered by our member companies.
Next, let me talk about the second activity for revitalizing the market.
This year is the one for biannual motor show. The 46th Tokyo Motor Show 2019 will be held from the end of October, in which EURU will participate as a co-organizer. In addition, regional motor shows will be held in Osaka, Nagoya, etc.
On the opportunities of motor shows and imported car fairs, the EURU member companies will devote themselves to let the customers throughout the country to experience the latest, attractive imported cars and motorcycles, and EURU will be further supporting such efforts.
4.2 Activities in Environmental and Technical Fields
As the second pillar of its activities, EURU will facilitate efforts for international harmonization of regulations relating to the environment and safety in order to provide leading-edge imported vehicles that are developed and launched in the world to Japanese customers as quickly as possible.
For the implementation of the Paris Agreement, countries of the world are upgrading anti-global warming measures. As its voluntary action, the Japanese government has set a target of cutting greenhouse gases as of the fiscal year 2030 by 26 percent from the 2013 levels. For automobiles, discussions have been carried out concerning the Post-2020 Passenger Car Fuel Efficiency Standards pursuant to the Energy Saving Act since March of last year for further improvement of fuel economy. New standard values and target years, among others, will be finalized by March this year.
EURU is convinced that it is important to give due consideration to international developments when establishing new fuel efficiency standard values and target years, since motor vehicles are global products. In addition, it is also essential to carry out discussions from a comprehensive viewpoint, including technological development to be conducted in the future for better fuel economy, trends of more diversified and sophisticated powertrains such as electrification, and consumers’ acceptance of such technologies and trends.
In order to ensure that the Post-2020 Fuel Efficiency Standards will be fair and reasonable for vehicles of both imported and domestic brands, EURU will be actively involved in discussions and, at the same time, continue calling on the government to develop appropriate market conditions including deploying enough infrastructure that is indispensable for promotion of electrification and granting of incentives to consumers.
In response to the global trend of electrification and needs of Japanese customers, the EURU member companies will further facilitate market launch of BEV, PHEV and other low-carbon vehicles. In parallel, recognizing significance of improved performance of the conventional internal combustion engines equipped with latest technologies for more effective CO2 reductions, EURU member companies will continue introducing environmentally-friendly HEVs and others that run on gasoline and diesel fuels.
Presently in imported vehicles, AEBS, active cruise control and lane departure control are increasingly installed along with other active safety technologies such as high-performance headlamps, in addition to adoption of more advanced safety technologies and functions of various kinds that lead to automated driving of the future, such as emergency driving stop systems.
The government aims at achieving Level 3 automated driving on motorways and Level 4 automated driving in limited areas by 2020, and has drawn up an “outline for development of schemes for automated driving” last year, and it is now working on the establishment of a legal framework for ensuring safety of motor vehicles equipped with automated driving and other advanced technologies.
In order to introduce advanced technologies relating to automated driving that are available in other countries, EURU is convinced that it is important to develop schemes that take into account international harmonization and practical use of new technologies, and flexibly apply laws and regulations on vehicles. We will be vigorously engaged in activities to help seamless adoption of automated driving technologies.
In addition, EURU has fostered a relationship of close cooperation with the government’s SIP-adus (Strategic Innovation Program-automated driving for universal services) and provided support for participation by imported vehicles in the phase-1 field operational testing.
For the Phase-2 SIP-adus as well, utilizing the opportunity of the 2020 Tokyo Olympics and Paralympics, EURU will support its member importers in participation in the field testing projects to be conducted from the latter half of 2019 until the end of the fiscal year 2022. EURU will actively support the SIP-adus projects for the achievement of automated driving in this year onward.
Furthermore, for international harmonization of regulations, the UNECE World Forum for Harmonization of Vehicle Regulations (WP29) adopted, and implemented the UN R0 in July last year, which prescribes procedures for IWVTA (International Whole Vehicle Type Approval), an international system of mutual recognition of approvals. EURU appreciates the efforts of MLIT and other parties concerned. Also, as of the present, the phase-2 projects toward an ultimate IWVTA are already underway. EURU will positively make contributions for the remaining issues of Japan-unique regulations for exhaust emissions, heavy-duty vehicles and the like, as well as international harmonization of type designation systems. Adoption of globally-harmonized standards and regulations will simplify import procedures, leading to reduced burdens on users. Aiming at the attainment of complete IWVTA, EURU will vigorously make contributions in cooperation with the Japanese government and pertinent organizations of both in Japan and overseas.
4.3 Activities for Imported Motorcycles
For imported motorcycles as well, EURU will further carry out activities for internationally harmonizing safety and environmental regulations and for revitalizing motorcycle market as a pair of driving wheels.
On one hand, EURU will further carry out activities for realizing more international harmonization of the future regulations on lamps, noise and emission. As an expected immediate next example of international harmonization, UN WP29 is expected to adopt the revised UN regulation on motorcycle lamp installation in June this year. EURU will monitor the implementation of such revised UN regulation in Japan.
On the other hand, EURU will further vigorously carry out activities for revitalizing motorcycle market including the followings.
On April 3 and 4, EURU will organize the fifth EURU Motorcycle Test Ride in Oiso. As soon as we have drawn up the implementation plan for providing the participating media with a meaningful opportunity to experience various latest models, we will invite you to the fifth Test Ride.
Moreover, EURU will actively participate in the upcoming 7th Bike Love Forum slated for the fall.
In closing, I would like to emphasize that EURU four-wheeler and motorcycle members are ready to further deliver wide-ranging attractive imported vehicles equipped with the most advanced safety and environmental technologies to the customers throughout Japan in 2019 onwards. And, we will further contribute to developments of safe and sustainable mobility in Japan, cooperating with the relevant ministries and organizations concerned.