Automobile

The number of registered cars sold overall also decreased to approximately 2.56 million units. In 2022, the sales volume of foreign brand four-wheelers, mainly European cars, continued to struggle from January to September. Although there were signs of recovery from October onwards, the total number of units sold in 2022 was 242,226 units, down 6.7% from the previous year. However, the share of foreign brands to the overall registered vehicles was 9.5%, the highest since the statistics began in 1988. In addition, the number of imported EVs sold was 14,341 units, exceeding 10,000 units for the first time, up 66.6% compared to 2021 and accounting for 45.3% of the passenger EVs sold in Japan.

For the overall motor vehicle sales market in the first half of 2023, the number of registered vehicles was about 1.56 million, showing a recovery trend at a faster pace than the previous year, and sales of foreign brand cars increased by 5.4% from a year ago to 122,667 units. Imported EVs continued to perform well, reaching 9,239 units, an increase of 77.9% from a year earlier. The continuous and seamless subsidy policy for electrified vehicles that we had requested also made a major contribution. I would like to once again express our gratitude. In such a turbulent market conditions, the EBC Automobile Committee member companies will continue to accelerate the introduction of EVs, PHEVs, etc, introducing new models equipped with advanced safety and environmental technology. On the other hand, compared to other major G7 countries, Japan is still far behind in selling EVs and introducing the infrastructure necessary for their widespread use. The government has established a study group on promoting charging infrastructure development, publishing the “Guidelines for promoting charging infrastructure development” in October, and doubled the previous target for installing chargers from 150,000 units to 300,000 plugs by 2030. EBC expects that the government’s infrastructure development policy will be implemented steadily in the future.

Regarding automobile-related taxation, in Japan, in the 2023 tax system, in view of the current situation, the Eco-Car Tax Incentives and the Automobile Tax Environmental Levy will be continued until the end of 2023, and the current preferential treatment for EVs, etc. will remain unchanged for the next three years.

However, the penetration of electric vehicles (EVs) in Japan is currently at a low level. We need to accelerate the spread of electrified vehicles that will contribute to achieving carbon neutrality. System reforms that increase the burden on users should be avoided, and we would like to request the government to consider tax reform to accelerate the spread of electrified vehicles such as EVs, PHEVs, and FCEVs.

Additionally, Japanese car users are subject to heavier and more complex taxes than in other countries, so we would like to request that automobile-related taxes be simplified and the burden on users be drastically reduced.

While there is a need to accelerate the spread of xEVs that will contribute to achieving carbon neutrality, we hope that the government will continue to provide xEV purchase subsidies and support for charging infrastructure from a medium- to long-term perspective, and we would like to ask for continued support to ensure the strong trust of consumers. Regarding the subsidy requirements, we would like to request that the current conditions be maintained at least, or even extended further.

Furthermore, regarding the fast charging required for the spread of xEVs, from the perspective of shortening charging time and increasing convenience for users, we believe that it is necessary to improve the charging environment by quantitatively and qualitatively expanding basic charging, en-route charging, and destination charging, and in particular, measures such as deregulation for higher output. For example, currently in Japan there are voltage restrictions of DC450V and 750V, making it impossible to perform high-output charging on par with Europe and North America, and in some cases, cars developed in Europe must be equipped with voltage converters developed for the Japanese market to match the low voltage from the charging infrastructure to the vehicle’s high voltage. We hope that the future guidelines set out by the METI Study Group on the promotion of Charging Infrastructure Development (October 2023) will be steadily implemented and voltage regulations will be relaxed.

In addition, regarding the reuse and recycling of batteries, which are essential for promoting electrification, the European Battery Regulation went into effect in July, and clear regulations for recycling and reuse have been established. We will continue to monitor moves in other countries, including the Battery Regulation, and will work closely with related authorities and businesses to appropriately promote recycling and reuse throughout the lifecycle of batteries.

Automated driving is becoming increasingly important these days. In order to comply with the systems for related connectivity technology, we will strive to understand the trends in telecommunications equipment installed inside and outside of vehicles, as well as the trends of governmental agencies related to communication infrastructure related to ITS social implementation. In addition, the Japanese government has decided to secure the 5.9GHz band as an ITS frequency. We intend to continue to request the government to achieve international harmonization in the radio wave and communication fields that is necessary for advanced safety technologies for auto driving, etc.

In addition, regarding regulations related to Cyber Security (CS) and software update (SU), which were applied to imported new models in July of this year, for the issue of the CS/SU management system compliance certification, which is a prerequisite for applying for SU permission for vehicles in use, we appreciate the authorities’ quick response to allow and utilize the CS/SU management system conformity certificates obtained from overseas authorities. We continue to request that various laws and regulations, including those related to auto driving, be harmonized with international regulations in line with the discussions at the World Forum for Harmonization of Vehicle Regulations (WP29).

Regarding safety and standards harmonization issues, the EBC Automobile Committee has continued to carry out activities with the complete abolition of NTM and the realization of “complete IWVTA (International Whole Vehicle Type Approval)” as one of its most important issues. EBC Automotive Committee will continue to review implementation status with related parties to request the complete abolition of NTM and the realization of “full IWVTA” seeking harmonization of international standards and regulations.”

Furthermore, the lack of mechanic personnel has recently become an urgent issue in the Japanese auto industry. It is also essential to develop human resources for car maintenance who can handle new technologies that will accompany the further spread of electrified vehicles. The EBC Automotive Committee will make requests to the government and others to improve the environment for solving these issues of mechanic personnel. 

The EBC Automotive Committee continues to support the EU and Japan’s goal of achieving truly fair and open markets.