Market Trends of japan mlcc Industry
The demand for light commercial vehicles is fueled by the increase in e-commerce, the expansion of urban areas, and the development of infrastructure
- The Japanese light truck market is witnessing moderate growth, following volatile performance in recent years. The country produced 83.95 thousand light commercial vehicles in 2019. These trucks are used in operations such as agriculture and construction. Due to the COVID-19 pandemic and the Russia-Ukraine war, the light commercial vehicle market witnessed a Y-o-Y drop of 16.93% in production. Moreover, Hybrid light commercial vehicles (LCV) are experiencing the most rapid growth in the Japanese market as a result of the combination of fossil fuel and electricity in modern technology.
- The automotive industry remains a crucial component of Japan's economy, and companies like Toyota, Honda, Nissan, and Mitsubishi have gained worldwide recognition. This dominance extends to the commercial vehicle sector, with Isuzu, Hino, and Fuso being industry leaders. Japan is renowned for its technological expertise, leading to developments in fuel efficiency, vehicle safety, and the emergence of hybrid and electric systems as alternative energy sources.
- While minerals and energy resources are essential for industries, autonomy offers the opportunity to remove people from harm's way and enhance safety. Along with sourcing critical minerals despite the ongoing challenge of labor shortages, autonomous light vehicles (ALV) provide additional safety measures at mine sites on which multiple pieces of equipment are operated to reduce accidents due to human error. In May 2023, Japan’s Komatsu Ltd and Toyota Motor Corporation announced the launch of a joint project to develop an autonomous light vehicle (ALV) that will run on Komatsu's Autonomous Haulage System (AHS).
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Increasing EV subsidy schemes are increasing the demand for passenger vehicles
- Japan is home to automotive manufacturers that supply their products and services globally. Toyota, Suzuki, Daihatsu, and Nissan are the domestic passenger vehicle brands in Japan. The country produced 8.32 million passenger vehicles in 2019.
- Following the pandemic and a nationwide recession in Japan, production slumped and witnessed a Y-o-Y decline of 16.43%, while exports of Japanese-made cars halved in April and reached a low of about 168,000. In 2021, the economy of the nation began to recover, and sales of electric automobiles increased significantly by more than 50% annually in 2021 compared to 2020.
- Japan's Green Growth Strategy aims to reach 100% electric car sales by 2035. The 2023 Act on the Rational Use of Energy tracks accelerates the targets set under the Strategy, helping the Japanese electric vehicle market grow. The country's demand for electric cars is increasing because of government support in the form of incentives and refunds. The government declared that it would treble the grants and incentives for buying electric automobiles. In 2022, Japan increased its EV subsidy scheme to fund USD 530 million, doubling the support for BEV purchases up to USD 6,500 and USD 4,200 for PHEVs.
- To expand the number of electric vehicles sold in the nation, numerous companies are developing and releasing new products. In Japan, in May 2022, Toyota launched its new electric SUV, Bz4x, which has a battery capacity of 71.4 kWh. The transition to e-mobility is shifting and will continue to shift trade balances. Japan is a net exporter of electric cars, electric motors, and Li-ion batteries. The country is well-positioned to benefit from a growing electric car market, which produced 6.56 million passenger cars in 2022; it is expected to grow further in the future.
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OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT
- The surge in crude prices is expected to drive inflation in Japan
- Due to the increasing humidity and temperature levels across Japan, advanced technology in ACs has increased
- The proliferation of mobile gaming has caused customers to be hesitant to invest in new gaming consoles
- Rising urbanization, growing residential sector activity, and rising disposable income are driving the demand
- The shortage of raw materials and electronic components impacted the market's growth
- Increasing digitalization and OTT content are the factors driving the demand
- Strict laws and regulations related to carbon dioxide emissions are expected to increase the demand for electric heavy-duty trucks
- Increasing number of fast-charging stations to spur the growth of BEVs
- The emergence of Industry 4.0 is expected to provide promising opportunities for industrial robots
- Increasing demand for silver is leading to a rise in prices
- The increase in the usage of smartphones, employees returning to offices, and the lack of interest in purchasing new products hindered the market’s growth
- Restrictions in transportation activities and slack in consumer demand due to inflationary pressures hindered the market’s growth
- Advanced 5G telecom infrastructure, coupled with high-speed and reliable internet connectivity, has enabled the swift adoption of smartphones in Japan
- The trend of employees going back to the workplace and the shift in consumer behavior regarding other devices are expected to restrain the market's growth
- Electric buses and coaches will have a positive impact on the growth of the market
- Technology is forcing drastic changes in the automotive industry
- Advancements in battery technology will propel the demand for PHEVs
- Japan's shrinking labor force is being managed with robots
