Introduction

This booklet offers our readers a brief overview of the Japanese automobile industry today. It contains a wide range of pertinent statistics on the industry s status and looks at relevant trends and developments. The Japan Automobile Manufacturers Association, Inc. (JAMA) aims to facilitate understanding of the Japanese motor vehicle industry by providing helpful insights into the industry. We hope that you will find this publication informative, and we welcome your questions and comments.

Japan Automobile Manufacturers Association, Inc.

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Also visit us on the Internet: http://www.jama.or.jp 2002 THE MOTOR INDUSTRY OF JAPAN Contents

2001 In Summary ...... 3

MOTOR VEHICLES Production ...... 4 Domestic Sales...... 5 Imported Vehicle Sales ...... 6 Car Market Sectors ...... 7 Exports ...... 8 In Use and Cars Per Capita ...... 9

MOTORCYCLES Production and Domestic Sales...... 10 Exports ...... 11

GLOBAL ACTIVITIES North American Manufacturing Operations ...... 12 European Manufacturing Operations ...... 14 Asian Manufacturing Operations ...... 16 International Automotive Industry Ties ...... 17

STANDARDS AND REGULATIONS Motor Vehicle Classification ...... 20 Domestic Taxes on Automobiles ...... 21 Automobile Certification and Standards ...... 22 SOCIAL CONCERNS Attention to the Environment ...... 24 Traffic Safety ...... 28 Intelligent Transport Systems ...... 29

AUTOMOBILES AND THE ECONOMY Automotive Shipments in Value Terms ...... 30 Automotive Trade ...... 31

MISCELLANEOUS Significant Events of 2001 ...... 32 Member Manufacturers ...... 34 Plant Locations of Member Manufacturers in Japan...... 35 JAMA Organization and Information Services...... 36 Related Automotive Associations ...... 37

Motor Vehicle Classifications Throughout this booklet, motor vehicles are referred to as standard, small or mini cars. These categories are based primarily on engine displacement: standard is over 2000cc, small is 661-2000cc, and mini is 660cc and under. Most passenger cars in Japan are in the small category, but the minicar sector has been expanding in recent For more details, see Motor Vehicle Classification on page 20 and Car Market Sectors on page 7.

This booklet is printed on recycled paper and is recyclable. Edited and published by JAMA 2001 In Summary

SUMMARY: 2001 DOMESTIC PERFORMANCE SUMMARY: 2001 DOMESTIC MOTORCYCLE AND EXPORTS PERFORMANCE AND EXPORTS Cars Trucks Buses Total 50cc & under Over 50cc Total Production 8,117,563 1,601,536 58,092 9,777,191 Production 610,993 1,717,047 2,328,040 -2.9% -7.3% 6.5% -3.6% -4.0% -3.5% -3.6% New 4,289,683 1,600,856 15,932 5,906,471 Demand 544,988 205,698 750,686 Registrations 0.7% -5.1% -3.9% -0.9% in Japan -2.4% -7.1% -3.7% Exports 3,568,797 552,891 44,481 4,166,169 Exports 59,406 1,518,007 1,577,413 -6% -10.5% 8.1% -6.5% -27.6% -2.6% -3.9% Notes: 1. New registrations include imported vehicles. 2. Percentage figures represent the change from the preceding year. Note: Percentage figures represent the change from the preceding year. Sources: Japan Automobile Manufacturers Association, Japan Automobile Dealers Association, Japan Mini-Vehicles Association.

JAPAN’S CAR/TRUCK/BUS PRODUCTION, SALES JAPAN’S TOP SELLERS AND EXPORTS BY MAKE (2001) 2001 Chg.(%) Production Chg.(%) Sales Chg..(%) Exports Chg.(%) Cars 482,763 -5.3 382,997 -0.7 53,805 -20.9 1 Toyota Corolla 236,507 45.2 Trucks 156,124 -7.9 159,027 -2.8 10,822 -25.6 2 Toyota Vitz 142,513 -11.3 Daihatsu 638,887 -6.0 542,024 -1.3 64,627 -21.7 3 Honda Stream 119,877 Cars 376,663 -4.2 202,170 -8.6 174,893 3.8 Trucks 90,220 12.9 85,094 7.0 — — 4 Toyota Estima 118,901 -2.9 Fuji Hvy. Ind 462,883 -1.3 287,264 -4.5 174,893 3.8 5 Honda Step Wagon110,014 38.8 Cars 492 — 118 — — — Trucks — — — — — — 6 Honda Fit 104,298 GM Japan 492 — 118 — — — 7 Toyota Crown 82,901 -17.9 Trucks 48,605 9.6 32,337 6.7 15,593 -1.2 8 Nissan Cube 75,003 -12.6 Buses 4,830 33.2 2,024 -1.5 3,080 65.6 9 Honda Odyssey 71,011 -41.0 Hino 53,435 11.4 34,361 6.2 18,673 5.8 10 Toyota Fun Cargo 70,096 -34.4 Cars 1,219,809 4.7 789,372 14.2 415,561 -12.9 Trucks 64,898 10.8 64,663 1.2 — — 11 Toyota Mark II 68,902 -7.0 Honda 1,284,707 5.0 854,035 13.1 415,561 -12.9 Cars 12,822 -58.7 555 -53.6 23,109 -43.1 12 Toyota Ipsum 67,700 Trucks 199,877 -10.9 58,834 -12.7 131,704 -13.5 13 Toyota bB 65,128 -27.6 Buses 3,230 51.4 1,184 -6.2 2,158 96.5 14 Subaru Legacy 62,772 -6.2 Isuzu 215,929 -16.2 60,573 -13.3 156,971 -19.1 15 Mazda Demio 61,551 -20.6 Cars 657,241 -5.8 225,831 -10.9 463,339 2.9 Trucks 72,038 -10.5 55,521 -7.1 15,590 -15.2 16 Nissan March 60,425 -3.9 Buses — — — — — — 17 Mitsubishi Lancer 56,105 Mazda 729,279 -6.3 281,352 -10.2 478,929 2.1 18 Nissan Sunny 54,290 -6.0 Cars 632,151 -13.1 289,026 -2.4 320,207 -18.0 19 Nissan Serena 54,220 -15.4 Trucks 195,719 -25.6 194,778 -19.8 46,840 -40.4 Buses 6,879 5.5 3,851 -9.9 2,907 34.8 20 Mazda MPV 51,535 1.3 Mitsubishi 834,749 -16.3 487,655 -10.3 369,954 -21.5 Cars 1,088,170 -4.7 493,717 -1.8 462,983 -11.5 Trucks 171,169 -2.4 235,511 4.7 86,662 -0.1 Note: Mini-vehicles are not included. Buses 10,949 42.7 2,400 34.2 7,338 31.5 Source: Japan Automobile Dealers Association. Nissan 1,270,288 -4.1 731,628 0.3 556,983 -9.5 Trucks 22,704 -7.5 15,654 -1.7 9,011 -19.1 Buses 1,449 40.4 672 17.7 870 77.2 Nissan Diesel 24,153 -5.6 16,326 -1.0 9,881 -14.0 Cars 712,632 1.2 431,924 1.7 238,431 3.2 Trucks 194,896 -4.2 190,133 0.3 15,547 43.6 Suzuki 907,528 -0.1 622,057 1.3 253,978 5.0 Cars 2,938,820 -1.8 1,204,885 -0.9 1,416,469 -2.1 Trucks 384,849 -4.4 502,594 -7.1 221,122 -3.7 Buses 30,755 -8.4 5,792 -12.4 28,128 -5.5 Toyota 3,354,424 -2.2 1,713,271 -2.9 1,665,719 -2.4 Cars — — 269,088 0.5 — — Trucks 437 26.3 6,710 -12.6 — — Buses — — 9 -10.0 — — Other 437 21.4 275,807 0.1 — — (Imports) Total Cars 8,117,563 -2.9 4,289,683 0.7 3,568,797 -6.0 Total Trucks 1,601,536 -7.3 1,600,856 -5.1 552,891 -10.5 Total Buses 58,092 6.5 15,932 -3.9 44,481 8.1 Total 9,777,191 -3.6 5,906,471 -0.9 4,166,169 -6.5

Sources: Japan Automobile Manufacturers Association, Japan Automobile Dealers Association, Japan Mini-Vehicles Association. 3 Motor Vehicle Production

In 2001 motor vehicle production in Japan moved into Production of passenger cars decreased by 2.9% to the minus column for the first time in two years, 8,117,563 units to register the first decline in three years. decreasing to 9,777,191 units, posting a year-on-year Production of trucks also dropped, by 7.3%, to 1,601,536 decline of 3.6% and dropping to the lowest level in 22 units, marking the seventh consecutive year of decline. years. The decline was attributed to a lackluster Production of buses rose by 6.5% to 58,092 units for the performance in Japanese domestic vehicle sales and second consecutive year of gain. exports.

MOTOR VEHICLE PRODUCTION

millions of units 14 12 Total 10 8 Cars 6 4 2 Trucks & Buses

1970 1975 1980 1985 1990 1995 1996 1997 1998 1999 2000 2001

Year Cars Chg.(%) Trucks Chg.(%) Buses Chg.(%) Total Chg.(%) 2001 8,117,563 -2.9 1,601,536 -7.3 58,092 6.5 9,777,191 -3.6 2000 8,359,434 3.2 1,726,818 -1.2 54,544 12.7 10,140,796 2.5 1999 8,097,082 0.6 1,746,912 -9.8 48,395 -15.0 9,892,389 -1.5 1998 8,047,929 -5.2 1,937,076 -20.0 56,953 -8.5 10,041,958 -8.5 1997 8,491,480 8.0 2,421,373 -0.3 62,234 17.1 10,975,087 6.1 1996 7,864,676 3.3 2,428,897 -4.3 53,126 12.4 10,346,699 1.5 1995 7,610,533 -2.5 2,537,737 -6.1 47,266 -3.8 10,195,536 -3.4 1990 9,947,972 9.9 3,498,639 -11.0 40,185 -4.5 13,486,796 3.5 1985 7,646,816 8.1 4,544,688 5.2 79,591 10.2 12,271,095 7.0 1980 7,038,108 14.0 3,913,188 15.2 91,588 46.4 11,042,884 14.6 1975 4,567,854 16.2 2,337,632 -9.2 36,105 -21.2 6,941,591 5.9 1970 3,178,708 21.7 2,063,883 2.1 46,566 11.3 5,289,157 13.1 1965 696,176 20.1 1,160,090 4.6 19,348 41.5 1,875,614 10.2 1960 165,094 110.0 308,020 73.5 8,437 25.3 481,551 83.2 1955 20,268 40.0 43,857 -11.5 4,807 -16.4 68,932 -1.6 1950 1,594 — 26,501 — 3,503 — 31,597 — Note: Percentage figures represent the change from the preceding year.

2001 DOMESTIC PRODUCTION BY MANUFACTURER Manufacturer Cars Chg.(%) Trucks Chg.(%) BusesChg.(%) Total Chg.(%) Daihatsu 482,763 -5.3 156,124 -7.9 — — 638,887 -6.0 Fuji Hvy. Ind. 372,663 -4.2 90,220 12.9 — — 462,883 -1.3 GM Japan 492 — — — — — 492 — Hino — — 48,605 9.6 4,830 33.2 53,435 11.4 Honda 1,219,809 4.7 64,898 10.8 — — 1,284,707 5.0 Isuzu 12,822 -58.7 199,877 -10.9 3,230 51.4 215,929 -16.2 Mazda 657,241 -5.8 72,038 -10.5 — — 729,279 -6.3 Mitsubishi 632,151 -13.1 �195,719 -25.6 6,879 5.5 834,749 -16.3 Nissan 1,088,170 -4.7 171,169 -2.4 10,949 42.7 1,270,288 -4.1 Nissan Diesel — — 22,704 -7.5 1,449 40.4 24,153 -5.6 Suzuki 712,632 1.2 194,896 -4.2 — — 907,528 -0.1 Toyota 2,938,820 -1.8 384,849 -4.4 30,755 -8.4 3,354,424 -2.2 Other — — 437 26.3 — — 437 21.4 Total 8,117,563 -2.9 1,601,536 -7.3 58,092 6.5 9,777,191 -3.6 Note: Percentage figures represent the change from the preceding year.

4 Domestic Sales of New Motor Vehicles

Registrations of new motor vehicles in 2001 declined Sales of passenger cars climbed for the third for the first time in two years, posting a year-on-year consecutive year, rising by 0.7% to 4,289,683 units. decrease of 0.9% to total 5,906,471 units. The drop in Sales of trucks declined for the sixth consecutive year, vehicle sales was particularly conspicuous in the last slipping by 5.1% to 1,600,856 units, while sales of buses quarter. were down 3.9%, the first drop in three years.

NEW MOTOR VEHICLE SALES millions of units 8 7 6 Total 5 4 Cars 3 2 1 Trucks & Buses

1970 1975 1980 1985 1990 1995 1996 1997 1998 1999 2000 2001 Year Cars Chg.(%) TrucksChg.(%) Buses Chg.(%) Total Chg.(%) 2001 4,289,683 0.7 1,600,856 -5.1 15,932 -3.9 5,906,471 -0.9 2000 4,259,872 2.5 1,686,599 -0.4 16,571 14.5 5,963,042 1.7 1999 4,154,084 1.5 1,692,654 -4.5 14,478 2.4 5,861,216 -0.3 1998 4,093,148 -8.9 1,772,136 -20.1 14,141 -10.3 5,879,425 -12.6 1997 4,492,006 -3.8 2,217,257 -7.3 15,763 -8.5 6,725,026 -5.0 1996 4,668,728 5.1 2,391,790 -0.5 17,227 -0.4 7,077,745 3.1 1995 4,443,906 5.6 2,403,825 4.6 17,303 -3.0 6,865,034 5.2 1990 5,102,659 15.9 2,649,909 -6.3 24,925 -5.9 7,777,493 7.2 1985 3,104,083 3.3 2,431,178 4.7 21,573 6.4 5,556,834 2.2 1980 2,854,176 -6.0 2,137,947 2.2 23,387 -2.5 5,015,510 -2.7 1975 2,737,641 19.7 1,551,454 0.7 19,836 -12.6 4,308,931 11.9 1970 2,379,137 16.8 1,693,502 -4.4 27,828 4.2 4,100,467 6.9 1965 586,287 18.8 1,073,832 9.0 14,843 -2.4 1,674,962 12.1 1960 145,227 98.8 255,693 61.2 7,260 12.2 408,180 71.4 1955 20,055 — 40,498 — 3,977 — 64,530 — Notes: 1. Figures include imported vehicles. Sources: Japan Automobile Dealers Association, Japan Mini-Vehicles Association. 2. Percentage figures represent the change from the preceding year.

2001 DOMESTIC SALES BY MANUFACTURER

Manufacturer Cars Chg.(%) Trucks Chg.(%) BusesChg.(%) Total Chg.(%) Daihatsu 382,997 -0.7 159,027 -2.8 — — 542,024 -1.3 Fuji Hvy. Ind. 202,170 -8.6 85,094 7.0 — — 287,264 -4.5 GM Japan 118 — — — — — 118 — Hino — — 32,337 6.7 2,024 -1.5 34,361 6.2 Honda 789,372 14.2 64,663 1.2 — — 854,035 13.1 Isuzu 555 -53.6 58,834 -12.7 1,184 -6.2 60,573 -13.3 Mazda 225,831 -10.9 55,521 -7.1 — — 281,352 -10.2 Mitsubishi 289,026 -2.4 194,778 -19.8 3,851 -9.9 487,655 -10.3 Nissan 493,717 -1.8 235,511 4.7 2,400 34.2 731,628 0.3 Nissan Diesel — — 15,654 -1.7 672 17.7 16,326 -1.0 Suzuki 431,924 1.7 190,133 0.3 — — 622,057 1.3 Toyota 1,204,885 -0.9 502,594 -7.1 5,792 -12.4 1,713,271 -2.9 Imports 269,088 0.5 6,710 -12.6 9 -10.0 275,807 0.1 Total 4,289,683 0.7 1,600,856 -5.1 15,932 -3.9 5,906,471 -0.9 Note: Percentage figures represent the change from the preceding year. Sources: Japan Automobile Dealers Association, Japan Automobile Importers Association.

5 Sales of Imported Vehicles in Japan

In 2001 sales of imported vehicles (including These figures include the sales of imported passenger commercial vehicles) rose 0.1% to 275,807 units, cars produced at the overseas facilities of Japanese marking the first increase in two years. Sales of automakers. In 2001 sales of these cars dropped by imported passenger cars were up 0.5% to 269,088 units, 29.9% to 14,002 units, marking the second consecutive also the first increase in two years. year of decline. The share held by imports of the Japanese passenger European-made cars maintained their domination of car market remained in 2001 at the same level of 6.3% the import market, raising their share by 4.3% to as in 2000. 229,382 units to account for 85.2% of total car imports.

BEST-SELLING FOREIGN MAKES

Manufacturer 2001 Chg.(%) Manufacturer 2001 Chg.(%) 1 Volkswagen 61,213 4.5 6 Peugeot 12,295 14.2 2 Mercedes-Benz 53,438 3.5 7 Honda 9,107 -14.2 3 BMW 36,068 -0.1 8 Chrysler 8,671 3.9 4 Volvo 16,626 6.0 9 Chevrolet 8,218 -13.8 5 Opel 12,626 -17.6 10 Audi 8,127 16.6

Note: BMW includes units manufactured in the U.S., Volvo includes units manufactured in the Netherlands, and Mercedes-Benz includes units manufactured in the U.S. and Spain.

NEW SALES OF IMPORTED CARS

thousands of units 4.0 3.5 U.S.A. Total 3.0 Other 2.5 2.0 1.5 European countries 1.0 0.5

1980 1985 1990 1995 1996 1997 1998 1999 2000 2001

Country of Origin 1980 1985 1990 1995 1996 1997 19981999 2000 2001

European countries 33,813 48,204 190,750 236,307 268,700 256,485 210,888 213,534 219,943 229,382 (German cars) (26,038) (40,157) (137,442) (156,216) (184,133) (177,075) (148,607) (157,645) (167,808) (176,833) U.S.A. 11,058 1,816 28,602 122,872 122,559 83,344 53,462 53,636 42,196 31,986 (U.S.-made Japanese cars) (0) (0) (12,598) (84,722) (69,534) (36,206) (17,664) (21,737) (15,534) (10,395) Other 0 152 2,345 3,086 2,133 1,666 1,498 4,266 5,628 7,720 Total 44,871 50,172 221,706 362,265 393,392 341,495 265,848 271,436 267,767 269,088 Chg.(%) — — 22.9 31.2 8.6 -13.2 -22.2 2.1 -1.4 0.5 Note: Percentage figures represent the change from the preceding year.

6 Car Market Sectors

The small (661cc-2000cc) and minicar (660cc and their dominant role. under) sectors have a dominant presence in the Japanese The minicar category, which is a distinctive sector in market, with these two sectors combined accounting for Japan, was established in 1949. At present, the category 82.7% of the market in 2001. Small cars accounted for is confined to vehicles with an engine displacement of 53% and minicars, which in the past few years have 660cc or lower. Demand for minicars is driven by their become increasingly popular, gained a 29.7% share. excellent fuel economy and ability to maneuver under By way of comparison, standard cars (2000cc+) cramped conditions, as well as attractive tax and peaked in 1995 with a 20% share of the market. Since insurance benefits. They offer a convenient, economical then, they have been losing share. mode of transportation for commuting to work and daily In contrast, standard cars have a strong presence in the shopping errands. import market. From 1996 through 2001, standard cars have held import market shares of 70.6%, 65.5%, 70.2%, 82.0%, 86.0%, and 83.5% respectively, underscoring

2001 CAR MARKET SHARE BY CATEGORY 2001 IMPORTED CAR MARKET SHARE BY CATEGORY Minicars (660cc & under) 0.2% Small cars (661cc-2000cc) Minicars Small cars 16.2% (660cc & under) 29.7% (661cc-2000cc) Standard cars 53.0% (2000cc+) Standard cars 83.6% (2000cc+) 17.3%

PASSENGER CAR SALES IN JAPAN BY MARKET SECTOR

1975 1980 1985 1990 1995 1997 1998 1999 2000 2001 SMALL CARS 2,531,396 2,608,215 2,869,527 3,839,221 2,654,291 2,701,686 2,389,671 2,193,920 2,208,387 2,274,996 Growth rate 27.1% -6.2% 1.8% 2.8% -2.2% -4.0% -11.5% -8.2% 0.7% 3.0% Market share 92.5% 91.4% 92.4% 75.2% 59.7% 60.1% 58.4% 52.8% 51.8% 53.0% STANDARD CARS 49,125 71,931 73,539 467,490 889,260 873,220 756,117 723,999 770,220 741,489 Growth rate 34.7% -15.1% 10.4% 69.1% 29.4% -2.8% -13.4% -4.3% 6.4% -3.7% Market share 1.8% 2.5% 2.4% 9.2% 20.0% 19.4% 18.5% 17.4% 18.1% 17.3% MINICARS 157,120 174,030 161,017 795,948 900,355 917,100 947,360 1,236,165 1,281,265 1,273,198 Growth rate -39.3% 2.2% -16.8% 102.8% 11.2% -4.2% 3.3% 30.5% 3.6% -0.6% Market share 5.7% 6.1% 5.2% 15.6% 20.3% 20.4% 23.1% 29.8% 30.1% 29.7% TOTAL MARKET 2,737,641 2,854,176 3,104,083 5,102,659 4,443,906 4,492,006 4,093,148 4,154,084 4,259,872 4,289,683 Growth rate 19.7% -6.0% 3.3% 15.9% 5.6% -3.8% -8.9% 1.5% 2.5% 0.7%

Note: Figures include imports.

7 Motor Vehicle Exports

Exports of motor vehicles fell into the minus column 38.6%. in 2001 for the first time in two years, registering a drop The share of exports within Japan’s total domestic of 6.5% to stand at 4,166,169 units. production slipped further to 42.6%. At the same time, By destination, although exports to the Middle East the global operations of Japanese automakers continued rose 29.4%, those to all other regions suffered a setback to move ahead. In 2001 overseas production amounted compared to 2000. By country, exports to the United to 6,327,405 units. States decreased 3.7%. Nevertheless, the U.S. remains Japan’s biggest export destination, with a share of

EXPORTS BY DESTINATION

Destination 1970 1975 1980 1985 1990 1995 1998 1999 2000 2001 Asia 149,787 290,134 581,116 710,587 569,143 616,027 264,987 290,436 410,590 351,227 Middle East 26,635 241,511 542,955 401,598 283,866 206,446 455,159 308,114 295,176 381,965 Europe 126,275 528,486 1,226,954 1,363,694 1,750,497 918,831 1,370,931 1,329,216 1,136,083 895,415 (EU) (51,514) (383,589) (955,974) (995,489) (1,484,588) (792,058) (1,132,535) (1,154,992) (973,076) (780,750) North America 495,608 1,003,954 2,592,577 3,384,562 2,521,823 1,301,218 1,459,338 1,723,598 1,836,941 1,795,816 (U.S.A.) (422,464) (919,949) (2,407,645) (3,131,997) (2,236,988) (1,228,096) (1,313,583) (1,556,419) (1,669,047) (1,606,998) Latin America 79,678 143,509 382,231 290,417 216,375 329,064 450,128 277,825 298,801 293,636 Africa 111,244 217,294 322,329 137,729 129,278 137,718 170,836 131,489 110,218 98,524 Oceania 97,316 251,426 316,865 426,075 344,236 274,828 347,194 337,288 357,739 341,808 Other 233 1,298 1,934 15,810 15,994 6,677 10,302 10,987 9,337 7,778 Total 1,086,776 2,677,612 5,966,961 6,730,472 5,831,212 3,790,809 4,528,875 4,408,953 4,454,885 4,166,169

MOTOR VEHICLE EXPORTS millions of units

7 6 Total 5 4 3 Cars 2 1 Trucks & Buses 1970 1975 1980 1985 1990 1995 1996 1997 1998 1999 2000 2001

Year Cars Chg.(%) TrucksChg.(%) Buses Chg.(%) Total Chg.(%) 2001 3,568,797 -6.0 552,891 -10.5 44,481 8.1 4,166,169 -6.5 2000 3,795.852 1.0 617,870 0.8 41,163 7.3 4,454,885 1.0 1999 3,757,460 2.0 613,113 -22.9 38,380 -21.5 4,408,953 -2.6 1998 3,684,430 2.9 795,528 -13.5 48,917 -10.4 4,528,875 -0.5 1997 3,579,131 25.1 919,469 13.8 54,602 24.5 4,553,202 22.7 1996 2,860,080 -1.2 807,772 -5.0 43,866 -2.0 3,711,718 -2.1 1995 2,896,216 -13.8 849,859 -17.2 44,734 -39.2 3,790,809 -15.0 1990 4,482,130 1.8 1,309,121 -9.4 39,961 13.7 5,831,212 -0.9 1985 4,426,762 11.2 2,238,104 8.0 65,606 16.7 6,730,472 10.2 1980 3,947,160 27.2 1,953,685 37.2 66,116 79.4 5,966,961 30.8 1975 1,827,286 5.8 833,672 -4.7 16,654 4.3 2,677,612 2.3 1970 725,586 29.5 351,611 20.9 9,579 41.6 1,086,776 26.7 1965 100,716 50.4 90,923 11.3 2,529 45.8 194,168 29.1 1960 7,013 43.6 31,028 122.3 768 73.8 38,809 24.6 1955 2 100.0 907 33.6 322 4.5 1,231 24.6 1950 7 — 5,409 — 93 — 5,509 — Note: Percentage figures represent the change from the preceding year.

8 Motor Vehicles In Use and Cars Per Capita

As of year-end 2001, the number of motor vehicles, The average age of passenger cars on the road in Japan excluding two-wheelers, in use on roads in Japan rose has been increasing. As of the end of March 2001, it 1% to 73,411,477 units. increased by 0.2 of a year to 6.04 years, its highest age In terms of the number of vehicles in use, the United ever. The average service life for cars lengthened by 0.44 States with 221.5 million units (as of year-end 2000) of a year to 10.40 years. accounts for about one out of three automobiles in use in Japan ranks below the United States and Europe in the world. As such, the United States is by far the terms of passenger cars per capita. Statistics for 2000 world’s leader, while Japan stands in second place, show Japan with 413 cars per thousand persons, or one accounting for about one-tenth of the estimated 73.4 car for every 2.4 persons. million motor vehicles in use worldwide.

PASSENGER CARS' LIFE IN YEARS (as of March of each year) PASSENGER CARS PER 1,000 PEOPLE (persons per car ) Year Average Age Average Service Life 0 100 200 300 400 500 600 U.S.A. 485 (2.1) 1975 3.30 6.72 1980 4.25 8.29 Italy 570 (1.8) 1985 4.57 9.17 Canada 547 (1.8) 1990 4.64 9.26 Germany 533 (1.9) 1995 4.88 9.43 Australia 522 (1.9) 1996 5.04 9.27 1997 5.14 9.28 U.K. 468 (2.1) 1998 5.33 9.44 France 476 (2.1) 1999 5.60 9.63 Belgium 452 (2.2) 2000 5.84 9.96 (2.4) 2001 6.04 10.40 Japan 413 Notes: Average age means the average years elapsed since first registration. Average service life means average vehicle lifespan. Note: Based on 2000 statistics from each country. Source: Japan Automobile Inspection and Registration Association.

MOTOR VEHICLES IN USE (as of the end of each year)

millions of units Total 70 60 50 Cars 40 30 20 Trucks & Buses & Other 10

1970 1975 1980 1985 1990 1991 1992 1993 1994 19951996 1997 1998 19992000 2001

Year Cars Trucks Buses Other Total Chg.(%) 2001 53,541,212 17,868,753 234,816 1,766,696 73,411,477 1.0 2000 52,438,083 18,228,108 235,483 1,751,252 72,652,926 1.3 1999 51,164,901 18,633,046 235,676 1,693,012 71,726,635 1.3 1998 49,896,326 19,083,546 237,701 1,600,791 70,818,364 1.2 1997 48,611,230 19,654,917 240,354 1,500,548 70,007,049 1.7 1996 46,868,712 20,092,120 242,243 1,601,444 68,805,073 2.9 1995 44,680,254 20,432,988 243,095 1,500,784 66,857,121 2.8 1994 42,678,566 20,670,360 245,387 1,420,734 65,015,047 2.8 1993 40,772,407 20,884,257 247,794 1,361,722 63,266,180 2.6 1992 38,963,861 21,134,660 248,624 1,314,761 61,661,906 2.9 1991 37,076,065 21,326,629 248,258 1,267,569 59,918,521 3.8 1990 34,924,213 21,324,848 245,668 1,206,996 57,701,725 4.7 1985 27,844,601 17,145,178 231,228 942,377 46,163,384 3.7 1980 23,659,528 13,193,439 230,020 790,911 37,873,898 10.4 1975 17,236,326 10,089,051 226,284 586,895 28,138,556 4.6 1970 8,778,975 8,517,507 187,980 341,315 17,825,777 15.4 1965 2,181,287 4,539,728 102,695 159,259 6,882,969 19.3 1960 457,451 1,589,965 56,192 72,077 2,175,685 24.2 1955 153,924 679,880 34,421 32,572 900,797 8.5 1950 45,006 261,579 18,306 12,494 337,385 — Note: Percentage figures represent the change from the preceding year. Source: Ministry of Land, Infrastructure and Transport.

9 Motorcycle Production and Domestic Sales

The year 2001 saw domestic demand for motorcycles 2,328,040 units. dropping for the fifth consecutive year, with sales The number of motorcycles in use in Japan has been sinking 3.7% to 750,686 units. This decline is due, falling for more than ten years, reflecting the long-term mainly, to the decreasing size of the youth segment of stagnation of the domestic markets. As of the end of the population and changes in lifestyles, as well as to March 2002, motorcycles in use numbered 13,719,898 reduced demand for motorcycles used as commercial units, accounting for an estimated one-tenth of the total vehicles because of the weak economy and the current number in use worldwide and ranking Japan third behind trend towards four-wheeled vehicles. India and China. Total domestic production of motorcycles in 2001 fell for the first time in two years, decreasing 3.6% to

MOTORCYCLE PRODUCTION millions of units 7 6 5 4 3 2

1970 1975 1980 1985 1990 1995 1996 1997 1998 1999 2000 2001 Over 50cc Year 50cc & under Total Chg.(%) 51~125cc 126~250cc Over 250cc Subtotal 2001 610,993 598,551 260,269 858,227 1,717,047 2,328,040 -3.6 2000 636,546 630,221 297,433 851,191 1,778,845 2,415,391 7.3 1999 679,690 532,909 237,706 801,406 1,572,021 2,251,711 -14.6 1998 839,123 783,646 271,378 742,149 1,797,173 2,636,296 -1.5 1997 933,921 817,284 275,847 648,631 1,741,762 2,675,683 3.5 1996 948,298 828,299 238,045 569,775 1,636,119 2,584,417 -6.1 1995 951,803 1,038,938 217,738 544,760 1,801,436 2,753,239 1.0 1990 1,343,220 686,734 270,304 506,637 1,463,675 2,806,895 0.4 1985 2,014,850 1,373,423 469,728 678,346 2,521,497 4,536,347 12.7 1980 2,493,910 2,181,206 660,831 1,098,577 3,940,614 6,434,524 43.8 1975 1,030,822 1,887,701 331,733 552,291 2,771,725 3,802,547 -15.7 1970 895,599 1,407,205 259,145 385,723 2,052,073 2,947,672 14.4

MOTORCYCLE DOMESTIC DEMAND

millions of units 3 2 1

1970 1975 1980 1985 1990 1995 1996 1997 1998 1999 2000 2001

Over 50cc Year 50cc & under Total Chg.(%) 51~125cc 126~250cc Over 250cc Subtotal 2001 544,988 78,263 79,156 48,279 205,698 750,686 -3.7 2000 558,459 102,116 72,886 46,416 221,418 779,877 -6.8 1999 621,276 105,550 51,461 58,672 215,683 836,959 -21.3 1998 744,900 177,092 65,659 75,329 318,080 1,062,980 -10.5 1997 864,395 156,183 84,799 82,861 323,843 1,188,238 -2.6 1996 876,522 171,105 83,982 88,307 343,394 1,219,916 0.6 1995 884,718 138,115 98,833 91,186 328,134 1,212,852 1.6 1990 1,213,512 169,618 158,882 76,921 405,421 1,618,933 -3.0 1985 1,646,115 130,574 173,887 145,674 450,135 2,096,250 3.7 1980 1,978,426 200,238 88,188 103,184 391,610 2,370,036 23.7 1975 778,117 307,276 15,882 28,018 351,176 1,129,293 -3.6 1970 598,165 461,570 61,608 69,586 592,764 1,190,929 -4.9 Note: Percentage figures represent the change from the preceding year.

10 Motorcycle Exports

After a year of advance, exports of motorcycles in 24.2%, 10.2% and 7.9%, respectively. Exports to the 2001 fell by 3.9% to total 1,577,413 units. U.S. surpassed those to Europe, which had been the By destination, shipments to the Middle East, Asia, biggest export destination since 1996. In 2001, the U.S. Africa and North America rose by 68.2%, 18.6%, 13.2% market accounted for 34.8% of total exports. and 9.8%, respectively. In contrast, shipments to Europe, Oceania and Latin America experienced a fall of

EXPORTS BY DESTINATION

1990 1991 1992 1993 1994 1995 1997 1998 1999 2000 2001 Asia 250,846 299,743 460,619 643,505 504,082 464,979 326,985 274,578 156,346 195,352 231,680 Middle East 41,766 113,205 78,099 29,512 25,473 16,131 46,417 37,125 18,582 26,775 45,028 Europe 527,040 563,130 535,761 484,742 355,761 340,585 546,882 690,629 663,667 652,375 494,416

(EU) (448,923) (492,699) (500,021) (457,932) (335,526) (322,957) (514,161) (652,210) (631,439) (623,294) (473,622) North America 182,933 214,347 270,412 268,620 244,666 267,831 244,622 291,611 377,423 541,478 594,381 (U.S.A.) (167,202) (202,340) (255,358) (253,732) (229,330) (251,880) (227,461) (266,903) (337,203) (494,508) (548,915) Latin America 92,001 128,817 241,528 223,677 219,985 178,175 218,131 220,855 101,309 139,854 128,857 Africa 52,721 55,230 51,466 36,924 25,027 26,329 34,929 41,855 38,306 27,277 30,890 Oceania 36,437 36,330 30,752 32,730 32,862 31,680 41,742 47,100 57,505 58,066 52,161 Total 1,183,744 1,410,802 1,668,637 1,719,710 1,407,856 1,325,710 1,459,708 1,603,753 1,413,138 1,641,177 1,577,413

4.0 3.5 3.0 2.5 2.0 Total 1.5 1.0 Over 50cc 50cc 0.5 & under 1970 1975 1980 1985 1990 1995 1996 1997 1998 1999 2000 2001

Over 50cc Year 50cc & under Total Chg.(%) 51~125cc 126~250cc Over 250cc Subtotal 2001 59,406 530,728 194,058 793,221 1,518,007 1,577,413 -3.9 2000 82,038 549,040 204,591 805,508 1,559,139 1,641,177 16.1 1999 89,547 422,876 177,399 723,316 1,323,591 1,413,138 -11.9 1998 114,853 616,213 206,751 665,936 1,488,900 1,603,753 9.9 1997 75,513 649,825 187,981 546,389 1,384,195 1,459,708 7.5 1996 55,016 666,593 154,103 481,623 1,302,319 1,357,335 2.4 1995 61,627 691,433 129,961 442,689 1,264,083 1,325,710 -5.8 1990 147,301 507,840 117,222 411,381 1,036,443 1,183,744 7.3 1985 369,167 1,350,412 296,865 525,038 2,172,315 2,541,482 19.7 1980 501,027 1,907,481 548,306 972,226 3,428,013 3,929,040 44.0 1975 288,974 1,546,170 328,313 527,344 2,401,827 2,690,801 -17.0 1970 326,815 914,325 187,185 309,277 1,410,787 1,737,602 33.8 Note: Percentage figures represent the change from the preceding year.

11 North American Manufacturing Operations

Today seven Japanese automakers conduct production vehicle development from the early stages on. This operations in the United States and three do so in process facilitates the development of vehicles more Canada. This emphasis on local production reflects closely suited to the U.S. market and encourages close Japanese automakers’ global strategy based on collaboration with local suppliers. Japanese automakers manufacturing where demand is present. The seven currently have nine R&D subsidiaries in the U.S., Japanese-affiliated automakers in the United States have providing jobs to about 2,800 Americans. invested almost $18.0 billion in aggregate in In addition to such undertakings by individual infrastructure and facilities, making the U.S. Japan’s automakers, JAMA is constructively involved in a range biggest base for overseas production. of initiatives designed to further mutual cooperation and In 2001 total production by Japanese-affiliated understanding. One key initiative is JAMA’s automakers in the United States declined 4.6% to collaboration with the U.S. Motor & Equipment 2,443,086 units，against the backdrop of a downward Manufacturers Association (MEMA) in sponsoring trend in the U.S. economy overall. regular meetings of the JAMA-MEMA Liaison Local production by Japanese automakers provides Committee and One-on-One Business meetings. numerous employment opportunities to people in host JAMA is also working closely with North America’s communities and contributes to U.S. automobile exports. Alliance of Automobile Manufacturers (AAM) and the In 2000, Japanese manufacturers’ affiliates in the U.S. European Automobile Manufacturers Association exported 173,400 American-built cars and trucks to (ACEA) in promoting the international harmonization of countries around the world, an increase of 35.3% over technical regulations and certification procedures. the previous year. Constituting about 13% of total U.S. vehicle exports, these exports, predominantly passenger cars, accounted for an estimated $2.5 billion in foreign exchange. Local R&D is strengthened by "design-in" development, a process in which suppliers take part in

PRODUCTION AT U.S. MANUFACTURING OPERATIONS

thousands of units Total 2,500 2,000 Cars 1,500 1,000 500 Trucks 0 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Honda 324,064 366,355 362,351 435,437 451,197 458,251 403,775 498,710 552,995 634,374 648,268 694,703 686,043 677,090 692,377 Nissan 117,334 109,897 115,584 95,844 133,504 171,402 293,182 312,654 333,234 277,869 279,510 222,733 167,742 150,129 157,876

NUMMI 143,652 129,978 192,235 205,287 206,634 180,960 207,025 229,327 228,920 224,422 209,879 203,464 210,726 197,737 188,967 Toyota 43,726 18,527 151,150 218,195 187,708 240,382 234,060 275,678 381,445 385,657 404,973 380,730 356,840 371,877 355,911 Cars AutoAlliance 4,200 167,205 216,200 184,428 165,314 168,859 219,096 247,004 149,562 129,441 100,394 167,268 165,143 107,431 71,645 Mitsubishi — 2,409 90,741 148,379 153,936 139,783 136,022 169,829 218,161 192,961 189,086 157,139 159,702 222,036 193,583 SIA — — 2,600 32,461 57,945 57,623 47,117 54,002 80,660 98,747 102,180 104,229 93,070 107,955 103,010 Subtotal 632,976 794,456 1,132,701 1,320,031 1,357,903 1,417,260 1,540,277 1,787,204 1,944,977 1,943,471 1,934,290 1,930,266 1,839,266 1,834,255 1,763,369 Nissan 102,718 95,919 123,056 139,404 131,519 128,924 93,791 131,954 132,552 136,162 118,798 86,104 156,903 227,146 168,349

NUMMI — — — — 2,535 75,271 114,403 133,713 123,755 141,047 147,930 158,395 156,395 146,339 162,714 Trucks SIA — — — 34,499 58,352 66,397 79,441 99,881 99,514 96,124 84,711 111,969 99,130 100,721 83,351

Toyota — — — — — — — — — — 26,838 95,473 176,862 253,277 263,020 Honda — — — — — — — — — — — — — — 2,283 Subtotal 102,718 95,919 123,056 173,903 192,406 270,592 287,635 365,548 355,821 373,333 378,277 451,941 589,290 727,483 679,717 Total 735,694 890,290 1,253,236 1,493,934 1,548,667 1,687,852 1,827,912 2,152,752 2,300,798 2,316,804 2,312,567 2,382,207 2,428,556 2,561,738 2,443,086

12 JAPANESE AUTOMAKERS’ NORTH AMERICAN MANUFACTURING OPERATIONS

United States Total Location Name of Company Pproducts Sstart-U Employee Investment (Status) ($million) Honda of America Marysville, East Liberty, Anna, Ohio Accord, Civic, Acura CL, Acura TL Nov. 1982 13,000 $4,000 Manufacturing, Inc. (Sole Entry) Engines Honda Manufacturing of Alabama, LLC Lincoln, Alabama Odyssey, Engines Nov. 2001 2,300 $580

Nissan North America,Inc. Smyrna, Tennessee Altima, Xterra, Frontier Jun. 1983 5,800 $1,430 (Manufacturing) (Sole Entry) AutoAlliance International, Inc. Flat Rock, Michigan Mazda: 626 Sep. 1987 1,800$1,23 3 (Mazda) (Joint Venture: Ford) Ford: Cougar Mitsubishi Motor Manufacturing of Normal, Illinois Mitsubishi: Eclipse, Galant Sep. 1988 3,100$1,04 0 America, Inc. (Sole Entry) Chrysler: Stratus, Sebring

New United Motor Mfg., Inc. Fremont, California Toyota: Corolla & Tacoma Dec. 1984 5,506 $1,064 (Toyota) (Joint Venture: General Motors) GM: Prizm Georgetown, Kentucky Toyota Motor Mfg. Kentucky, Inc. C8amry, Avalon, Sienna, Engines May �198 7,490 $5,290 (Sole Entry)

Toyota Manufacturing Princeton, Indiana Tundra, Sequoia Dec. 1998 2,618 $1,601 Indiana, Inc. (Sole Entry)

Toyota Motor Manufactuing Buffalo, West Virginia Engines Dec. 1998 861 $715 West Virginia., Inc. (Sole Entry)

Lafayette, Indiana Fuji (Subaru): Legacy, Engines Subaru-Isuzu Automotive, Inc. Sep. 1989 3,100 $760 (Joint Venture) Isuzu: Rodeo, Rodeo-Sport, Axiom

DMAX, Ltd. Moraine, Ohio Diesel Engines Jul. 2000 $300 (Isuzu) (Joint Venture: GM) 800

Canada Alliston, Ontario Civic, Acura EL, Odyssey, Acura MDX, Honda Canada Inc. Nov. 1986 4,100C$1,10 0 (Sole Entry) Pilot

Cambridge, Ontario Toyota Motor Mfg., Canada Inc. C8orolla, Camry, Solara Nov. 198 2,593 C$2,328 (Sole Entry) CAMI Automotive Inc. Ingersoll, Ontario A0pr. 1989 25,40 C$61 (Suzuki) (Joint Venture: GM Canada) Escudo

JAPANESE AUTOMAKERS’ NORTH AMERICAN R&D CENTERS

Current Current Functions Name of Company Headquarters, Division Offices Employees (Planned) Torrance, CA, Raymond & East Liberty, OH, Denver, CO, 1,000 1,2,3,4,5,6,7 Honda R&D Americas, Inc. Mojave Desert, CA Key to Functions Isuzu Motors America, Inc. Los Angeles, CA, Detroit, MI 300 1,2,3,4,5,6,7 1) Technical support for Mazda North American procurement of parts for Operations, Inc. Irvine, CA, Flat Rock, MI, Ann Arbor, MI 103 1,2,3,4,(5),(6),7 local production Mitsubishi Motors R&D of 2) Evaluation of parts America, Inc. Normal, IL 123 1,2,3,4,5,6,7 3) Evaluation of vehicles 4) Styling & general design Nissan Design America, Inc. San Diego, CA 50 4 5) Parts design Farmington Hills, MI, Cambridge, MA, Los Angeles, CA, Stanfield, AZ, 6) Vehicle design Nissan Technical Center 550 1,2,3,5,6,7 North America, Inc. Smyrna,TN , Sheffeld Village, OH ,Washington, D.C. 7) Prototype production Subaru R&D, Inc. Ann Arbor, MI, Lafayette, IN 40 1,3,4,6 Toyota Technical Center U.S.A., Inc. Ann Arbor, MI (with offices in California and Arizona) 575 1,2,3 Calty Design Research, Inc. Newport Beach, CA 50 4 (Toyota)

13 European Manufacturing Operations

Japanese automakers currently operate local plants at (CLEPA) have been holding regular joint conferences eleven sites in Europe (in France, Hungary, the centered on company-to-company business meetings. Netherlands, Poland, Portugal, Spain and the U.K.). The sixth JAMA-CLEPA Business Conference was held From 1988 to 2001 European production by Japanese in April 2002 in Germany. ′� automakers increased approximately sevenfold, totaling JAMA also cooperates with the United Kingdom’s 949,323 units in 2001 and providing employment to Industry｀� Forum in the Master Engineers Program. This 28,492 Europeans. Japanese vehicles built in Europe is a project launched by the U.K.’s Department of Trade contribute industrially to their host regions and to the and Industry and the Society of Motor Manufacturers trade balance of their host nations through exports. and Traders (SMMT) to strengthen the fundamentals of Japanese automakers also have R&D and technical the automotive parts industry. Under the program, centers at thirteen sites in Europe, providing jobs for Toyota, Nissan, and Honda, the three Japanese 1,973 engineers and other personnel. Although the main automakers with manufacturing operations in the U.K., objective of these facilities is to steadily elevate local dispatch outstanding engineers to provide on-site kaizen content, they also provide support for market research, training, with the goal of developing master engineers at product planning and technical assistance. the U.K. suppliers so as to boost the competitiveness of Japanese automakers have reached over 80 percent the parts industry. Since its launch in 1996, the project European local content for Japanese-brand cars has developed 32 master engineers, conducting kaizen manufactured in western Europe. This is a valuable training at 300 companies in the process. market for suppliers willing to develop good, long-term business relations with Japanese automakers.

The Japanese automakers also undertake vigorous industry-to-industry cooperation to strengthen local parts manufacturing and procurement in Europe. Since 1995, for example, JAMA and the Comite de Liaison de la Construction d’Equipements et de Pieces d’Automobiles

EUROPEAN PRODUCTION BY JAPANESE AUTOMAKERS

thousands of units 1,000 800 600 400 200 0 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 19992000 2001

1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 France Toyota — — — — — — — — — — — — — 61,904 Hungary Suzuki — — — — 996 13,151 19,412 36,473 51,778 63,540 66,305 72,000 80,688 83,664 Netherlands Mitsubishi — — — — — — — 20,879 44,491 81,698 91,936 110,446 58,881 67,111 Toyota13,684 12,545 10,528 12,03313,801 10,888 8,808 6,251 5,475 6,364 6,440 6,020 4,518 4,086 Portugal Mitsubishi5,807 5,496 5,022 7,1119,074 8,577 6,920 7,176 5,562 7,265 9,503 10,736 11,796 8,058 Subtotal 19,491 18,041 15,550 19,14422,875 19,465 15,728 13,427 11,037 13,629 15,943 16,756 16,314 12,144 Nissan26,888 85,879 79,662 70,99276,676 82,036 101,172 117,324 107,332 101,780 97,032 96,338 136,807 137,382 Spain Suzuki22,362 18,383 21,203 25,50532,511 30,476 14,668 25,843 29,726 32,133 32,862 34,355 31,584 22,512 Subtotal 49,250 104,262 100,865 96,497109,187 112,512 115,840 143,167 137,058 133,913 129,894 130,693 168,391 159,894 Honda5,044 3,630 26,454 35,95233,445 50,545 51,531 93,283 105,810 108,097 112,089 114,479 74,751 114,163 Nissan56,541 77,282 76,190 124,666179,009 246,281 204,944 215,346 231,627 271,666 288,818 271,157 327,701 297,028 UK Toyota — — — — — 37,314 85,467 88,440 116,973 104,615 172,342 178,660 171,339 153,415 Subtotal 61,585 80,912 102,644 160,618212,454 334,140 341,942 397,069 454,410 484,378 573,249 564,296 573,791 564,606 Total 130,326 203,215 223,164 282,278 352,292 484,122 495,931 614,524 702,768 777,682 877,327 894,191 898,065 949,323

Source: Respective automakers.

14 JAPANESE AUTOMAKERS’ EUROPEAN MANUFACTURING OPERATIONS

Location Total Name of Company Pproducts Sstart-U Employee Investment (Status) (million) France Toyota Motor Manufacturing Valenciennes YarisJan. 2001 1,902 FF800 France S.A.S. Hungary

Magyar Suzuki Esztergom C2ultus, Subaru Justy, Wagon R Plus Oct. 199 1,800 N.A. Corporation (Joint Venture) The Netherlands Netherlands Car B.V. Mitsubishi: Carisma, Space Star Born, Linburg May 1995 6,100N.A . (Mitsubishi) Volvo: S40, V40 Poland Isuzu Motors Polska Sp.zo.o Tychy Diesel Engines Jul. 1999 1,100 ·26,000 Portugal Salvador Caetano I.M.V.T., Ovar D8yna, Hiace, Coaster Oct . 196 408 PESC.115 S.A. (Toyota) (Joint Venture: Salvador Caetano) Mitsubishi Trucks Europe-Sociedade Tramagal C6anter Mar. 199 413N.A . Europeia de Automoveis, S.A. Spain Santana-Motor, S.A. Linares (Suzuki) (Technical Support) J5imny, Escudo Mar. 198 630N.A . Barcelona ’ Terrano II, Tino, Engines & Transmissions Nissan Motor Iberica S.A. (yS)ole Entr Jan. 1983 3,646N.A . United Kingdom Nissan Motor Manufacturing Sunderland Primera, Primera Estate,,,Almera Micra (U K ), Ltd. (Sole Entry) Engines Jul. 1986 4,900 £1,800 Swindon Honda of the U K Mfg., Ltd. Accord, Civic, CR-V, Engines Jul. 1989 4,000 £1,150 (Sole Entry) Burnaston, Derbyshire (Sole Entry) Corolla, Avensis, Engines Dec. 1992 3,593 £3,030 Toyota Motor Mfg. (U K ), Ltd. Deeside (Sole Entry)

JAPANESE AUTOMAKERS’ EUROPEAN R&D CENTERS Current Current Name of Company Headquarters Employees Functions Key to Functions Honda R&D Europe G.m.b.H. Offenbach, Germany 130 1,2,3,4,6,7 1) Technical support for Honda R&D Europe (UK), Ltd. Swindon, UK 90 1,2,3,5,7 procurement of parts for Mazda Moter Europe Oberursel, Germany 120 3,4,7 local production 2) Evaluation of parts Mitsubishi Motor R&D of Europe Trebur, Germany, Helmond, The Netherlands 72 1,3,4,6 3) Evaluation of vehicles G.m.b.H. Born, The Netherlands 4) Styling & general design Mitsubishi Motors Marketing Research .. 5) Parts design Europe Florsheim, Germany 26 8 6) Vehicle design Nissan Design Europe G.m.b.H Geretsried, Germany 14 4 7) Prototype production 8) Market research Nissan Technical Centre 24 Europe (Brussels), S.A. Brussels, Belgium 3 Nissan Technical Centre Europe, Ltd. Cranfield, UK 402 1,2,3,4,5,6,7 Nissan Technical Centre 250 1,2,3,4,5,6,7 Europe (Spain), S.A. Barcelona, Spain N.V.Toyota Motor Europe Marketing & Engineering, S.A. Zaventem, Brabant, Belgium 155 1,2,3 (Technical Div.) Toyota Europe Design Development S.A.R.L Sophia Antipolis Cedex, France 32 4,6 Toyota Motorsport G.m.b.H Cologne, Germany 550 3,4,6,7 Isuzu Motors Germany G.m.b.H Ginsheim-Gustavsburg, Germany 108 1,2,5

15 Asian Manufacturing Operations

Japanese automakers are stepping up the pace of their In response to the worldwide current of trade and localization in Asia, while at the same time undertaking investment liberalization, the ASEAN region is seeking comprehensive measures to contribute to the to enhance its economic power through the formation of development of the region’s economies. Most notably, AFTA (the ASEAN Free Trade Area). As part of its they provide major assistance to supporting industries in target of achieving trade liberalization within the the region, including the metals and electronics ASEAN region, AFTA has established specific tariff industries, through such crucial activities as transferring reduction schedules. CEPT (the ASEAN Free Trade technological expertise (through joint ventures), Agreement Common Effective Preferential Tariff), for participating in technical agreements and training local example, has a tariff-reduction schedule calling for 0-5% personnel. tariff cuts within the region, and AICO (ASEAN As part of the assistance package, JAMA, in Industrial Cooperation) and other schemes also have cooperation with the Japan Auto Parts Industries specific schedules so that the region will be able to enjoy Association (JAPIA), has been implementing since 2000 the benefits of trade liberalization as soon as possible. the ASEAN Experts Dispatch Program in the interest of Japanese automakers highly favor such efforts by aiding the development of the ASEAN automotive ASEAN, and vigorously support AICO and similar industry. The program’s first group, consisting of schemes that encourage the mutual complementation of experts in automotive management and production parts within the region. AICO is now showing growing technology, was dispatched to Thailand, and two follow- benefits. Since the scheme’s introduction in 1996, 74 up groups were sent there in 2001 to provide continuing cases have been approved in total as of July 2001, 64 of guidance. Similar groups of Japanese experts have been which have been in the automobile industry. dispatched to Malaysia, the Philippines, and Indonesia. In addition, JAMA, JAPIA, and the ASEAN Automotive Federation (AAF) are cosponsors of the Conference on ASEAN Auto-Supporting Industries, whose chief sponsor is JETRO.

JAPANESE AUTOMAKERS’ ASIAN MANUFACTURING OPERATIONS

Fuji Hvy. Daihatsu Hino Honda Isuzu Mazda Mitsubishi Nissan Nissan Suzuki Toyota lndustries Diesel Bangladesh CVs CVs CVs CVs

China Cars &CVs Cars CVs Cars CVs Cars & CVs CVs CVs CVs Cars & CVs CVs

India Cars CVs Cars & CVs Cars & CVs CVs

Indonesia Cars &CVs CVs Cars CVs Cars & CVs Cars & CVs CVs Cars & CVs Cars & CVs

Malaysia Cars &CVs CVs Cars CVs Cars & CVs Cars & CVs Cars & CVs CVs Cars & CVs Cars & CVs

Myanmar Cars & CVs

Pakistan Cars CVs Cars CVs CVs Cars CVs Cars & CVs Cars & CVs

Philippines CVs Cars CVs Cars Cars & CVs Cars & CVs CVs Cars & CVs Cars & CVs

S. Korea Cars & CVs

Taiwan Cars CVs Cars CVs Cars & CVs Cars & CVs Cars & CVs Cars & CVs Cars & CVs

Thailand CVs Cars CVs CVs Cars & CVs Cars & CVs CVs Cars & CVs Cars & CVs

Vietnam CVs CVs CVs Cars & CVs Cars & CVs CVs Cars & CVs

Notes: Includes assembly operations. CVs = Commercial vehicles.

16 International Automotive Industry Ties

At present seven of Japan’s eleven automakers development costs and take the lead in launching models (excluding motorcycle manufacturers) have substantial into waiting markets, Japanese automakers have forged foreign investment or ties with foreign capital. numerous strategic alliances, including capital and Wide-ranging changes along with a diversification in technological tie-ups, joint and subcontracted vehicle demand are taking place as the market matures development, joint and subcontracted production, and environmental protection requirements increase. supplemental sales networks, and the supply of finished Similarly, the cost of developing new vehicles is vehicles. escalating in step with the changes in demand, while development times are shrinking. In an effort to cut

Daihatsua

Europe ●�Production of commercial vehicles on consignment to Italy-based P&D, S.p.A. Asia ●�Supply of components and technology to Liushou Wuling Mini Auto Factory in China. ●�Joint production venture with Perodua Manufacturing Sdn. Bhd. (Malaysia).

Fuji Heavy Industriesa

North America ●�A 51% equity stake in Subaru-Isuzu Automotive Inc. ●�GM holds a 20% equity stake in Fuji Heavy Industries. Europe ●�Supply of transmissions to Fiat of Italy. ●�Magyar Suzuki (Hungary) supplies CBUs to Fuji Heavy Industries. Asia ●�A 25% equity stake in three manufacturers in a joint venture with Auto Works of China Guizhou Aviation Industry Corporation, all of which mutually supply parts for minicar assembly. ●�A 45% equity stake in Ta Ching Motor Co., Ltd. (Taiwan).

GM Japana

North America ●�GM wholly owns GM Japan.

Hinoa

Asia ●�A 24% equity stake in Shenyang Shenfei Hino Automobile Manufacturing Co., Ltd. (China). ●�A 10% equity stake in Kouzui Motors Ltd. (Taiwan). ●�Supply of technology to Korea-based Kia Motors.

Hondaa

Asia ●�A 50% equity stake in China-based Guangzhou Honda Automobile Co., Ltd., a joint venture with Guangzhou Auto Group. ●�Supply of engines to a joint venture with Guangzhou Honda Automobile Co., Ltd. via a joint venture with Dongfeng Motor Corporation. ●�Technology tie-up with San Yan Industry Co., Ltd. (Taiwan), in which American Honda Motor, Inc. holds a 12.5% equity stake.

17 International Automotive Industry Ties (cont’d.)

Isuzua

North America ●�Supply of diesel engines and CVs to GM. ●�Production of commercial vehicles and diesel engines on consignment to GM. ●�Holds a 49% equity stake in Subaru-Isuzu Automotive, Inc. ●�GM holds a 49% equity stake in Isuzu. Europe ●�Supply of diesel engines and RVs to GM Europe. ●�Supply of diesel engines from Poland to GM Europe. ●�Supply of diesel engines from Japan to GM Europe and Renault. Asia ●�An equity stake of 7.4% in China-based Qingling Automobile (Group) Co., Ltd., which assembles small CVs. ●�An equity stake of 12.5% in China-based Jiangling Motors Co., Ltd., which assembles small CVs. ●�An equity stake of 49% in Guangzhou Isuzu Bus Co., Ltd., which produces medium-sized and large buses. ●�An equity stake of 51% in Taiwan-based Taiwan Isuzu Motors Co., Ltd. ●�An equity stake of 20% in Malaysia-based Malaysia Truck & Bus Sdn. Bhd.

Mazdaa

North America ●�A 50%-50% equity stake in AutoAlliance International, Inc. with Ford Motor. ●�Supply of components to Ford U.S. ●�Supply of complete vehicles and components to Ford in the Asia-Pacific region. ●�Ford holds an equity stake of 33.4% in Mazda. ●�Supply of complete CVs to Ford in North America. Europe ●�Ford Europe supplies complete vehicles to Mazda in Europe. Asia ●�Supply of technology to China-based Ford (Lio Ho) Motor Co., Ltd. ●�An equity stake of 17.5% in China-based Hainan Mazda Motor Co., Ltd. ●�Supply of components to China-based Faw Hainan Motor Co., Ltd. ●�Supply of components to Taiwan-based Ford Lio Ho Motor Co., Ltd. ●�Supply of technology and components to Korea-based Kia Motors Corporation. ●�An equity stake of 45% in AutoAlliance (Thailand) Co., Ltd., a joint venture with Ford. ●�A 15.6% equity stake in India-based Swaroji Mazda.

Mitsubishi Motorsa

North America ●�Supply of complete vehicles from U.S. plants to Daimler Chrysler. Europe ●�DaimlerChrysler holds an equity stake of 34% in Mitsubishi. ●�Production on consignment to Pininfarina of Italy. ●�Supply of engine technology to France-based PSA Peugeot Citroen. Asia ●�A 20% equity stake in China-based Hunan Changfeng Automobile Manufacturing Plant. ●�A 14.6% equity stake in Taiwan-based China Motor Co., Ltd. ●�A 1.27% equity stake in Korea-based Hyundai Motor Corporation. ●�An equity stake of 8.0% in Malaysia-based PROTON. ●�PROTON has an equity stake of 25% in Vietnam-based Vina Star Motors Corporation.

18 Nissan Motora

Europe ●�Renault holds a 44.4% equity stake in Nissan. Asia ●�A 30% equity stake in China-based Zhengzhou Nissan Automobile. ●�A 25% equity stake in Taiwan-based Yulon Loone Motor Co., Ltd. ●�Supply of technology to Korea-based Samsung Motors Inc. ●�A 35% equity stake in Thailand-based Thai Automotive Industry. ●�A 25% equity stake in Thailand-based Siam Nissan Automobile. ●�A 25% equity stake in Thailand-based Siam Motors and Nissan. ●�A 30% equity stake in Thailand-based Siam Nissan Casting Co., Ltd. ●�A 25% equity stake in Thailand-based Siam Metal Technology Co., Ltd. ●�A 27.8% equity stake in Thailand-based SNN Tools & Dies Co., Ltd. ●�A 75% equity stake in Indonesia-based P.T. Nissan Motor Indonesia. ●�A 5.36% equity stake in Philippines-based Nissan Motor Philippines Inc.

Nissan Diesela

Europe ●�Renault holds a 22.5% equity stake in Nissan Diesel. Asia ●�A 25% equity stake in Dongfeng Nissan Diesel Motor Co., Ltd., a joint venture with China- based Dongfeng Motor Group for the production of large trucks and buses.

Suzukia

North America ●�Joint development of subcompact cars with GM, which holds a 20% equity stake in Suzuki. Europe ●�Magyar Suzuki has a mutual-supply-of-components agreement with GM Europe. ●�France-based PSA Peugeot Citroen supplies diesel engines to Suzuki. ●�Supply of complete vehicles from Hungary to Fuji Heavy Industries in Europe. Asia ●�A 35% equity stake in China-based Chongqing Suzuki Automobile Co., Ltd. ●�A 39% stake in China-based Jiangxi Changhe Suzuki Automobile Co., Ltd. ●�A 9.99% equity stake in China-based Changan Automobile Co., Ltd. ●�Technology tie-up with Taiwan-based Prince Motors Co., Ltd. ●�Technology tie-up with Taiwan-based Ford Lio Ho Motor Co., Ltd. ●�A 50% equity stake in India-based Maruti Udyog.

Toyotaa

North America ●�A 50%-50% equity stake with General Motors in New United Motor Manufacturing, Inc. (NUMMI). Europe ●�A 50%-50% equity stake with PSA Peugeot Citroen in Toyota Peugeot Citroen Automobile Czeck. Asia ●�A 45% equity stake in China-based Sichuan Toyota Motor Co., Ltd. ●�A 50% equity stake in China-based Tianjin Fengjin Auto Parts Co., Ltd. ●�A 47% equity stake in Taiwan-based Kouzui Motors Ltd.

19 Motor Vehicle Classification

Japan classifies motor vehicles in various categories above. according to the provisions of two basic laws: the Road The Road Traffic Act, which divides vehicles and Vehicles Act and the Road Traffic Act. motorcycles into two categories each, determines the The Road Vehicles Act divides passenger cars into classification of driver’s licenses. three categories and motorcycles into four categories on Recreational vehicles (RVs) that are built on the basis of vehicle dimensions and engine displacement. passenger car chassis are classified as passenger cars, The classifications of the Road Vehicles Act are used for while RVs that are built on truck chassis are classified as registration statistics as well as inspections and related commercial vehicles. (These vehicles are also referred maintenance and repair purposes. When a vehicle to as sport-utility vehicles, or SUVs.) exceeds any of the specifications listed in a given category under the Road Vehicles Act, the vehicle is automatically placed in the model category immediately

CLASSIFICATION BY THE ROAD VEHICLES ACT CLASSIFICATION BY THE ROAD TRAFFIC ACT

Standard Large Motor Vehicles

Over 2m

Over 4.7m Over 1.7m Gross vehicle weight 8 tons or more (Over 2000cc in engine displacement) Maximum payload 5 tons or more or Occupants 11 persons or more Small Ordinary Motor Vehicles 2m and under

Over 1.48m to 1.7m Over 3.4m to 4.7m (661cc to 2000cc in engine displacement) Gross vehicle weight less than 8 tons Mini Maximum payload less than 5 tons or Occupants less than 11 persons

2m and under

1.48m and under 3.4m and under

(660cc and under in engine displacement)

CLASSIFICATION OF MOTORCYCLES

Road Vehicles Act Road Traffic Act

Engine Engine Type Wtidth Hheigh Leengt Typ Displacement Displacement

Small-sized Omver 250cc Omver 1.3 Omver 2.0 Over 2.5 Large Motorcycles Over 400cc Mini-sized 126cc to 250cc 1r.3m and under 2r.0m and unde 2.5m and unde Motor- cycles Stan- 51cc to 400cc Class 2 51cc to 125cc 1r.3m and unde r 2r.0m and unde 2.5m and unde dard Motor-driven cycles Class 1 50cc and under 1r.3m and unde r 2r.0m and unde 2.5m and unde Motorized 50cc and under bicycles Note: A motorcycle that exceeds any one of the requisites for a category is classified in the higher category.

20 Domestic Taxes on Automobiles

Japan’s system of automobile-related taxes is times the taxes assessed on automobiles in Europe and exceedingly complex, consisting principally of nine North America (see chart below). different taxes levied at the various stages of car Every year, JAMA petitions the Japanese government acquisition, ownership, and operation, with the for revisions to the automobile tax system. In 2001, objective of securing financial resources for road JAMA called for a reduction of the tax burden as well maintenance and construction programs. as a simplification of the automobile tax system, based Automobile taxes in Japan account for slightly more on its longstanding position that this system should be than 10% of the government’s annual tax revenue, or more equitable, more streamlined, and closer to such tax approximately 9 trillion yen in revenues per year. This systems abroad. JAMA also called for the means that Japanese car users are saddled with an establishment of a scheme to refund a portion of the extremely heavy tax burden, ranging from two to eight Tonnage Tax when an end-of-life vehicle is deregistered during a shaken inspection s period of COMPARISON OF TAX BURDENS validity. In addition, the Association called for the IN VARIOUS COUNTRIES expansion of measures applicable to the Acquisition Tax ¥10,000� 70� ¥696,000 and the Automobile Tax so as to reduce taxes on low- Consumption Tax� emission vehicles and clean-energy vehicles, including ¥90,000 � � 60� Automobile vehicles powered by electricity, natural gas, and Acquisition ¥559,000 Tax ¥81,000 methane as well as hybrid vehicles. 50� Working in coordination with the Japan Automobile Tonnage ¥448,000 Tax� Added- Federation (JAF), a vehicle user organization, and other ¥170,000 40� ¥397,000 Value Tax� ¥315,000 � industry partners, JAMA has been actively promoting Added- Value Tax� its position on this issue through a range of related 30� ¥288,000 informational activities, including the publication of a Automobile Added- Value Tax 20� Tax� ¥183,000 pamphlet advocating the consolidation and ¥355,000 Registration ¥371,000 Tax� simplification of the automobile tax system so that only ¥3,000 Registration Retail Tax Tax� 10� ¥22,000 ¥148,000 one tax applies at each of the three main stages of Automobile Automobile Tax Tax� 106,000 244,000 Automobile vehicle acquisition, ownership, and operation. ¥ ¥ Tax� Automobile Tax� 0� ¥55,000 ¥35,000 Japan� Germany� Great� France� U.S.A.� Britain� Assumptions:� � 1. Displacement:1800cc� 2. GVW: 1,100 kg� 3. Vehicle price: ¥1,800,000� 4. Service life: 9 years (average service life)� 5. Currency exchange rates (averaged April 2001-February 2002)� ＊ 1 Euro = ¥109, 1 Pound = ¥175, 1 US$ = ¥124

AUTOMOBILE-RELATED TAXES (Passenger Cars, as of April 2002 )

=

21 Automobile Certification and Standards

In recent years Japan has undertaken wide-ranging imported in small quantities. A third motor vehicle measures to streamline the systems covering automobile certification system, the Type Notification System, certification, standards, and other automobile-related applies mainly to large trucks. regulatory systems. These measures have been implemented to ensure that foreign automakers have Harmonization of Motor Vehicle Standards unhindered access to the Japanese market. At present automobile standards vary from country to There are absolutely no constraints on the Japanese country. Efforts are being made to bring about the automobile market in the form of import duties, international harmonization of standards so as to reduce numerical restraints on volume, or local content the burden on manufacturers, who must ensure requirements. In fact, imported vehicles and parts, in compliance with local regulations in every market they some cases, enjoy preferential treatment in the areas of enter. taxes, insurance premiums, and automobile-related In collaboration with other government agencies and standards and certification systems. in consultation with its counterparts overseas, the Ministry of Land, Infrastructure and Transport (MLIT) Automobile Certification has been supervising Japan’s efforts to harmonize its The principal certification procedure in Japan is called regulations with international standards. MLIT the Type Designation System (TDS). Applied to most participates actively in the World Forum for the mass-produced models, it equally covers imported and Harmonization of Vehicle Regulations (WP29), the domestic vehicles. The Preferential Handling Procedure principal international forum for harmonization issues, for Imported Motor Vehicles (PHP) is an alternative formerly known as the United Nations Economic system used to facilitate the certification of cars Commission for Europe’s Working Party on the

AUTOMOBILE CERTIFICATION PROCEDURES IN JAPAN

THE PREFERENTIAL HANDLING PROCEDURE THE TYPE DESIGNATION SYSTEM FOR IMPORTED VEHICLES

- Applies equally to domestic and imported vehicles. - This special procedure is applied to individual models - Requires less documentation and time than comparable when imported into Japan in quantities of 2,000 units per systems in other countries. year or less. - This procedure provides simpler, faster processing than The automaker or importer applies to the Ministry the Type Designation System. of Land, Infrastructure and Transport (MLIT). MLIT inspects the application documentation, The automaker or importer applies to MLIT, one sample vehicle, and the automaker’s quality which inspects the application documentation. control system. The certification process is completed within The certification process is completed within one month. two months.

- Following the approval of the certification application, - Following the approval of the certification application, the automaker undertakes inspection of individual MLIT inspects individual vehicles at domestic MLIT complete vehicles and MLIT periodically inspects the facilities or at dealers’ facilities prior to new car registration. automaker’s quality control system. Features of PHP specifically aimed at expediting Features of TDS specifically aimed at expediting imports: imports: - Tests of vehicle emissions and noise levels may be - MLIT officials are dispatched overseas at the expense of performed at the automaker’s own domestic facilities with the Japanese government to perform certification an MLIT-approved inspector in attendance. inspections on sample vehicles. - MLIT accepts the test results of designated foreign testing - MLIT accepts the test results of designated foreign institutions. The number of such institutes and the number testing institutions. The number of such institutes and the of test cases being accepted are increasing. number of test cases being accepted are increasing. - In some cases, the data from tests on similar vehicles is - In some cases, the data from tests on similar vehicles is acceptable. acceptable. - The reporting requirement is waived in the case of minor - A grace period for compliance with standards is usually changes to vehicle specifications. provided when new domestic standards are implemented.

22 EFFECTIVE DUTIES IN JAPAN, THE U.S. AND THE EUROPEAN UNION (as of April 2002)

Japan U.S. European Union Passenger Cars 0% 2.5% 10% Commercial Vehicles 0% 25% Class I: 22%, Class II: 11%

Note: Class I refers to gasoline-fueled trucks of 2800cc or more, and diesel-fueled trucks of 2500cc or more. Class II refers to gasoline-fueled trucks of less than 2800cc, and diesel- fueled trucks of less than 2500cc.

Construction of Vehicles (UN/ECE/WP29). on Japan’s Type Designation System for automobiles. As a part of such efforts, the Ministry has declared a This handbook aims to promote an accurate number of foreign standards to be equivalent to Japan’s, understanding in foreign countries of Japan’s standards and accepts data compiled by designated foreign testing and certification procedures and related laws and institutes. As of March 2001, for example, 22 categories procurement. of ECE standards had been accepted, and Japan will continue to implement such measures in accordance with The Motor Vehicle Inspection System its program of deregulation. Japan’s motor vehicle inspection system, commonly The Japanese government became an official member known as the shaken system, consists of periodic vehicle of the UN-ECE 1958 Agreement in November 1998. checks mandated under the Road Vehicles Act to ensure This Agreement establishes the reciprocal recognition of that vehicles comply with technical standards related to certification among various countries, allowing safety and environmental protection. equipment and parts already certified in the other The New Car Inspection (initial shaken inspection) countries that are party to the Agreement to be exempt for passenger cars is valid for three years and may be from certification procedures in Japan. In August 2000, carried out at any MLIT Land Transport Office or office Japan officially acceded to the 1998 Agreement on where the registration of automobile shaken inspections Global Technical Regulations and thus became the first may take place. If the model has received Type country to become a signatory to both the 1958 and the Designation approval, all the owner needs to do is 1998 Agreements. present the attestation issued by the automaker that the vehicle has passed the complete vehicle inspection. The JASIC presentation of the actual vehicle for inspection is The Japan Automobile Standards Internationalization waived. Center (JASIC) was established in 1987. It is a If New Type Notification or the Preferential Handling cooperative public- and private-sector initiative to Procedure for Imported Motor Vehicles (PHP) applies to promote the harmonization of standards and to help the vehicle, the vehicle itself must be presented to verify improve standards certification systems in developing that it has received approval. countries through the collection and dissemination of The Continuing Inspection (shaken inspections after data on inspections, surveys, and related information. the initial New Car Inspection), which is valid for two In March 1988 JASIC opened an office in Geneva, years, may be carried out at any Land Transport Office Switzerland, where the WP29 conferences take place. or at any designated service garage that is qualified to There it plays a key role in the cooperative creation of conduct the shaken inspection. If a certificate for safety internationally harmonized regulations for lamps, brakes, standards compliance issued by a designated service and other equipment, while maintaining close liaison garage is submitted, the presentation of the actual with the countries concerned. vehicle is waived. JASIC also sponsors conferences on automobile safety standards, emission regulations and inspection systems in collaboration with Asian governments, and dispatches experts to Asian countries to discuss the issues raised at such conferences. JASIC actively promotes the harmonization of automotive regulations within the Asia-Pacific Economic Cooperation (APEC) region by carrying out surveys of regulations within the region at the request of APEC authorities. It also publishes an annual bluebook

23 Attention to the Environment

Fuel Economy emissions in the transport sector overall, the automobile The United Nations Framework Convention on industry is not merely improving the fuel efficiency of Climate Change/COP3, a conference on global warming individual vehicles and developing and promoting the held in Kyoto in December 1997, established targets for use of clean-energy vehicles powered by alternative the reduction of greenhouse gases worldwide. In fuels such as electricity or natural gas. The industry is response, under its own program to counter global also undertaking bold, essential measures to make warming, the government of Japan has set for the distribution more efficient, improve traffic flow, and transport sector a general target of reducing CO2 make vehicle users more aware of the need to conserve emissions to the level of fiscal year 1995. The Japanese energy. As part of this program, the industry is automobile industry is responsible for developing, continuously improving its own logistical efficiency. manufacturing and promoting the widespread use of For example, automakers have joined together to make vehicles that offer greater fuel efficiency. mixed shipments of finished vehicles and parts and Japanese automakers have been making significant regularly examine new ways to increase the efficiency of advances in developing technologies for increased fuel freight transport and goods distribution. They are also efficiency. Yet the resulting gains in fuel economy (on a working with relevant institutions in the ongoing per-vehicle basis) have been comparatively modest development of ITS (Intelligent Transport Systems; see because they have been offset by other factors, such as page 29) in addition to expanding their own research and measures to improve safety and reduce vehicle promotion of measures by which to further improve emissions. traffic flow. Japan’s Ministry of Land, Infrastructure and Transport (MLIT) and Ministry of Economy, Trade and Industry Emissions (METI) together have introduced stricter fuel economy Motor vehicle exhaust emission regulations for targets, in line with the June 1998 revision of the Energy gasoline-powered vehicles were first established in Conservation Act. Under these targets, gasoline- Japan in the late 1960s. Ten years later new Japanese powered passenger cars will achieve an average fuel gasoline-vehicle regulations_at the time the most economy increase of 22.8% over 1995 levels by 2010; stringent in the world_required reductions of more than gasoline-powered commercial vehicles with GVW of 2.5 90% in carbon monoxide (CO), nitrogen oxide (NOx) tons or less will achieve an average increase of 13.2% and hydrocarbon (HC) emissions. A further mandatory over 1995 levels by 2010; diesel-powered passenger cars reduction of 70% in CO, NOx and HC emissions was will achieve an average increase of 14.9% over 1995 imposed in 2000. The Central Council for the levels by 2005; and diesel-powered commercial vehicles Environment has recommended (in April 2002) the with GVW of 2.5 tons or less will achieve an average introduction, from 2005 on, of what are to be the world’s increase of 6.5% over 1995 levels by 2005. most stringent regulations on particulate matter (PM) All the automakers are stepping up their development and NOx emissions from diesel engines. Under this of the new technologies that will be needed to meet the program, PM emissions from diesel vehicles are to be targets for improved fuel economy set for the years 2005 slashed by 75-80% from 2002 regulatory values and NOx and 2010. emissions are to be reduced by 40-50% from the levels However, in order to achieve greater cuts in CO2 stipulated in regulations to be issued in October 2002.

FUEL ECONOMY TARGETS FOR GASOLINE-POWERED FUEL ECONOMY TARGETS FOR DIESEL-POWERED VEHICLES (average rate of improvement: 22.8%) VEHICLES (average rate of improvement: 14.9%)

km/l km/l 25 25 Actual value for 1995 Actual value for 1995 21.2 Target value for 2010 Target value for 2005 20 16.8 20 18.9 19.1 17.9 18.4 16.2 18.8 16.0 15 15.7 15 13.0 14.7 13.2 11.9 12.9 10.8 10.5 11.7 9.8 10 8.9 10 10.5 8.7 10.0 7.8 9.2 8.4 8.5 6.4 7.6 7.4 6.6 5 5.7 5

0 0 ~702 703~ 828~ 1016~ 1266~ 1516~ 1766~ 2016~ 2266~ ~1015 1016~ 1266~ 1516~ 1766~ 2016~ 2266~ 827 1015 1265 1515 1765 2015 2265 1265 1515 1765 2015 2265 Vehicle Vehicle weight (kg) weight (kg)

24 Furthermore, regulations on gasoline engines addition, recommendations jointly issued by JAMA, recommended from 2005 on would cut NOx and HC AAM, ACEA and EMA (the United States’ Engine emissions down to about one-half the values stipulated Manufacturers Association) in April 2000 are calling for in the 2000 regulations. lower levels of sulfur in gasoline and diesel fuel in view Automakers are making maximum use of their R&D of the fact that fuel quality has a major effect on resources to meet these reduced emission requirements emissions. and are taking bold steps to deal with every conceivable challenge involved in improving combustion-engine Low-Emission Vehicles technology, covering the entire emission process. As a In combination with the aforementioned efforts, an result, they have made some notable achievements with equally important measure will be to encourage the respect to exhaust gas recirculation (EGR) systems; widespread use of hybrid vehicles, electric vehicles, and catalytic converters with O2 sensors; and a ceramic vehicles that operate on compressed natural gas (CNG) , filtering system that eliminates up to 100% of the smoke as well as certified low-emission vehicles. In July 2001 from diesel engines and reduces particulate matter by the government unveiled its action plan for the approximately 80%. New diesel engines featuring development and dissemination of low-emission common rail-type electronic fuel injection systems are vehicles, which targets at least 10 million LEVs on the expected to result in massive cuts in NOx and PM. In road in Japan by fiscal year 2010. Automakers are

EXHAUST EMISSIONS REGULATIONS IN JAPAN (as of May 2002) Particulate Type of Vehicle CO HC NOx Matter Passenger Cars 0.67 g/km 0.08 g/km 0.08 g/km Gasoline- GVW † 1.7t 0.67 g/km 0.08 g/km 0.08 g/km powered Commercial N.A. 1.7 < GVW † 3.5t 2.10 g/km 0.08 g/km vehicles Vehicles 0.13 g/km 3.5t < GVW 16.0 g/kWh 0.58 g/kWh 1.40 g/kWh Passenger Cars 2.10 g/km 0.40 g/km 0.40 g/km 0.08 g/km Diesel- GVW † 1.7t 2.10 g/km 0.40 g/km 0.40 g/km 0.08 g/km powered Commercial 1.7 < GVW † 2.5t 2.10 g/km 0.40 g/km 0.70 g/km 0.09 g/km vehicles Vehicles 2.5t < GVW 7.40 g/kWh 2.90 g/kWh 4.50 g/kWh 0.25 g/kWh

Notes: GVW = Gross vehicle weight. A G13 test mode is used for gasoline CVs with GVW of over 3.5 tons and a D13 mode for diesel CVs with GVW of over 2.5 tons; otherwise, a 10-15 test mode is used. Figures are applicable to new domestic models. Existing domestic models and imports are granted certain grace periods on part of the above standards. Sources: Ministry of Land, Infrastructure and Transport, Ministry of the Environment.

REGULATORY REQUIREMENTS FOR NOx AND PM EMISSIONS FROM DIESEL VEHICLES, 1973-2005 % 100 100 90 80 80 NOx 70 68 56 60 49 50 42 40 35 26 30 20 20 12 10 0 1973 1975 1985 1995 2000 2003 2005 Year % 100 100 90 80 78 PM 70 60 50 40 30 28 20 20 10 3 0 1973 1975 1985 1995 2000 2003 2005 Gross vehicle weight : Over 2.5t/Over 3.5t (2005~) Year 25 Attention to the Environment (cont’d.) responding by making every effort to expand their roster concept. of low-emission model lines. Development is also Working in concert with European and U.S. moving forward on the practical use of fuel cell-powered automakers, JAMA has submitted comments and vehicles worldwide. recommendations to the ISO concerning methods for calculating actual and potential vehicle recycling rates Recycling and has thereby contributed directly to international About 5 million vehicles per year become end-of-life recycling promotion activities. vehicles (ELVs) in Japan. Most of the content of these Japan is now involved in wide-ranging initiatives ELVs is recyclable, and about 75-80% (by vehicle aimed at the fostering of a more advanced recycling- weight) is already being recycled. In May 1997 METI oriented society. The national government is introducing issued an ELV Recycling Initiative, to which JAMA new legislation targeting recycling and based on the responded in January 1998 with the formulation of a concept of broader manufacturer responsibility, at least Voluntary Action Plan including numerical targets. where principal consumer commodities are concerned. Under this plan, the ratio of recyclable parts for new It is also expected to consider new draft legislation, to be vehicles will be raised to 85% or higher from the year proposed in 2002 for implementation in 2004, which will 2002 and to 95% or higher from 2015. The groundwork aim to increase the efficiency of vehicle recycling for achieving these targets is now being put in place. operations and minimize its social costs by identifying The JAMA Action Plan also targets, first, the the roles and obligations of all industry partners reduction of the volume of automobile shredder residue involved. (ASR) to be disposed of in landfills to three-fifths or less Under this new legislation, the cost of recycling is to of 1996 levels as of 2002; and second, the reduction of be borne by the purchasers of new vehicles at the time of the amount of lead (excluding batteries) used in new cars acquisition, while provisions for the processing by placed on sale as of the end of 2005 to one-third or less manufacturers of designated vehicle components (CFCs of 1996 levels. and air bags) and automobile shredder residue have been Following revisions made in April 2001 to existing designed to ensure the appropriate disposal of ELVs. legislation promoting the efficient use of resources, JAMA is currently involved in creating the infrastructure JAMA formulated in December 2001 its own product that will be needed to address all the logistical operations assessment guidelines, including assessment standards, involved, from the processing of recycling fees to the which are based on the "recycle, reduce, and reuse" management of electronic checklist systems for the

TRENDS IN THE USE OF CLEAN-ENERGY VEHICLES

1995 1996 1997 1998 1999 2000 (units) Hybrid Vehicles 176 228 3,728 22,520 36,870 51,200 CNG Vehicles 759 1,211 2,093 3,640 5,250 7,811 Electric Vehicles 2,500 2,600 2,500 2,400 2,600 3,830 Diesel-Alternative LPG Vehicles 7,272 7,883 8,888 9,950 10,955 12,602 Methanol Vehicles 336 327 313 289 220 157 Total 11,043 12,249 17,522 38,799 55,895 75,600

THE JAMA VOLUNTARY ACTION PLAN FOR VEHICLE RECYCLING Numerical Targets for Vehicle Recyclability and the Reduced Use of Hazardous Materials Numerical targets for vehicle manufacturers Recyclability rate for new vehicles At least 90% recyclability as of 2002 Lead content in new vehicles About 1/2 of (or 50% decrease About 1/3 of (or 66% decrease (excluding batteries) from) 1996 levels as of 2000 from) 1996 levels as of 2005 Numerical targets for all relevant industry partners Recycling rate for end-of-life vehicles (actual rate) At least 85% as of 2002 At least 95% as of 2015 Volume of automobile shredder About 3/5 of (or 60% decrease About 1/5 of (or 80% decrease residue disposed of as landfill from) 1996 levels as of 2002 from) 1996 levels as of 2015 Notes: 1. The recyclability rate for new vehicles is calculated on the basis of an evaluation procedure devised for auto manufacturers to assist them in verifying vehicle recyclability rates during the design and development stages. 2. The recycling rate for end-of-life vehicles is calculated on the basis of actual recycling operations carried through to their conclusion.

26 proper disposal of vehicle parts. scheduled to take effect from autumn 2002 onward on the basis of government-recommended guidelines The Recovery and Disposal of CFCs in Vehicle Air relating to the entire recovery and disposal process. Conditioners In 1991 Japanese automakers took the world lead in switching to the use of HFC134a, a new refrigerant for vehicle air conditioner systems, to replace the ozone layer-damaging CFC12. This switchover process for new vehicles was completed by 1994. The government and the automobile industry also developed and introduced in October 1998 a system for the recovery and appropriate disposal of CFC12 refrigerants from end-of-life vehicles. In addition, a system to recover and dispose of HFC134a was launched nationwide in May 2001 as part of a larger overall effort to prevent global warming. In June 2001 the CFC Recovery and Destruction Law (see diagram below) was passed and enforcement is

SUMMARY DIAGRAM OF THE LAW ON THE RECOVERY AND DESTRUCTION OF CFCS IN CAR AIR CONDITIONERS (ELVS) covering CFC12 (R12) and HFC134a (R134a) Party Disposing of Designated Class 2 Product (Automobile Users)

Car air conditioner (ELV)

Party Receiving Designated Class 2 Product Registration

Invoice for Payment for Control register for Car air Prefectural processing costs automotive CFCs conditioner (ELV) Registration Authorities (recovery, transport, destruction) Report on Party Recovering Class 2 CFCs recovery volume, etc. Record of Payment for Invoice for Control register for recovery CFCs Notice regarding recovery and costs automotive CFCs volume, etc. transport recovery volume, etc.

Automobile Manufacturer/Importer Report on volume destroyed, etc. Payment for Invoice for CFCs Record of destruction costs Ministry costs volume destroyed, etc. Responsible

Party Engaged in Destroying CFCs Approval

27 Traffic Safety

The Three Major Factors Involved in Traffic with measures concerning people and road conditions. Accidents With respect to enhancing people’s safety, JAMA holds Traffic accidents involve complex relationships nationwide spring and autumn traffic safety campaigns, between three factors: people, road conditions, and sponsors classes in safe driving techniques, and conducts vehicles. "People" refers to the perceptions, decisions, similar PR activities to raise public awareness and teach and actions of drivers and pedestrians; "road conditions" practical safety. With respect to road conditions, JAMA to road structure and natural conditions; and "vehicles" actively helps prevent accidents by making proposals to to structural and other characteristics of vehicles administrative authorities to improve road conditions themselves. Making the public conscious of traffic and traffic infrastructure. In addition, the Association safety requires study and analysis of the interplay of contributes personnel and financial support to study and these three factors in accidents and actions to implement analyze accidents with the objective of identifying causal appropriate safety measures. factors and measures that will reduce injury and damage.

Preventive and Collision Safety Initiatives Attuned to Realities Preventive safety consists of measures to prevent As the number of elderly with driver’s licenses rises, accidents. With respect to people, preventive safety the number of traffic fatalities among such drivers has means enhancing the public’s awareness of traffic safety been increasing. JAMA, therefore, is now sponsoring through driver education and efforts to raise public hands-on driving seminars and similar measures aimed consciousness. With respect to road conditions, it at elderly drivers. It also emphasizes longstanding safety involves structuring intersections to avert accidents and themes, using traffic safety campaigns to underscore the similar measures. With respect to vehicles, it involves importance of wearing seatbelts and of driving improving visual recognition and other accident- motorcycles in the daytime with the headlamps on. avoidance capabilities. Collision safety refers to features, such as seatbelts and air bags, that minimize Informational Activities Aimed at All Road Users personal injuries when an accident occurs. Everyone who uses roads, including drivers of passenger cars, motorcycles, and bicycles as well as Ongoing Initiatives to Protect People, Enhance Road pedestrians, needs to be reached by traffic safety-related Conditions, and Analyze Accidents informational activities. Therefore, a broad range of As the chief representative organization of the safety activities must be undertaken, including the industry that provides vehicles to the public, JAMA proper training of driving instructors and related believes its primary social responsibility is to ensure professionals. Reaching age groups ranging from the vehicle safety. This is why JAMA conducts a wide elderly to children with its traffic safety campaigns and range of research and development activities to improve training activities, JAMA’s objective is to educate people vehicle safety. It also works actively to expand so that vehicle transport can play a better role in society. applications of safety-enhancing structures and devices in vehicles and increase the benefits of advanced electronic and other technologies. However, JAMA’s scope of activities embraces people and road conditions as well as vehicles. Representing the standpoint of the automobile industry, JAMA undertakes liaison activities with pertinent government agencies and traffic safety organizations in connection

TRAFFIC ACCIDENT CASUALTIES (including motorcycle accident casualties)

Traffic Vehicles in Use* Per 10,000 Vehicles: Injuries Index Year Accidents Index Fatalities Index (million) Index Fatalities Injuries 1970 718,080 100 16,765 100 981,096 100 28.3 100 6.3 369 1975 472,938 66 10,792 64 622,467 63 36.9 130 2.9 169 1980 476,677 66 8,760 52 598,719 61 49.8 176 1.8 120 1985 552,788 77 9,261 55 681,346 69 64.3 227 1.4 106 1990 643,097 90 11,227 67 790,295 81 75.5 266 1.5 105 1995 761,789 106 10,679 64 922,677 94 82.5 292 1.3 112 1997 780,399 108.7 9,640 57.5 958,925 97.7 84.9 300 1.1 111 1998 803,184 111.9 9,211 54.9 989,297 100.8 85.4 301 1.0 112 1999 850,363 118.4 9,006 53.7 1,050,398 107.1 86.0 304 1.0 122 2000 931,934 129.8 9,066 54.1 1,155,697 117.8 86.7 306 1.0 133 2001 947,169 131.9 8,747 52.2 1,180,955 120.3 87.2 308 1.0 136 Note: *Figures include motor vehicles and motorcycles in use (as of end of December each year) and motor-driven cycles in use (as of end of March). 28 Sources: National Police Agency, Ministry of Land, Infrastructure and Transport. Intelligent Transport Systems

Intelligent Transport Systems (ITS) are designed to tolls from vehicles without requiring them to stop at resolve the efficiency-reducing load on traffic flow tollbooths, went into full operation in 2001. As of April resulting from accidents and congestion by taking 2002, the ETC system was in operation at 681 locations advantage of data networks using advanced throughout Japan. By the end of March 2003, ETC telecommunications technology. In other words, ITS systems will be installed at approximately 900 major toll initiatives, which are being undertaken by both the stations throughout Japan. public and private sectors, are intended to improve road The target date for full-fledged Automatic Highway transportation efficiency, thus making road travel more System (AHS) operation, including completed road enjoyable. infrastructure and vehicles with advanced cruise-assist The government’s ITS master plan, the systems, is 2010. April 1996 marked the launch of the "Comprehensive Concept for the Promotion of ITS," advanced car navigation system known as the Vehicle foresees five main user categories: drivers, pedestrians, Information and Communication System (VICS). public transportation users, freight transporters, and Initially providing service on roads in the Tokyo managers of traffic and road infrastructure. Ongoing metropolitan area and on expressways extending about research-and-development targets the implementation of 100 kilometers from Tokyo, as well as throughout the a total of 21 user services in nine areas of development Tomei and Meishin expressway systems (running from by 2015. Tokyo through Nagoya to Kobe), VICS is now being expanded to cover the entire country. Significant Trends Following trials lasting several years, electronic toll collection (ETC) systems, which automatically collect

ITS DEVELOPMENT AREAS AND USER SERVICES 9 ITS Development Areas 21 User Services Advanced navigation systems ● Traffic-related information ● Route guidance information Electronic toll collection ● Automatic collection of vehicle tolls Safe-driving assistance ● Road-related information ● Hazard warnings ● Driver assistance ● Advanced cruise-assist systems Optimized traffic management ● Optimization of traffic flow ● Traffic flow control information in case of accidents Optimized road infrastructure management ● More efficient maintenance and management ● Special vehicle deployment management ● Information on current traffic regulations Public transport assistance ● Information on using public transport ● Assistance in public transport operations and management More efficient commercial vehicle use ● Assistance in commercial vehicle logistical operations ● Advanced cruise-assist systems for commercial vehicles Pedestrian assistance ● Road network information ● Prevention of hazards Assistance to emergency vehicle operations ● Automatic notification of emergencies ● Emergency vehicle deployment support (route guidance and rescue activity support) Other ● Linkage with other advanced information networks

29 Automotive Shipments in Value Terms (2000)

Automotive shipments are the second largest industrial sector of the 2000 SHIPMENTS OF MAJOR MANUFACTURING INDUSTRIES Japanese economy (after electrical machinery and equipment). By the (billions of yen) latest accounts, they represent 13.2% Nonferrous Metals of the value of the nation’s total ·6,219 Other manufacturing shipments and 28.9% (2.0%) ·111,572 (36.8%) of the value of the machinery General Machinery industries’ combined shipments. The & Equipment value of domestic automotive ·30,413 Total (10.0%) shipments rose by 2.7% in 2000 to ·303,582 40,042.9 billion yen for the first time Metal billion Products (100%) Electrical in three years. ·15,587 Machinery (5.1%) & Equipment The number of people in Japan ·59,582 engaged in work related to (19.6%) automobiles is approximately 5.4 Chemicals million. Given that there are currently ·23,799 (7.9%) around 64.1 million workers in Japan, Automotive this means that about one in every ·40,043 Iron & Steel (13.2%) twelve workers is employed directly ·11,963 or indirectly by the automobile (3.9%) Transport Equipment industry.(As of this year, some data ·44,447 previously included in employment (14.6%) statistics will no longer be included.) ¥Automobile manufacturers (including motorcycles) ·19,992 ¥Automobile body & related manufacturers ·2,558 ¥Automobile parts & accessories manufacturers ·17,493

SHIPMENTS OF MAJOR MANUFACTURING INDUSTRIES IN VALUE TERMS (billions of yen)

Automotive Machinery Industries Machinery Shipments Year Chemicals Iron & Non- Metal Industries Other Total % of % of General Electrical Other Transport Equipment Manufactur- Steel ferrous Products Subtotal Machinery Machinery/ Machinery/ Machinery ing Industries Automotive Industries Metals Equipment Industries Equipment Value Value 2000 23,799 11,963 6,219 15,587 30,413 59,582 44,447 40,043 4,119 138,561 107,453 303,582 28.9 13.2 1999 23,055 11,322 5,789 15,238 27,972 54,905 43,877 39,004 4,169 130,924 105,071 291,398 29.8 13.4 1998 23,223 12,942 6,441 16,736 30,781 56,292 45,237 40,248 4,588 136,898 109,600 305,840 29.4 13.2 1997 24,580 14,563 7,188 18,125 32,575 60,381 47,448 42,483 4,503 144,907 113,708 323,072 29.3 13.1 1996 23,490 13,890 6,710 17,933 31,424 57,748 45,145 40,600 4,089 138,405 112,640 313,068 29.3 13.0 1995 23,363 14,073 6,496 17,647 29,884 54,831 44,215 39,561 4,107 133,036 111,421 306,036 29.7 12.9 1994 22,519 13,574 5,931 17,488 27,594 51,928 44,652 39,682 4,209 128,383 111,133 299,027 30.9 13.3 1993 23,260 14,932 6,140 18,732 29,171 52,103 47,065 41,767 4,488 132,827 115,310 311,200 31.4 13.4 1992 24,169 16,558 6,865 19,805 33,192 54,566 49,426 44,295 5,051 142,235 119,888 329,521 31.1 13.4 1991 24,270 18,631 7,697 20,230 35,847 58,624 48,960 44,192 5,511 148,941 121,066 340,835 29.7 13.0 1990 23,503 18,269 7,822 18,573 33,225 54,529 46,858 42,311 5,132 139,744 115,462 323,373 30.3 13.1 1985 20,552 17,754 6,384 13,094 24,190 40,842 36,179 27,693 4,381 105,593 101,943 265,321 26.2 10.4 1980 17,979 17,896 8,119 10,646 17,600 22,235 24,954 21,235 3,458 68,246 91,815 214,700 31.1 9.9 1975 10,438 11,306 3,909 6,573 10,611 10,821 14,794 10,524 1,729 37,955 57,252 127,433 27.7 8.3 1970 5,540 6,565 3,055 3,728 6,803 7,331 7,276 5,467 892 22,301 27,847 69,035 24.5 7.9

Source: "Industry Statistics," Ministry of Economy, Trade and Industry.

30 Automotive Trade

In 2001 the value of motor vehicle exports (including (including parts) rose by 5.2% to 1,039 billion yen for motorcycles and parts) rose by 3.4% to 9,780.2 billion the second straight year. yen, the second consecutive yearly increase. Similarly, the value of motor vehicle imports

2001 EXPORTS BY 2001 IMPORTS BY PRINCIPAL COMMODITY (FOB) PRINCIPAL COMMODITY (CIF)

Export Value (billions of yen) Import Value (billions of yen) ¥Non-Electrical ¥Mineral Fuels ·8,520 Machinery ·10,230 (20.9%) (20.1%) ¥Iron & Steel Products ·1,650 ¥Foodstuffs ·5,250 (3.4%) (12.4%) ¥Chemicals ·3,740 ¥Raw Materials ·2,590 (7.6%) (6.1%) ¥Visual & Audio Apparatus ·1,610 ¥Chemicals ·3,100 (3.3%) Imports (7.3%) Exports ¥Scientific & · 42,420 billion ¥Metals ·1,820 · 48,980 billion Optical Equipment ·2,500 (100%) (4.3%) (100%) (5.1%) ¥Textiles ·920 ¥Textiles ·2,890 (1.9%) (6.8%) ¥Metal Products & Motor Vehicles ¥Other ·5,030 Nonferrous Metals ·1,240 · 780 billion (11.9%) Motor Vehicles (2.5%) (1.8 %) (including motorcycles & parts) ¥Ships ·1,000 Machinery & Equipment · 9,780 billion (2.0%) · 13,220 billion (20.0%) ¥Other ·16,310 (31.2%) (33.3%)

AUTOMOTIVE EXPORTS IN VALUE TERMS (FOB) (billions of yen)

Motor Vehicles Merchandise Year Chg.(%) Cars, Trucks, Buses Parts & Components Motorcycles Subtotal Export Total 2001 7,210.8 1,880.4 689.1 9,780.23.4% 48,979.2 2000 6,930.1 1,864.2 660.3 9,454.61.2% 51,654.2 1999 7,094.8 1,636.7 613.9 9,345.4-7.5% 47,547.6 1998 7,795.2 1,637.4 670.0 10,102.66.3% 50,645.0 1997 7,112.3 1,789.5 604.6 9,506.4 20.3% 50,938.0 1996 5,513.8 1,840.5 548.9 7,903.29.1% 44,731.3 1995 4,979.7 1,781.5 480.7 7,241.9 -10.9% 41,530.9 1994 5,836.6 1,798.2 494.3 8,129.1 -7.3% 40,497.6 1993 6,550.5 1,654.4 564.6 8,769.5 -10.4% 40,202.4 1992 7,657.7 1,584.7 549.6 9,792.0 4.7% 43,012.3 1991 7,370.5 1,523.9 458.9 9,353.3 0.3% 42,359.9 1990 7,358.7 1,566.8 396.4 9,321.9 11.7% 41,955.7 1985 8,195.1 1,242.0 624.1 10,061.2 14.4% 41,456.9 Source: "The Summary Report on Trade of Japan," Ministry of Finance. AUTOMOTIVE IMPORTS IN VALUE TERMS (CIF) (billions of yen) Motor Vehicles Year Merchandise Cars, Trucks, Buses Parts & Components Subtotal Chg.(%) Import Total 2001 781.4 257.6 1,039.05.2% 42,415.5 2000 767.9 220.0 988.08.8% 40,938.4 1999 722.6 185.4 908.0-4.8% 35,268.0 1998 746.5 207.6 954.1-19.8% 36,653.6 1997 974.0 215.6 1,189.6 -10.5% 40,956.2 1996 1,152.1 177.4 1,329.521.4% 37,993.4 1995 958.5 136.4 1,094.9 28.2% 31,548.8 1994 737.8 116.2 854.0 22.1% 28,104.3 1993 583.0 116.6 699.6 -11.3% 26,826.4 1992 655.0 133.4 788.4 -7.6% 29,527.4 1991 727.8 125.5 853.3 -17.6% 31,900.2 1990 923.3 111.9 1,035.2 58.9% 33,855.2 1985 129.0 44.6 173.6 — 31,084.9 Source: "The Summary Report on Trade of Japan," Ministry of Finance.

31 Significant Events of 2001

DOMESTICA Industries Ltd. (June).

The Tokyo municipal government compiles report Suzuki Motor Corporation announces elimination of entitled "Road Pricing Concept" (June). lead from painting processes in all domestic vehicle (including two-wheeler) production facilities The CFC Recovery and Destruction Law is passed (January). (June).

The Ministry of Land, Infrastructurc Toll Collection MLIT, the Ministry of Economy, Trade and Industry (ETC) service on expresswe and Transport (MLIT) (METI) and the Ministry of the Environment announces the launching, beginning on March 30, of announce action plan for the Development and Electroniays in Tokyo and Chiba Prefecture and on Dissemination of Low-Emission Vehicles (July). some roads in Okinawa (January). Honda Motor Co., Ltd. notifies MLIT of presence of Mitsubishi Motors Corporation announces its defects in some vehicles using fuels containing highly "Turnaround Plan" (February). concentrated alcohol (August).

JAMA and the Japan Motor Industrial Federation Suzuki and Kawasaki Heavy Industries, Ltd. (JMIF) announce their merger, scheduled for May announce agreement on comprehensive tie-up in two- 2002 (March). wheeler business operations (August).

Nissan closes the production line of its Murayama JMIF cancels opening ceremony and reception at the plant (March). 35th Tokyo Motor Show to express sympathy with the victims of the terrorist attacks in the United States Itaru Hasegawa appointed President of Yamaha (September). Motor Co., Ltd. (April). Mitsubishi announces signing of basic agreement Nissan announces entry in 2002 into sales of minicars with Jatco Trans Technology Ltd. on consolidation of supplied on OEM basis from Suzuki (April). automatic transmission business (October).

JAMA announces a JAMA initiative on recall (April). The 35th Tokyo Motor Show (for passenger cars and motorcycles) takes place (October). Toyota announces that Hino Motors, Ltd. will become a subsidiary (April). JAMA’s Board of Directors approves membership of GM Japan (December). The Japan Automobile Recycling Promotion Center begins nationwide program to recover and destroy alternative CFCs used in car air conditioners (May).

Isuzu Motors Limited announces its "Isuzu V Plan" (May).

Prime Minister Koizumi announces switch to use of low-emission official limousines (May).

Tadaaki Jagawa is appointed President of Hino INTERNATIONALA (June).

Toyota Motor Corporation, General Motors Corporation, and ExxonMobil Corporation announce Kyoji Takenaka is appointed President of Fuji Heavy agreement on joint development of fuel-cell vehicles

32 (January).

France-based Renault and Nissan Motor Co., Ltd. announce common platforms for core models (February).

Mitsubishi and Volvo announce dissolution of their tie-up (April).

Yamaha announces complete transfer to Taiwan of production of 50cc motor scooters for the Japanese market (April).

China imposes special customs duties on automobiles manufactured in Japan as a retaliatory measure against Japan’s resort to emergency safeguards (June).

Toyota and PSA Peugeot Citroen announce basic agreement on joint development and production of compact cars in Europe (June).

Mitsubishi and DaimlerChrysler announce joint development of low-emission diesel engines for medium-sized and large trucks (August).

Nissan Diesel Motor Co., Ltd. announces provision of production and assembly technology for small diesel engines to a China-based diesel engine manufacturer (August).

GM and Suzuki announce agreement on joint development of fuel-cell vehicles (October).

Nissan and Renault announce Nissan’s acquisition of a 15% equity stake in Renault and Renault’s raising of its equity stake in Nissan to 44.4% (October).

Honda launches operations at new plant in Alabama, U.S.A. (November).

The Chinese government withdraws special customs duties on motor vehicles manufactured in Japan (December).

China becomes WTO member (December).

Program to realign and streamline special public corporations is approved, leading to privatization of the four public highway corporations (December).

33 Member Manufacturers

DAIHATSU MOTOR CO., LTD. MAZDA MOTOR CORPORATION Head Office: Head Office: 1, Daihatsu-cho 1-chome 3-1, Shinchi, Fuchu-cho Ikeda City, Osaka Pref. 563-8651 Aki-gun, Hiroshima Pref. 730-8670 Tel : (0727) 51-8811 Fax: (0727) 53-6880 Tel : (082) 282-1111 Fax: (082) 287-5190 Tokyo Branch Office: Tokyo Head Office: 2-10, Nihonbashi Hon-cho 2-chome 1-7, Uchisaiwai-cho 1-chome Chuo-ku, Tokyo 103-8408 Chiyoda-ku, Tokyo 100-0011 Tel : (03) 3279-0813 Fax: (03) 3279-0038 Tel : (03) 3508-5031 Fax: (03) 3508-5094 Products: Cars and Trucks Products: Cars, Trucks and Buses Internet: http://www.daihatsu.co.jp/ Internet: http://www.mazda.co.jp/ FUJI HEAVY INDUSTRIES LTD. MITSUBISHI MOTORS CORPORATION Subaru Bldg. 33-8, Shiba 5-chome 7-2, Nishi-Shinjuku 1-chome Minato-ku, Tokyo 108-8410 Shinjuku-ku, Tokyo 160-8316 Tel : (03) 3456-1111 Fax: (03) 5232-7477 Tel : (03) 3347-2111 Fax: (03) 3347-2338 Products: Cars, Trucks and Buses Products: Cars, Trucks and Buses Internet: http://www.mitsubishi-motors.co.jp/ Internet: http://www.fhi.co.jp/ NISSAN DIESEL MOTOR CO., LTD. GENERAL MOTORS JAPAN LIMITED 1, Oaza 1-chome 27th Floor, 20-3, Ebisu 4-chome Ageo City, Saitama Pref. 362-8523 Shibuya-ku, Tokyo 150-6027 Tel : (048) 781-2301 Fax: (048) 781-7505 Tel: (03) 5424-2727 Products: Trucks and Buses Products: Cars Internet: http://www.nissandiesel.co.jp/ Internet: http://www.gmjapan.co.jp/ NISSAN MOTOR CO., LTD. HINO MOTORS, LTD. 17-1, Ginza 6-chome Head Office and Hino plant: Chuo-ku, Tokyo 104-8023 1-1, Hinodai 3-chome Tel : (03) 3543-5523 Fax: (03) 3546-2669 Hino City, Tokyo 191-8660 Products: Cars, Trucks and Buses Tel : (042) 586-5111 Fax: (042) 586-5038 Internet: http://www.nissan.co.jp/ Tamachi Office: 11-3, Shiba 4-chome Minato-ku, Tokyo 108-0014 SUZUKI MOTOR CORPORATION Tel : (03) 5419-9320 Fax: (03) 3453-0174 Head Office: Products: Trucks and Buses 300, Takatsuka Internet: http://www.hino.co.jp/ Hamamatsu, Shizuoka Pref. 432-8611 Tel : (053) 440-2061 Fax: (053) 445-0040 Tokyo Branch Office: HONDA MOTOR CO., LTD. Suzuki Bldg. Higashi-Shinbashi 1-1, Minami-Aoyama 2-chome 2-8, Higashi-Shinbashi 2-chome Minato-ku, Tokyo 107-8556 Minato-ku, Tokyo 105-0021 Tel : (03) 3423-1111 Fax: (03) 3423-0511 Tel : (03) 5473-1601 Fax: (03) 5473-1602 Products: Cars, Trucks and Motorcycles Products: Cars, Trucks and Motorcycles Internet: http://www.honda.co.jp/ Internet: http://www.suzuki.co.jp/ ISUZU MOTORS LIMITED TOYOTA MOTOR CORPORATION 26-1, Minami-Oi 6-chome Head Office: Shinagawa-ku, Tokyo 140-8722 1, Toyota-cho Tel : (03) 5471-1111 Fax: (03) 5471-1042 Toyota City, Aichi Pref. 471-8571 Products: Trucks and Buses Tel : (0565) 28-2121 Fax: (0565) 80-1116 Internet: http://www.isuzu.co.jp/ Tokyo Head Office: 4-18, Koraku 1-chome Bunkyo-ku, Tokyo 112-8701 KAWASAKI HEAVY INDUSTRIES, LTD. Tel : (03) 3817-7111 Fax: (03) 3817-9037 Kobe Head Office: Products: Cars, Trucks and Buses Kobe Crystal Tower Internet: http://www.global.toyota.com 1-3, Higashi Kawasaki-cho 1-chome Chuo-ku, Kobe, Hyogo Pref. 650-8680 Tel : (078) 371-9530 Fax: (078) 371-9568 YAMAHA MOTOR CO., LTD. Tokyo Head Office: Head Office: World Trade Center Bldg. 2500, Shingai 4-1, Hamamatsu-cho 2-chome Iwata City, Shizuoka Pref. 438-8501 Minato-ku, Tokyo 105-6116 Tel : (0538) 32-1115 Fax: (0538) 37-4250 Tel : (03) 3435-2111 Fax: (03) 3436-3037 Tokyo Office: Products: Motorcycles Mita 43 Mori Bldg. Internet: http://www.khi.co.jp/ 13-16, Mita 3-chome Minato-ku, Tokyo 108-0073 Tel : (03) 5442-0600 Fax: (03) 5442-0700 Products: Motorcycles Internet: http://www.yamaha-motor.co.jp/

34 Plant Locations of Member Manufacturers in Japan

TOYOTA Tomakomai ISUZU MAZDA Tomakomai Hofu MAZDA Hiroshima Mitsugi

MITSUBISHI Mizushima KAWASAKI TOYOTA Akashi Tohoku ISUZU DAIHATSU Tochigi Tada HINO NISSAN DAIHATSU Nitta Tochigi Ikeda FUJI MITSUBISHI Ota NISSAN Kyoto Yajima HONDA Iwaki Yagi Otakita Takanezawa DAIHATSU Ohizumi Maoka Kyoto Isezaki Haga DAIHATSU NISSAN DIESEL Shiga Ageo MITSUBISHI Konosu Shiga Hanyu

FUJI Saitama HONDA Sayama HINO Wako Hino Hamura

ISUZU SUZUKI Kawasaki HONDA Hamamatsu Fujisawa Suzuka Iwata Osuka Kosai NISSAN Sagara Yokohama SUZUKI Oppama Toyokawa HONDA TOYOTA Hamamatsu HONDA Toyota Hosoe MITSUBISHI Kumamoto Motomachi YAMAHA Kawasaki Kamigo Iwata Nakatsu Takaoka NISSAN Hamakita Miyoshi Kyushu Fukuroi Tsutsumi TOYOTA Toyooka Myochi Miyata Nakase Shimoyama Soude Kinuura Morimachi Tahara Teiho Hirose MITSUBISHI (as of April 2002) Oye Okazaki

35 JAMA Organization and Information Services

The Japan Automobile Manufacturers Association, among the chief executives of the member companies. Inc. (JAMA) is a nonprofit trade association which was Reporting to the chairman are five vice-chairmen, one of established in 1967. The organization is comprised of whom also serves as president; an executive director; the fourteen manufacturers of cars, trucks, buses and and a secretary general. Final authority for decisions on motorcycles in Japan. JAMA’s major activities and overall administration is JAMA’s activities are administered under the vested in its board of directors. guidance of various committees composed of member- company representatives. The administrative structure of JAMA is headed by a chairman, who is elected from

Chairman Vice-Chairmen — Committees — — Administration — General Assembly President Board of Directors Executive Director Executive Committee Secretary General General Committees: Technical Administration Committee Administrative Div. Safety & Environmental Technology Committee Environment Committee Coordination Div. Traffic Affairs Committee Traffic Affairs Dept. Distribution Committee Taxation Committee Business Affairs Dept. International Affairs Committee Technical Dept. Purchasing Committee Environment Dept. Electronic Information Exchange Committee Human Resources Committee International Dept. Tokyo Motor Show Dept. Special Vehicle Committees: Public Relations Office Mini-Vehicle Committee Motorcycle Committee Human Resources Office Heavy Vehicle Committee

Tokyo Motor Show Committee

JAMA INFORMATION SERVICES

Periodicalsa in the U.S., in English. A Better Environment for Future Generations Motor Vehicle Statistics of Japan A summary of JAMA initiatives related to Historical compilation of Japanese motor vehicle environmental issues and the measures JAMA production, export, and new registration statistics. Other Publicationsa members are taking in regard to environmental Annual, in English. Japan’s Automobile Manufacturers—Global protection. Companies in a Global Industry—Moving News from JAMA Forward with Cutting-Edge Technology Brief articles and current production, export, and A detailed look at how Japanese automakers’ Videosa new registration statistics. Monthly, in French, sales, employment and investment activities have Man and the Automobile—A Look at the Future English and German. made them a part of the fabric of America. A 20-minute video on technology trends in the Japanese motor vehicle industry. Statistics on News from JAMA Asia-Pacific Edition Japanese Automakers in Europe—Investing in production, sales and exports are also included. News and feature articles on JAMA’s activities a Common Future In Japanese and English. related to the ASEAN automotive industry. A detailed look at how Japanese automakers are Published thrice yearly, in English. working within the European Community to build Automobile Recycling in 1998—Towards the cars in Europe for Europeans. Technology of Tomorrow News from JAMA Motorcycle A 20-minute presentation which reviews the News, views and developments related to Toward the Development of the ASEAN industry’s voluntary initiatives to further promote Japan’s motorcycle industry. Quarterly, in Automotive Industry end-of-life vehicle recycling, explaining the latest English. A detailed look at how Japanese automakers are technologies in shredder residue processing and working to promote the automotive industry in and other systems. In Japanese and English. Japan Auto Trends with ASEAN countries. News, views and developments related to Internet: http://www.jama.or.jp Japan’s automobile industry. Published quarterly Note: Publications can be obtained from JAMA by contacting any of the offices listed inside the cover of this booklet. For information on video availability, please contact JAMA’s head office.

36 Related Automotive Associations

Japan Auto Parts Industries Association (JAPIA) Japan Automobile Dealers Association (JADA) 16-15, Takanawa 1-chome 7-17, Minami-Aoyama 5-chome Minato-ku, Tokyo 108-0074 Minato-ku, Tokyo 107-0062 Tel: (03) 3445-4211 Fax: (03) 3447-5372 Tel: (03) 3400-8404 Fax: (03) 3400-8413 Objectives: To establish and promote policies to streamline Objectives: To promote the use of automobiles and im- parts manufacturing, and to research, develop and prove their distribution, thereby contributing to improve production engineering. the development of the national economy.

Japan Auto-Body Industries Association, Inc. Japan Mini-Vehicles Association (JAVA) (JABIA) Shinjuku Sanei Bldg., 22-2, Nishi-Shinjuku 1-chome Kishimoto Bldg., 2-1, Marunouchi 2-chome Shinjuku-ku, Tokyo 160-0023 Chiyoda-ku, Tokyo 100-0005 Tel: (03) 3342-7831 Fax: (03) 3344-6289 Tel: (03) 3213-2031 Fax: (03) 3213-2034 Objectives: To promote strong sales and good Objectives: To research and promote policies to streamline distribution of mini-vehicles and to address auto-body manufacturing and assembly. safety and pollution measures. Japan Automotive Machinery and Tool Manufacturers Association (JAMTA) Japan Automobile Importers Association (JAIA) Kikaishinko Bldg. TBR Bldg., 5-7, Kojimachi 5-8, Shibakoen 3-chome Chiyoda-ku, Tokyo 102-0083 Tel: (03) 3222-5421 Fax: (03) 3222-1730 Minato-ku, Tokyo 105-0011 Objectives: To establish orderly import transactions and Tel: (03) 3431-3773 Fax: (03) 3431-5880 advance the interests of member companies, Objectives: To conduct research on the engineering thereby promoting the growth of automobile import technology of automotive servicing equip- businesses. ment and tools, and to disseminate the resulting information among its members. Japan Automobile Federation (JAF) Japan Electric Vehicle Association (JEVA) Kikaishinko Kaikan, Room 103 22-15, Toranomon 1-chome 5-8, Shibakoen 3-chome Minato-ku, Tokyo 105-0001 Minato-ku, Tokyo 105-0014 Tel: (03) 3503-3651 Fax: (03) 3503-8493 Tel: (03) 3436-2811 Fax: (03) 3436-3008 Objectives: To promote the utilization of electric vehicles, as Objectives: To promote an understanding of traffic issues well as collect information and conduct analysis and traffic safety, protect the interests of on electric vehicles at home and abroad. members, encourage international friendship through automobiles, and develop motor sports programs, thereby contributing to the welfare of Japan Automobile Research Institute, Inc. (JARI) the public. 2530 Karima, Tsukuba City Ibaraki Pref. 305-0822 Japan Automobile Service Promotion Association Tel: (0298) 56-1111 Fax: (0298) 56-1122 (JASPA) Tokyo Office: 1-16, Moto-Akasaka 1-chome Kanda Union Bldg., 25, Kanda-Nishiki-cho 3-chome Minato-ku, Tokyo 107-0051 Chiyoda-ku, Tokyo 101-0054 Tel: (03) 3404-6141 Fax: (03) 3404-6478 Tel: (03) 3293-9123 Fax: (03) 3295-2386 Objectives: To promote the advancement of automobile Objectives: To conduct comprehensive research aimed at service technologies and equipment, in order to the long-range development of automotive help prevent automobile accidents and technologies for vehicle safety and reduced pollution. emissions, noise and vibration. Japan Automobile Standards Inter-nationalization Society of Automotive Engineers of Japan, Inc. Center (JASIC) (JSAE) TBR Bldg., 5-7, Kojimachi 10-2, Goban-cho Chiyoda-ku, Tokyo 102-0083 Chiyoda-ku, Tokyo 102-0076 Tel: (03) 5216-7241 Fax: (03) 5216-7244 Tel: (03) 3262-8211 Fax: (03) 3261-2204 Objectives: To promote the harmonization of standards and Objectives: To research, study and experiment in auto- to help improve standards certification systems motive science and technologies. in developing countries through the collection and dissemination of data on inspections, surveys, and related information.

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