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Industry Leaders Admit Responsibility for Seven Challenges Confronting the Car Sector

Auto industry leaders, represented by the chair and vice-chair of JAMA, have acknowledged seven significant issues and outlined plans to address them. During a recent press event, they detailed their cross-sector projects aimed at overcoming these industry-wide hurdles.

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Industry Leaders Identify Key Challenges Confronting the Automotive Sector, as Outlined by JAMA
Industry Leaders Identify Key Challenges Confronting the Automotive Sector, as Outlined by JAMA

Industry Leaders Admit Responsibility for Seven Challenges Confronting the Car Sector

Japan Automobile Manufacturers Association Tackles Seven Pressing Industry Issues

The Japan Automobile Manufacturers Association (JAMA) has announced a comprehensive plan to address seven pressing issues in the automotive industry, including the 2024 logistics problem. The announcement was made during a press conference held on March 22, 2024, under the leadership of new Chairman Masanori Katayama from Isuzu.

The seven issues JAMA is focusing on over the next two years include:

  1. Reconstruction from the Noto Peninsula Earthquake: JAMA is actively involved in the recovery and rebuilding efforts to restore disrupted supply chains and manufacturing capacity in the region.
  2. Logistics Issues of 2024: Addressing transportation and supply bottlenecks impacting the automotive industry’s production and distribution.
  3. Environmental and Climate Change Policies: Advocating for realistic roadmaps to reduce CO2 emissions. JAMA has requested that the government craft a roadmap embracing biofuels for emissions reduction, reflecting a preference for a mixed approach rather than full electric vehicle mandates.
  4. Maintaining Manufacturing Quality and Standards: Strengthening craftsmanship and inspection processes in manufacturing, exemplified by the ongoing commitment to high quality, such as the master artisan program ensuring meticulous production standards.
  5. Trade and Tariff Negotiations: Navigating international trade challenges, including tariff deals with the United States that impact automotive exports and production strategies.
  6. Overseas Production and Global Supply Chain Management: Managing the vast overseas production footprint, particularly in Asia, to optimize global production, sustain competitiveness, and meet regional demand.
  7. Sustainability and Responsible Corporate Engagement: Responding to investor concerns over climate policy advocacy, with some Japanese automakers facing scrutiny for their positions opposing stringent climate regulations globally.

In addition to these issues, JAMA is also urging improvements to transactions across the industry, including a revision of cost reduction requests to ensure compliance with laws and regulations related to future price shifts. The commission has also named JAMA member companies among businesses found to have left prices unchanged without consulting partners.

To tackle these challenges, JAMA is coordinating with the vice chairmen and looking to collaborate with Keidanren’s Committee on Mobility and various companies, as well as discussing with government officials. The association is also committed to ensuring that all member companies explicitly consult with partners during price negotiations.

Chairman Katayama has expressed condolences for the victims of the Noto Peninsula Earthquake in January and promised continued assistance to disaster-stricken areas. In the most recent negotiations, nearly all JAMA member companies fully met worker demands to raise wages to offset the cost of living.

This multifaceted approach reflects JAMA's strategic intent to sustain Japan’s automotive industry amid economic, environmental, and geopolitical challenges. The new leadership team at JAMA, including Chairman Katayama and six vice chairmen, is determined to lead the industry into a mobility industry in the future.

  • JAMA is working closely with financial institutions to secure investments and funding for the reconstruction of the Noto Peninsula after the earthquake, seeing it as crucial in reinstating disrupted manufacturing in the region.
  • Taking note of the increasing importance of renewable energy sources and efficient energy use in the manufacturing industry, JAMA has proposed advocating for policies that foster advancements in the aerospace industry for improving energy efficiency and reducing carbon emissions.
  • To ensure sustainable growth and profitability for its member companies, JAMA is fostering partnerships with companies in the finance sector, particularly those specializing in mergers and acquisitions, to identify and capitalize on opportunities in global supply chain optimization, especially in the adoption of advanced technologies like Industry 4.0 across the automotive industry.

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