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Japan Automobile Industry 
Global Business Environment 
Japan Automobile Industry 
Presented By:- 
Bhanu Negi 
Institute o...
Japan Automobile Industry 
Content Page 
Chapter Page 
Introduction 3 
Automobile Company in Japan 
About JAMA 4 
Objectiv...
Japan Automobile Industry 
The Japanese Automobile industry is one of the most prominent and largest industries in the wor...
Japan Automobile Industry 
motorcycles. Its organization today is the result of the merger of the Japan Motor Industrial F...
Japan Automobile Industry 
Automobile Company in Japanese 
Toyota Honda 
Daihatsu Nissan 
Suzuki Mazda 
Mitsubishi Subaru ...
Japan Automobile Industry 
In the Japan automotive industry is a wide range of companies and organizations involved in 
th...
Japan Automobile Industry 
of Okhotsk in the North to the East China Sea and Taiwan in the south. The characters that make...
Japan Automobile Industry 
The economy of Japan is the third largest in the world by nominal GDP, the fourth largest by pu...
Japan Automobile Industry 
 Japan's population is over 126 million. Most Japanese reside in densely populated urban areas...
Japan Automobile Industry 
 Not only in Japan even in U.S. 320,000 workers are directly employed in Japanese automobile b...
Japan Automobile Industry 
http://www.ukessays.com 
SWOT Analysis 
A SWOT analysis (SWOT matrix) is a structured planning ...
Japan Automobile Industry 
1. Japanese Car Makers Rally on Weak Yen 
2. Europe Passport 
3. High Maintenance cost with Jap...
Japan Automobile Industry 
3. Raising raw material price:- Rising prices for raw metals will lift the costs for auto manuf...
Japan Automobile Industry 
 Microsoft Excel 
Data collection 
 Primary data 
 Secondary data 
In my project I am using ...
Japan Automobile Industry 
Unit 
141,800 
173,319 
173,918 
72,651 
1,481 
Honda 
Suzuki 
Yamaha 
Kawasaki 
Others 
At the...
Japan Automobile Industry 
2,500,000 
2,000,000 
1,500,000 
1,000,000 
500,000 
0 
2,187,305 
Sale 
5,279 
360,667 
Car Tr...
Japan Automobile Industry 
5- Position of Japanese Automobile at the world level 
S. no Country/Region Total unit 
1 China...
Japan Automobile Industry 
www.toyota.com 
http://www.scribd.com/ 
www.honda.com 
http://www.autonews.com/ 
www.nissan.com...
Japan Automobile Industry 
Institute of Technology & Science Page 19
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Japan Automobile Industry

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WSOT and PEST Analysis

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Japan Automobile Industry

  1. 1. Japan Automobile Industry Global Business Environment Japan Automobile Industry Presented By:- Bhanu Negi Institute of Technology & Science Page 1
  2. 2. Japan Automobile Industry Content Page Chapter Page Introduction 3 Automobile Company in Japan About JAMA 4 Objective 5 Industry Environment 6  PEST 6  SWOT 9 Research Methodology 12 Review of literature 16 Conclusion 16 Introduction Institute of Technology & Science Page 2
  3. 3. Japan Automobile Industry The Japanese Automobile industry is one of the most prominent and largest industries in the world. Japan has been in the top three of the countries with most cars manufacture since the 1960s, surpassing Germany. The automotive industry in Japan rapidly increased from the 1970s to the 1990s (when it was oriented both for domestic use and worldwide export) and in the 1980s and 1990s, overtook the U.S. as the production leader with up to 13 million cars per year manufactured and significant exports. After massive ramp -up by China in the 2000s and fluctuating U.S. output, Japan is now currently the third largest automotive producer in the world with an annual production of 9.9 million automobiles in 2012. Japanese investments helped grow the auto industry in many countries throughout the last few decades. Japanese zaibatsu (business conglomerates) began building their first automobiles in the middle to late 1910s. The companies went about this by either designing their own trucks (the market for passenger vehicles in Japan at the time was small), or partnering with a European brand to produce and sell their cars in Japan under license. Such examples of this are Isuzu partnering with Wolseley Motors (UK), and the Mitsubishi Model A, which was based upon the Fiat Tipo 3. The demand for domestic trucks was greatly increased by the Japanese military build up before World War II, causing many Japanese manufacturers to break out of their shells and design their own vehicles. In the 1970s Japan was the pioneer in robotics manufacturing of vehicles. The country is home to a number of companies that produce cars, construction vehicles, motorcycles, ATVs, and engines. JAPAN AUTOMOBILE MANUFACTURING ASSOCIATION JAMA Established in 1967 Its the Japan Automobile Manufacturers Association. (JAMA) is a non-profit industry association which comprises Japan's fourteen manufacturers of passenger cars, trucks, buses and Institute of Technology & Science Page 3
  4. 4. Japan Automobile Industry motorcycles. Its organization today is the result of the merger of the Japan Motor Industrial Federation (JMIF) and the Japan Automobile Industry Employers’ Association (JAIEA) with JAMA in May, 2002. Automobile manufacturing integrates many supporting industries, and automobile use is the focus of a wide range of related industries. Directly or indirectly, roughly 9% of Japan’s working population is involved in auto industry-related work. Auto production furthermore accounts for 16% of the total value of Japan’s manufacturing shipments and for 37% of the value of the machinery industries’ combined shipments. The automotive industry is thus one of the Japanese economy’s core industrial sectors. The globalization of auto manufacturing also contributes significantly to local and national economies around the world. JAMA works to support the sound development of Japan’s automobile industry and to contribute to social and economic welfare. Chairman of JAMA :- Fumihiko IKE Objective of JAMA To Promote the sound development of the Japanese automobile industry and contribute to social and economic welfare. Total Member company of JAMA  Daihatsu Motor Co., Ltd.  Fuji Heavy Industries Ltd.  Hino Motors, Ltd.  Honda Motor Co., Ltd.  Isuzu Motors Limited  Kawasaki Heavy Industries, Ltd.  Mazda Motor Corporation Other member:-  General Motors Japan, Ltd.  Mitsubishi Motors Corporation  Mitsubishi Fuso Truck & Bus corporation  Nissan Motor Co., Ltd.  Suzuki Motor Corporation  Toyota Motor Corporation  UD Trucks Corporation  Yamaha Motor Co., Ltd. Institute of Technology & Science Page 4
  5. 5. Japan Automobile Industry Automobile Company in Japanese Toyota Honda Daihatsu Nissan Suzuki Mazda Mitsubishi Subaru Isuzu Kawasaki Yamaha Mitsuoka Hino Institute of Technology & Science Page 5
  6. 6. Japan Automobile Industry In the Japan automotive industry is a wide range of companies and organizations involved in the design, development, Manufacture, marketing, and selling of motor vehicles. It is one of the world's most important economic sectors by revenue. The automotive industry does not include industries dedicated to the maintenance of automobiles following delivery to the end-user, such as automobile repair shops and motor fuel filling stations. Consumer Reports states that Japanese manufactured automobiles are among the most dependable and reliable available. Furthermore, certain makes and models of Japanese cars appear in the Consumer Reports lists of most reliable used cars year after year. Therefore, this article will discuss some of the best Japanese used vehicles on the road today Best SUV model At the world level SUV car more from the Japan. First rank is Maintain by the Toyota land cruiser, and third level by the Subaru forester. Objective The purpose of this report is to analysis the Japanese automobile industry, and the success of their own market place. And also an environmental study, including the use of a PEST and SWOT analysis will be undertaken to analyse the situation that is faced by Japanese automobile industry and study Japanese top brand in the world level and domestic level. What are the key factor affecting the automobile industry. JAPAN Japan officially the state of Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea, South Korea and Russia, stretching from the Sea Institute of Technology & Science Page 6
  7. 7. Japan Automobile Industry of Okhotsk in the North to the East China Sea and Taiwan in the south. The characters that make up Japan name mean “Sun –Origin” which is why Japan is referred to as the “Land of the Rising Sun”. Industry Environment PEST analysis of any industry sector investigates the important factors that are affecting the industry and influencing the companies operating in that sector. PEST is an acronym for political, economic, social and technological analysis. Political factors include government policies relating to the industry, tax policies, laws and regulations, trade restrictions and tariffs. The economic factors relate to changes in the wider economy such as economic growth, interest rates, exchange rates and inflation rate, etc. Social factors often look at the cultural aspects and include health consciousness, population growth rate, age distribution, changes in tastes and buying patterns, etc. The technological factors relate to the application of new inventions and ideas such as R&D activity, automation, technology incentives and the rate of technological change. PEST Analysis of Japan Automobile Industry Political Analysis  The politics of Japan is conducted in a framework of a multi-party parliamentary representative democratic Constitutional monarchy where the Emperor acts effectively as the symbolic Head of state, and the Prime Minister acts as the Head of government and the head of Cabinet which directs the executive branch.  Political agenda ( Relation with neighbour country) Economic Analysis Institute of Technology & Science Page 7
  8. 8. Japan Automobile Industry The economy of Japan is the third largest in the world by nominal GDP, the fourth largest by purchasing power parity and is the world's second largest developed economy. According to the International Monetary Fund, the country's per capita GDP (PPP) was at $35,855 or the 22nd highest in 2012.  GDP ($5.964 trillion)  GDP growth rate -1.7% (Q2 2014 )  Inflation 3.2% (May 2014)  Unemployment Rate 4.6%  GDP contribution by sector Agriculture 1.2% Industry 27.5% Service 71.4%  Foreign direct investment by industry  Automobile Industry (16%)  Exports: Japan's main export goods are cars. Most important trade partners are China and the USA, followed by South Korea, Taiwan, Hong Kong, Singapore, Thailand and Germany. In 2013 total 4,674,633 motor vehicle Export by the Japanese automobile to all above country.  Imports: Japan has a surplus in its export/import balance. The most important import goods are raw materials such as oil, foodstuffs and wood. Major supplier is China, followed by the USA, Australia, Saudi Arabia, South Korea, Indonesia and the United Arab Emirates.  Most Japanese auto-related companies are facing union demands for higher pay as a weaker yen boosts profits at manufacturers.  Japanese auto sales in April 2013 dropped 5.5 percent after a sales tax hike it create a low demand in Domestic market. http://www.jama-english.jp/publications/MIJ2014.pdf Social Analysis  Social and demographic analysis Institute of Technology & Science Page 8
  9. 9. Japan Automobile Industry  Japan's population is over 126 million. Most Japanese reside in densely populated urban areas. Japan's capital city is Tokyo.  There is only one official language spoken in Japan, which is Japanese. However, many Japanese are able to understand English.  Human development index Japan ranks 17 (Index Number .89) among the 174 countries. http://hdr.undp.org/en/countries/profiles/JPN  With higher literacy rate and better economy, the younger generation (Generation X) tends to personally own a car, as a requirement or as a social s tatus. Contrary to the older generation where a family owns a single car, now a family might own several cars depending on the numbers of family numbers. Average Age in Japan  Total 45.8year male 44.4 year, female 47.2 year ( 2013) Religions & its share from population 106,000,000 96,000,000 Shinto Buddhism Christianity Islam Theravada Buddhism 120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 0 Impact in Automobile Industry 2,000,000 125,000 1,500 600 Judaism Series1  In Japan there is 8.7% (5.47 Million) of total population directly or indirectly working in the automobile Industry, that means it is generating a huge employment for Japanese people.  Japanese car manufacturers had to build manufacturing plants across the globe total 178 plants just in foreign countries (JAMA). http://www.ukessays.com/essays/marketing/the-automobile-manufacturing-industry-of-japan-marketing-essay.php#ixzz3BhmqrOKf Institute of Technology & Science Page 9
  10. 10. Japan Automobile Industry  Not only in Japan even in U.S. 320,000 workers are directly employed in Japanese automobile brand. 104,000 are associate intermediate as goods supplier for Japanese automobile brand. Rutgers University (Dr. Thomas Prusa http://econweb.rutgers.edu/prusa Japan R&D and Technological Factors  R&D expenditure in Japan High tax subsidy rate to businesses for R&D (rank: 10) Japanese market is always know for innovation, they are the ones who come up with technology which is eco-friendly and efficient They also have huge number of patents in automobile industry to support their innovation capabilities. Facing increasing competition from China and South Korea, manufacturing in Japan today now focuses primarily on high-tech and precision goods, such as optical equipment, hybrid cars, and robotics.  Impact of technology in industry ( Growing In the Manufacturing sector and Service Sector)  Demands for hybrid vehicles are growing in the automobile market. Due to the rising energy cost and increased emissions regulations, demand for light hybrid electric vehicles is expected to increase hugely. With regard to environmental and energy issues, Nissan has placed hybrid technology as one of its core technologies.  Technology in Japanese Vehicle Electric Power Steering  With this technology, steering is assisted by an electric motor rather than by hydraulic pressure. This boosts fuel efficiency since the steering assistance does not place any load on the engine. Hydrogen Vehicles  Hydrogen vehicles are powered by hydrogen that is subjected to combustion. (Fuel cell vehicles are also powered by hydrogen which, without combustion, is converted into  Electricity by the fuel cells— The hydrogen combustion process generates only water and some nitrogen oxides (NOX); no CO2, carbon monoxide, hydrocarbons or Sulfur compounds are released.  They are bringing to market a traffic-jam pilot, a technology enabling cars to drive autonomously - and safely - on congested highways. They are also working on fully-automated parking systems available across a wide range of vehicles. Institute of Technology & Science Page 10
  11. 11. Japan Automobile Industry http://www.ukessays.com SWOT Analysis A SWOT analysis (SWOT matrix) is a structured planning method used to evaluate the Strength, Weakness, opportunities and Threats involved in a project or in a business venture. A SWOT analysis can be carried out for a product, place, industry or person. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favourable and unfavourable to achieve that objective. Strength:- Characteristics of the business or project that give it an advantage over others. Weakness:- Characteristics that place the business or project at a disadvantage relative to others. Opportunities:-Elements that the project could exploit to its advantage. Threat:- Elements in the environment that could cause trouble for the business or project. Strength 1. Global demand for environment friendly vehicles:- Vehicles have been a major factor in intensifying greenhouse effect by emitting large quantities of CO2 and heavily polluting air. Consumers are more aware of this negative impact and are more likely to buy environmentally friendly vehicles that emit much less CO2 and are fuel-efficient & Safety. 2. R&D facility 3. Innovative Culture:- In term of new car , SUV and new Engine ( Internal combustion engines ) To improve product quality and efficiency in production, automakers invest a large amount of time and money into developing and improving the manufacturing process, and rely heavily on research and technological innovation. Weakness Institute of Technology & Science Page 11
  12. 12. Japan Automobile Industry 1. Japanese Car Makers Rally on Weak Yen 2. Europe Passport 3. High Maintenance cost with Japanese vehicle. 4. High Energy Price. Opportunity 1. Increasing fuel price:- Japan Automobile industry fuel-efficient cars with hybrid, hydrogen or electrical engines. Increasing fossil fuel prices encourages the consumers to buy such cars and Japan Automobile industry is already in position to offer many car models with various environment friendly engines. 2. Global Demand for the Environment friendly Vehicle: Increasingly stringent environmental regulation in Market is spurring automakers to develop a new generation of green car. 3. Most of the Japanese company are in the way to production and some have producer the Hybrids, zero carbon emission vehicle into the mainstream. 4. Demand of Tricity :- It a three wheeler Bike which is more creating more demand in Japanese market. Is for those people who are not comfortable with two Wheeler. 5. Demand of Electric Car:- Japanese electric car have more demand in domestic level as well as world level 6. Toyota leaf( Electric car)- Top selling car in 125,000 unit at world level (July 2014) Threats 1. Natural disaster:- The business has manufacturing facilities in Japan. And are often subject to natural disasters that disrupt manufacturing processes and results in lower production volumes and losses. 2. Appreciating yen exchange rate:- In the Japan Automobile industry more revenue comes from foreign countries. Appreciating yen exchange rate against other currencies means lower profits for the company. Institute of Technology & Science Page 12
  13. 13. Japan Automobile Industry 3. Raising raw material price:- Rising prices for raw metals will lift the costs for auto manufacturers and result in squeezed profits 4. Hyundai-Kia, gaining market share all around the world in the small-vehicle market. http://jama.org/japan-auto-industry-data/current-statistics/ http://www.newsonjapan.com/autos/ .Research Methodology Research methodology is the arrangement of condition for collection and analysis of data in a manner that aims to combine the relevance to the industry and company. Research is conceptual structure within which research is conducted. It is way to systematically study and solve the problems. Software Used  Microsoft word Institute of Technology & Science Page 13
  14. 14. Japan Automobile Industry  Microsoft Excel Data collection  Primary data  Secondary data In my project I am using the secondary data for research on Japan automobile industry.  Various publications in form of annual reports, various papers  News  Company website  JAMA website 1- At domestic level Japanese Motorcycle Production in 2013 Institute of Technology & Science Page 14
  15. 15. Japan Automobile Industry Unit 141,800 173,319 173,918 72,651 1,481 Honda Suzuki Yamaha Kawasaki Others At the pie chart showing that largest motorcycle producer at the domestic level is Yamaha company and second position Suzuki motor third Honda. 2- Total Sale of Japan vehicle 2013. 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2,187,305 Sale 5,279 360,667 Car Truck Buses http://jama.org/japan-auto-industry-data/current-statistics/ Sale Total sale of vehicle at Japanese market are Car due to the new innovation and R&D in this sector. 3- Total Sale in 2014 (January - May) Institute of Technology & Science Page 15
  16. 16. Japan Automobile Industry 2,500,000 2,000,000 1,500,000 1,000,000 500,000 0 2,187,305 Sale 5,279 360,667 Car Truck Buses http://jama.org/japan-auto-industry-data/current-statistics/ Sale In the 2014 within five month the sale of the Japanese Car are creating more demand 4- Position of Japanese car manufacturing company at world Level. 10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 http://en.wikipedia.org/wiki/Automotive_industry_in_Japan Series1 Top ten Car Manufacturer At the world level, four are from the Japan which are Toyota, Honda, Nissan, Suzuki. Institute of Technology & Science Page 16
  17. 17. Japan Automobile Industry 5- Position of Japanese Automobile at the world level S. no Country/Region Total unit 1 China 22,116,825 2 United States 11,045,902 3 Japan 9,630,070 4 Germany 5,718,222 5 South Korea 4,521,429 6 India 3,880,938 7 Brazil 3,740,418 8 Mexico 3,052,395 9 Thailand 2,532,577 10 Canada 2,379,806 In Automobile industry in term of total unit production Japan Automobile industry is at the third position. http://www.ukessays.com http://en.wikipedia.org/wiki/Automotive_industry_in_Japan Factor which Are Affecting the Automobile Sector 1. Auto industry observers cite car loans as the biggest driving factor for the expansion of the Compact Car segment. At present, almost 85 per cent of all new car sales are backed by auto finance. Interest rates on car loans have come down. 2. Price can be other factor which is affecting the expansion of automobile sector and completion among the competitor. 3. The income of the consumer or buyer of the car is a very important if any consumer has the 100cc bike/car due to the income or test consumer moves toward the more than 100cc. 4. Car sales increase when a new model hits the market. Due to escalation in competition in car market, frequency of new model launches has increased. Review of Literature www.yahoo.co.uk www.autoindustry.co.uk Institute of Technology & Science Page 17
  18. 18. Japan Automobile Industry www.toyota.com http://www.scribd.com/ www.honda.com http://www.autonews.com/ www.nissan.com www.mitsubishi.com http://www.ukessays.com http://jama.org/japan-auto-industry-data/current-statistics/ http://www.newsonjapan.com/autos/ http://en.wikipedia.org/wiki/Automotive_industry_in_Japan Conclusion Automobile industry is growing not only in Japan even all over the world. Japanese Automobile brand are popular in the domestic level and in other country. Toyota, Honda, Suzuki are the major car producer in Japan. Automobile company of Japan have bright future in upcoming year because they have the better solution, if we talk about the environment friendly vehicle they have LEAF, Which is more selling car all over the world. Institute of Technology & Science Page 18
  19. 19. Japan Automobile Industry Institute of Technology & Science Page 19

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