Japan-led strategy

So far, Japanese automakers have pursued independent strategies in the ASEAN region. However, with the intensifying competition in the electric vehicle market, it seems that the Japanese government has made up its mind to intervene in the market and achieve cooperation among different parties.

Multiple fields, long duration

According to a report by the Nikkei Shimbun, both parties plan to hold an economic ministerial meeting as early as September this year and develop a temporary joint strategy that will last until around 2035. This strategy is expected to cover multiple areas such as personnel training, decarbonization, mineral resource procurement, and biofuels.

Japan is reportedly planning to use 140 billion yen (approximately 900 million US dollars) from the budget of the Ministry of Economy, Trade and Industry to assist in training a new generation of automotive workers in ASEAN markets.

Training budget

Japan is reportedly planning to use 140 billion yen (approximately 900 million US dollars) from the budget of the Ministry of Economy, Trade and Industry to assist in training a new generation of automotive workers in ASEAN markets.

Renewable energy

Japan will also promote its carbon dioxide emission measurement technology to facilitate the transition of the automotive industry towards renewable energy. Japan and ASEAN will also consider joint procurement of rare materials for electric vehicle batteries and cooperate on battery recycling.

Both sides are currently considering the development and use of biofuels made from waste cooking oil to promote the high environmental standards of cars within the Japan-ASEAN alliance.

Current Situation in Southeast Asia

Automobile production base

The Association of Southeast Asian Nations (ASEAN) is an important layout for the global industry and also a location for factories of many Japanese car manufacturers. Every year, Japanese car manufacturers assemble over 3 million vehicles in ASEAN, accounting for approximately 80% of the total production in ASEAN. The majority of these cars are exported to the Middle East and other regions.

Opportunity

According to a senior executive of a certain automobile manufacturer, the overall demand for cars in Southeast Asia is declining due to factors such as rising interest rates. However, it is regrettable that many car manufacturers have failed to take advantage of the generous local car subsidies.

Toyota’s Determination

The ever-changing market has intensified the sense of urgency among several Japanese car manufacturers. Honda has pledged to double its investment in electrification and software by 2030, reaching approximately $65 billion. Meanwhile, Toyota has announced an increase in its annual sales target for hybrid cars to one million units and plans to raise production capacity to two million units per year.