A Vast Range of Related Industries

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2 Automotive Industry AutomobileRelated Industries and Employment A Vast Range of Related Industries Automobiles are the focus of an extremely wide range of industrial and related activity, from materials supply and vehicle production to sales, servicing, freight shipping and other autocentered operations. Autorelated employment in Japan at present totals 5.45 million people. EMPLOYMENT IN THE AUTOMOBILE MANUFACTURING AND RELATED INDUSTRIES Number of employees Automobile Production , employment in auto manufacturing & related industries: 5.45 million (8.7%) Automobile manufacturing (including motorcycles)... 6, Auto parts and accessories manufacturing... 62, Auto body and trailer manufacturing... 4, Road Transport... 2,8, Road freight transport...,793, Road passenger transport , Road transportrelated services... 35, Vehicle rental services... 44, Automotive Fuel/Insurance/Recycling... 4, employment (workforce) in Japan: million (%) Automotive fuel retailing , Auto damage insurance... 4, Automobile recycling... 3, Materials & Equipment Supply... 36, Electrical machinery & equipment... 55, Nonferrous metals... 6, Iron & steel... 85, Metal products... 37, Chemicals (including paints), textiles, and petroleum... 2, Plastics, rubber, and glass... 82, Electronic parts & equipment... 33, Manufacturing machinery... 32, Sales & Services...,85, Automobile retailing (including motorcycles, used vehicles, and auto parts and accessories) , Automobile wholesaling (including motorcycles, used vehicles, and finished/used parts and accessories)... 76, Automobile servicing , Note: Figures are rounded off to the nearest thousand. Sources: Economic Census, Labor Force Survey, InputOutput Tables for Japan, Census of Manufactures, Ministry of Internal Affairs and Communications Statistics Bureau; Ministry of Economy, Trade and Industry

3 Automotive Industry Investment in Materials and Equipment Automobile Manufacturing Is an Integrated Industry An automobile typically is composed of 2, to 3, parts, all of which even the largest manufacturers cannot produce themselves. Automakers therefore either outsource production or purchase finished products (such as tires, batteries, air conditioners and audio systems), including products manufactured abroad. The volume of imported components increases yearly. Automobile manufacturing is thus an integrated industry because it relies on many supporting industries to produce the great diversity of materials and components it uses. Trends in the automobile industry, which makes huge investments in equipment and researchanddevelopment activities, are considered a barometer of the economy. PRINCIPAL MATERIALS AND COMPONENTS USED IN AUTOMOBILE MANUFACTURING Cast iron Common steel Special steel Copper Lead, tin, zinc Aluminum Noble metals Other nonferrous metals Synthetic resin Glass Rubber Ceramics Textiles Leather Paper Wood Paints Chemicals Animal and vegetable oils Fats and oils Engine parts, e.g. cylinder blocks Chassis, frames, wheel parts Gears, axle shafts, crankshafts, fuel injection equipment Electricals, radiators, cables Engine metals, solder, body varnish, batteries Engine parts (e.g. pistons, cylinder heads), wheels, chassis Emissions aftertreatment parts Magnets, plating Steering wheels, bumpers, radiator grilles, body components Window glass, mirrors, headlamps Tires, sealing parts, vibration control parts Plugs, electronic parts, sensors, emissions aftertreatment parts Seats, linings, seatbelts Seats, packing Filters Loadcarrying platforms, interior equipment Ornamental and rustproof paints Antifreeze, engine oil, transmission oil, brake oil For casting For lubrication, heat treatment, etc. Springs, dampers Turbochargers Bearings Machined parts, e.g. pumps Tires and tubes Batteries Window glass Onboard tools, e.g. jacks Supplies, e.g. extinguishers, tire chains Electronic parts Lights, cables, optical fibers Air conditioners, air cleaners Sensors, ECUs, actuators Starters, alternators, generators, inverters, meters Audio systems, phones, navigation systems Safety equipment, e.g. antilock brakes, airbags, traction control Coke Petroleum, electricity, natural gas For casting Fuel, heat treatment, paint drying, power generation INVESTMENTS IN EQUIPMENT OF MAJOR MANUFACTURING SECTORS (PROJECTED, FY 2) NonFerrous Metals 2,64 (6.6%) Pulp & Paper,235 (3.%) General Machinery 3,895 (9.8%) Other 5,223 (3.2%) Chemicals 5,672 (4.3%) Petroleum 789 (2.%) Automotive 5,5 (2.8%) All Manufacturing Sectors 39,587 (%) Electrical Machinery & Equipment 3,37 (7.7%) Electronic Equipment 6,474 (6.4%) Iron & Steel 5,597 (4.%) x million yen INVESTMENTS IN R&D OF MAJOR MANUFACTURING SECTORS (FY 2) Foods 2,375 (2.3%) Iron & Steel,5 (.4%) Other,556 (.%) Electrical Machinery & Equipment 9,922 (9.5%) All General Machinery & Equipment 6,397 (5.7%) Manufacturing Sectors 4,657 (%) Chemicals 7,439 (7.%) IT & Telecommunications Equipment 7,293 (6.5%) Pharmaceuticals 2,76 (2.2%) x million yen Electronic Circuits, Parts & Equipment 5,9 (4.9%) Automotive 2,63 (9.7%) Transport Equipment 2,23 (2.3%) Source: Survey on Corporate Finance, Ministry of Economy, Trade and Industry Source: Survey on Research Activities in Science and Technology, Ministry of Internal Affairs and Communications 2

4 Automotive Industry Automotive Shipments in Value Terms Automobile Manufacturing Is a Core Industry The automotive industry is one of the Japanese economy s core industrial sectors. In 2 automotive shipments accounted for 6.4% of the total value of Japan s manufacturing shipments, and 36.6% of the value of the machinery industries combined shipments. Automotive shipments (both domestic and export shipments, including motorcycles, auto parts, etc.) in value terms totalled 47.3 trillion yen in 2, up 6.8% from the previous year. SHIPMENTS OF MAJOR MANUFACTURING SECTORS IN VALUE TERMS (2) x million yen COMPARISON OF VALUE OF AUTOMOTIVE SHIPMENTS TO TOTAL VALUE OF ALL MANUFACTURING SHIPMENTS Other 944,29 (32.7%) Metal Products 22,92 (4.2%) Iron & Steel 8,463 (6.3%) NonFerrous Metals 89,4 (3.%) 2,89,77 (%) General Machinery 36,86 (.6%) Chemicals 262,2 (9.%) Electrical Machinery & Equipment 442,848 (5.3%) Automotive 472,962 (6.4%) Transport Equipment 542,36 (8.7%) Breakdown of automotive shipments: Automobiles (including motorcycles)... 85,6 Auto bodies and trailers... 3,77 Automotive parts and accessories , value of all manufacturing shipments value of automotive shipments x trillion yen SHIPMENTS OF MAJOR MANUFACTURING SECTORS IN VALUE TERMS Chemicals 55,42 4,38 79,787 25, ,3 233, , , , ,27 24,493 25,27 26, ,939 28, , ,2 Iron & Steel 65,648 3,63 78,956 77,543 82,687 4,727 9,63 2,8 9,627 9,3 4,43 68,964 84,727 2,97 243,322 59,884 8,463 NonFerrous Metals 3,547 39,87 8,86 63,836 78,27 64,964 62,89 58,492 56,685 56,32 6,93 67,6 9,62 7,75 4,85 69,4 89,4 Metal Products 37,277 65,73 6,465 3,944 85,736 76,465 55,868 45,45 37,365 32,43 34,543 4,59 44,5 5,889 5,492 24,267 22,92 General Machinery 68,28 6,2 75,998 24,94 332, ,844 34,32 282, ,773 26,683 29,742 32,8 333,33 362,734 42, ,32 36,86 Electrical Machinery & Equipment 73,35 8,23 222,346 48, , ,39 595,87 524,657 46,4 48,37 498, ,83 5, ,265 58,797 4, ,848 Machinery Industries Transport Equipment 72,758 47, ,536 36, , ,45 444,474 45, , ,869 56, , , , 637,666 47, ,36 Automotive Subtotal Other x million yen Automotive Shipments As % of Value of Machinery Shipments As % of Value of Manufacturing Shipments Notes:. Shipments from all manufacturing operations with four or more employees are included in this data. 2. Compilation of data on production in value terms was discontinued in 996 and replaced by data on shipments in value terms. 3. Figures in value terms include domestic consumption tax revenue from shipments. 4. Electrical Machinery & Equipment includes ITrelated electronic parts and equipment as of 22. Source for all statistical data on this page: Census of Manufactures, Ministry of Economy, Trade and Industry 54,673 5,24 22, , ,6 395,63 4,429 44,25 43,63 45,5 458,22 489,548 54,9 57, ,53 44,95 472, ,8 379,55 682,457,55,932,397,439,33,364,385,62,299,43,23,66,275,564,335,93,385,37,484,34,597,84,558,94,6,779,29,7 287, ,87 952,724,63,24,25,939,55,277,5,72,6,56 967,3 956,63 968, ,77,23,649,58,7,5,93 894,53 944,29 69,348,274,329 2,46,998 2,653,26 3,233,726 3,6,356 3,35,824 2,867,544 2,693,68 2,737,344 2,844,83 2,962,47 3,48,346 3,367,566 3,355,788 2,652,59 2,89,

5 Automotive Industry Automotive Trade Motor Vehicle Exports Show a Decrease Japan s gross exports in 2 decreased by 2.7% from the previous year, while gross imports rose by 2.%. In value terms, automotive exports dropped 8.4% from 2 to.5 trillion yen, with motorcycle exports rising but motor vehicle and parts exports falling. On the other hand, automotive imports increased, by.4% yearonyear to.2 trillion yen, with motor vehicle imports showing growth but auto parts imports showing a slight decline. EXPORTS BY PRINCIPAL COMMODITY (FOB) IN 2 Scientific & Optical Equipment 2 (3.2%) Ships 25 (3.%) Electrical Machinery & Equipment,6 (7.7%) Other 853 (3.%) 6,555 (%) General Machinery,38 (2.%) Transport Equipment,43 (2.4%) Motor Vehicles (including motorcycles and parts),54 (7.6%) Textile Yarn & Textiles 63 (.%) Chemicals 68 (.4%) Iron & Steel Products 37 (5.7%) x billion yen NonFerrous Metals & Metal Products 229 (3.5%) IMPORTS BY PRINCIPAL COMMODITY (CIF) IN 2 Transport Equipment 74 (2.6%) Motor Vehicles (excluding motorcycles and parts) 2 (.8%) Electrical Machinery & Equipment 799 (.7%) General Machinery 497 (7.3%) NonFerrous Metals & Metal Products 263 (3.9%) Other,74 (7.2%) Chemicals 6 (9.%) 6,8 (%) Foodstuffs 585 (8.6%) Petroleum & Petroleum Products,364 (2.%) Mineral Fuels 2,82 (32.%) x billion yen Raw Materials 527 (7.7%) AUTOMOTIVE EXPORTS IN VALUE TERMS (FOB) Motor Vehicles 5,675 8,363 24,773 35,32 6,795 85,267 75,26 93,679 25,956 5,47 Chg. (%) Passenger Cars, Trucks, Buses 87,746 88,95 92,42 99,288 22,995 43,7 37,36 66,933 9,74 82,42 Auto Parts Note: Chg. (%) means change from the previous year (with the previous year s result indexed at ). AUTOMOTIVE IMPORTS IN VALUE TERMS (CIF) 2,72 22,998 25,67 28,6 3,227 33,555 3,655 23,89 3,833 29,972 Motorcycles & Motorcycle Parts 6,757 6,45 7,4 7,839 8,573 8,543 7, 3,657 3,382 3,43 Exports 52,9 545,484 6,7 656, , ,34 8,8 54,76 673, ,465 x million yen Chg. (%) x million yen Motor Vehicles,234,799 2,842 3,353 4,42 5,586 4,6 8,245,836 2,69 Chg. (%) Passenger Cars, Trucks, Buses 8,38 8,279 9,55 9,49 9,63 9,294 7,499 4,549 5,957 7,352 Auto Parts Notes:. Motor vehicles include passenger cars, trucks, buses, and chassis. 2. FOB = free on board; CIF = cost, insurance, and freight. 3. Chg. (%) means change from the previous year (with the previous year s result indexed at ). 3,96 3,52 3,787 4,24 5,249 6,29 6,662 3,696 4,879 4,77 Imports 422, ,62 492,66 569, ,443 73, ,548 54,994 67,65 68,2 Chg. (%) Source for all statistical data on this page: The Summary Report on Trade of Japan, Ministry of Finance 4

6 Motor Vehicles Production Motor Vehicle Production Declines for First Time in 2 s In 2 motor vehicle production in Japan decreased for the first time in two years, totalling 8.4 million units, down 2.8% from the previous year. Passenger car production fell 3.9% to a total of 7.6 million units. Within that category, standard car production dropped 3.7% to 4.8 million units, small car production slipped 3.8% to.86 million units, and minicar production dipped 4.4% to.2 million units. Truck and bus production also showed a decline from 2, shrinking 6.% to.4 million units and 4.8% to 4, units, respectively. MOTOR VEHICLE PRODUCTION BY TYPE IN 2 Standard 52,335 (6.%) Small 234,586 (2.8%) Mini 389,5 (4.6%) Buses 4,9 (.3%) TRENDS IN MOTOR VEHICLE PRODUCTION x million units 4 2 Mini,6,885 (3.3%) Trucks,36,7 (3.5%) 8,398,75 (%) Standard 4,8,36 (49.8%) Passenger Cars 8 6 Small,86,279 (22.%) Passenger Cars 7,58,525 (85.2%) Trucks & Buses MOTOR VEHICLE PRODUCTION Standard 5,69 29,32 43, ,792,75,783 2,553,73 3,376,447 3,67,23 3,753,446 4,44,563 4,9,36 4,95,428 5,864,354 5,786,333 3,459,589 4,846,4 4,8,36 Small 2,377,639 4,98,55 6,438,847 6,99,432 7,36,224 4,4,629 3,699,893 3,637,5 3,434,662 3,39,47 3,46,622 3,32,265 2,638,842 2,74,43 2,45,279 2,59,9,86,279 Passenger Cars Mini 749,45 6,272 95,923 6, ,965 96,2,283,94,39,83,29,22,366,675,48,753,537,2,44,44,427,397,257,293,34,832,6,885 3,78,78 4,567,854 7,38,8 7,646,86 9,947,972 7,6,533 8,359,434 8,68,354 8,478,328 8,72,385 9,6,735 9,754,93 9,944,637 9,928,43 6,862,6 8,3,362 7,58,525 Chg. (%) Gasoline 52,47 84,34 457,28 842, , ,54 53,28 57,225 57,42 27,529 6,53 96,83 25,262 2,443 83,442 75,6 58,95 Standard Diesel 26,53 23, ,99 435,42 64,27 59, ,9 522,739 65,37 642,424 67,33 63, ,639 63,48 288, , ,384 Subtotal 258, 288,7 885,98,278,22,249, ,4 649,8 679, , , , ,4 78,9 734,923 37,686 52,672 52,335 Gasoline,56,729,44,759,663,834,28,423 57,972 34,495 24,253 98,2 25,9 26,92 233,694 23,687 77,425 63,237 27,4 33,43 35,335 Trucks Small Diesel 97,32 68,76 449, ,47 744,97 64, ,29 82,3 99,443 84,634 23,69 25,77 88,7 66,52 88,35 5,733 99,25 Notes:. Passenger cars are classified under Japan s Road Vehicles Act in three categories, based primarily on engine capacity: standard (over 2,cc), small (66cc2,cc), and been treated as components since Chg. (%) means change from the previous year (with the previous year s result indexed at ). 5

7 TRENDS IN MOTOR VEHICLE PRODUCTION IN VALUE TERMS x trillion yen 25 Passenger Cars Trucks & Buses MOTOR VEHICLE PRODUCTION IN VALUE TERMS Passenger Cars Trucks Standard Small Mini Standard Small Mini Tractors Large Small 895,4 3,77,356 5,47,637 6,64,75 8,573,769 8,454,25 8,836,999 9,352,545,89,826 3,22,924 3,6,9 7,26,654,239,33 8,45,638 7,49,323 8,676,75 4,869,427 4,298,37 4,468,9 4,243,75 4,67,398 4,78,64 4,88,449 3,67,9 3,27,9 2,548,37 2,69,86 2,343,337 85,925 8,3, ,88 2,966,259 79,33,87,367,237,65 2,76,5,66,97 4,28,57,54,329 3,752,249,46,5 4,5,52,69,87 4,7,57,333,394 6,33,669,39,576 7,6,4,293,624 7,56,852,55,68,965,76,27,423 4,56,587,45,46,84,435,793,,953,924,69,428,,558,29,75,539,22,85,35,96,692 2,29,3 2,46,53 2,,682,27,974,684,489,7,83,59,934,8,28 849,5 543,48 44,59 54,48 56, , ,272 52, ,435 32, ,8 35, ,498 59,44 5, , , , ,66 357,65 352,5 39,4 32,374 28, ,8 285,454 46,745 64,93 24,764 45,453 36,334 67,945 89,959 4,567 22,267 2,346 36,277 34,778 75,944 89,976 4,39,77 3,79,9 3,4,282 2,58,84 2,2,46 2,485,882 2,79,32 2,967,98 3,77,69 3,99,46 3,22,768,757,37 2,442,34 2,437,56 3,53 34,5 7,647 8,897 97,5 6,56 5,985 27,65 3,726 29,29 36,5 9,723 8,3 97,57 Buses,7 66,988 89,44 9,7 3,83 3,268 29,577 63,69 23,23 264,477 33,594 66,5 2,359 99,3 x million yen Grand 24,6 2,273,526 2,3 6,957,27 97,88 4,8,737 89,94 4,424,38 228,863 6,449, ,828 6,484, ,562 7,76,376 29,674 7,958, ,957 9,726, ,686 2,93, ,79 2,979, ,838 2,998,68 329,659 6,828,56 296,458 4,574,49 Source: Ministry of Economy, Trade and Industry Subtotal,253,86,6,475 2,3,3,877,893,262,943 99,32 483,282 38,33 449, , ,763 49,44 365, ,758 25,39 238, ,586 Mini 55, ,987 94,679,388, ,7 84, ,356 52, ,427 54,22 546,85 52, , ,78 398, , ,5 2,63,883 2,337,632 3,93,88 4,544,688 3,498,639 2,537,737,726,88,572,64,746,66,73,69,76,6,64,693,538,2,58, ,,29,224,36,7 Large Buses Small Chg. (%) ( 3 passengers) ( 29 passengers) Chg. (%) ,265 3,624 6,47 5,547 5,787 2,84 8,35,4,46 2,286,763,63,56,66 8,783,274 9,427 3,3 22,48 75,8 64,44 24,398 34,452 46,59 55,8 49,668 48,56 64,55 77,574 2,54 27,442 78,2 99,6 94,682 46,566 36,5 9,588 79,59 4,85 47,266 54,544 66,32 6,74 6,442 76,33 88,637 3,67 39,2 86,795 9,334 4, ,289,57 6,94,59,42,884 2,27,95 3,486,796,95,536,4,796,257,35,286,8,5,58,799,659,484,233,596,327,575,644 7,934,57 9,628,92 8,398,75 mini (66cc and under); see page 66 for details. 2. KD sets have been excluded since 979; they represent less than 6% of the cost of compositional components per vehicle and have Source: Japan Automobile Manufacturers Association Chg. (%)

8 Motor Vehicles New Registrations Motor Vehicle Sales Decline from Previous Passenger car and commercial vehicle demand in Japan in 2 totalled 4.2 million units, a decrease of 5.% from the previous year. passenger car sales dropped 6.3% to 3.53 million units, with the standard car segment shrinking 9.7% to.4 million units, small cars declining 7.3% to.25 million units, and minicars falling.4% to.4 million units. Sales of trucks and buses decreased 7.7% and 6.6% from 2, to 675, and, units respectively. NEW MOTOR VEHICLE REGISTRATIONS BY TYPE IN 2 Standard 7,29 (2.5%) Small Mini 85,97 382,393 (4.4%) (9.%) Standard Mini,38,752 (27.%) Trucks 674,78 (6.%) Buses,65 (.3%) 4,2,29 (%) Passenger Cars 3,524,788 (83.7%),39,9 (27.%) Small,246,26 (29.6%) TRENDS IN NEW MOTOR VEHICLE REGISTRATIONS x million units Passenger Cars Trucks & Buses NEW MOTOR VEHICLE REGISTRATIONS Passenger Cars Trucks Standard Small Mini Subtotal Chg. (%) Standard Small Mini Subtotal Chg. (%) 9,68 49,25 7,93 73, ,49 889,26 77,22 674,94,229,97,358,28,27,349,225,867,299,68,25,987,6,75,49,99,39,9,652,899 2,53,396 2,68,25 2,869,527 3,839,22 2,654,29 2,28,387 2,46,3 2,94,94 2,37,767 2,89,992,98,267,654,25,549,677,48,37,57,693,246,26 77,7 57,2 74,3 6,7 795,948 9,355,28,265,37,57,29,89,372,83,387,68,57,598,447,6,426,979,283,429,284,665,38,752 2,379,37 2,737,64 2,854,76 3,4,83 5,2,659 4,443,96 4,259,872 4,44,354 4,75,92 4,768,3 4,748,49 4,64,732 4,4,299 4,227,643 3,923,74 4,22,267 3,524, ,86 2,8 54,472 8,9 93,775 77,264 84,626 76,35 28,752 86,588 97,548 29,283 7,998 46,69 87,692,697 7,29 986, ,55,44,67 945,484,449,678,4,296,5,33 739,52 373,259 36,449 35,78 354,87 293,2 249,655 8,59 87,642 85,97 538,743 43,8 839,38,367,685,6,456 85, ,66 58,843 59,44 59,67 536,648 56,2 472,73 442,94 44,742 44, ,393,693,52,55,454 2,37,947 2,43,78 2,649,99 2,43,825,686,599,334,38,9,55,67,4,85,94,8,74 937, , ,943 73,94 674,78 Notes:. Chassisbased through 22, data compilation became vehicle registration numberbased as of Truck figures include specialpurpose vehicles (except large ones). 3. Data includes

9 NEW MINIVEHICLE SALES BY TYPE Passenger Cars (Minicars),37,296,29,889,372,83,387,68,57,598,447,6,426,979,283,429,284,665,38,752 Commercial Vehicles ( Bonnet minivans),789 89,532 77,297 77,547 68,74 57,59 5,622 42,932 4,63 33,23 Commercial Vehicles (Caboverengine minivans) 63,42 72,644 83,995 97,4 24,838 96,4 85,86 67,358 8,55 68,75 Commercial Vehicles (Minitrucks) 258,23 25,69 257,775 26,96 242,469 29,64 25,486 94,452 29,62 8,665 Notes:. Figures here through 23 include other types of minivehicles not counted in the data in the bottom chart. 2. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Source: Japan Mini Vehicles Association,83,7,84,755,89,5,923,76 2,23,69,99,89,869,893,688,7,726,42,52,45 Chg. (%) RECREATIONAL VEHICLE (RV) SALES Station Wagons Vans OffRoad 4WD Vehicles Minivans Chg. (%) ,29 77, ,5 62,667 59,936 46,95 454,64 339, , ,4,87 6,927 7,347 9,363 9,46 8,752 9,396 7,433 8,762 8,482 98,29 83,435 7,447 79,776 2,35 226,59 23,29 57,284 95,783 7,34 Note: Chg. (%) means change from the previous year (with the previous year s result indexed at ).,23,797,2,27,23,788,69,6,26,26 98,8 938,694 89, , ,33 2,82,494 2,63,6 2,78,83,97,82,856,693,676,42,65,463,394,89,56,583,34, Source: Japan Automobile Dealers Association Buses Large Small Subtotal Chg. (%),256 8,88 9,44 8,798 9,62 6,475 4,333 4,729 5,862 5,98 5,856 6,64 5,53 5,357 4,234 4,777 3,36 7,572,8 3,973 2,775 5,763,828 2,238,63 5,34 3,49,898,536,464 9,976 8,338 7,998 7,55 27,828 9,836 23,387 2,573 24,925 7,33 6,57 6,359 2,23 8,47 7,754 7,6 5,67 5,333 2,572 2,775, ,,467 4,38,93 5,5,5 5,556,834 7,777,493 6,865,34 5,963,42 5,792,93 5,828,78 5,853,382 5,852,67 5,739,56 5,353,648 5,82,235 4,69,256 4,956,36 4,2,29 Chg. (%) imported cars. 4. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Vehicle Registrations 2,844,554 3,72,63 4,2,72 4,28,32 5,975,89 5,49,44 4,95,7 3,966,93 4,27,35 3,962,232 3,928,35 3,75,887 3,433,829 3,22,342 2,92,85 3,229,76 2,689,74 Chg. (%) Mini Vehicles Chg. (%),255, ,3 82.,3, ,528,72 4.8,82,44 6.3,75,62 6.2,867, ,826, 98.8,8, ,89,5 5.,923,76.7 2,23,69 5.2,99, ,869, ,688,7 9.3,726,42 2.3,52, Sources: Japan Automobile Dealers Association; Japan Mini Vehicles Association 8

10 Motor Vehicles Imported Vehicle Sales Sales of Imported Vehicles Rise for Second Consecutive Imported vehicle sales in Japan in 2 totalled 276, units, up 22.5% from the previous year. Passenger car sales increased 22.2% to 26, units, and commercial vehicles (trucks and buses) surged 26.6% to 5, units. Sales of used imported vehicles increased.3% to 484, units, with passenger cars rising.3% to 462, units, and trucks growing 7.4% to 4, units. TRENDS IN IMPORTED MOTOR VEHICLE SALES Vehicles produced by nonjapanese manufacturers Passenger Cars Commercial Vehicles Vehicles produced by Japanese manufacturers abroad Passenger Cars Commercial Vehicles Vehicles produced by nonjapanese manufacturers Vehicles produced by Japanese manufacturers abroad Passenger Cars Commercial Vehicles Grand s Chg. (%) 4, 3, 2,, Passenger Cars Commercial Vehicles Passenger Cars Commercial Vehicles 256,528 4,7 26,599 6,466 6, ,994 4,7 277, ,996 3,6 247,66 3,98 3,98 275,94 3,6 278, ,29 3, ,89 28,989 28, ,98 3, , Note: Chg. (%) means change from the previous year (with the previous year s result indexed at ). 245,6 3, ,993 9,9 9,9 264,729 3, , ,892 2,72 246,64 5,67 5,67 259,562 2,72 262, ,78,55 23,593 32, , ,996 2,9 265,86. 92,37,585 93,92 3,96,368 25,329 26,278 2,953 29, ,43,76 6,94 8,746 8,877 7,623 67,889,638 78, ,255,827 82,82 33,28 9,973 43, 23,283,8 225, ,8 2,57 25,857 56,97 2,88 69,787 26,77 4, , Source: Japan Automobile Importers Association IMPORTED MOTOR VEHICLES (ON CUSTOMS CLEARANCE BASIS) Passenger Cars 46,285 52,225 25,69 4, , ,657 28, , , ,726 29, ,255 45,687 23,79 273,798 USED IMPORTED VEHICLE SALES Passenger Cars 537,75 555, ,89 588, , ,2 54,7 47,986 46,5 462,435 Chg. (%) Chg. (%) Commercial Motor Other Vehicles Vehicles Chg. (%) ,85 47, , , , , , , , , , , , , , , , , , , , , , , , , , , Trucks 5,69 6,48 7,96 9,468,2 2,58 2,44 2,547 3,38 4,37 Chg. (%) SpecialPurpose Vehicles 42,669 38,25 3,856 27,269 22,64 7,574 3,292,83 7,878 6,756 Chg. (%) Other ,93 6,376 66,97 625,362 62, ,57 53, ,78 482,49 483,725 Motorcycles 7,5 7,87 28,696 43,936 74,96 629,93 562,45 485, , , ,722 43,87 367, ,26 386,949 Notes:. Other denotes specialpurpose vehicles and enginemounted chassis. 2. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Source: Trade Statistics of Japan, Ministry of Finance Chg. (%) Notes:. Passenger cars are classified under Japan s Road Vehicles Act in three categories, based primarily on engine capacity: standard (over 2,cc), small (66cc2,cc), and mini (66cc and under); see page 66 for details. 2. Other includes buses, large specialpurpose vehicles and smallsized threewheeled trucks. 3. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Source: Japan Automobile Importers Association

11 Motor Vehicles Used Vehicle Sales Used Vehicle Sales Decline for Sixth Straight In 2 sales of used motor vehicles decreased.4% from the previous year to total 6.45 million units, with used passenger car sales declining.9% to 5.8 million units. In this category, standard passenger cars dropped 3.% to.54 million units and small cars fell 4.6% to.73 million units, but minicars increased.8% to.9 million units. While used truck sales grew.4% from 2 to.7 million units, used bus sales dipped 2.2% to 4, units. USED VEHICLE SALES BY TYPE IN 2 Buses 3,849 (.2%) Other 82,7 (.3%) TRENDS IN NEW AND USED MOTOR VEHICLE SALES Used vehicles New vehicles x million units 9 Small Mini 233, ,63 (3.6%) (.9%) Standard Standard 68,47 (2.6%) Trucks,7,639 (8.%) 6,45,5 (%),542,64 (23.9%) Mini,96,523 (29.6%) Passenger Cars 5,82,656 (8.4%) Small,733,59 (26.9%) USED MOTOR VEHICLE SALES Passenger Cars Trucks Buses Other Standard Small Mini Subtotal Chg. (%) Standard Small Mini Subtotal Chg. (%) Chg. (%) Chg. (%) Chg. (%) 985 6,5 3,295,92 356,726 3,8, , ,32,25,545,854, , , ,722, ,93 3,945,86 34,782 4,554, ,85 555,634,746,495 2,487, , , ,9, ,3 3,845,76 727,259 5,566, ,523 52,244,538,78 2,28, , , ,945, ,742,786 3,5,87,448,546 6,24, ,74 42,5,69,626,783, , , ,23, ,86,694 2,744,64,74,827 6,32, ,88 374,,89,79,669, , , ,67, ,9,7 2,64,456,89,84 6,36, ,47 379,46,62,66,662, , , ,95, ,984,562 2,524,764,777,866 6,287, ,75 363, ,,56, , , ,, ,2,563 2,46,4,89,54 6,353,27. 24,6 368,778 98,74,589, , , ,6, ,959,739 2,34,226 2,33,569 6,297, ,77 365,8,3,67,63, , , ,66, ,8,596 2,5,22 2,22,866 5,938, ,989 32,43 935,745,458, , , ,53, ,728,9,944,766,995,333 5,668, , , ,836,389, , , ,78, ,69,37,855,7,864,874 5,339, ,8 266, ,957,248, , , ,698, ,592,,86,696,873,466 5,282, , , ,854,55, , , ,539, ,542,64,733,59,96,523 5,82, ,47 233, ,63,7, , , ,45,5 Notes:. Passenger cars are classified under Japan s Road Vehicles Act in three categories, based primarily on engine capacity: standard (over 2,cc), small (66cc2,cc), and mini (66cc and under); see page 66 for details. 2. Includes imported vehicles. 3. Other refers to emergency vehicles, special vehicles equipped with beds, refrigerated trucks, tank trucks, tractors, bulldozers, steamrollers, snowplows, snowmobiles, etc., that are assigned special registration numbers. 4. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Sources: Japan Automobile Dealers Association; Japan Mini Vehicles Association 98.6

12 Motor Vehicles Motor Vehicles in Use and Motor Vehicle Density Slight Increase in Number of Motor Vehicles in Use At the end of December 2, motor vehicles in use in Japan (excluding motorcycles) totalled 75.5 million units, a.2% increase over the previous year. Passenger cars in use increased.6% to 58.7 million units, with standard and minicars growing.9% and 2.8% to 7. million and 8.5 million units respectively, but small cars dropping.4% to 23. million units. Meanwhile, trucks in use slipped 2.% from 2 to 5. million units and buses in use decreased.6% to 226, units. At the end of March 2, the average service life of motor vehicles in Japan was 2.43 years for passenger cars, 3.4 years for trucks, and 7.37 years for buses. MOTOR VEHICLES IN USE BY TYPE AT END OF 2 Buses 225,948 (.3%) SpecialPurpose Vehicles,646,23 (2.2%) TRENDS IN MOTOR VEHICLES IN USE x million units 8 7 Small 3,74,36 (4.9%) Standard 2,266,42 (3.%) Mini 8,486,738 (24.5%) Mini 8,963,64 (.9%) Trucks 4,97,422 (9.8%) 75,52,887 (%) Passenger Cars 58,67,34 (77.7%) Standard 7,39,684 (22.6%) Small 23,43,892 (3.6%) Passenger Cars Trucks, Buses & SpecialPurpose Vehicles (Minicars) (Minitrucks) MOTOR VEHICLES IN USE (at end of every calendar year) ,374 27,5 472,34 7,94,784,594 7,874,89 3,942,626 5,375,465 5,836,593 6,295,52 6,634,529 6,74,523 6,77,52 6,748,373 6,688,645 6,89,42 7,39,684 6,457,8 4,47,68 2,,96 25,6,79 3,554,652 3,3,462 28,593,49 27,493,644 26,885,69 26,4,67 26,254,546 25,698,33 24,92,226 24,356,3 23,99,9 23,47,3 23,43,892 Passenger Cars Standard Small Mini Subtotal Standard 2,244,47 2,6,3 2,76, 2,6,487 2,584,926 5,775,386 9,9,258,67,73 2,49,928 3,297,363 4,2,74 5,8,27 5,93,25 6,76,486 7,42,89 7,986,982 8,486,738 8,778,972 7,236,32 23,659,52 27,844,58 34,924,72 44,68,37 52,437,375 54,539,839 55,22,59 55,994,5 57,9,789 57,52,43 57,623,753 57,864,972 58,9,853 58,347,387 58,67,34 Trucks Chg. (%) Small Mini Subtotal Chg. (%) ,256,58,465,494,464,668,852 2,76,488 2,574,433 2,596,42 2,53,293 2,476,588 2,464,873 2,474,378 2,465,823 2,455,268 2,386,255 2,39,62 2,28,7 2,266,42 4,478,486 6,,26 7,55,22 6,679,665 6,69,536 6,23,45 5,474,66 5,,24 4,87,933 4,694,922 4,594,363 4,43,3 4,323,579 4,2,553 3,952,534 3,825,632 3,74,36 3,5,7 2,785,82 4,527,794 8,79,289 2,535,45,642,3,54,427 9,838,7 9,732,853 9,62,53 9,665,3 9,62,484 9,495,42 9,47,694 9,288,679 9,77,282 8,963,64 8,28,759,43,853 3,77,479 7,39,86 2,32,439 2,43,49 8,225,58 7,48,424 7,8,374 6,78,848 6,733,87 6,499,4 6,274,267 5,896,52 5,56,825 5,284,625 4,97, Notes:. Specialpurpose vehicles refers to emergency vehicles, special vehicles equipped with beds, refrigerated trucks, tank trucks, tractors, bulldozers, steamrollers, snowplows, ). 3. Threewheeled vehicles includes threewheeled passenger cars, trucks, and specialpurpose vehicles.

13 PRIVATE PASSENGER CARS IN USE PER HOUSEHOLDS BY PREFECTURE (at March 3, 2). Fukui 2. Toyama 3. Gunma 4. Yamagata 5. Gifu 6. Tochigi 7. Iwate* 8. Fukushima* 9. Ibaraki. Nagano. Niigata 2. Yamanashi 3. Ishikawa 4. Miyagi* 5. Saga 6. Mie 7. Shizuoka 8. Shiga 9. Tottori 2. Shimane 2. Okayama 22. Akita 23. Tokushima 24. Aichi 25. Kagawa 26. Kumamoto 27. Oita 28. Okinawa 29. Miyazaki 3. Yamaguchi 3. Aomori 32. Wakayama 33. Nara 34. Kagoshima 35. Ehime 36. Hiroshima 37. Fukuoka 38. Kochi 39. Nagasaki 4. Saitama 4. Chiba 42. Hokkaido 43. Hyogo 44. Kyoto 45. Kanagawa 46. Osaka 47. Tokyo 48.4 National Average *Figures for Iwate, Fukushima and Miyagi are estimates because households in 22 municipalities there affected by the March, 2 earthquake and tsunami are not included in the count. Source: Automobile Inspection & Registration Information Association PASSENGER CARS IN USE BY YEAR OF FIRST REGISTRATION of First Registration April 2March 2 April 29March 2 April 28March 29 April 27March 28 April 26March 27 April 25March 26 April 24March 25 April 23March 24 April 22March 23 April 2March 22 April 2March 2 April 999March 2 April 998March 999 April 997March 998 March 997 Vehicles in Use Vehicles in Use 2,652,963 2,86,58 2,438,27 2,786,77 2,829,498 3,8,947 3,4,396 2,858,398 2,867,9 2,525,75 2,443,55,99,954,88,985,468,422 4,57,32 4,35,32 AVERAGE AGE BY TYPE AVERAGE SERVICE LIFE BY TYPE At March 3, 2 % of Vehicles in Use In years Passenger Cars Trucks Buses In years Passenger Cars Trucks Buses Notes:. Average age means the average number of years elapsed since first registration. 2. Average service life means average vehicle lifespan. The method of calculating average service life changed in 2 for passenger cars and trucks and in 22 for buses. 3. Average age and average service life figures are as at the end of every fiscal year. 4. The above three tables exclude minivehicles. Source: Automobile Inspection & Registration Information Association Large 4,895 2,86 6,633 8,967 4,89 4,478,46,58 9,99 9,73 9,97 9,763 9,62 9,88 8,76 8,36 7,435 Small Buses 83,85 24,98 23,387 22,26 3,849 28,67 25,437 23,347 2,99 2,23 2,86 2,98 2,37 2,873 9,637 9,35 8,53 Subtotal 87,98 226,284 23,2 23, , ,95 235, ,45 23,88 23,934 23,733 23,68 23,928 23,68 228, ,27 225,948 Chg. (%) SpecialPurpose Vehicles 333,32 584, 789,55 94,647,26,39,5,29,75,733,735,682,689,629,649,686,63,62,66,934,585,873,536,6,55,4,52,593,646,23 Chg. (%) ,58,843 28,9,558 37,856,74 46,57,26 57,697,669 66,853,5 72,649,99 73,989,35 74,24,4 74,655,58 75,686,455 75,859,68 75,74,82 75,528,35 75,324,486 75,36,876 75,52,887 Chg. (%) Trailers 23,79 39,88 56,84 65,485 87,359 2,7 33,676 36,72 37,5 42,32 47,626 5,44 54,798 57,95 52,38 52,834 54, Three Wheeled Vehicles 243,934 47,998 7,724 6,23 4,56 3,62 3,827 3,63 3,478 3,47 3,28 3,238 3,2 3,9 3,27 3,2 3,89 snowmobiles, etc., that are identified as specialpurpose vehicles by special registration numbers. 2. Chg. (%) means change from the previous year (with the previous year s result indexed at Source: Ministry of Land, Infrastructure, Transport and Tourism

14 Motor Vehicles Exports Motor Vehicle Exports Show First Decrease in 2 s Exports of motor vehicles in 2 decreased 7.8% from the previous year to 4.46 million units. Passenger car exports dropped 8.% to 3.93 million units, truck exports fell 5.9% to 424, units, and bus exports shrank 4.4% to, units. Although the value of automobile exports therefore decreased.5% from the previous year to US$.9 billion, the value of auto parts exports rose 4.8% to US$ 4.2 billion, bringing the total value of auomotive exports to US$ 42. billion, up.9% from 2. MOTOR VEHICLE EXPORTS BY TYPE IN 2 Small 53,786 (.2%) Mini 8 (.%) Buses,742 (2.5%) TRENDS IN MOTOR VEHICLE EXPORTS x million units 7 6 Standard 369,973 (8.3%) 5 Mini,2 (.2%) Trucks 423,767 (9.5%) Passenger Cars 4 Small 743,59 (6.7%) 4,464,43 (%) 3 Passenger Cars 3,929,94 (88.%) Standard 3,76,95 (7.%) Trucks & Buses MOTOR VEHICLE EXPORTS ,58,623 3,932,44 3,38,47,732,5,462,69,228,525,222,433,27,3,98,273,449,68,359,44,534,975 84,98 88,66 743,59 Passenger Cars Standard Small Mini Subtotal 345,43 493,47,343,967,56,22 2,333,263 2,783,45 2,856,32 2,995,259 3,64,63 3,845,8 4,45,934 4,379,569 2,43,359 3,453,95 3,76,95 75,45,82,835,36 5,45 2,24,3 6 8, ,753, , ,755,2 725,586,827,286 3,947,6 4,426,762 4,482,3 2,896,26 3,795,852 4,2,373 4,8,498 4,24,27 4,363,68 5,295,497 5,8,959 5,95,429 3,28,639 4,275,366 3,929,94 Chg. (%) Standard 65,7 68,37 332,257,96, ,737 62,654 53, ,33 553,46 59,233 52, , , 567, ,6 397,44 369,973 Small 272, ,232,548,25,29, , ,929 86,329 7,28 76,787 96,453 89,946 89,2 89,28 9,58 48,447 52,98 53,786 Trucks Mini 3,892 22,7 73,77, Notes:. Passenger cars are classified under Japan s Road Vehicles Act in three categories, based primarily on engine capacity: standard (over 2,cc), small (66cc2,cc), and mini (66cc and manufactured in Japan. 3. KD sets have been excluded since 979; they represent less than 6% of the cost of compositional components per vehicle and have been treated as components since

15 MOTOR VEHICLE EXPORT TRENDS (BY REGION OF DESTINATION) Asia Middle East Europe North America Latin America Africa Oceania Other (EU) (U.S.A.) ,, 2 2 6,, 5,, 4,, 3,, 2,,,, Asia Middle East Europe (EU) North America (U.S.A.) Latin America Africa Oceania Other Chg. (%) 426,692 49, , ,794 2,76,298,84, ,65 44, ,455 9,66 4,698, ,93 439,587,59,76,9,58,786,387,594,57 272,297 46,269 48,22 9,82 4,756, , ,46,275,229,36,27,726,465,559,67 344,844 82,45 448,67,658 4,957, ,67 59,594,78,97 895,728,854,438,662,939 43,259 29, ,922,36 5,53,6.9 38,56 59,34,35,86 92,837 2,488,373 2,26, , ,956 44,92 9,344 5,966, ,92 8,887,497,8 99,42 2,455,99 2,25, ,945 33, ,268 9,277 6,549, ,8 952,749,589,54 82,63 2,38,254 2,68,62 57,9 35,762 46,56,73 6,727, ,84 428,42 685,26 542,25,379,5,22, ,96 45,3 347,394 8,389 3,66, ,44 583, , ,58,727,35,53,26 396,499 88, ,26 7,86 4,84, ,47 49,75 995,33 52,84,585,327,426, ,375 48, ,747 4,92 4,464, Note: Chg. (%) means change from the previous year (with the previous year s result indexed at ). Subtotal 35,6 833,673,953,685 2,238,4,39,2 849,859 67,87 637,593 63, ,795 6, ,974 66,45 658,28 35,57 45,32 423,767 Buses Chg. (%) Large Small Subtotal Chg. (%) Chg. (%) 2.9 4,52 5,59 9, ,86, ,46,247 6, ,677, ,66 58,5 66, ,966, ,249 59,357 65, ,73, ,66 33,895 39, ,83, ,28 36,76 44, ,79, ,3 34,32 4, ,454, ,346 39,46 48, ,698, ,3 37,29 45, ,756, ,692 44,49 55, ,957, ,957 67,98 77, ,53, ,567 8,634 93, ,966, ,887 7,644 2, ,549, ,574 35,87 53, ,727, ,6 8,96 92, ,66, ,969,83 5, ,84, ,495 96,247, ,464, under); see page 66 for details. Vehicle type classification in this table differs somewhat from that used in Ministry of Finance export data. 2. Figures represent exfactory export shipments of motor vehicles 4. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Source: Japan Automobile Manufacturers Association

16 Motor Vehicles Exports by Destination A Decline in Motor Vehicle Exports Worldwide, Except to Europe Compared to the previous year, motor vehicle exports in 2 increased 6.3% to Europe, but declined 28.% to the Middle East, 2.2% to Africa,.7% to Oceania, 9.6% to Latin America, 8.2% to North America, and.7% to Asia. MOTOR VEHICLE EXPORTS BY DESTINATION IN 2 Europe 995,33 (22.3%) Middle East 49,75 (9.4%) of which EU 52,84 (.7%) 4,464,43 (%) North America,585,327 (35.5%) of which U.S.A.,426,833 (32.%) Asia 572,47 (2.8%) Latin America 358,375 (8.%) Africa 48,599 (3.4%) Oceania 379,747 (8.5%) million units, units Note: The figure includes 4,92 units (.%) shipped to other destinations., units MOTOR VEHICLE EXPORT TRENDS (BY REGION OF DESTINATION) In % Asia Middle East Europe (EU) 2.2 (7.8) (2.8) (2.9) 23.3 (7.7) 2.9 (5.4) 22.9 (4.) 23.6 (2.) 9. (5.) 9.3 (.7) 22.3 (.7) North America (U.S.A.) 44.2 (39.2) (33.5) (3.5) 36.7 (32.9) 4.7 (37.9) 37.5 (33.8) 34.5 (3.7) 38. (33.3) 35.7 (3.6) 35.5 (32.) Latin America Africa Oceania Other

17 MOTOR VEHICLE EXPORTS BY DESTINATION IN 2 Standard Small Mini Subtotal Passenger Cars Standard Small Mini Subtotal Trucks Large Small Subtotal Buses Note: Passenger cars are classified under Japan s Road Vehicles Act in three categories, based primarily on engine capacity: standard (over 2,cc), small (66cc2,cc), and mini (66cc and under); see page 66 for details. Asia Middle East Europe North America Latin America Africa Oceania Other Grand s South Korea China Taiwan Hong Kong Thailand Singapore Malaysia Philippines Indonesia Pakistan Other Subtotal Iran Saudi Arabia Kuwait Oman Israel United Arab Emirates Qatar Other Subtotal Sweden Denmark UK Netherlands Belgium France Germany Spain Italy Finland Poland Austria Greece Other Subtotal Norway Switzerland Russia Turkey Ukraine Other Subtotal Canada U.S.A. Subtotal Mexico Puerto Rico Colombia Ecuador Peru Chile Brazil Other Subtotal Algeria Egypt Nigeria Kenya South Africa Other Subtotal Australia New Zealand Other Subtotal Destination E U Source: Japan Automobile Manufacturers Association 3,734 27,46 4,836,864 8,722,976 24,869 7,856 23,5 25 9, ,558 2,487 42,565 2,278 38,232 24,253 49,969,443 2,38 29,265 5,969 4,273 56,367 33,262 2,7 49,368 85,85 28,632 35,896 8,747 2,63 5,29 2,54 2,65 38,53 7,29 8,877 37,68 5,78 23,433 2,56 766,567 4,865,228,469,369,334 5,95 2,36,727 4,955 6,88 33,793 32,6 3,929 2,79 2,48,284 2, ,969,742 34,57 26,78 5,468 2, ,843,942 3,76,95 3,399 2,873 3,568 5,2 32 4,378,945 8,38 2,394 4,68 56,86 2,2 33,22 4,662 3,3 9,26 5, ,86 94,99 2,343 2,277 2,228 9,398 5,875 2,2 29,769 2,6 8,668 2, ,57,745 2,474 7,772 4,25 9,492 3,78 2,38 3, ,65 5,835 77,777 93,62,947,349 4,34 2,78,6 5, ,79 79,59 3,489 4, ,82 3,522 32,647 85,84 2,688,58 99, , , ,69, , ,2 7,33 2,334 44,49 6,22 8,723 2,295 39,248 9,8 3,75 2,644 4,599 46,58 4,57 75,687 24,94 4,245 43,379 65,233 2,369 36,898 34,258 8,325 6,634 77,682 42,696 8,8 68,23 6,267 3,785 54,65,5 3,626 2,936 4,286 23,257 57,37 22,488 28, ,982 26,748 26,584 2, ,585 56,875,46,575,563,45 62,898 3,485 5,33 7,663 7,248 49,35 33,57 53,22 279,369 5,97 5,834 2, ,79 4,264 67,54 32,686 28,8 3, ,59,988 3,929,94 6 2, 7,326 5,3 23,936 3,327 5,432 2,77 38,7 3,624 4,54 6,22,9 22,396,674 7, ,9,73 7,72 69, , ,259 3, ,53 4,46 3,3,57 2,3 4,273, ,39,69 5,24 6,643,98 8,869 3,544 3,78 3,455 7,35 58,24 7,96, ,753 4,45 7,58 44,63 3,245 3,4 3,96 36,84, , , ,4 8,84 2,99 553,54 7,29, ,763,884 2,933 4,87 5,234 5, , ,377 6, , , ,264 53, , 8,295 5,472 24,8 3,934 7,2 3,2 38,8 3,828 8,949 24,944,9 24,595 2,227 8, ,382 2,762 7,77 82, , ,259 3, ,53 4,46 3,3,57 3,887 7,26, ,856,69 2,258 2,877,85 9,46 3,656 5,296 4,7 2,727 64,645 7,262 22, ,993 4,83 7,97 58,336 3,66 3,66 3,333 38,5, ,767, ,74, , ,857 3,449, , ,495 2, , ,326 6, ,66 36,78 4, ,534 4,5,656,953 8, , , ,585, ,568 2,58 335,35 4,37 2,695 4,33 2,924 7,67,374 96,247 2,553, , ,684 6, ,67 4,892 5,622,42 6,325 4,983,9 2,758 23, , , ,442 4,36,832 2,754 3,27 347,35 4,834 23,9 4,5 2,962 7,23,385,742 7,49 224,888 54,699 22,87 5,843 6,878 6,43 9,435 7,8 7,299 26,75 572,47 25,48 5,94 28,579 65,862 43,96 85,598 7,3 47,363 49,75 8,562 7,666 78,32 43,8 8,25 68,955 6,959 3,888 56,864 4,59 3,77 22,47 4,34 27,76 52,84 25,68 3,57 352,689 33,954 28,83 3,8 995,33 58,494,426,833,585,327 77,453 3,485 34,972 22,28 25,779 53,697 33,57 8,29 358,375 5,64 4,29 6,22 6,29 52,935 27,68 48, ,93 3,896 9, ,747 4,92 4,464,43 6

18 Motorcycles Production Production of Class MotorDriven Cycles Up for First Time in 5 s Overall domestic motorcycle production in 2 decreased 3.8% from the previous year to 639, units. While Class motordriven cycles (5cc and under) grew 9.9% to 5, units, the combined total for larger motorcycles (all those over 5cc) shrank 7.4% to 534, units, with Class 2 motordriven cycles (5cc to 25cc), minisized motorcycles (26cc to 25cc) and smallsized motorcycles (over 25cc) declining 2.% to 65, units, 4.% to 4, units, and 5.7% to 365, units respectively. MOTORCYCLE PRODUCTION BY ENGINE CAPACITY IN 2 TRENDS IN MOTORCYCLE PRODUCTION x million units 4 5cc & Under 4,936 (6.4%) 3 Over 25cc 365,8 (57.2%) 638,987 (%) 5cc25cc 64,57 (.%) 2 26cc25cc 4,436 (6.3%) Over 5cc 5cc & Under MOTORCYCLE PRODUCTION MotorDriven Cycles Class (5cc & Under) 895,599,3,822 2,493,9 2,4,85,343,22 95,83 636, , ,72 33, ,549 36, ,336 62,928 8,47 87,53 4,936 MotorDriven Cycles Class 2 (5cc25cc),47,25,887,7 2,8,26,373, ,734,38,938 63,22 543, ,8 34,622 26,343 49,868 78,827 28,38 57,424 8,63 64,57 MiniSized Motorcycles (26cc25cc) Over 5cc 259,45 33,733 66,83 469,728 27,34 27, ,433 24, ,499 27,26 279, ,43 269,689 92,863 25,384 8,95 4,436 SmallSized Motorcycles (Over 25cc) 385, ,29,98, ,346 56, ,76 85,9 74,882 76, , ,49,39, , , , ,82 365,8 Subtotal 2,52,73 2,77,725 3,94,64 2,52,497,463,675,8,436,778,845,526,532,372,833,48,35,493,36,465,4,4,76,63,9 536, , ,5 2,947,672 3,82,547 6,434,524 4,536,347 2,86,895 2,753,239 2,45,39 2,5,488,83,95,739,584,79,585,77,386,676,97,226, ,9 664,75 638,987 Chg. (%) Notes:. KD sets have been excluded since 979; they represent less than 6% of the cost of compositional components per vehicle and have been treated as components since Chg. (%) means change from the previous year (with the previous year s result indexed at ). Source: Japan Automobile Manufacturers Association

19 Motorcycles Sales Motorcycle Sales Show First Increase in 6 s Domestic motorcycle sales (defined here as exfactory shipments to domestic dealers, not as new registrations) in 2 totalled 46, units, up 6.7% from the previous year, marking the first increase in six years. In the Class motordriven cycle category (5cc and under), sales climbed.2% to 257, units. While sales of minisized motorcycles (26cc to 25cc) grew 6.5% to 32, units, sales of Class 2 motordriven cycles (5cc to 25cc) and smallsized motorcycles (over 25cc) dropped.7% and 7.%, to 96, and 2, units respectively. Overall sales of motorcycles with engine capacity over 5cc thus totalled 48, units, a decrease of.3% from 2. MOTORCYCLE SALES BY ENGINE CAPACITY IN 2 TRENDS IN MOTORCYCLE SALES x million units 26cc25cc 3,767 (7.8%) Over 25cc 2,9 (5.2%).75 5cc25cc 95,72 (23.6%) 45,533 (%) 5cc & Under 257,45 (63.4%) 5cc & Under.5 Over 5cc MOTORCYCLE SALES (SHIPMENTS TO DOMESTIC DEALERS) MotorDriven Cycles Class (5cc & Under),978,426,646,5,23,52 884,78 558, , ,6 5,388 47, ,96 458,23 295,98 255,56 23, ,45 MotorDriven Cycles Class 2 (5cc25cc) 2,238 3,574 69,68 38,5 2,6 94,468 89,96 62,78 88,747 82,2,72 2,99 65,888 96,368 95,72 MiniSized Motorcycles (26cc25cc) Over 5cc 88,88 73,887 58,882 98,833 72,886 94,44 87,88 97,35 99,658 9,395 86,8 55,674 37,8 27,275 3,767 SmallSized Motorcycles (Over 25cc) 3,84 45,674 76,92 9,86 46,46 46,873 42,724 39,78 47,86 48,564 4,2 49,743 22,48 25,352 2,9 Note: Chg. (%) means change from the previous year (with the previous year s result indexed at ). Subtotal 39,6 45,35 45,42 328,34 22,48 235,755 22,5 99, ,59 222,7 226,92 226,47 25,26 48,995 48,488 Chg. (%) 2,37,36 2,96,25,68,933,22, ,877 77,82 76,2 7,2 76,53 7, , ,35 38,777 38,242 45, Source: Japan Automobile Manufacturers Association 8

20 Motorcycles Motorcycles in Use To our readers: Because a significant amount of data on motorcycles in use in 2 was not yet available at press time, this entire page remains unaltered from last year s edition of this publication. Tenth Straight of Rise in Number of Motorcycles Over 5cc in Use As of March 3, 2, the number of motorcycles in use in Japan dipped to 2.48 million, down.6% from the previous year. By engine capacity, Class motordriven cycles, which account for 59.7% of all motorcycles in use, dropped 3.2% to 7.45 million units and minisized motorcycles in use slipped.2% to.99 million units. On the other hand, Class 2 motordriven cycles and smallsized motorcycles in use rose 2.2% and.3%, to.5 million and.52 million units respectively. Thus, motorcycles over 5cc in use increased.%, to a total of 5.3 million units. MOTORCYCLES IN USE BY ENGINE CAPACITY (at March 3, 2) TRENDS IN MOTORCYCLES IN USE (at March 3 yearly) x million units 2 6 Over 25cc,524,76 (2.2%) 26cc25cc,992,939 (6.%) 5cc25cc,5,44 (2.%) 2,477,47 (%) 5cc & Under 7,448,862 (59.7%) 5cc & Under Over 5cc MOTORCYCLES IN USE (at March 3 yearly) MotorDriven Cycles Class (5cc & Under) 3,727,426 4,85,4 8,794,335 4,69,399 3,539,269,65,39 9,643,487 9,354,554 9,36,832 8,95,37 8,739,686 8,566,63 8,345,225 8,34,692 7,92,5 7,694,9 7,448,862 MotorDriven Cycles Class 2 (5cc25cc) 4,43,745 3,32,88 2,28,6,747,957,57,228,42,3,337,395,344,33,334,792,329,4,34,88,353,732,378,74,397,85,429,738,479,588,5,44 MiniSized Motorcycles (26cc25cc) 583,36 492,37 56,567,47,426,669,77,823,446,74,522,72,597,734,395,772,545,8,594,857,439,98,42,95,52,976,829,996,3,992,939 Over 5cc SmallSized Motorcycles (Over 25cc) 9,77 276,75 383, ,627,45,59,77,229,288,399,38,47,334,354,352,99,37,33,397,392,428,49,452,893,478,724,55,34,524,76 Subtotal 5,24,832 3,9,84 3,7,22 3,57, 4,232,58 4,42,76 4,33,36 4,365,344 4,43,54 4,454,54 4,522,3 4,68,563 4,75,265 4,8,49 4,885,29 4,98,23 5,28,555 Chg. (%) 8,852,258 8,752,98,965,547 8,8,49 7,77,787 5,587,96 3,973,83 3,79,898 3,54,373 3,369,9 3,26,699 3,75,76 3,6,49 2,935,82 2,787,342 2,675,22 2,477, Notes:. Motordriven cycle data is as at April, and since 26 motorcycles with engine capacity of 25cc and under whose owners fail to pay the mandatory motorcycle ownership tax are not included in this data. 2. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Sources: Ministry of Land, Infrastructure, Transport and Tourism; since 26 (only for the 25ccandunder categories), Ministry of Internal Affairs and Communications 9

21 Motorcycles Exports Motorcycle Exports Rise for First Time in 5 s Motorcycle exports in 2 increased 2.3% over the previous year to 55, units. By engine capacity, exports of Class motordriven cycles surged 7.4% to 2, units, whereas exports of Class 2 motordriven cycles dropped 6.4% to 46, units. Exports in the minisized motorcycle category declined 2.2% to 84, units, but those in the smallsized motorcycle category grew 2.4% to 356, units. In 2 the total value of motorcycle and motorcycle components exports increased 6.4% to US$ 4.7 billion, with the value of motorcycle exports rising 4.2% to US$ 3.2 billion and the value of components exports climbing.5% to US$.5 billion. MOTORCYCLE EXPORTS BY ENGINE CAPACITY IN 2 TRENDS IN MOTORCYCLE EXPORTS x million units 2.6 5cc & Under 9,745 (3.9%) 5cc25cc 45,853 (9.%).2 54,985 (%) 26cc25cc 83,594 (6.5%) Over 5cc.8 Over 25cc 355,793 (7.5%).4 5cc & Under MOTORCYCLE EXPORTS MotorDriven Cycles Class (5cc & Under) 326,85 288,843 5,27 369,67 47,3 6,627 82,38 74,8 4,35 84,832 57,86 57,558 34,92 36,234 4,493,522 9,745 MotorDriven Cycles Class 2 (5cc25cc) 94,325,546,7,97,48,35,42 57,84 69, ,4 462,37 32, ,245 97,378 24,335 34,57 95,4 44,78 48,976 45,853 MiniSized Motorcycles (26cc25cc) Over 5cc 87,85 328,33 548,36 296,865 7,222 29,96 24,59 49,9 44,873 73,37 77,824 83,98 77,673 49,53,298 85,56 83,594 SmallSized Motorcycles (Over 25cc) 39, , , ,38 4,38 442,689 85,58 73,834 78,999 84,3 899,6 968,53 886,36 72,39 383,38 347,46 355,793 Subtotal,4,787 2,4,827 3,428,3 2,72,35,36,443,264,83,559,39,343,87,66,64,242,32,274,363,276,468,98,64 965, ,386 48, ,24 Chg. (%),737,62 2,69,67 3,929,4 2,54,482,83,744,325,7,64,77,48,682,28,955,327,44,332,223,334,26,232,796,2,87 543, ,464 54, Notes:. Figures represent exfactory export shipments of motorcycles manufactured in Japan. 2. Class 2 motordriven cycles include threewheeled motordriven cycles. 3. KD sets have been excluded since 979; they represent less than 6% of the cost of compositional components per vehicle and have been treated as components since Chg. (%) means change from the previous year (with the previous year s result indexed at ). Source: Japan Automobile Manufacturers Association 2

22 Motorcycles Exports by Destination A Rise in Motorcycle Exports to North America and Latin America Whereas motorcycle exports in 2 increased 68.7% to North America and 8.8% to Latin America over the previous year, they declined 23.6% to Europe, 7.8% to Africa, 6.7% to Oceania, 4.7% to Asia, and 2.9% to the Middle East. MOTORCYCLE EXPORTS BY DESTINATION IN 2 Europe 74,286 (34.5%) Middle East 3,774 (.8%) of which EU 67,254 (33.%) 54,985 (%) North America 79,228 (35.5%) of which U.S.A. 64,875 (32.6%) Asia 38,856 (7.7%) Latin America 46,62 (9.%) Africa 2,3 (4.2%) Oceania 4,576 (8.2%), units, units, units MOTORCYCLE EXPORT TRENDS (BY REGION OF DESTINATION) Asia Middle East In % Europe (EU) 3.7 (29.) (32.5) (35.) 35. (33.8) 34.9 (33.7) 37.7 (36.5) 36.9 (35.6) 38.8 (37.) 46.2 (44.4) 34.5 (33.) North America (U.S.A.) 43.3 (39.9) (43.4) (39.6) 47. (42.6) 48. (44.7) 4.4 (36.9) 4.9 (37.2) 33.6 (29.5) 2.5 (7.8) 35.5 (32.6) Latin America Africa Oceania

23 MOTORCYCLE EXPORTS BY DESTINATION IN 2 Asia Middle East Europe North America Latin America Africa Oceania Grand s South Korea Taiwan Hong Kong Singapore Malaysia Philippines Other Subtotal Saudi Arabia Israel United Arab Emirates Other Subtotal Sweden Denmark UK Netherlands Belgium France Germany Portugal Spain Italy Finland Poland Hungary Greece Slovenia Czech Republic Other Subtotal Norway Switzerland Turkey Russia Other Subtotal Canada U.S.A. Subtotal Mexico Guatemala Nicaragua Panama Colombia Venezuela Peru Chile Brazil Argentina Other Subtotal Guinea Ghana Togo Niger Rwanda Dem Rep Congo Ethiopia Kenya Uganda Tanzania Namibia South Africa Other Subtotal Australia New Zealand Other Subtotal , , , ,82, , ,82 9,745 7, , , , ,83 2,28 2,259 4, , ,23 93, ,448 2,52 2,274 8,4, ,459 45, , , ,53 2,5, , , ,66 2,34 23,878 26, , ,43 7, , ,2 95 5,452 7,53, ,5 83, ,6,85 5, , , ,33 33, ,839 24, ,2 3, , , , ,68 9,9 9,556 28,646, ,354 2, ,47 2, , , ,284 6, , ,793 62,576 2,58,895 5,24 25,259,344 38, , , ,534 35, ,53 26, ,989 3, , , , ,66 3,432 55,693 69,25,752 86, ,774 2, ,647 27,72 3,663 2,37 45, , ,93, ,364 3,85 2, 3,795 3, , , ,232 2,22,895 5,24 25,259,389 38, , , ,67 35, ,54 26, ,24 32, , , , ,286 4,353 64,875 79,228,854 86, ,786 2, ,653 27,33 3,663 2,342 46, , ,93, ,453 3,855 2,3 37,367 3, ,576 54,985 MotorDriven Cycles Class 2 (5cc25cc) MiniSized Motorcycles (26cc25cc) SmallSized Motorcycles (Over 25cc) Subtotal Over 5cc Destination MotorDriven Cycles Class (5cc & Under) E U Source: Japan Automobile Manufacturers Association 22

24 Automobiles and Society Attention to the Environment Climate Change Climate Change and CO2 Emissions Reduction: The Response of the Transport Sector Under the Kyoto Protocol, adopted in 997 by most industrialized countries to reduce CO2 and other greenhouse gas emissions and enforced in February 25, Japan pledged to reduce its average GHG emissions volume in the first commitment period (2822) to 6% below the 99 level. In April 25, the Japanese government formulated a target achievement plan (revised in March 28) and then promoted diverse CO2 reduction measures in all major sectors including the industrial, consumer, and transport sectors. In line with the national initiative, the automobile industry has been making vigorous efforts with respect to increasing vehicle fuel efficiency, developing and promoting alternativeenergy and nextgeneration vehicles, raising public awareness of ecofriendly driving practices, and supporting the government s efforts to improve traffic flow. After peaking in 2, CO2 emissions in Japan s transport sector have been on a steady decline, owing largely to increased fuel efficiency in passenger cars and greater efficiency in goods distribution. JAPAN S GHG EMISSION VOLUMES: ACTUAL & TARGETED under the Kyoto Protocol Japan s GHG emissions in 99 totalled,26 million tons (in equivalent tons of CO2). In order for Japan to meet its target under the Kyoto Protocol, it was determined that its average GHG emissions volume would have to be reduced to,86 million tons by the end of the first commitment period in 22. GHG emissions in 2 rose 3.9% from 29 as a result of an increase in CO2 emissions from all sectors, and particularly the industrial sector, with the recovery of activity following the economic recession triggered by the global financial crisis in 28. In addition, electric power demand increased owing to the relatively high number of days on which exceptionally hot or cold temperatures were recorded. GHG emissions in 2 totalled,256 million tons,.4% below the 99 level or 5.6% higher than the target volume. In order to achieve the 6% below 99 target, therefore, further reduction efforts are urgently required. x million tons,4,3,2,,26,35,333,365,28,29,256 (.4%),86 (6.%) Forest sink (3.8%) Kyoto mechanisms (.6%), 99 (Baseline) Fiscal (Preliminary figure) Targeted under the Kyoto Protocol (2822) Source: Ministry of the Environment ACTUAL & TARGETED CO2 EMISSION VOLUMES IN JAPAN S TRANSPORT SECTOR Of Japan s total CO2 emissions, the transportation sector accounts for roughly 2%, of which 9% are autoemittedmaking CO2 reduction in road transport a priority concern. With steadily declining CO2 emissions since 2, the transport sector s original target of an annual total of 25 million tons of CO2 emissions by 2 was revised in 28, to a more challenging million tons. In fact, by means of increased vehicle fuel efficiency, road congestion mitigation, the wider practice of ecodriving and other measures, the transport sector s CO2 emissions in 2 totalled 232 million tons, considerably surpassing the target. x million tons 32 3 Compliance with vehicle fuel efficiency targets, etc Fiscal If no CO2 countermeasures taken (Preliminary figure) Through increased vehicle fuel efficiency: Down million tons Through improved traffic flow: Down 32.3 million tons Through other measures: Down million tons reduction: Down million tons 2 Targeted Sources: Kyoto Protocol Target Achievement Plan, etc. 23

25 Automobiles and Society Attention to the Environment Climate Change CO2 Emissions Reduction: Improving Vehicle Fuel Efficiency In 998 Japan s Energy Conservation Law recommended vehicle fuel efficiency targets for fiscal year 2, applying top runner criteria whereby the leading fuel efficiency performance to date (998) for a given vehicle weight category was established as the target value. Auto manufacturers worked hard to comply, and in 2 the average fuel efficiency of domestic new gasolinepowered passenger cars reached 8.7 km/liter, largely surpassing the 2 target of 4.4 km/liter. In 26 fuel efficiency targets were established for heavyduty vehicles, i.e. trucks and buses weighing more than 3.5 tons, for enforcement in 25; in 27 new and stricter fuel efficiency targets, also for 25, were introduced for passenger cars and trucks/small buses weighing 3.5 tons or less; and in 22 still stricter fuel efficiency targets were established for passenger cars for enforcement in 22. Japan s automakers will therefore continue to advance fuel efficiency technologies in order to meet these new targets as soon as possible. TRENDS IN DOMESTIC NEW VEHICLE COMPLIANCE WITH 2 FUEL EFFICIENCY TARGETS Compliance rate (%) Fiscal Note: Above figures indicate the rate of compliance with the 2 fuel efficiency standards among all domesticallymanufactured vehicles with GVW 2.5t. Source: Japan Automobile Manufacturers Association AVERAGE FUEL EFFICIENCY OF DOMESTIC NEW GASOLINEPOWERED PASSENGER CARS In km/ Fiscal Note: Figures are for domesticbrand new passenger cars only. Source: Japan Automobile Manufacturers Association 25 AVERAGE FUEL EFFICIENCY TARGETS FOR NEW PASSENGER CARS & TRUCKS/SMALL BUSES VEHICLE TECHNOLOGIES FOR INCREASED FUEL EFFICIENCY Passenger cars Trucks (GVW 3.5tons) 25 target value 6.8 km/ 24 actual value 3.6 km/ 25 target value 5.2 km/ 24 actual value 3.5 km/ (Percentage gain) (23.5%) (2.6%) 25 target value 8.9 km/ Small buses (7.2%) 24 actual value 8.3 km/ km/ Note: Fuel efficiency here is JC8 test cyclemeasured (see page 67), and targets were established assuming the same respective shipment volume ratios by vehicle weight category for 25 as those recorded in 24. Sources: Ministry of Economy, Trade and Industry; Ministry of Land, Infrastructure, Transport and Tourism Improved engine efficiency Improvements in thermal efficiency: Direct injection Variable mechanisms (variable cylinder activation, VVT&L, etc.) Reduction of friction loss: Reduction of piston & piston ring friction loss Lowviscosity lubricating oil Reduced aerodynamic drag Improved body configuration Reduced vehicle weight Expanded use of lightweight materials Improved body structure 25 AVERAGE FUEL EFFICIENCY TARGETS FOR NEW HEAVYDUTY VEHICLES (GVW 3.5t) (Percentage gain) 25 target value 7.9 km/ Trucks (2.2%) 22 actual value 6.32 km/ 25 target value 6.3 km/ Buses (2.%) 22 actual value 5.62 km/ km/ Note: Fuel efficiency here is JE5 test cyclemeasured (see page 67), and targets were established assuming the same respective shipment volume ratios by vehicle weight category for 25 as those recorded in 22. Sources: Ministry of Economy, Trade and Industry; Ministry of Land, Infrastructure, Transport and Tourism Improved powertrain performance Expansion of lockup area Expanded number of transmission gears Continuously variable transmission Reduced rolling resistance Low rollingresistance tires Other Electric power steering Idling prevention (stopstart) Hybridization 24

26 Automobiles and Society Attention to the Environment Climate Change InUse Status of AlternativeEnergy/NextGeneration and FuelEfficient Vehicles Hybrid and electric vehicles and other vehicles that run on alternative fuels are gaining increasing attention because of their significantly reduced CO2 and other emissions. In 2 nearly.5 million of such vehicles (mostly hybrids) were in circulation in Japan and that number is expected to grow. The more widespread use of nextgeneration vehicles will largely depend on the automakers resolution of a number of technological issues (for fuel cell and hydrogen vehicles, for example) and on the expansion of the fuel/energy supply infrastructure. Meanwhile, the use of more fuelefficient and lowemission conventional vehicles continues to be actively promoted. Indeed, in 2 shipments of domestic alternativeenergy/nextgeneration and fuelefficient/lowemission vehicles registered a combined total of 3.57 million units. DOMESTIC SHIPMENTS OF ALTERNATIVEENERGY/NEXTGENERATION & FUELEFFICIENT/LOWEMISSION VEHICLES (Fiscal 2) Fuel cell vehicles Electric vehicles Hybrid vehicles Natural gas vehicles Methanol vehicles Subtotal Vehicles certified as fuelefficient and lowemission vehicles (see Note) Subtotal Dieselalternative LPG vehicles Hydrogen vehicles () (2) Passenger Cars Standard and smallsized vehicles 4,86 444, ,352,829,926 58,,888,36 2,337,388 2,687 2, ,898 68,567,52,465,55,52 Standard and smallsized vehicles,27 559,776 68,722 8,974 77, ,87 Trucks Minivehicles Minivehicles ,469 6,676,45, ,53 445,854, 454,358 2,923,5 96,327 3,9, ,574,5 Buses Chg. (%) () = Emissions down by 75% from 25 emission standards. (2) = Emissions down by 5% from 25 emission standards. Notes:. Vehicles that meet or surpass 2 fuel efficiency standards (as per Japan s Energy Conservation Law) and are compliant with lowemission environmental performance certification criteria (see starred ratings above). 2. Chg. (%) means change from the previous year (with the previous year s result indexed at ). Source: Japan Automobile Manufacturers Association TRENDS IN ALTERNATIVEENERGY/NEXTGENERATION & FUELEFFICIENT/LOWEMISSION VEHICLE SHIPMENTS (DOMESTIC) Fiscal 2 78 TRENDS IN ALTERNATIVEENERGY/NEXTGENERATION VEHICLE USE IN JAPAN Electric vehicles of which motorcycles Hybrid vehicles Natural gas vehicles Methanol vehicles of which motorcycles* Dieselalternative LPG vehicles excluding motorcycles *Figures prior to 29 are not available Fiscal ,7 3,99 74,563 2,2 35 4,962 6,372 2, ,59 2,895 9,2 6,56 4 7,54 3,53 27, ,677 4,658 32,56 2, ,483 8,372 75, ,468 5,357 96,77 24, ,67 25,24 244, ,928 6, ,644 27, ,868 36,7 39,72 x, units ,42 6, ,626 3, ,7 47,536 4, ,358 6,9 429,274 34, ,97 495, , ,85 6,25 536,473 37,7 7 22,68 65,65 598,85 8,473 4, ,83 38, ,82,52,99,48, AlternativeEnergy/NextGeneration Vehicles This designation includes hybrid, electric, natural gas, methanol (virtually no longer in use), fuel cell, dieselalternative LPG and hydrogen vehicles. Emissions down by 75% from 25 standards Emissions down by 5% from 25 standards Emissions down by 75% from 2 standards Emissions down by 5% from 2 standards Emissions down by 25% from 2 standards 2 6,882 5,777,48,4 4, ,764,496,487,49,78 Sources: Next Generation Vehicle Promotion Center; Japan Gas Association; Automobile Inspection & Registration Information Association 25

27 Automobiles and Society Attention to the Environment Climate Change CO2 Emissions Reduction: Improving Traffic Flow Improved road traffic flow enables increased vehicle speed and increased fuel efficiency, which in turn contributes to CO2 reduction. Improving traffic flow by upgrading road networks and overall infrastructure is therefore urgently required. JAMA advocates such upgrades, including measures to mitigate congestion at intersections, as well as the early completion of the Tokyo metropolitan area s three major ring roads and the greater use of expressways. To help ensure steady progress in this regard, the government and other relevant publicsector players must jointly establish a data compilation/analysis and response formulation/implementation scheme to evaluate the impact of traffic flowrelated measures on CO2 reduction and to follow up accordingly. JAMA in fact conducted a quantitative assessment of the impact on CO2 reduction of the operation of the Oji section (opened for service in December 22) of the Tokyo Metropolitan Expressway s inner ring road. This study determined that operation of the new section enabled increased average vehicle speed on that ring road and on surrounding local roads, resulting in an estimated reduction in CO2 emissions of 2, to 3, tons annually. IMPACT OF VEHICLE SPEED ON CO2 EMISSIONS CO2 6 emission 6 5 levels 5 4 (%) km/h 2km/h 3km/h Average vehicle speed Source: Japan Automobile Research Institute IMPACT OF THE OJI SECTION S OPERATION ON CO2 REDUCTION Average vehicle speed in km/h CO2 emissions volume x, tons/year Tokyo Metropolitan Expressway Local roads Tokyo Metropolitan Expressway Local roads Before Operation Note: Vehicle speed and CO2 emissions were calculated on the basis of three established models, including that of the Japan Automobile Research Institute. The estimated annual CO2 reduction volume varies between 2, and 3, tons depending on the model used. Source: Japan Automobile Manufacturers Association PROPOSED DATA INPUT/ANALYSIS & RESPONSE FORMULATION SCHEME FOR IMPROVED TRAFFIC FLOW After Operation Increase/ Decrease General Statistical Data: Road transport statistics Relevant national energy statistics Ministry of Land, Infrastructure, Transport and Tourism Data: Odometer data (collected at vehicle inspections) Road transport surveys Traffic volume data (via monitoring) Road congestion monitoring Data Compilation and Processing Data Analysis/Evaluation Response Formulation and Implementation National Police Agency Data: Road traffic data from sensors Uplink data from ITS optical beacons Status Reports on the Impact of: Use of advanced signalcontrol systems Onstreet parking bans Measures for smoother flow at intersections Construction of bypass routes Source: Japan Automobile Manufacturers Association CO2 Reductions at Production Plants Japan s automobile manufacturers have implemented multiple measures to reduce energy consumption and otherwise cut CO2 emissions at their production facilities. Since 28, they have worked with Japan s autobody manufacturers towards a combined reduction target for Originally set at 6.59 million tons of CO2 annually, this shared target was revised in 29 to a stricter 6.32 million tons, down 25% from the 99 level. As a result of the manufacturers concerted efforts, plantgenerated CO2 emissions totalled 4.67 million tons in 2. REDUCTIONS IN PRODUCTION PLANTGENERATED CO2 EMISSIONS CO2 emissions (x million tons) Target Fiscal (2822 average) CO2 emissions/ production value (x, tons CO2 per trillion yen) Source: Japan Automobile Manufacturers Association 26

28 Automobiles and Society Environmental Performance Vehicle Certification Promoting Vehicles with Greater Fuel Efficiency and Lower Emissions Vehicles with greater fuel efficiency help counter global warming through their reduced emission of CO2, while vehicles with reduced tailpipe emissions help improve air quality. For gasoline, diesel, and LPG vehicles, the Japanese government has established environmental performance certification criteria keyed to Japan s latest fuel efficiency and emission standards. Trucks and buses that comply with NOx (nitrogen oxides) and PM (particulate matter) emissions requirements are also certified, separately. To boost widespread public awareness of vehicles with advanced fuel efficiency and/or low emissions, such vehicles are identified with appropriately coded stickers. CERTIFICATION FOR VEHICLES WITH ADVANCED FUEL EFFICIENCY For Gasoline and Diesel Vehicles Including Trucks and Buses with GVW 2.5t Rating/Performance Level Vehicle Sticker CERTIFICATION FOR VEHICLES WITH LOW EMISSIONS Rating/Performance Level Emissions down by 75% from 25 standards Vehicle Sticker Compliant +2% compared to standards Compliant +% compared to standards Compliant with standards Performing 2% better or more compared to 25 fuel efficiency standards Performing % better or more compared to 25 fuel efficiency standards Compliant with 25 fuel efficiency standards Emissions down by 5% from 25 standards Emissions down by % from 29 standards Note: Fuel efficiency is JC8 test cyclemeasured. For Trucks and Buses with GVW 2.5t Compliant +% compared to standards Compliant +5% compared to standards Compliant with standards Rating/Performance Level Performing % better or more compared to 25 fuel efficiency standards Performing 5% better or more compared to 25 fuel efficiency standards Compliant with 25 fuel efficiency standards Vehicle Sticker CERTIFICATION FOR TRUCKS AND BUSES WITH LOW NOx & PM EMISSIONS Rating/Performance Level Compliant with 29 emission standards Compliant with 25 emission standards Compliant with other certification criteria (see above) Vehicle Sticker Note: Fuel efficiency is JC8 or JE5 test cyclemeasured. For Gasoline and LPG Vehicles Including Trucks and Buses with GVW 2.5t Rating/Performance Level Vehicle Sticker Compliant +5% compared to standards Compliant +38% compared to standards Compliant +25% compared to standards Performing 5% better or more compared to 2 fuel efficiency standards Performing 38% better or more compared to 2 fuel efficiency standards Performing 25% better or more compared to 2 fuel efficiency standards Note: Fuel efficiency is 5mode test cyclemeasured. 27

29 Automobiles and Society Attention to the Environment Emissions Vehicle Exhaust Emissions: New Regulations Enforced in 29 Japan s vehicle exhaust emissions regulations have always been among the strictest in the world, and its automakers have worked very hard to develop the advanced technologies required to comply with them. As a result, NOx and other atmospheric pollutant levels have been on a steady decline even in large urban areas. Based on the Ministry of the Environmentaffiliated Central Environment Council s policy recommendations for future reductions in motor vehicle exhaust emissions (released in April 25), comprehensive new regulations were implemented by the Japanese government in 29, of which the regulations for trucks and buses were, at the time of their enforcement, the most stringent in the world. Starting in 26, the NOx regulation for heavyduty diesel vehicles will be even stricter. COMPARISON OF HEAVYDUTY DIESEL TRUCK EMISSIONS REGULATIONS Japan (GVW=Over 3.5 tons) () Longterm regulations (997, 998, 999) New shortterm regulations (23, 24) New longterm regulations (25) (2) Postnew longterm regulations (29, 2) Future regulations (26, 27, 28) U.S.A. (GVW=Over 3.85 tons) 998 standard 24 standard 27 standard (3) 2 standard Europe (GVW=Over 3.5 tons) EURO (995) EURO (2) (4) EURO (25) EURO (28) EURO (23) EEV (5) Transient mode Steady state mode Transient mode Steady state mode Transient mode Steady state mode Transient mode Steady state mode Transient mode Steady state mode NOx Nitrogen oxides HC Hydrocarbons NMHC Nonmethane hydrocarbons Automobile manufacturers must comply with one of the following: ) NOx + NMHC ) NOx + NMHC 3.35 with mandatory NMHC value of (.6) (5.) 3.5 (3.5) 2. (2.).46 (.4) 2. (2.) All regulatory values below apply to the heaviest truck categories. In g/kwh CO Carbon monoxide (2.) 4. (.5) 4. (.5) 4. (.5) 3. (.5) PM Particulate matter () GVW (gross vehicle weight) (Japan) = Vehicle weight + Maximum load + Maximum occupants x 55 kg. Weight per occupant and other details slightly differ from those of U.S. and European regulations. (2) Japan s regulations applied to the over 2.5t GVW vehicle category; regulations as of 25 apply to the over 3.5t GVW vehicle category. (3) The U.S. s 27 standard permits an NOx compliance level of around.6g until 2 depending on engine family type. (4) EURO (Europe): All vehicle categories were regulated in the steady state (ESC) mode only, except DPF and NOx reduction catalystequipped vehicles, which were regulated in both the steady state (ESC) and transient (ETC) modes. Beginning with EURO, all vehicle categories, whether DPF and NOx reduction catalystequipped or not, are regulated in both modes. (5) EEV (Europe): Enhanced Environmentally Friendly Vehicles. EEV regulations constitute a special category and are applied by EU member countries only in specific instances when urban air quality is particularly poor (for example, when temporary restrictions on vehicle circulation in cities are enforced). Emission values indicated are provisional (.66) (.46) (.46).6 (.3) (.25) (.).3 (.2).3 (.2). (.).2 (.2) COMPARISON OF HEAVYDUTY DIESEL TRUCK EMISSIONS REGULATIONS (PM and NOx) More stringent PM (Particulate matter).3.3. U.S.A. (2) Japan (from 26) Europe (from 23) Japan (29) U.S.A. (27) Europe (28) NOx (Nitrogen oxides) More stringent In g/kwh Note: Countries apply different test cycles based on different running patterns. 28

30 MOTOR VEHICLE EMISSIONS REGULATIONS IN JAPAN Previous/Current Regulations New Regulations Gasoline and LPG Vehicles Diesel Vehicles Motorcycles Vehicle Type Passenger cars Trucks and buses Mini Lightduty (GVW.7t) Mediumduty (.7t<GVW 3.5t) Heavyduty (GVW>3.5t) Passenger cars (3) Trucks and buses Lightduty (GVW.7t) Mediumduty (.7t<GVW 3.5t) Heavyduty (GVW>3.5t) Motordriven cycles Class Motordriven cycles Class 2 Minisized motorcycles Smallsized motorcycles Test cycle 5M + M (g/km) () 5M + M (g/km) () 5M + M (g/km) () 5M + M (g/km) () JE5 (g/kwh) 5M + M (g/km) 5M + M (g/km) 5M + M (g/km) JE5 (g/kwh) Motorcycle test cycle (g/km) enforced CO NMHC NOx CO NMHC NOx CO NMHC NOx CO NMHC NOx CO NMHC NOx Emission CO NMHC Smallsized NOx Midsized Smallsized PM Midsized CO NMHC NOx PM CO NMHC NOx PM CO NMHC NOx PM CO HC NOx CO HC NOx CO HC NOx CO HC NOx Regulatory value (Average) Test cycle JC8 (g/km) () enforced Emission Regulatory value (Average) () All vehicles weighing 3.5t or less are regulated as follows: Beginning in 28, on the basis of (values measured in coldstart state in JC8 test cycle) x.25 + (values measured in 5mode test cycle) x.75; and beginning in 2, on the basis of (values measured in coldstart state in JC8 test cycle) x.25 + (values measured in warmstart state in JC8 test cycle) x.75. (2) PM values apply only to directinjection, leanburn vehicles equipped with absorptiontype NOx reduction catalysts. (3) Smallsized diesel passenger cars have an equivalent inertia weight (EIW) of.25t (GVW of.265t) or less, and midsized diesel passenger cars have an E W over.25t. (4) Enforced since 2 for mediumduty diesel vehicles weighing 2.5t or less and heavyduty diesel vehicles weighing 2t or less. (5) Future regulations will mandate a stricter NOx value of.4g/kwh; enforcement: 26 for GVW>7.5t; 27 for tractortrailer cabs; and 28 for 3.5t<GVW 7.5t. Note: CO: carbon monoxide; NMHC: nonmethane hydrocarbons; HC: hydrocarbons; NOx: nitrogen oxides; PM: particulate matter. Sources: Ministry of the Environment; Ministry of Land, Infrastructure, Transport and Tourism JC8 (g/km) JC8 (g/km) () JC8 (g/km) JC8 (g/km) () JC8 (g/km) JC8 (g/km) () JC8 (g/km) JE5 (g/kwh) JC8 (g/km) JC8 (g/km) JC8 (g/km) JE5 (g/kwh) (4) 29 (4) CO NMHC NOx PM (2) CO NMHC NOx PM (2) CO NMHC NOx PM (2) CO NMHC NOx PM (2) CO NMHC NOx PM (2) CO NMHC NOx PM CO NMHC NOx PM CO NMHC NOx PM CO NMHC NOx (5) PM

31 Automobiles and Society Attention to the Environment Emissions Improving Air Quality Japan s central government as well as local governments in the greater Tokyo area have implemented measures to address airquality problems caused by motor vehicles. In accordance with national legislation aimed at curbing nitrogen oxide (NOx) and particulate matter (PM) emissions in major metropolitan areas, the issuance of inspectioncompliance certification is prohibited for vehicles that fail to meet the legal standards at inspection time. Moreover, the Tokyo metropolitan and surrounding prefectural governments have introduced additional regulations for diesel vehicles for the specific purpose of reducing PM emissions. Enforcement of these regulations means that restrictions are imposed on diesel vehicle circulation in the areas concerned. PROVISIONS OF THE NATIONAL MOTOR VEHICLE NOx & PM EMISSIONS ACT/ DIESELVEHICLE PM EMISSION REGULATIONS FOR THE GREATER TOKYO AREA Provisions of the National Motor Vehicle NOx & PM Emissions Act (Major Metropolitan Areas) Provisions of PM Emission Regulations for Diesel Vehicles (Greater Tokyo Area Only) Areas Regulated Vehicle Types Regulated Substances Regulated Regulatory Values in Force Specific Provisions Grace Periods Tokyo, Osaka, and Aichi, Chiba, Hyogo, Kanagawa, Mie, and Saitama prefectures (designated areas) Diesel, gasoline, and LPG trucks and buses Diesel passenger cars NOx and PM Trucks and Buses GVW = Gross vehicle weight GVW=.7 tons & under: NOx Same as 988 regulatory values for new gasoline vehicles PM Half the 22 regulatory values for new diesel vehicles GVW=Over.7 tons to 2.5 tons: NOx Same as 994 regulatory values for new gasoline vehicles PM Half the 22 regulatory values for new diesel vehicles GVW=Over 2.5 tons to 3.5 tons: NOx Same as 995 regulatory values for new gasoline vehicles PM Half the 23 regulatory values for new diesel vehicles GVW=Over 3.5 tons: NOx Same as regulatory values for new diesel vehicles PM Same as regulatory values for new diesel vehicles Passenger Cars NOx Same as 978 regulatory values for new diesel vehicles PM Half the 22 regulatory values for new diesel vehicles New Vehicles In regulated areas, new vehicles not meeting the standards cannot be registered. Vehicles in Use Regulated vehicles whose principal places of use (as declared in their inspection certificates) fall in regulated areas and that do not meet the standards will not be granted inspection certification after grace periods have expired. Note: Vehicles whose principal places of use (as declared in their inspection certificates) do not fall in regulated areas can travel through regulated areas even if they do not meet the standards. From first registration: Small trucks... 8 years etc. Diesel passenger cars... 9 years etc. Standard trucks... 9 years etc. Minibuses... years etc. Large buses... 2 years etc. Tokyo (except for islands) and Chiba, Kanagawa, and Saitama prefectures (all areas) Diesel trucks and buses Note: Not applicable to diesel passenger vehicles with up to passenger occupancy PM only In Chiba and Kanagawa, same as 997, 998, and 999 regulatory values for new diesel vehicles In Tokyo and Saitama, same as 22, 23, and 24 regulatory values for new trucks and buses New Vehicles No restriction. Vehicles in Use Vehicles not meeting the standards will be prohibited from travelling through regulated areas after grace periods have expired. Vehicles equipped with local governmentspecified PM reduction systems are deemed to be in compliance with the standards. Note: Applicable to diesel trucks and buses registered anywhere in Japan and travelling through regulated areas. Seven years from first registration, regardless of vehicle type (truck or bus) Note: Except in Chiba Prefecture, where vehicles neither registered in nor travelling through areas designated under the national Motor Vehicle NOx and PM Emissions Act will be exempted for a period of 2 years, provided vehicle owners apply for such an exemption. 3

32 Automobiles and Society Attention to the Environment Noise Reducing AutomobileEmitted Noise Automobiles generate various kinds of noise, including the noise emitted by the engine, intake system, powertrain, and cooling and exhaust systems. Tires also generate tire/road noise. Automotive noise in Japan is regulated by standardson accelerated running noise, steady running noise, and stationary exhaust proximity noisewhich have become progressively more stringent, requiring automakers to develop the technologies necessary for compliance. Tampered muffler systems are another source of noise. To address that issue, strengthened regulations in effect from April 2 mandate a) that mufflers be tamperresistant so as to prevent the alteration of their noisesuppression mechanism, and b) that replacement mufflers meet Japan s accelerated running noise standard, as well as its stationary exhaust proximity noise standard, through type approval compliance and be IDmarked accordingly. For further progress in automotive noise reduction, Japan s Central Environment Council is working on regulatory reform, including changes in noise testing methodology and the implementation of tire noise regulations, in line with the results of studies conducted by the UNECE s World Forum for Harmonization of Vehicle Regulations (WP.29). THE PROGRESS IN MOTOR VEHICLE NOISE REDUCTION (accelerated running noise) db(a)/% (equivalent conversion) % db(a) regulation 89 db(a) 976 regulation LargeSized Vehicles 84 db(a) Powertrain, Other Tires Cooling system Exhaust system Engine 86 db(a) 979 regulation 83 db(a) 8 db(a) 985 regulation 2 regulation 97 regulation Passenger Cars Tires, Powertrain, Other Intake system Cooling system Exhaust system Engine 82 db(a) 977 regulation 8 db(a) 979 regulation 78 db(a) 76 db(a) 982 regulation 998 regulation 86 db(a) 97 regulation 83 db(a) 976 regulation Motorcycles Tires, Other Powertrain Intake system Exhaust system Engine 78 db(a) 75 db(a) 73 db(a) 979 regulation 987 regulation 2 regulation TESTING MOTOR VEHICLE NOISE LEVELS Accelerated running noise Noiselevel measurement span m m 7.5m Steady running noise Noiselevel measurement span m m 7.5m Exhaust proximity noise.5m 45 After running at a steady speed up to this point, f u l l t h r o t t l e acceleration Microphone (.2m above ground level) Running at a constant speed Microphone (.2m above ground level) Microphone (at height of exhaust port) After maintaining the stationary vehicle for a few seconds at a constant engine revolution speed, quick deceleration Source: Japan Automobile Manufacturers Association OVERVIEW OF JAPAN S MOTOR VEHICLE NOISE REGULATIONS (for accelerated running noise) LargeSized Vehicles MediumSized Vehicles SmallSized Vehicles Passenger Cars Motorcycles MotorDriven Cycles Vehicle Type Vehicles with GVW>3.5 tons and maximum engine output>5 kw Vehicles with GVW>3.5 tons and maximum engine output 5 kw Vehicles with GVW 3.5 tons Vehicles exclusively for the transport of passengers, with up to passenger occupancy Other than minivehicles Minivehicles Smallsized motorcycles (over 25cc) and minisized motorcycles (26cc25cc) Class motordriven cycles (5cc & under) and Class 2 motordriven cycles (5cc25cc) 4WD vehicles, etc. Trucks Buses 4WD vehicles, etc. Trucks Buses Over 6 occupants 6 occupants or fewer GVW>.7 tons GVW.7 tons Bonnet type Caboverengine type Smallsized Minisized Class 2 Class Notes:. In pre987 regulations, 5 kw reads 2 horsepower. 2. 4WD vehicles, etc. includes 4WDs, tractors, and cranes Regulation In db(a) Source: Ministry of the Environment 3

33 Automobiles and Society Attention to the Environment Recycling Vehicle Recycling and Waste Reduction Under Japan s EndofLife Vehicle (ELV) Recycling Law which entered into force in January 25, automobile manufacturers and importers are responsible for recovery, recycling and appropriate disposal with respect to fluorocarbons, airbags, and automobile shredder residue (ASR). Compliance with the law was anticipated to enable ASR to be recycled at a rate of 7% by 25, resulting in an automobile recycling rate, by vehicle weight, of 95% (as compared with the 8% rate prevailing prior to the introduction of the law); those rates were in fact surpassed in 28. Japan s vehicle recycling infrastructure as mandated by its ELV Recycling Law is the first in the world to administer the entire process of auto recyclingfrom ELV recovery to final disposalon the basis of electronic manifests (or compliance checklists). JAMA itself played a central role in the development and implementation of this advanced vehicle recycling system. It also provided financial support for related software development and continues to help finance system maintenance and upgrades. In line with national efforts to reduce, reuse, recycle, Japan s automakers are also striving to design vehicles using lightweight materials that are easy to dismantle and recycle, and to reduce and recycle waste generated in the manufacturing process. In 2 the volume of auto plantgenerated waste destined for landfill disposal totalled, tons, a 99.7% decrease from the 99 level, very largely surpassing the 25 target of, tons. INDUSTRY MEASURES IN LINE WITH NATIONAL LEGISLATION Promotion of Effective Utilization of Resources Law (the 3R Law) EndofLife Vehicle Recycling Law Product Design Waste Management ELV Recycling Reduce initiatives Reuse initiatives For designated products: Weight reduction/ Downsizing Longer product life Reduced use of hazardous substances For designated products: Use of recyclable materials Ease of dismantling For designated areas of activity: Reduction/recycling of designated waste products generated in vehicle manufacturing operations: ) Scrap metals 2) Casting sand residue waste volume*: 99 (baseline): 352, tons Distribution, Servicing and Use Recovery and recycling of: ) Fluorocarbons 2) Airbags 3) ASR Note: Motorcycles are not covered by the ELV Recycling Law. Recycle initiatives Ease of sorting Nonhazardous recycling 2:, tons (a 99.7% reduction from 99) JAMA target:, tons by FY 25 Materials identification *For landfill disposal, including scrap metals, casting sand residue, and other waste ELV RECOVERY IN NUMBERS RECYCLING RATES: TARGETED & ACHIEVED Fiscal No. of ELVs recovered Appropriate disposal of 3 designated items Fluorocarbons Airbags () ASR (2) 2 3,648,428 3,,962,95,49 3,743,46 2 2,963,642 2,374,587,645,528 2,87,55 () Through recovery/appropriate disposal of inflators or through onboard deactivation. (2) Covers all categories of processors, whether for direct disposal or for transfer to other markets. Source: Japan Automobile Recycling Promotion Center Three Designated Items Fluorocarbons Airbags ASR Target Destruction 85% 25: 3% 2: 5% 25: 7% Achieved 2,375 million vehicle units (2) 93.% (2) % (2) Sources: Governmentaffiliated entities 32

34 THE ELV RECYCLING FLOW (as per the provisions of the EndofLife Vehicle Recycling Law) ELV flow Information flow Payment/funds remittance flow Payment of recycling fee Purchasers of New Vehicles Purchasers of Used Vehicles Fluorocarbon Disposal* Facilities Delegated Funds Management Entity (Japan Automobile Recycling Promotion Center) Automobile Manufacturers/Importers/Delegated Organization (Japan Automobile Recycling Promotion Center) *Fluorocarbons are destroyed. Airbag Disposal Facilities Fluorocarbon & airbag disposal managed by Japan Auto Recycling Partnership (JARP) Remittance of recyclingfee funds Shredder Residue Recycling Facilities Designated Handling Agent Shredder Residue Recycling Facilities Designated Handling Agent Final Owners Fluorocarbons Payment for recovery Airbags Payment for recovery To markets for recyclable parts, metals, etc. Shredder residue ELVs ELV Collectors ELVs Fluorocarbon Recovery Operators ELVs Dismantlers Vehicle carcasses Press & Shear Operators Shredder Residue Processors Shredding & Sorting Operators Recovery manifests Delivery manifests Recovery manifests Delivery manifests Recovery manifests Delivery manifests Recovery manifests Delivery manifests Delegated Information Management Entity (Japan Automobile Recycling Promotion Center) Inspection & registration verification (MOTAS) MOTAS: Japanesederived acronym for motor vehicle inspection & registration system. Minivehicle inspection Note: The Japan Automobile Recycling Promotion Center assumes the same responsibilities as automobile manufacturers and importers when an ELV has no manufacturer representation under the provisions of this law. It also assumes transporttomainland costs for ELVs turned in on Japan s smallest islands. In addition, this organization provides financial assistance in the disposal of illegally abandoned vehicles. REDUCTIONS IN PRODUCTION PLANTGENERATED WASTE As a result of the efforts made by Japan s automobile manufacturers, the total volume of auto plantgenerated waste destined for landfill has decreased dramatically. Having shrunk in 25 to 8, tons, down more than 97% from the 99 baseline level and for the first time surpassing the 25 target of, tons, plantgenerated waste totalled, tons in 2, a 99.7% decrease from the 99 level. Waste for landfill disposal (x, tons) Fiscal Target value of vehicle production including motorcycles (x billion yen) Source: Japan Automobile Manufacturers Association 5 33

35 Automobiles and Society Attention to the Environment Recycling Voluntary Initiatives to Recycle Commercial Vehicle Rack Equipment and Motorcycles Japan s EndofLife Vehicle Recycling Law does not cover some types of commercial vehicle rack and custom equipment, nor does it cover motorcycles. In response, JAMA, in cooperation with the Japan AutoBody Industries Association, promotes the development and use of rack equipment that is easy to dismantle and contains minimal amounts of hazardous substances. JAMA has also introduced a recyclinganddisposal system for such equipment, and by the end of 2 a total of 63 operators across Japan were participating in the system voluntarily. Since October 24, JAMA s four motorcyclemanufacturing members, along with 2 motorcycle importers, have been voluntarily operating a recycling system under which motorcycle dealers nationwide sell only vehicles that feature an official motorcycle recycling mark, enabling, without any additional charge to their final owners, their recovery and processing through the proper disposal channels at the end of their service life. In October 2, the motorcycle recycling fee was eliminated for vehicles sold prior to the introduction of the motorcycle recycling system seven years earlier. Municipallyowned motorcycles require a preapproval by the Japan Automobile Recycling Promotion Center prior to their appropriate disposal. COMMERCIAL VEHICLE RACK EQUIPMENT NOT COVERED BY THE ENDOFLIFE VEHICLE RECYCLING LAW Voluntary Recovery (from CabType Vehicles) Voluntary Recovery (from SingleBody Vehicles) Vehicles Not Covered by the EndofLife Vehicle Recycling Law (Color code explains cost burden placement.) Cost Burden for Equipment Not Covered by the Law All equipment whose recovery is not mandated by law (Color code explains cost burden placement.) Custom and other equipment The EndofLife Vehicle Recycling Law does not cover some types of rack and custom equipment for commercial vehicles. Recovery costs through final disposal are therefore not included in the vehicle recycling fee but rather marketdetermined. Vantype CVs such as: Tanktype CVs such as: Hauling CVs such as: Freezer trucks/vans, refrigerator trucks/vans, dry vans, etc. Tank trucks, cement mixers, waterspraying trucks, watersupply trucks, sewage removal trucks, etc. Specialized hauling trucks, vehicle carriers, container trucks, liftequipped vehicles, etc. Cost Burden for Equipment Covered by the Law For all commercial vehicle rack equipment covered by the Endof Life Vehicle Recycling Law, including singlebody vehicle equipment (exclusive of custom equipment), the vehicle recycling fee covers the entire cost of recovery through final disposal. Specialpurpose CVs such as: Special allterrain vehicles, fire trucks, wreckers, pump trucks, ladderequipped vehicles, etc. THE MOTORCYCLE RECYCLING FLOW Final Owners Delivery of endoflife motorcycle directly to a certified collection center Delivery of endoflife motorcycle to an ELV motorcycle dealer Motorcycle Recycling Mark EndofLife Motorcycle Dealers ELV Motorcycle Dealer Designation Digits represent dealer s ID code. Verification of ownership Verification of recycling documentation Delivery to certified collection centers EndofLife Motorcycle Processing (nationwide operations) Certified Collection Centers (9) Verification of ownership Verification of recycling documentation Disposal/ Recycling Facilities (4) Note: The cost of ELV motorcycle delivery from ELV dealers to certified collection centers is financed by the motorcycle manufacturers on the basis of the consumer s recycling fee paid at time of motorcycle purchase. Source: Japan Automobile Recycling Promotion Center 34

36 Automobiles and Society Road Safety Status of Road Accidents Road Accidents and Resulting Fatalities and Injuries Continue to Decline In 2 road fatalities (defined as occurring within 24 hours after the accident) in Japan fell 72.5% compared to their peak of 6,765 in 97, to a total of 4,6. Road accidents and road injuries also declined, for the seventh consecutive year, to 69,936 and 854,493 respectively. Increased seatbelt use is one of the major factors behind the downward trend in road fatalities. The June 28 revision to the Road Traffic Act requires all automobile passengers, including rearseat occupants, to use seatbelts. Although the rate of use of rear seatbelts in 2 stood at 33.2% on regular roads and at 63.5% on expressways, those rates remain low compared to the rate of use of front seatbelts, which approaches %. Further measures are needed to encourage rearseat occupants to buckle up. ROAD ACCIDENTS/INJURIES/FATALITIES Injuries (Number of persons) 2,,,5, 2, 5, Fatalities (Number of persons) Accidents (Number of accidents),, 5,, 5, ROAD ACCIDENTS/INJURIES/FATALITIES (exact figures) Accidents Injuries (Number of persons) Fatalities (Number of persons) ,8 472, , , ,97 76,789 93, , , ,47 98,96 622, ,79 68,346 79, ,677,55,697,56,633,34, ,54 6,765,792 8,76 9,26,227,679 9,66 6,87 5,744 5, ,474 9,8 725,773 69, ,28 854,493 4,94 4,863 4,6 Source: National Police Agency SEATBELT USE RATES BY SEAT POSITION Driver s seat Front passenger s seat Rear seat Regular Roads Expressways In % Notes:. The survey on seatbelt use is conducted annually in October survey samples totalled roughly 45, on regular roads and 87, on expressways. Sources: National Police Agency; Japan Automobile Federation ROAD ACCIDENTS IN 2 BY ROAD CONFIGURATION Straightaway 29,38 (42.%) Other 24,953 (3.6%) Number of Accidents 69,936 (%) Near intersection 86,57 (2.5%) Number of accidents Intersection 375,62 (54.3%) Within intersection 289,445 (4.8%) Notes:. Straightaway includes some curves and tunnels. 2. Other includes railroad crossings. Source: National Police Agency 35

37 Automobiles and Society Road Safety Vehicle Safety Equipping More Vehicles with Advanced Safety Features Road accidents, injuries and fatalities in Japan continued to decline in 2 (see page 38). Nevertheless, road accidents still claim thousands of lives every year in Japan and in 2, they injured 854,493 people. Further efforts are therefore required to make the nation s roads safer for all their users. Road safety involves three factorsvehicles, road users, and road infrastructureand greater road safety requires that progress be made in all three areas. The automotive industry continuously strives for greater active safety by enhancing and expanding the installation rates of onboard vehicle safety equipment to help prevent accident occurrence. At the same time, it seeks to increase passive safety through enhanced structural safety and vehicle features designed to mitigate injury when accidents do occur. VEHICLE SAFETY FEATURES & YEAR OF INTRODUCTION Active Safety Intervehicle distance warning Adaptive cruise control ( With lowspeed following mode) ( Fullrange) Lanekeeping assist Blindcorner monitoring Night vision monitoring Navigatorbased gearshift control (ATs only) Adaptive frontlighting system (AFS) Park assist Collisionmitigation braking system (precrash safety) Approachingvehicle warning Passive Safety Active head restraints Curtain airbags Pedestrian protection vehicle design ISOFIX anchorages (for child safety seats) Advanced compatibility vehicle structure Rollover curtain airbags Knee airbags Precrash seatbelts Automatic popup hood Motorcycle airbags Source: Japan Automobile Manufacturers Association SAFETY FEATURE ONBOARD INSTALLATION STATUS (for passenger cars produced in 2 for home market) Active Safety Passive Safety Antilock braking system (ABS) Brake assist Unfastened seatbelt warning (driver s seat) Unfastened seatbelt warning (front passenger s seat) Powerwindow jamming prevention (with autoup function) Powerwindow jamming prevention (without autoup function) Highintensity discharge headlamps Adaptive frontlighting system (AFS) Backup monitoring (rear obstacle detection) Vehicle perimeter monitoring Vehicle perimeter obstacle warning Blindcorner monitoring Night vision monitoring Night vision pedestrian ahead warning Curve detection Tire pressure monitoring Driver inattention warning Intervehicle distance warning Lane deviation warning Rear collision warningequipped headrest control Collisionmitigation braking system (precrash safety) Adaptive cruise control Adaptive cruise control with lowspeed following mode Fullrange adaptive cruise control Lanekeeping assist Backup monitoring (parking assistance) Navigatorbased gearshift control Precrash seatbelts Electronic stability control Traction control with ABS Navigatorbased stop sign alert with brake assist Rearwardapproachingvehicle warning Emergency braking warning Approachingvehicle warning Side airbags Curtain airbags Active head restraints ISOFIX anchorages (for child safety seats) Threepoint seatbelt for rear center seat* Safety Feature In no. of models (see Note ) (67) (58) (9) (64) (8) (3) (58) (8) (2) (6) (4) (2) () () () (5) () () () () (2) (2) () () () () (8) (5) (55) (54) (6) () (8) (4) (52) (49) (2) (26) (7) Installation Status In % (see Note 2) In % (see Note 2) 3,85,786 3,76,284 4,49,4,42,625 4,,257 39,592,764,57 223,932 52,283 22,56 86,4 8,424,279,279 74,736 83,88 85,593 4,727 23,882 3,599 47,882 38,843 2,877 7,665,4 39,64 79,37 28,623,, ,58 9,844, ,447 2,893,86, ,676 2,52,87 3,255,95,9, ,49,894 Notes:. In no. of models indicates the number of models in which the safety feature is installed as standard or optional equipment. Figures in parentheses indicate the number of models in which the safety feature is standard equipment. 2. In % means as a percentage of the total number of models/units produced. 3. Passenger cars here include minicars. *In 2 a total of 59 passenger car models (2,97,375 vehicle units) featured a rear center seat. Minicars do not feature a rear center seat. Source: Japan Automobile Manufacturers Association

38 Automobiles and Society Road Safety JAMA Initiatives JAMA Initiatives in Promoting Greater Road Safety In April 24, JAMA pledged its support of the Japanese government s goal to reduce road fatalities by 5% over a period of ten years. JAMA s own initiatives towards that goal are outlined below. JAMA S ROAD SAFETY INITIATIVES IN EIGHT PRIORITY AREAS Priority Area Road Users: Public Awareness Campaigns Vehicles: Safety Measures Road Infrastructure: Proposals to Government Accidents involving pedestrians or cyclists Continued implementation of road safety public awareness campaigns, based on the results of accident causation studies. More widespread application of AFS (), ABS (2), BA (3), and stability control. For infrastructural improvements, based on the results of accident causation studies. Special measures for the elderly Development of road safety educational programs specifically for the elderly. Development of technologies specifically geared to agingrelated physical changes. For more widespread roadway/sidewalk demarcation and greater barrierfree mobility. Greater use of seatbelts Public awareness campaigns to promote the use of seatbelts. Delays in driver recognition and incorrect vehicle control Campaigns aimed at preventing faulty driver recognition and incorrect vehicle control. Research into the mechanisms of accident causation and humanmachine interface conditions using data recorders, etc. Accidents occurring at twilight/night Campaigns to promote the early lighting of automobile headlamps. More widespread application of AFS. For improved nighttime road illumination. Accidents occurring at intersections Public awareness campaigns to encourage drivers to exercise greater caution at intersections, where the majority of fatal road accidents occur. More widespread application of ABS, BA, and stability control. Improvement of sideimpact protection performance. For road infrastructure regulations for effective utilization of ITS technologies. Collisions with stationary objects Improvement of sideimpact and vehicle occupant protection performance and of side and curtain airbags. For expanded provision of underground power lines and impactabsorbing road installations. Compatibility R&D on crashcompatible vehicle bodies and compatibility evaluation methods to improve vehicle performance. () Adaptive frontlighting systems. (2) Antilock braking systems. (3) Brakeassist systems. Automobiles and Society Road Safety National Initiatives Japan s 9th Basic Plan for Road Safety Japan s road safety measures are promoted in line with the nation s consecutive basic plans for road safety, the first of which was implemented in 97. Under the slogan Towards a Zero Road Accidents Society, the ninth road safety plan (225) aims to create a highly road safetyconscious society that places maximum priority on human life and, in particular, the safety of those of its members who are most vulnerable to road accidentsnamely, pedestrians, senior citizens, and persons who are disabled. The plan emphasizes the need to pursue aggressive measures targeting further reductions in the occurrence of road accidents and fatalities. JAPAN S ROAD SAFETY TARGETS To reduce the annual number of road fatalities (occurring within 24 hours postaccident) to below 3,* by 25, and thus to make Japan s roads the safest in the world. *Or about 3,5 when fatalities occurring within 3 days postaccident are included (based on the actual ratio in 2) To reduce the total annual number of road fatalities (occurring within 24 hours postaccident) and injuries to below 7, by 25. EIGHT MAJOR AREAS OF ROAD SAFETY PROMOTIONAL ACTIVITY Road Infrastructure Improvements Sidewalk construction/upgrades, especially in school zones More pedestrian routes suitable for the elderly and disabled Increased use of ITS Promotion of Safe Driving Implementation of special drivereducation programs for the elderly Vehicle fleet operationrelated road accident analysis Enforcement of Road Traffic Laws Strict enforcement of traffic regulations Stronger crackdowns on hotrodding motorcyclists Provision of Fair Compensation for Road Accident Victims Enhanced support for the provision of fair damages compensation Road Safety Public Awareness Campaigns Promotion of safe cycling Promotion of road safety education for the elderly Promotion of seatbelt use by all vehicle occupants Promotion of road safety activities in local communities with the participation of residents Enhancement of Vehicle Safety Expanded development and onboard application of Advanced Safety Vehicle technologies Implementation of improvements to the national vehicle recall system Promotion of regular vehicle checks and maintenance Reinforcement of Emergency Rescue Operations Infrastructure Improved training and deployment of emergency rescue personnel Upgrading of emergency dispatch support systems Promotion of doctorstaffed helicopters Promotion of Road Safety Research and Analysis Promotion of further safedriving research Promotion of comprehensive analysis of road accident causation Source: Japan s 9th Basic Plan for Road Safety 37

39 Automobiles and Society Motor Vehicle Thefts Efforts to Prevent Theft After peaking at 64,223 in 23, the annual number of automobile thefts in Japan fell for seven consecutive years, dropping to 23,775 in 2, but then rose slightly, to 24,928, in 2. This overall downward trend is largely attributable to the widespread use of immobilizers (portable electronic lock systems). Meanwhile, although 67,776 motorcycle thefts were reported in 2, that figure nevertheless represents a continuing steady decline in such thefts since 2. To enhance motor vehicles theftresistance, the automobile industry has introduced and promotes the use of electronic devices such as smart keys equipped with immobilizers. TRENDS IN CONFIRMED MOTOR VEHICLE THEFTS TRENDS IN CONFIRMED MOTORCYCLE THEFTS With key Without key number of confirmed thefts With key Without key number of confirmed thefts Number of thefts Number of thefts 22 2,24 42,469 62, ,39 55,63 98, ,568 45,655 64, ,969 2, 54, ,999 42,738 58, ,574 98,43 26,77 5 3,86 33,542 46, ,758 8,397 4,55 6,355 25,73 36,58 6 2,45 72,49 93, ,695 23,95 3,79 7 9,686 63,342 83,28 8 7,628 9,887 27,55 8 8,496 6,858 8, ,38 8,777 25,85 9 8,458 63,658 82,6 6,355 7,42 23,775 7,349 56,42 73,49 6,295 8,633 24,928 6,364 5,42 67,776 2, 4, 6, 8,, 2, 3, 4, Source: National Police Agency Source: National Police Agency A SAMPLE IMMOBILIZER DEVICE AND HOW IT WORKS Transponder Key Vehicle manufacturer s original product ID code ID accepted ID verification ID rejected Ignition turned on Ignition not turned on The transponder incorporated in the key transmits a signal (ID code) to the computer installed onboard the vehicle. The ignition is turned on electronically only when the ID has been accepted. This technology combining a sophisticated lock function and electronic coding effectively protects the vehicle against theft. Note: The above diagram illustrates the operation of a vehicle manufacturer s original product. Other types of immobilizers are available in the aftersales market. 38

40 Automobiles and Society Automotive Freight Transport Motor Vehicles are Vital to Goods Distribution Accounting for 56% of Japan s total freight transport, road transportation plays an essential role in goods distribution. With everexpanding goods distribution, the role of motor vehicles in freight transport will become even more significant in the years ahead. TRENDS IN DOMESTIC FREIGHT TRANSPORT VOLUMES, BY MODE x million tons/km 6, 5, 4, 3, Air Maritime Rail Road 3,66.52,836 4, ,58 5, , ,763 5,79 5,69 5,623 5,684 5, ,47 2,445 2,356 2,82 2,88 2, ,77 5, ,78 2, ,56. 5,22 9.8,879, , , ,,, , ,59 2,946 3,6 3,6 3,6 3,25 3,262 3,335 3,45 3,533 3,449 3,332 2, Fiscal Notes:. As of 987, Road includes transport by minivehicles. 2. Survey and calculation methods for Road data changed in Road figures for fiscal 2 (ending March 3, 2) do not include data from the Tohoku region and Hokkaido as a consequence of the March, 2 earthquake. Sources: Ministry of Land, Infrastructure,Transport and Tourism, etc. Automobiles and Society Automobile Customs Tariffs Automobile Customs Tariffs After repeated reductions in tariff rates, import tariffs in Japan on finished motor vehicles and major auto components were completely abolished in 978. Meanwhile, some countries still impose high tariffs on imported vehicles. The United States imposes a 25% tariff on imported trucks, and EU import tariffs range from % (on finished passenger cars) to 22% (on largersized trucks). China s auto tariffs remain high despite having been progressively lowered after the country s accession to the World Trade Organization. AUTOMOBILE CUSTOMS TARIFFS, JAPAN/U.S.A./EU/CHINA Passenger Cars Trucks Buses Components, etc. None None None Japan U.S.A. EU Major components: None 2.5% 25% Cab chassis, 5t or greater in GVW... 4% % Gasoline trucks, over 28cc Diesel trucks, over 25cc... 22% Gasoline trucks, 28cc or under Diesel trucks, 25cc or under... % 25% China As of February % Trucks, under 5t in GVW Gasoline trucks, 5t or greater in GVW Diesel trucks, from 5t up to 4t in GVW... 2% Vehicles for the transport of or more persons, incl. the driver... 2% Vehicles for the transport of or more persons, incl. the driver Gasoline buses, over 28cc Diesel buses, over 25cc... 6% 25% Gasoline buses, 28cc or under Diesel buses, 25cc or under... % Bodies, parts and accessories % Bodies, parts and accessories % Major components... 3% Sources: Customs tariff schedules of countries/region concerned 39

41 Automobiles and Society ITS and ASV Evolution of Intelligent Transport Systems (ITS) in Japan Intelligent Transport Systems aim to radically improve transport safety, efficiency and comfort through the use of information and communication technologies integrating road users, road infrastructure, and vehicles. In 996 the Japanese government formulated its Comprehensive Concept for the Promotion of ITS, on the basis of which it has promoted, as a national project, ITS development in a number of areas. Advanced navigation systems are already widely in use, as are ETC (electronic toll collection) and smart highway toll stations using ETC exclusively. With the development and introduction of advanced safety vehicles (ASVs), roadtovehicle safedriving support systems, including an ITS spot service system for use mainly on expressways, were tested in 28 and entered into fullscale operation in 2. The government s New Strategy in Information and Communications Technology of 2 calls for the introduction of safedriving support systems and the halving of road congestion by 22 (compared to 2) on major national highways. INTRODUCTION OF ROADTOVEHICLE SAFEDRIVING SUPPORT SYSTEMS Incorporating ITS technologies, roadtovehicle systems providing safedriving support and cruise assistance are now in operation in Japan. In 2 an ITS spot service system was launched mainly on expressways and a DSSS (for Driving Safety Support System ) system on national highways. Meanwhile, the use of electronic toll collection (ETC) on highways has increased to nearly 9% per million vehicles. DSSS SYSTEM FEATURES (EXAMPLES). Oncoming traffic warning (here, on right turn) 2. Entering traffic ahead warning Source: Universal Traffic Management Society of Japan SPOT SERVICE SYSTEM FEATURES (EXAMPLES) ETC UTILIZATION STATUS, 8 x,/day In % Number of invehicle units in use Utilization rate Visual traffic congestion ahead warning Visual sharp curve ahead warning Audio warning Audio warning Sources: Ministry of Land, Infrastructure,Transport and Tourism, etc. Jan. 25 Jan. 26 Jan. 27 Jan. 28 Jan. 29 Jan. 2 Jan. 2 Dec. 2 Notes:. Data was not collected from roads that were made tollfree on a trial basis from July 2 through June No data was collected from the entire Tohoku region in and after June 2, when all toll roads there were made tollfree. Source: Ministry of Land, Infrastructure, Transport and Tourism 4

42 EXPANDING AVAILABILTY OF ASV TECHNOLOGIES IN THE MARKET In the area of safedriving assistance using ITS technologies, a wide range of vehicle safety features, including adaptive frontlighting systems, lanekeeping assist systems, fullrange adaptive cruise control systems and collisionmitigation braking systems, have been developed based on the results of research conducted on the Advanced Safety Vehicle (ASV) concept. Most of these advanced technologies have already been introduced to the market (see page 39 for details on the status of their onboard installation). THE ADVANCED SAFETY VEHICLE (ASV) PROJECT, PHASES 5: Summary of Contents and Scheduling Phase (Five Plan) Phase 2 (Five Plan) Phase 3 (Five Plan) Phase 4 (Five Plan) Phase 5 (Five Plan) Implementation Period FY 99 through FY 995 FY 996 through FY 2 FY 2 through FY 25 FY 26 through FY 2 FY 2 through FY 25 Objectives Technological verification R&D for market introduction Preparation for widespread use Development of new technologies Promotion of widespread use Practical application of some DSSS systems (see page 44) Breakthroughs in active safety technologies Preparation for implementation of telecommunicationsbased systems to help prevent accidents involving pedestrians Source: Ministry of Land, Infrastructure, Transport and Tourism PRINCIPAL ASV SAFETY TECHNOLOGIES DEVELOPED CollisionMitigation Braking System 6 Vehicle Perimeter Obstacle Warning Driver Inattention Warning System 2 Curve Detection System 7 Adaptive FrontLighting System Electronic Stability Control System 3 FullRange Adaptive Cruise Control 8 Rear Collision WarningEquipped 2 Rear/Side Obstacle Detection 4 Lane Deviation Warning System Headrest Control 3 Emergency Braking Warning 5 LaneKeeping Assist System 9 PreCrash Seatbelts 4 Night Vision Pedestrian Ahead Warning Source: Ministry of Land, Infrastructure, Transport and Tourism PRACTICAL APPLICATION OF ASV TECHNOLOGIES. LaneKeeping Assist Sensors (cameras) positioned on the vehicle monitor the road ahead and, through auxiliary control of the steering wheel, help keep the vehicle centered in the lane whenever the vehicle deviates from its course because of, for example, a crosswind or road surface unevenness. Lanekeeping assist Lane deviation warning Area monitored Area monitored 2. FullRange Adaptive Cruise Control Information from front sensors helps a vehicle keep a safe distance from the vehicle ahead through brake or speed control according to a preset vehicle speed. Monitoring of distance to the vehicle ahead When vehicle ahead slows down, auxiliary braking is activated. 3. CollisionMitigation Braking System (precrash safety) Based on the distance from and speed relative to the vehicle ahead obtained principally by means of radar technology, the system s electronic control unit calculates the risk of collision. In the event of such a risk, multiple warnings are emitted and auxiliary braking is applied. When a collision is imminent, full braking power is applied and seatbelts are retracted automatically. 4. Vehicle Perimeter Monitoring & BlindCorner Monitoring In blindcorner monitoring (bottom image), front cameras with builtin prisms transmit both left and right views to the incabin display screen. Sideview camera Millimeterwave radar continuously monitors the distance to the vehicle ahead. Forwardview camera Rearview camera Sideview camera Auxiliary braking activated When the distance to the vehicle ahead narrows dangerously, multiple warnings are emitted and auxiliary braking is automatically applied. Full braking power activated When a collision is imminent, full braking power is automatically applied and seatbelts are rapidly retracted. 4

43 Automobiles and Society Taxes Taxes on Automobiles Eight Trillion Yen in Annual AutomobileRelated Tax Revenue Since the initial earmarking of funds for road construction and road maintenance programs in line with Japan s first fiveyear road improvement plan in 954, there has been a steady increase both in the number of automobilerelated taxes assessed on users and in their respective rates. Currently, the automobile tax structure consists of nine different taxes, creating a very heavy tax burden for Japanese motor vehicle owners. Under the government s budget for fiscal 22, the total value of tax revenue from these automobilerelated taxes was estimated at 7.8 trillion yen, or 9.8% of Japan s projected total tax revenue of 79 trillion yen in fiscal 22. TAX REVENUE (Estimated) BY SOURCE IN FISCAL 22 (as per Japan s fiscal 22 budget) Consumption tax 7,769 (4.9%) Income tax 34,9 (7.%) Fixed asset tax 85,574 (.8%) Tax Revenue (national and local taxes) 789,399 (%) Other 237,29 (3.%) Corporate tax 88,8 (.2%) Breakdown of AutomobileRelated Tax Revenue (estimated) 77,539 (9.8%) Stamp tax,32 (.3%) Liquor tax 3,39 (.7%) Business tax 24,527 (3.%) LPG tax 22 Regional gasoline excise tax 2,793 Diesel handling tax 8,92 Gasoline tax 26, Consumption tax (on fuels) 5,923 Taxes on Taxes on Fuels Automobiles 43,948 33,59 While in use On acquisition During ownership Minivehicle tax,8 x million yen Acquisition tax Consumption tax 2,68 (on automobiles) 7,4 Tonnage tax 7,32 Automobile tax 5,677 Notes:. Automobilerelated consumption tax revenue is not included in the Consumption tax segment in the chart on the left, but is included in the breakdown of automobilerelated tax revenue appearing in the chart on the right. 2. Automobilerelated consumption tax revenue values have been calculated by JAMA. 3. The consumption tax is a national sales tax, of which % of the revenue is redistributed to local government coffers. Sources: Ministry of Finance; Ministry of Internal Affairs and Communications AUTOMOBILERELATED TAXES IN JAPAN (as of May, 22) On Acquisition Tax Category Acquisition Tax Consumption Tax Tonnage Tax During Ownership How Assessed Assessed on the acquisition of an automobile, whether new or used, based on the purchase price Assessed on the purchase price of the automobile Assessed according to vehicle weight at each vehicle inspection National/Local Tax Prefectural tax National and local tax National tax Tax Rate/ Amount (Private use) 5% of purchase price (3% for commercial and minivehicles) Exempted for vehicles purchased for 5, yen or less Note: Acquisition tax reductions/exemptions are in effect from April, 22 through March 3, 25 for ecofriendly vehicles (see pages 485). 5% (of which % is a local tax) ) Vehicles complying with 25 fuel efficiency standards: Original rates apply ( 2,5/.5t per year for private passenger cars) 2) Vehicles on the road 8 years or longer since first registration: Previous rates apply ( 6,3/.5t per year for private passenger cars) 3) Vehicles on the road 3 years or longer since first registration: Temporary rates apply ( 5,/.5t per year for private passenger cars) 4) Other vehicles for private use: Passenger cars: 4,/.5t per year Trucks (GVW>2.5t): 4,/t per year Trucks (GVW 2.5t): 3,3/t per year Buses: 4,/t per year Minivehicles: 3,3 per year Motorcycles (25cc and over):,9 per year Motorcycles (26 to 25cc): 4,9 upon registration Note: Additionally, tonnage tax reductions/exemptions are in effect from May, 22 through April 3, 25 for ecofriendly vehicles (see pages 485). 42

44 JAPAN S ESTIMATED AUTOMOBILERELATED TAX REVENUE IN FISCAL 22 Taxes on Automobiles Taxes on Fuels Grand Notes:. Consumption tax revenue values have been calculated by JAMA. 2. Tax rates indicated effective as of May, A new carbon tax, to be incorporated separately into the petroleum and coal tax and with rates calculated on the basis of CO2 emissions per ton, comes into effect in October 22. TAX RATES IN EFFECT (Examples), 95422, TO SUPPORT ROAD NETWORK IMPROVEMENTS First Five Plan Second Third Fourth Fifth Sixth Seventh On acquisition During ownership While in use Eighth Ninth Tenth Eleventh Twelfth As per the national priority infrastructure development plan As per the national mediumterm road infrastructure plan Acquisition tax Consumption tax (on automobiles) Tonnage tax Automobile tax Minivehicle tax Gasoline tax Regional gasoline excise tax Diesel handling tax LPG tax Consumption tax (on fuels) Acquisition Tax Commercial and minivehicles excluded 3% 5% Tax Revenue (x million yen) 2,68 7,4 7,32 5,677,8 33,59 26, 2,793 8, ,923 43,948 77,539 Tonnage Tax Yen/.5t per year In the case of a passenger car for private use 2,5 5, 6,3 Original Tax Rate Gasoline Tax Yen/ 3.. 6,3 5, 2 5% 4, (2,5*) Comparison with original tax rate (multiplier value) Original tax rate *The original tonnage tax rate ( 2,5/.5t per year) is applied to vehicles compliant with 25 fuel efficiency standards. Notes:. Tax rates indicated effective as of May, A new carbon tax, to be incorporated separately into the petroleum and coal tax and with rates calculated on the basis of CO2 emissions per ton, comes into effect in October 22. Source: Japan Automobile Manufacturers Association 3% 5% 2,5/.5t per year (Registered vehicles for private use) Based on engine capacity 7,2/year (Passenger cars for private use) 24.3/ 4.4/ 5./ 7.5/kg 5% Regional Gasoline Excise Tax Yen/ Current Tax Rate 5% (Excluding commercial/minivehicles) 4,/.5t per year (Registered vehicles for private use) No change No change 48.6/ 5.2/ 32./ No change Diesel Handling Tax Yen/ Comparison with Original Tax Rate (multiplier value) LPG Tax Yen/kg While in Use Automobile Tax MiniVehicle Tax Gasoline Tax Regional Gasoline Excise Tax Diesel Handling Tax LPG Tax Consumption Tax Fixed amount assessed on the owner each year as of April Fixed amount assessed on the owner each year as of April Assessed on gasoline Included in the fuel price Assessed on light oil Assessed on LPG Assessed on the purchase price of fuels Prefectural tax Municipal tax National tax Prefectural tax National tax National and local tax Passenger cars (for private use) Up to,cc 29,5 yen/year, to,5cc 34,5 yen/year,5 to 2,cc 39,5 yen/year 2, to 2,5cc 45, yen/year 2,5 to 3,cc 5, yen/year 3, to 3,5cc 58, yen/year 3,5 to 4,cc 66,5 yen/year 4, to 4,5cc 76,5 yen/year 4,5 to 6,cc 88, yen/year Over 6,cc, yen/year ) Minivehicles (for private use) Passenger cars 7,2 yen/year Trucks 4, yen/year 2) Motorcycles Up to 5cc, yen/year 5 to 9cc,2 yen/year 9 to 25cc,6 yen/year 26 to 25cc 2,4 yen/year 25cc and over 4, yen/year 48.6 yen/ 5.2 yen/ 32. yen/ (light oil) 7.5 yen/kg (LPG) 5% of the purchase price of fuels (of which % is a local tax) For light oil, imposed on the light oil price excluding the diesel handling tax Source: Japan Automobile Manufacturers Association 43

45 Automobiles and Society Taxes Tax Incentive Measures for EcoFriendly Vehicles Tax Incentives to Promote the Wider Use of EcoFriendly Vehicles To help expedite the shift to lowcarbon road transport in the interest of curbing global warming, the Japanese government has, since April 29, applied both new and extended autorelated tax incentives to promote the wider use of ecofriendly (i.e., fuelefficient and lowemission) vehicles. For the purchase of new vehicles that comply with Japan s 25 fuel efficiency standards, reductions/exemptions are applicable to the acquisition tax and tonnage tax since April and May, 22, respectively. INCENTIVES & ELIGIBILITY REQUIREMENTS FOR NEW VEHICLES ACQUISITION AND TONNAGE TAX REDUCTIONS/EXEMPTIONS Period in effect: April, 22 through March 3, 25 for the acquisition tax; May, 22 through April 3, 25 for the tonnage tax. Vehicle Type Reductions/Exemptions Requirements Certification Sticker(s) Acquisition Tax (4) Tonnage Tax Passenger Cars and Small Trucks and Buses (GVW 2.5t) Electric Vehicles (including fuel cell vehicles), PlugIn Hybrid Vehicles, Clean Diesel Vehicles (), Natural Gas Vehicles (2) Exempt Exempt at time of st vehicle inspection; 5% reduction at 2nd inspection Gasoline Vehicles (including hybrid vehicles) Compliant +2% compared to 25 fuel efficiency standards, with emissions down by 75% from 25 standards (3) Compliant +% compared to 25 fuel efficiency standards, with emissions down by 75% from 25 standards (3) Exempt 75% reduction Exempt at time of st vehicle inspection; 5% reduction at 2nd inspection 75% reduction Compliant with 25 fuel efficiency standards, with emissions down by 75% from 25 standards (3) 5% reduction 5% reduction MidSized Trucks and Buses (2.5t GVW 3.5t) Electric Vehicles (including fuel cell vehicles), PlugIn Hybrid Vehicles, Natural Gas Vehicles (2) Exempt Exempt at time of st vehicle inspection; 5% reduction at 2nd inspection Diesel Vehicles (including hybrid vehicles) Compliant +% compared to 25 fuel efficiency standards, with NOx and PM emissions down by % from 29 standards Compliant +5% compared to 25 fuel efficiency standards, with NOx and PM emissions down by % from 29 standards Exempt 75% reduction Exempt at time of st vehicle inspection; 5% reduction at 2nd inspection 75% reduction Compliant +% compared to 25 fuel efficiency standards, and compliant with 29 emission standards 75% reduction 75% reduction Compliant with 25 fuel efficiency standards, with NOx and PM emissions down by % from 29 standards 5% reduction 5% reduction Compliant +5% compared to 25 fuel efficiency standards, and compliant with 29 emission standards 5% reduction 5% reduction Gasoline Vehicles (including hybrid vehicles) Compliant +% compared to 25 fuel efficiency standards, with emissions down by 75% from 25 standards Compliant +5% compared to 25 fuel efficiency standards, with emissions down by 75% from 25 standards Exempt 75% reduction Exempt at time of st vehicle inspection; 5% reduction at 2nd inspection 75% reduction Compliant +% compared to 25 fuel efficiency standards, with emissions down by 5% from 25 standards 75% reduction 75% reduction Compliant with 25 fuel efficiency standards, with emissions down by 75% from 25 standards 5% reduction 5% reduction Compliant +5% compared to 25 fuel efficiency standards, with emissions down by 5% from 25 standards 5% reduction 5% reduction 44

46 Vehicle Type Reductions/Exemptions Requirements Certification Sticker(s) Acquisition Tax (4) Tonnage Tax HeavyDuty Trucks and Buses (GVW 3.5t) Electric Vehicles (including fuel cell vehicles), PlugIn Hybrid Vehicles, Natural Gas Vehicles (2) Exempt Exempt at time of st vehicle inspection; 5% reduction at 2nd inspection Diesel Vehicles (including hybrid vehicles) Compliant +% compared to 25 fuel efficiency standards, with NOx and PM emissions down by % from 29 standards Compliant +5% compared to 25 fuel efficiency standards, with NOx and PM emissions down by % from 29 standards Exempt 75% reduction Exempt at time of st vehicle inspection; 5% reduction at 2nd inspection 75% reduction Compliant +% compared to 25 fuel efficiency standards, and compliant with 29 emission standards 75% reduction 75% reduction Compliant with 25 fuel efficiency standards, with NOx and PM emissions down by % from 29 standards 5% reduction 5% reduction Compliant +5% compared to 25 fuel efficiency standards, and compliant with 29 emission standards 5% reduction 5% reduction () Passenger cars complying with 29 emission standards. (2) With NOx emissions down by % from 29 emission standards. (3) Fuel consumption and exhaust emission requirements are JC8 test cyclebased. The Compliant +2% compared to 25 fuel efficiency standards, Compliant +% compared to 25 fuel efficiency standards, and Compliant with 25 fuel efficiency standards requirements are equivalent to Compliant +5% compared to 2 fuel efficiency standards, Compliant +38% compared to 2 fuel efficiency standards, and Compliant +25% compared to 2 fuel efficiency standards, respectively, when measured in the 5mode test cycle, on which basis the 2 fuel efficiency standards were established. (4) Acquisition tax reductions/exemptions are applied once, at the time of new vehicle purchase during the period in which these reductions/exemptions are in effect. ACQUISITION AND TONNAGE TAXES ON NEW VEHICLES: EXAMPLES OF AMOUNTS ASSESSED, BY VEHICLE TYPE In yen Passenger Cars MiniVehicles HeavyDuty Vehicles Tax Status Exempt With 75% reduction With 5% reduction Exempt With 75% reduction With 5% reduction Exempt With 75% reduction With 5% reduction Acquisition Tax As of April, 22 2,2 4,5 6,7 3,5 9, 8, Without reductions/ exemptions 8, 8, 8, 27, 27, 27, 36, 36, 36, Tonnage Tax As of May, 22 5,6,2,8 3,7 9,3 8,7 Without reductions/ exemptions 22,5 22,5 22,5 7,5 7,5 7,5 37,5 37,5 37,5 Reduction (acquisition tax + tonnage tax) 3,5 77,7 5,8 34,5 26, 7,3 397,5 298,2 98,8 Assumptions: For passenger cars: purchase price =.8 million, GVW<.5t; For minivehicles: purchase price = million; For heavyduty vehicles: purchase price = 8 million, GVW=5t. Notes:. New tax assessment values above have been calculated on the basis of tax rates to be applied from April and May, Reductions are applied on the basis of compliance with stipulated requirements, and reduction amounts vary according to vehicle purchase price and weight. 45

47 Automobiles and Society Taxes Tax Incentive Measures for EcoFriendly Vehicles ACQUISITION AND TONNAGE TAX REDUCTIONS/EXEMPTIONS FOR HEAVYDUTY VEHICLES EQUIPPED WITH ADVANCED SAFETY FEATURES AND PUBLICUSE ASSISTEDMOBILITY VEHICLES Period in effect: April, 22 through March 3, 25 for the acquisition tax; May, 22 through April 3, 25 for the tonnage tax. Vehicle Type Trucks (GVW>8t) and Tractors (GVW>3t) equipped with a collisionmitigation braking system Reductions/Exemptions Acquisition Tax 3.5 million deduction from purchase price (), (2) Tonnage Tax 5% reduction (), (3) AssistedMobility Vehicles Lowfloor ( nonstep ) buses (for use in public transport) million deduction from purchase price (2) Exempt (3) Buses equipped with an electric lift (for use in public transport) For large buses (occupancy 3 persons), 6.5 million deduction from purchase price (2) For small buses (occupancy<3 persons), 2 million deduction from purchase price (2) Exempt (3) Universal designbased taxis (for use in public transport). million deduction from purchase price (2) Exempt (3) () For large trucks (GVW>22t) and some tractors (GVW>3t), period in effect: April, 22 through October 3, 24. (2) Deductions are applied once, at the time of first registration. (3) Reductions/exemptions are applied once, at the time of first mandatory vehicle inspection. Notes:. Acquisition tax is assessed on the amount remaining after deduction. 2. The above tonnage tax reduction/exemptions do not apply to vehicles targeted by this scheme that are eligible for the tonnage tax reductions/exemptions prescribed for ecofriendly vehicles (see page 48), to which the latter measures only are applied. Regarding the acquisition tax, owners of vehicles covered under this scheme can opt either for the deductions indicated here or for the acquisition tax reductions/exemptions prescribed for ecofriendly vehicles (see page 48). FISCAL 2223 AUTOMOBILE TAX REDUCTIONS FOR PASSENGER CARS AND SMALL TRUCKS AND BUSES (GVW 2.5t) * Requirements () Certification Stickers Reduction Compliant +% compared to 25 fuel efficiency standards, with emissions down by 75% from 25 standards (2) Compliant with 25 fuel efficiency standards, with emissions down by 75% from 25 standards (2) 5% reduction approximately (3) 25% reduction approximately (3) *Also applies to trucks and buses (2.5t<GVW>3.5t, gasoline vehicles only) certified as fuelefficient and lowemission vehicles. () Applies additionally to electric (including fuel cell) vehicles, plugin hybrid vehicles and natural gas vehicles (with NOx emissions down by % from 29 standards). (2) Fuel consumption and exhaust emission requirements are JC8 test cyclebased, with Compliant +% compared to 25 fuel efficiency standards and Compliant with 25 fuel efficiency standards being equivalent to Compliant +38% compared to 2 fuel efficiency standards and Compliant +25% compared to 2 fuel efficiency standards, respectively, when measured in the 5mode test cycle, on which basis the 2 fuel efficiency standards were established. (3) For eligible vehicles newly registered in 22 and 23, the automobile tax reduction is applied in the year subsequent to the year of registration. Note: This scheme also mandates a yearly % surcharge on the automobile tax for diesel vehicles on the road years or longer, and for gasoline and LPGpowered vehicles on the road 3 years or longer, since first registration. INCENTIVES & ELIGIBILITY REQUIREMENTS FOR USED VEHICLES FISCAL 2223 ACQUISITION INCENTIVES FOR PASSENGER CARS AND SMALL TRUCKS AND BUSES (GVW 2.5t) * Requirements () Compliant +2% compared to 25 fuel efficiency standards, with emissions down by 75% from 25 standards (2) Compliant +% compared to 25 fuel efficiency standards, with emissions down by 75% from 25 standards (2) Compliant with 25 fuel efficiency standards, with emissions down by 75% from 25 standards (2) Certification Stickers Incentive 45, deduction from purchase price 3, deduction from purchase price 5, deduction from purchase price *Also applies to trucks and buses (gasoline vehicles only) and heavyduty trucks and buses (hybrid vehicles only) certified as fuelefficient and lowemission vehicles. () Applies additionally to electric (including fuel cell) vehicles, plugin hybrid vehicles, natural gas vehicles (with NOx emissions down by % from 29 standards) and clean diesel passenger cars (compliant with 29 emission standards). (2) Fuel consumption and exhaust emission requirements are JC8 test cyclebased, with Compliant +2% compared to 25 fuel efficiency standards, Compliant +% compared to 25 fuel efficiency standards, and Compliant with 25 fuel efficiency standards being equivalent to Compliant +5% compared to 2 fuel efficiency standards, Compliant +38% compared to 2 fuel efficiency standards, and Compliant +25% compared to 2 fuel efficiency standards, respectively, when measured in the 5mode test cycle, on which basis the 2 fuel efficiency standards were established. Note: Acquisition tax is assessed on the amount remaining after deduction. 46