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The Global Japan

The Global Japan

By Sharad Matade:

Japanese tyre companies have a dominating position in the global tyre business, offering consistent breakthoughs in technologies and expanding in both developed and developing markets. In an interview with Tyre Asia, Kenji Kurata, Executive Director, the Japan Automobile Tyre Manufacturers Association (JATMA), said, “Japan’s tyre manufactures are no more ‘Japanese tyre industry.’ It is more suitable to regard them as a major part of world tyre industry originated from Japan.” Excerpts

What is the current status of the Japanese tyre industry vis-à-vis the global tyre industry?

As you may know that there are four tyre manufactures in Japan, namely Bridgestone Corporation, Sumitomo Rubber Industries Ltd, Yokohama Rubber Co., Ltd. and Toyo Tire & Rubber Co., Ltd. Their sales of tyres are slightly increasing though some ups and downs are found according to fluctuation of a foreign exchange rate as shown in Fig.1. It is worthy of special mention that their overseas sales ratio has been almost consistently continued to rise. In this context, it is said that overseas market is decisively important for Japan’s tyre manufacturers.
Next, take a close look at situation of Japan’s domestic market. According to Fig.2, tyre sales for OE as well as for replacement seem to be staying steady while export goes down. This decreasing of export and increasing of overseas sales ratio as mentioned above get together, you can easily understand that Japan’s tyre manufactures are expanding their overseas tyre manufacturing capacity.
All these explanations together, Japan’s tyre manufactures are no more ‘Japanese tyre industry’. It is more suitable to regard them as a major part of world tyre industry originated from Japan. As world players, I think these four manufactures seem to be doing well.

Tightening regulations and overall trends in the global auto market have been pressuring tyre companies to reduce CO2 caused by tyres. What are steps being taken by the association’s in this direction?

Surely the public as well as a market are very serious about global environmental issues including global warming. Not only from the market point of view but also from the view as a responsible global player, JATMA as well as Japan’s four tyre manufactures are very serious about tackling these issues. Among the issues, reducing CO2 emission is one of the most important and urgent ones to be tackled.
JATMA thinks that there are two passes for reducing CO2 emission regarding tyres. First pass is to reduce CO2 emission during a tyre manufacturing process. Each company is attaining this by introducing the state of art technology which enable to manufacture tyres with less energy, consequently less CO2 emission.
The other pass is to reduce CO2 emission during use of tyres. Obviously decreasing of rolling resistance of tyres will be a key to attain it. Various kinds of researches have been conducted to reduce rolling resistance by each company. The focus of the researches mainly falls on a refinement of materials used in the tread part of tyres.
As the association which consists of tyre manufactures in Japan, JATMA is managing a labeling system for fuel efficiency tyres, which aims to enhance the effort done by the manufacturers as well as to familiarize fuel efficiency tyres among the public. In the labeling system, there are two requirements, which are rolling resistance and wet grip. These two specifications are in trade off relationship. Low rolling resistance can contribute to reduction of CO2 emission while driving. At the same time, we cannot give up the safety. Wet grip must be important to keep a certain level of safety.
The system started in 2010 and diffusion rate of fuel efficiency tyre for passenger car is steadily increasing under the system as shown in .

Japanese companies have earned their reputation and high position in the global market. However, now the global market is being intensified as regional companies are expanding in international markets. How do you see this growing competition in the global market?

Tyre market in the world is rapidly growing along with the growth of world car market. Especially growing speed in China, India and South East Asian countries is awesome. Under this circumstance, there must be new comers emerging and this phenomenon is natural. Consequently, competition comes severe. Based on this understanding, each manufacture must shape its own business strategy to survive in this highly competing market, so is Japan’s one. No one knows which strategy works well. This is the business.

What about exports and imports. What are the major tyre export destinations of Japan and are you facing any challenge of cheap imports of tyres?

Tyre import to Japan is increasing and most of tyres imported range below average in price. So imported tyre are now taking a certain share in the low price market. It happens not only in Japan but also in north America and Europe. As a result, anti-dumping measures have been taken in some countries though not yet in Japan.
It is a universal phenomenon to be encroached on low price market in the developed countries. Then business strategy of each manufacturer in the market should be examined for their survival. Tyre manufacturers in the developed countries have to accept this competition as long as the competition is fair.

How do you see the impact of the growing thrust on Electric Vehicles?

From car manufacturer’s point of view, an emergence and introduction of Electric Vehicles (EVs) is a centennial change. For tyre manufactures, rise of EVs also brings some changes on tyres. For example, car manufacturers seem to be more conscious in fuel efficiency for EVs so that they strongly require high fuel efficiency in tyres. Tyre manufacturers must meet this requirement otherwise losing a position as an OE supplier.
From tyre manufacturer’s technical point of view, there are some specific characters need to be recognised in EVs. Relatively large torque is generated by motors through wide range in EVs. Same even in breaking because of a regenerative brake system is equipped. As fa as car weight is concerned, EVs are relatively heavy because of a huge amount of battery equipped. All these characters lead to strengthen tyres’ toughness. It means that there would be a possibility for a differentiation of tyres much more by each company’s technology.

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