Public-Private Joint Efforts for

Low Carbon Emissions

in Road Transport in Japan

Yoshihiro YANO

Vice President for International Affairs

Japan Automobile Manufacturers Association, Inc.

The Director-General Meeting of ASEAN Member Countries

on Automobile Taxation

Chiang Mai, November 20, 2014

1

1. Continuous Increases in Vehicle Fuel Efficiency

and the Diffusion of Next-Generation Vehicles

1.1 Global Warming and the Depletion of Oil Resources

Air pollution

Energy consumption

Reducing CO2, etc.

(CO, HC, NOx, etc.)

Imp

acts

of is

su

es o

f co

nce

rn

Reduced emissions from gasoline & diesel

engines

Present

Timeline (non-specific), historic and projected Source: JAMA

Global warming

Transition to

renewable energy

Reducing toxic substances in exhaust emissions

Increased vehicle

fuel efficiency

Fuel-cell vehicles

Electric vehicles

Hybrid vehicles

Natural gas vehicles

2

Governments and industries in all countries must work on a cooperative basis

to tackle global warming and the depletion of oil resources.

1.2 Vehicle Technologies for Increased Fuel Efficiency

Certified as well as on-road vehicle fuel efficiency has increased as a result

of continuous technological progress.

Reduced aerodynamic drag Reduced vehicle weight

Reduced rolling resistance Improved powertrain performance

Other

Improved thermal efficiency:

-Direct injection

-Variable mechanisms

(variable cylinder activation,

VVT&L, etc.)

Reduction of friction loss:

-Reduction of piston and piston

ring friction loss

-Low-viscosity lubricating oil

-Expansion of lock-up area

-Expanded number of transmission

gears

-Continuously variable transmission

Low rolling-resistance tires

Improved body configuration

3

Note: In fiscal years; figures here are JC08 test cycle-based for greater real-world accuracy and apply only to domestic new

gasoline-powered passenger cars sold in Japan. Source: JAMA

km/ℓ

Year

Auto manufacturers have introduced numerous technologies to increase engine

efficiency, boost related precision control technology, improve powertrain

systems, reduce aerodynamic drag and rolling resistance, and reduce vehicle

weight. As a result, average vehicle fuel efficiency in Japan has increased yearly.

1.3 Continuous Increases in Vehicle Fuel Efficiency

10

12

14

16

18

20

22

24

1995 2000 2005 2010 2015 2020Ave

rag

e fu

el e

ffic

ien

cy o

f n

ew

pa

sse

nge

r ca

rs

Actual value 2013 (21.2) ●

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Smaller cars of up to 2,000cc in engine capacity are the mainstay of Japan’s

domestic car market. Their share in the gasoline-powered car market reached

89.8% in 2013.

Sources: JAMA; Japan Automobile Dealers Association; Japan Mini Vehicles Association

x 1,000 units

Domestic New Passenger Car Sales, 2011-2013

(not including diesels)

0

500

1,000

1,500

2,000

2,500

3,000

660cc & Under 661-2,000cc Over 2,000cc

2011 2012 2013

New Passenger Car Market Shares

by Engine Capacity in 2013

(not including diesels)

1.4 Trends in Japan’s New Passenger Car Market

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1.5 Target: Expanding the Share of Next-Generation Vehicles

6

Strategies need to be developed and implemented to expand the share of next-

generation vehicles in the national vehicle fleet.

Japan’s Next-Generation Vehicle Diffusion Projections for 2020 and 2030

2020 2030

Conventional vehicles 50-80% 30-50%

Next-generation vehicles 20-50% 50-70%

Hybrid vehicles 20-30% 30-40%

Electric vehicles,

Plug-in hybrid vehicles 15-20% 20-30%

Fuel cell vehicles Under 1% Under 3%

Clean diesel vehicles Under 1% 5-10%

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1.6 Hybrid Vehicles

Outlook • Number of hybrids in use is expected to continue to rise. While freight transport vehicles will

increase, passenger vehicles will remain the prevailing vehicle type in use.

• Improved battery performance and reduced cost are needed for the greater diffusion of hybrid

vehicles.

Status • Current number of vehicles in use (end of fiscal 2013 estimate): Approx. 3.87 million.

• Almost all are passenger vehicles, but freight transport trucks and buses are increasing.

• Hybrids have a significant impact on energy saving and CO2 reduction.

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1.7 Electric Vehicles

Outlook • The introduction of lithium-based batteries has helped reduce the number of problems, but an

expansion of charging infrastructure is necessary.

• A significant breakthrough at a basic research level for new types of batteries is essential

for expansion.

• The primary issues are cost, durability, and range.

Example models • i-MiEV (Mitsubishi) Sales to corporations began in July 2009, market sales in April 2010.

• MINICAB-MiEV (Mitsubishi) Market sales began in December 2011.

• Leaf (Nissan) Market sales began in December 2010.

• Fit (Honda) Leasing began in August 2012.

• eQ (Toyota) Limited market sales began in December 2012.

Status • Current number of vehicles in use (end of fiscal 2013 estimate): Approx. 54,000.

• EVs have seen notable growth in recent years.

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1.8 Plug-In Hybrid Vehicles

Outlook • Primary issues are to improve battery performance (to extend travel range) and reduce cost.

Example models • Prius (Toyota) Market sales began in January 2012.

• Outlander (Mitsubishi) Market sales began in December 2012.

• Accord (Honda) Market sales began in June 2013.

Status • Current number of vehicles in use (end of fiscal 2013 estimate): Approx. 30,000.

• Charged by an external power source, giving the vehicle an extended range.

• Drives as an EV for short trips, and as a normal HV for long trips.

Engine

Motor

Fuel tank

Battery

Home power supply

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1.9 Fuel Cell Vehicles

Status • High potential to reduce both oil dependency and CO2 emissions. Development is in

progress at various companies.

• Verification tests combining hydrogen infrastructure and fuel cell vehicles are being

promoted both domestically and abroad.

Outlook • Fuel cell vehicles are shaping up to be both durable and reliable.

• A reduction in FC system costs and development of a hydrogen infrastructure are required

to bring FCs into full-scale use.

Example models • FCHV-adv (Toyota) Limited leasing began in September 2008.

• MIRAI (Toyota) Market sales are scheduled to begin in 2014.

• FCX Clarity (Honda) Limited leasing began in November 2008.

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1.10 Clean Diesel Vehicles

Outlook • Clean diesel vehicles emit significantly fewer CO2 emissions than gasoline vehicles, but their

production costs are higher because they require an advanced purification system.

Example models • X-Trail 20GT (Nissan) Market sales began in September 2008.

• Pajero (Mitsubishi) Market sales began in September 2010.

• CX-5 XD (Mazda) Market sales began in February 2012.

Status • Current number of vehicles in use (end of fiscal 2013 estimate): Approx. 145,000.

• Clean diesel vehicles have seen notable growth in recent years.

1.11 Sales of Next-Generation Passenger Cars in Japan

Sales of next-generation passenger cars have expanded to a more than 20%

share of Japan’s new passenger car market as a result of the Japanese

government’s tax incentives and purchasing subsidies programs.

Source: JAMA 12

Clean-energy vehicle purchasing subsidies

In units

Tax incentives

1.12 Status of Next-Generation Vehicle Use in Japan

At present, the number of next-generation vehicles in use in Japan is roughly 4.1 million,

or as little as 5.4% of the total number of vehicles in use.

In the years ahead, a steady growth is expected in the in-use number of these vehicles.

Fiscal year

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

2,200,000

2,400,000

2,600,000

2,800,000

3,000,000

3,200,000

3,400,000

3,600,000

3,800,000

4,000,000

4,200,000

4,400,000

クリーンディーゼル自動車

天然ガス自動車

電気自動車

プラグインハイブリッド自動車

ハイブリッド自動車

In units

Clean diesel vehicles

Natural gas vehicles

Electric vehicles (EVs)

Plug-in hybrid vehicles (PHVs)

Hybrid vehicles (HVs)

Breakdown

in FY 2013

Notes: 1. Motorcycles not included. 2. Clean diesel

vehicles here comprise passenger cars only.

Source: JAMA

Conventional Vehicles:

Approx. 72 million units

(94.6%)

Clean diesel:

Approx. 145,000 units

PHVs:

Approx.

30,000 units

HVs: Approx.

3.87 million units

Natural gas:

Approx. 41,000 units EVs: Approx.

54,000 units

Next-Generation

Vehicles:

Approx. 4.1 million units

(5.4%)

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1.13 Japanese Government Initiatives to Promote

Increased Fuel Efficiency and Low Emissions

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1) Tax incentives for eco-friendly and next-generation vehicles

Period in effect: For acquisition tax: April 1, 2012 through March 31, 2015

For tonnage tax: May 1, 2012 through April 30, 2015

1.13 Japanese Government Initiatives to Promote

Increased Fuel Efficiency and Low Emissions

2) Clean-energy vehicle purchasing subsidies in effect in 2014

15

Requirement (Vehicle Type) Subsidy Amounts

Plug-in hybrid vehicles, Electric vehicles JPY 850,000

Clean diesel vehicles JPY 350,000

Note: “Clean diesel vehicles” here refers to diesel-engine automobiles generating low levels of

particulate matter (PM), nitrogen oxides (NOx) and other emissions in compliance with the limit

values stipulated in Japan’s “post new long-term regulations” for diesel emissions introduced in

2009.

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2. Importance of the Integrated Approach

in CO2 Reduction in Road Transport

CO2 reduction in road transport will be most effectively achieved through an

integrated approach involving efforts by automobile manufacturers, government,

fuel and energy suppliers, and vehicle users.

2.1 The Integrated Approach to Reducing CO2 Emissions

Government

Vehicle Users

Fuel/Energy Suppliers

Automakers

- Increased vehicle fuel efficiency

- Commercialization of next-generation vehicles

- Fuel diversification - Ecodriving

- Road congestion mitigation (improved traffic flow) through infrastructure development

- Programs to accelerate

vehicle fleet replacement with fuel-efficient and low-emission vehicles

- Expansion of onboard ITS and ecodriving support systems

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Source: Japan Automobile Research Institute

0

50

100

150

200

250

10 20 30 40 50 60 70 80 90 100 Average vehicle speed (km/h）

CO2 emissions increase by about 40% when average vehicle speed drops from 40 km/h to 20 km/h.

CO

2 e

mis

sio

ns

(In

dex

: 4

0 k

m/h

= 1

00

) 2.2 Improving Traffic Flow

Congestion mitigation is achieved through such measures as road network

development and ITS applications.

Improved road traffic flow enables increased vehicle speed and increased fuel

efficiency, and thus contributes to CO2 reduction.

Average vehicle speed:

・Tokyo

・Paris

・London

18 km/h

18

26 km/h

30 km/h

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2.3 Dynamic Route Guidance in Greater Tokyo* *Tokyo and its surrounding prefectures

Real-time traffic information covering greater Tokyo

This ITS spot service provides car navigation systems with real-time travel time data for

all road segments in greater Tokyo.

On the basis of that data, car navigation systems select optimum routes.

This service thus enables optimal use of the entire road network in greater Tokyo.

ITS Spot Information Service Length of road network covered: Approx. 1,000 km

■ ITS “spot” units now transmit real-time road traffic information throughout the greater Tokyo area, enabling vehicle navigation systems to provide optimal real-time route guidance.

Ecodriving by vehicle users in Japan has led to increased fuel efficiency and

lower CO2 emissions. By practicing ecodriving, the potential average rate of

decrease in CO2 emissions from passenger cars is estimated at about 10%.* * International Energy Agency Workshop on Ecodriving, 2007

2.4 Promoting Fuel-Conserving Ecodriving

Ten Tips for Fuel-Conserving Ecodriving

1. Accelerate gently. 2. Maintain a steady speed and keep your distance. 3. Slow down by releasing the accelerator. 4. Make appropriate use of your air conditioner. 5. Don’t warm up or idle your engine. 6. Plan your itinerary to avoid congested routes. 7. Check your tire pressure regularly. 8. Reduce your load. 9. Respect parking rules and regulations. 10. Check the readings on your fuel efficiency- monitoring equipment.

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Passenger cars in Japan are increasingly being equipped with fuel efficiency

gauges and systems for real-time on-screen displays of fuel efficiency

performance. About 90% of new cars are now equipped with such devices.

2.5 Equipping Vehicles with Ecodriving Aids

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Thank you for your attention.

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