Japanese Auto Company Maiwei... Accelerates Investment Despite Electric Vehicle Slowdown

Despite Tesla and others reducing investments, opportunities arise for latecomers
Nissan, Honda, and others say "We will not spare necessary investments"

Japanese automakers are fueling their commitment to expand investments despite concerns over the slowdown in the electric vehicle (EV) market growth. The reduction in investments and sluggish performance forecasts from major EV companies, including Tesla, are being interpreted as opportunities by the latecomer Japanese firms.

[Image source=Yonhap News]

Bloomberg News reported on the 19th, citing statements from executives of major Japanese automakers such as Nissan Motor and Honda Motor. Nissan Motor's Chief Financial Officer (CFO), St?phane Ma, said at a recent earnings announcement, "The growth trend of electric vehicles is not a straight line. It will fluctuate," but emphasized, "In the long term, it will definitely grow." He added, "Customers determine the pace of EV transition," and stated, "We will not spare necessary investments." Nissan has already committed to investing 2 trillion yen (approximately 18 trillion won) over the past five years in EV transition.

Honda Motor's CFO, Fujiwara Eiji, also said, "The slowdown in EV demand was expected," but added, "Honda will continue to promote electrification to achieve carbon neutrality." Subaru Vice President Emori Tomoaki mentioned, "When we established our investment plan of 1.5 trillion yen (approximately 13 trillion won) for electrification, we had already considered the possibility of the EV market entering a stagnation phase." This indicates that the current concerns about the slowdown in EV growth have already been factored in by Japanese automakers.

The current global EV market situation is challenging. This is evident from the recent performance of EV companies, including Tesla. Tesla reported below-expectation results last month and issued a pessimistic forecast that "the sales growth rate in 2024 could significantly decline." Its stock price has dropped nearly 20% since the beginning of the year. General Motors (GM) has postponed plans to operate an electric pickup truck factory, and Renault SA has scrapped plans to list its EV business, signaling a global trend of investment cutbacks. Additionally, the sharp drop in battery material prices has led mineral suppliers to shut down, raising concerns that manufacturers will face difficulties in sourcing materials.

Bloomberg News conveyed the atmosphere by stating, "Japanese automakers know that buyers are not yet ready to switch to electric vehicles quickly," and "Despite the slowdown in growth, they are accelerating investments in EVs."

Toyota, the world's largest automaker by sales volume, is responding to the forecasted slowdown in EV demand with a hybrid strategy. Toyota CFO Miyazaki Yoichi said, "Hybrids, which do not require charging infrastructure, are a realistic solution," and added, "We will continue to build a lineup that includes battery-electric, plug-in hybrid, and hydrogen powertrains to meet any demand."

This content was produced with the assistance of AI translation services.