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Oct 24th, 2019 Comments Off on Japanese Auto Makers Increasing R&D Budgets

Japanese Auto Makers Increasing R&D Budgets

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Any company working in the auto parts industry, like EBC Brakes, know how much flux their industry is. Japanese auto parts suppliers have also taken notice, and, in response, have amped up their research and development budgets as part of their efforts to stay secure in the changing industry.

Japan’s top 16 auto parts makers are putting so much into R&D that it’s expected to hit ¥1tn (~US$93 bn) by 2022, which would be double the amount that was being put in compared to 2012.

Auto parts makers like EBC Brakes are working hard to stay ahead of the market, and these Japanese companies are no exception, with them stating that the emerging era in the auto industry is marked by the acronym CASE; connectivity, autonomy, sharing and electrification.

These four trends are expected to shape the auto parts industry in the years to come, with some even going so far to say it’s an even bigger revolution in the industry than the creation of the Ford Model T itself, though it is accepted that the CASE age will render a lot of car parts obsolete.

By 2035, it’s projected that electric vehicles will account for 30% of the world’s global passenger car sales, according to Boston Consulting Group. On top of that, CASE-related products and services are expected to account for 40% of the overall profits made by the world’s auto industry by 2035.

Aisin Seiki President Kiyotaka Ise says that they cannot take the chance of getting long-term viability for granted, and admits that the CASE era will be a challenge for the company, which has Toyota Motors amongst its clientele. The company’s current R&D focus is the development of drivetrain parts for hybrid and electric vehicles, as well as properly integrated controls for autonomous vehicles.

The EV revolution is set to completely change parts for drivetrains, engines, and vehicle control systems, due, in part, to the fact that EVs use far less of these parts compared to more traditional vehicles. This is a notable change, as drivetrain parts and control system parts account for about 40% of the country’s domestic shipments in FY 2017, according to the Japan Auto Parts Industries Association. That explains neatly why these changes are happening.

 

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