Automotive components

1. Automotive components Issues and Recommendations

2. GLOBILISATION OF THE AUTOMOBILE INDUSTRY

3. Globalisation of the Automobile Industry YEARLY STATUS REPORT: Limited Progress • The EBC welcomes the opportunity that internationalisation presents for innovative European firms to strengthen their relationship with Japanese automobile manufacturers in developing new products and sharing technical expertise. • European firms are not tied to specific European automobile manufacturers, and have products proven to the rest of the auto industry. • Japanese automobile manufacturers are increasingly making use of foreign tie-ups to develop their business and respond to competitive pressures both at home and abroad. • Many firms are also reassessing their procurement strategies.

4. Globalisation of the Automobile Industry YEARLY STATUS REPORT: Limited Progress • Nevertheless, European automotive component and system manufacturers continue to face numerous challenges in promoting European technical expertise to automobile manufacturers in Japan. • In general, Japanese manufacturers are still reluctant to outsource product development on a global basis and to procure from non-traditional sources. • Japan-specific requirements are common, and it is not unusual for specifications to differ between domestic and overseas production, even within the same company. • Hence, even European component manufacturers successfully supplying to Japanese transplants in Europe are seldom able to build on this base to become a supplier of the parent company in Japan.

5. Globalisation of the Automobile Industry RECOMMENDATION The EBC urges the Japanese automobile industry to focus more on the technical, commercial and logistics aspects of automobile production in the procurement of components and systems. Increased purchasing on a global basis and more emphasis on single platform development would further benefit the cost-effectiveness of the Japanese industry.

6. PROMOTING INFORMATION EXCHANGE

7. Promoting Information Exchange YEARLY STATUS REPORT: Limited Progress • Face-to-face meetings between the European Association of Automotive Suppliers and Japanese car manufacturers were established in 1995 to promote information exchange between European and Japanese companies. • These meetings have proven to be an extremely effective venue for discussing issues of mutual concern relating to products, platforms, global strategies and other important matters affecting the industry. • The next meeting schedule is currently under negotiation between the European Association of Automotive Suppliers and the Japan Automobile Manufacturers Association. • The EBC encourages top-level Japanese industry participation.

8. Promoting Information Exchange RECOMMENDATION The EBC strongly supports the continuation of face-to-face meetings with leading representatives from the Japanese automobile industry. Such meetings have led to a greater understanding between European component manufacturers and Japanese carmakers. The EBC also hopes that the scope of these meetings will be expanded in future to include Japanese venues.

9. GREEN PROCUREMENT

10. Green Procurement YEARLY STATUS REPORT: New Issue RECOMMENDATION A significant number of Japanese companies’ purchasing departments are introducing “green procurement” (green chotatsu) requirements. Suppliers are required to document, specifically for Japan, the list of substances used in their manufacturing process, instead of simply being able to establish conformity with an RoHS-type “negative” list. The EBC urges the Japanese automobile industry to adhere to accepted international practices when setting procurement requirements.