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Kia is launching a new range of EVs that can be easily modified to meet different interior and design needs and will begin selling a mid-size van in Korea in July. The company is currently in talks with about 100 companies in the transportation and logistics industry. Although global EV sales are currently sluggish, Kia hopes to develop a new revenue stream by promoting the fact that the specifications of these vehicles can be changed to suit the needs of different industries.
“We have opened up a new paradigm with our customized EVs.” The CEO spoke with great enthusiasm at Kia’s EV Day event in Spain. The company unveiled the first production model of the “PV5,” a mid-size van that is the first in a series of independently developed EVs called “Platform Beyond Vehicle” (PBV).
Editor’s Note: For a brief period from Feb. 8 – 12, I visited the Indonesian capital, Jakarta, and conducted interviews with several people involved in the construction equipment industry. Here is a summary of the country and the stories I heard from industry experts.
Country Profile: Population 280 million, median age 29.7, and 90% of the population is Muslim. Comprises over 17,000 islands. The current capital is Jakarta, but due to worsening problems of land subsidence and air pollution, a plan has been made to move the capital to Nusantara, and construction of the new capital has already begun.
PSR Analysis: Chinese-made construction machinery is rapidly gaining popularity in the Indonesian market, where price is a key consideration–the initial cost is on average about 20% cheaper than Japanese or Western brands. The quality of Chinese-made machines has improved dramatically compared recently, and the after-sales service is also responsive, making it easy for buyers to select them.
The financial results for the year ending December 2024 of the three major Korean battery manufacturers all showed a decrease in sales compared to the previous year due to the sluggish sales of EVs worldwide. Unable to recoup the amount of upfront investment they had made in anticipation of the increasing shift to EVs, the companies are reviewing their plans for increased production.
SK ON has announced that it will delay the startup of its new U.S. plant, which was planned for 2025. LG Energy Solution, the largest company in South Korea, also reported a decline in both revenue and profit. Sales fell 24% and operating profit fell 73%. This is the first time since the company became an independent battery-focused subsidiary of the LG Group in 2020 that it has seen a decline in both sales and profits. Samsung SDI also saw a 23% drop in sales and a 76% drop in operating profit.
Kanadevia (formerly Hitachi Zosen) said it plans to build the first mass-production plant for water electrolysis equipment, which produces hydrogen by electrolyzing water, in Yamanashi Prefecture.
A company announcement said, “We want to develop this as an important production base that contributes to the realization of a hydrogen society. The company will invest approximately 8 billion yen ($52,000,000 USD) to build a mass production plant for water electrolysis equipment with an annual production capacity of 1 gigawatt (157,000 tons of hydrogen produced).
Construction is scheduled to begin about June 2026, with completion and operation by the end of fiscal 2028. The company plans to position this as a domestic mother plant, and in the future, it envisions gradually expanding its hydrogen production equipment manufacturing bases both in Japan and overseas.
In Thailand, major Japanese and Chinese automakers are requesting government support for HVs and EVs. At a time when the growth of electric vehicles has slowed, Toyota Motor Corporation President Akio Toyoda visited Thailand and appealed to the prime minister for measures to promote hybrid vehicles. The Chinese are also demanding that the conditions for EV subsidies be relaxed, and they are lobbying hard for the largest automotive industry base in Southeast Asia.
According to a Thai government statement, Toyota’s chairman and the Thai prime minister discussed measures to promote Thailand’s automotive industry, including finished vehicles and parts suppliers. They discussed the promotion of hybrid vehicles, and the Prime Minister reportedly expressed a positive attitude toward government support.
Tadano, a major manufacturer of cranes, has converted one of its crawler cranes, which can lift up to 1600 tons, to electric power. By changing the power source from a diesel engine to an electric motor, the company has been able to maintain the performance of the existing product while reducing CO2 emissions to zero. The company converted its CC 88.1600-1 lattice boom crawler crane to electric power. This is a large crane equipped with crawlers instead of tires, and is used in plant and bridge construction, as well as wind power installation.
The electrified crane is connected by cable to the main unit and power supply equipment, and two 390-kilowatt electric motors drive the hydraulic pump. There are no CO2 emissions during operation. Compared to existing products powered by diesel engines, this crane will reduce CO2 emissions by approximately 55 tons per year. The crane itself will be manufactured in Germany, while the electrification equipment will be produced in Japan. The crane is expected to go on sale in the summer of 2025 as part of the company’s EVOLT line of electrified products.
Kubota says it plans to build a factory in Germany to manufacture small excavators. Production will begin in 2026, and the new factory will increase the local subsidiary’s production capacity by 40%. Kubota will acquire a factory site near the current factory of Kubota Baumaschinen, which manufactures and sells construction equipment in Germany. In the fiscal year ending December 2022, sales of construction equipment in Europe accounted for 20% of the company’s total sales in this sector, behind North America and Australia, which accounted for 60%.
Demand for small construction equipment in Europe is currently sluggish. In the first nine months of fiscal 2024, sales of construction equipment in Europe declined 29.1 billion yen from the same period a year earlier.
Kubota says the reason for building a new plant despite the sluggish demand for construction equipment is that the market has bottomed out.
PSR Analysis: In Germany, Kubota has held the leading market share for its main product, mini excavators, for 20 years. Although the construction equipment market is currently sluggish, this move can be seen as an investment in anticipation of an upturn in demand in the medium to long term. The EU has the most stringent exhaust regulations, and acceptance in such a market demonstrates the company’s ability to respond to increasingly stringent environmental regulations in other countries. PSR
Akihiro Komuro is Research Analyst, Far East and Southeast Asia, for Power Systems Research
The declaration of martial law by South Korean President Yoon Suk Yeol has sparked a series of strikes by labor unions. The unions, which are the support base for the opposition parties calling for the president’s resignation, are mobilizing up to 200,000 people. Major industries such as the automobile industry are already affected.
The strike was led by the umbrella organization, the National Metal Workers’ Union. In addition to Hyundai Motor, which is a member of the union, more than 70,000 workers from other companies that support the Korean auto industry, such as Kia Motors, GM Korea and Hyundai Mobis, an auto parts manufacturer, have joined the strike.
The Thai government says it will relax the requirement for EV manufacturers receiving subsidies to produce a certain number of vehicles by 2024. There had been calls for a revision from Chinese manufacturers and others. This is in response to poor market conditions for EVs.
The Board of Investment (BOI) of Thailand provides subsidies to manufacturers that can be applied to the purchase of EVs. The subsidy amount is up to about US$ 3,000 (100,000 baht or about 440,000 yen) per vehicle, which is about 10% of the purchase price of a medium-sized SUV.
The Asia Zero-Emission Community is a collaborative framework for decarbonization involving nine ASEAN countries (excluding Myanmar), Japan and Australia. It is abbreviated as AZEC. The first summit was held in December 2023. The principles of the initiative are “decarbonization through diverse pathways that take into account the circumstances of each country” and “simultaneous realization of decarbonization, economic growth, and energy security”.
Many countries in Southeast Asia rely on fossil fuels such as coal and natural gas to generate electricity. Japanese companies are driving the adoption of renewable energy, and the Japan government is also providing support through subsidies and other means. As of the end of 2023, 120 cooperation projects have been implemented between Japan and countries in the region.
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