Sojitz Corporation

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Automotive Division

With automotive assembly and wholesale and retail sales as its core businesses, the Automotive Division develops its operations in growing markets, such as Asia and Latin America, as well as in mature markets, such as Japan and the United States. In addition, this division is actively enhancing its auto-financing business while developing automotive-related services that meet the needs of the changing times.

Strengths of the Division

External Environment

Opportunities

  • Increase in demand for automobiles due to economic development in emerging countries and diversification of needs in developed countries
  • Paradigm shift in the automotive industry and changes to the existing industry structure
  • Rising need for quality control due to globalization and supply chain diversification

Risks

  • Market, financial, and economic stagnation and event risks such as natural disasters
  • Political and regulatory changes in various countries and changes to the social environment caused by technological advancements
  • Changes in international strategies of car makers

Growth Strategy

We will strengthen the functions in automobile sales as a core business, build business bases in new fields, and ultimately contribute to a prosperous mobility society.

Tatsuhiko Kanetake

Executive Officer, COO
Automotive Division

The automotive industry is currently in the midst of a paradigm shift, which includes focusing on CASE (Connected, Autonomous, Shared, and Electric) technologies as well as MaaS (Mobility as a Service) platforms. Further, the COVID-19 pandemic is transforming people’s lifestyles, which reminds us of the progress toward a next-generation mobility society.

The Automotive Division is in the process of growing earnings from business investments under Medium-Term Management Plan 2020 and in the first year of Medium-Term Management Plan 2023. In addition, the division is expanding the scope of its operations in promising markets in its core automobile sales business (distributorships and dealerships). Specific measures in this division include efforts to increase business value through enhancement of locally based sales and marketing capabilities and after-sales services and the strengthening of functions through utilization of digital technologies. We are also reinforcing our financing business while aggressively developing new service businesses that adapt to the changing times.

Although numerous countries are relaxing the restrictions imposed in response to the COVID-19 pandemic, recovery in automobile production and sales volumes has been sluggish as a result of the global semiconductor shortage and the prolonged conflict between Russia and Ukraine, and the impacts of this slow recovery are also expected to be felt to some extent, in the year ending March 31, 2023. Conversely, we expect ongoing growth in automobile demand centered on Asian, Latin American, and other emerging countries. A focus in the Automotive Division will thus be augmenting Sojitz’s functions and regional operating foundations to ensure we are able to capitalize on this demand growth.

Businesses

Business Map

Sojitz G Auto Philippines Corporation

Sojitz Auto Group Osaka Co., Ltd.

■Distributor Business

Sojitz has a long track record in the assembly and sales of automobiles, and the Company’s management functions have received praise from various partners. We are bolstering our portfolio of South Korean- and Chinese-brand vehicles while expanding assembly and sales of Hyundai automobiles in the Pakistan market and sales of Geely automobiles in the Philippines. We also plan to develop operations for selling competitive automobile brands in promising markets boasting robust demand.

■Dealership Business

We are expanding our authorized dealership business for premium brand vehicles, in which we anticipate stable demand in countries including Japan, the United States, and Brazil. In addition, we are working to strengthen used vehicle sales and after-sales services and to build a next-generation sales platform that utilizes the internet and digital technologies. We are also promoting automobile sales to customers who are unable to receive a standard auto loan through financing operations that utilize fintech services.

■Auto-Financing Business

Sojitz is developing the Autofinanciamiento business in Mexico. Autofinanciamiento, or self-financing, refers to a system in which potential buyers pool funds as a group, purchasing a vehicle monthly through a raffle system. All group members are able to purchase a vehicle at a determined step in the process, and each buyer pays off their remaining balance individually. This system provides an opportunity for potential buyers who are not able to receive a standard auto loan to purchase new vehicles.

■Service Business

Sojitz is developing a parts quality assurance business, with a customer base that includes automobile and automobile parts manufacturers. Furthermore, in response to the changing times, we are working to build new service businesses for consumers and business operators that make use of the internet and digital technologies to offer mobility as a service (MaaS) and subscription services.

TOPICS

Market-Oriented Initiatives

Entry into Camper Manufacturing and Sales Business

Sojitz has acquired full ownership of K Access Corporation (“K Access”), a manufacturer and seller widely recognized in the camper industry for its “Camper Kagoshima” brand campers (New company name is Sojitz Mobility Corporation). Demand for campers and vehicles that can function as remote offices is robust in Japan and expected to grow going forward. Sojitz decided to commence full-fledged entry into the camper market in order to cater to such demand by enhancing its systems for developing new products and for supplying and selling these products. We also aim to encourage use of these vehicles for disaster preparedness purposes and at roadside rest stops to help revitalize regional communities across Japan. Our operations in this area will be used as a vessel for providing new products and services that preemptively address the automotive needs projected to arise from changes in consumer lifestyles.

Camper Kagoshima website (Japanese)

Digital Transformation Initiatives

Digital Transformation Using Virtual Reality

Sojitz has formed a business alliance with infiniteloop Co., Ltd., a software development company that provides so-called cross reality* services. Together with this company, we have developed “Auto VR,” an automobile sales negotiation tool that utilizes virtual reality (VR). Through VR technologies, “Auto VR” creates digital showrooms that do not need actual vehicles as a solution for realizing new approaches to selling automobiles. Going forward, Sojitz will continue to utilize digital technologies to heighten business value and to create value in new areas.

* Virtual reality, augmented reality, mixed reality, and other technologies for creating new experiences by merging physical and virtual spaces

Organization

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