Tokyo’s auto show is back for the first time in four years and newly rebranded for the electric vehicle era, in a marketing overhaul that may be more reflective of industry aspirations than Japanese automakers’ lagging battery-powered lineup.
The Japan Mobility Show, which opens on Thursday, comes at a critical moment for the domestic industry. Toyota (7203.T), the world’s top-selling automaker, this year announced a strategic pivot to battery EVs, including plans to commercialize advanced batteries and adopt die-casting technology pioneered by Tesla (TSLA.O).
Toyota’s shift has helped silence criticism that it was too slow to embrace battery EVs. But the outlook is gloomier for some of its smaller rivals like Subaru (7270.T), Mazda (7261.T), and Mitsubishi Motors (7211.T) that may face a more daunting challenge in rolling out EVs, analysts say.
Meanwhile, China’s top automaker BYD (1211.HK) will be the first Chinese car maker to exhibit models at the show, and one of just three foreign auto manufacturers to do so, along with German brands Mercedes (MBGn.DE) and BMW.
And unlike many of the Japanese companies, who will be displaying concept cars, the foreign automakers will all show battery EVs that are already in production or are going to be in production.
There seems to be a “growing gap” between Japan’s stronger automakers, such as Toyota and Honda (7267.T) that are producing record profits, and weaker players, said Koji Endo, head of equity research at SBI Securities.
Japan’s auto industry is also facing pressure from high input costs and slumping sales in China, where Japanese brands such as Nissan (7201.T) and Mitsubishi, which reportedly has decided to end production there, have been hit harder than other non-Chinese makers.
Toyota will display various battery-powered concept models at the show, including a sport utility vehicle, mid-size pickup truck, and a sports car.
The world’s biggest automaker by sales has long advocated for a multi-pronged approach to reduce carbon emissions that includes other electrified and alternative energy options besides battery EVs.
The company will show new models of its Century and Crown series, which it has previously unveiled as plug-in hybrid and hybrid vehicles.
Nissan plans to display the battery-powered Ariya, Leaf, and Sakura models, in addition to new battery EV concept models such as a luxury minivan.
SHRINKING HOME MARKET
The biennial show was not held in 2021 because of the pandemic. This year, it will feature a range of mobility technologies including autonomous vehicles, motorbikes, trucks, and so-called “flying cars.”
Yet despite the bid to appeal to a wider audience, Japanese automakers are grappling with growing pressure from a rapidly aging and declining population that has fewer young people to buy cars, pressuring auto sales.
New registrations for passenger cars last year hit their lowest annual level on record, according to data from the Japan Automobile Manufacturers Association that goes back to 1993.
Registrations declined 6.2% in 2022 from the previous year to 3.4 million vehicles.
Nearly a third of Japan’s population of 124 million was aged 65 or older as of May 1, according to government data.
Last year was the third consecutive year that new car sales stayed below 4 million, though they were also hit by fallout from a post-pandemic chip shortage that disrupted auto production and supply.
In contrast to the darkening outlook in Japan, data from the ASEAN Automotive Federation shows that the auto market in Southeast Asia has been growing.
Passenger vehicle sales in seven Southeast Asian countries jumped 24% year-on-year to 2.2 million in 2022, the data showed, though Japanese automakers are battling against Chinese EV upstarts to maintain share in key markets like Thailand.
What will it take for the Fed to cut rates?
Leading economists anticipate a potential shift in the Federal Reserve’s monetary policy, shedding light on the timeline for an interest rate reduction.
Financial experts and analysts have closely examined economic indicators, which suggest that a change in the Fed’s stance may be on the horizon. Factors such as inflationary pressures, employment rates, and GDP growth have all been scrutinized to ascertain when the central bank might decide to cut interest rates.
The consensus among these experts is that a rate cut could occur within the next six to nine months. They point to the Federal Reserve’s commitment to maintaining a flexible approach, adjusting policies as needed to support economic stability. With inflationary concerns still looming and the labor market showing signs of recovery, the timing of a potential rate cut remains a key topic of discussion among financial circles.
The Federal Reserve’s decision on interest rates can have a profound impact on financial markets, investments, and borrowing costs. As such, investors and businesses are keeping a keen eye on developments in this regard, preparing for potential changes in their financial strategies.
Kyle Rodda from Capital.com spoke with Ticker’s Ahron Young. #featured
Bank accidentally deposits $86M into client’s account
A financial institution mistakenly deposited over $86 million into a client’s account, causing shockwaves in the banking industry.
The error came to light when the client, a small business owner, checked their account balance and discovered the astronomical sum. It is being hailed as one of the most significant banking errors in recent memory.
The client, who wishes to remain anonymous, reportedly contacted the bank immediately upon noticing the massive windfall. Bank officials were left scrambling to rectify the error, which has raised numerous questions about the institution’s internal controls and safeguards.
The client’s account, initially holding just a few thousand dollars, suddenly displayed a balance that could buy luxury yachts, mansions, and more.
The incident has prompted investigations by regulatory authorities to determine how such an egregious error occurred in the first place.
While the bank has issued an apology and assured the client that the funds will be corrected to the proper balance, it remains unclear how this mistake could have happened on such a colossal scale.
The financial institution may also face potential legal consequences for the error, as well as reputational damage that could impact its future business.
Tech giants drive global mega-cap surge amid inflation relief
Tech giants have taken the lead in propelling global mega-cap stocks to new heights.
This surge comes as a welcome relief for investors who have been closely monitoring the impact of rising inflation on the financial markets.
The tech sector, including giants like Apple, Amazon, and Microsoft, has been instrumental in driving the rally. These companies have reported robust earnings and strong growth prospects, which has boosted investor confidence. As a result, the market capitalization of these tech behemoths has reached unprecedented levels, contributing significantly to the overall rise in global mega-cap stocks.
The easing of inflationary pressures has played a pivotal role in this resurgence. Central banks’ efforts to tame inflation through monetary policy adjustments have begun to bear fruit, reassuring investors and stabilizing financial markets. As concerns over rapidly increasing prices recede, investors have become more willing to invest in mega-cap stocks, particularly in the tech sector, which has demonstrated resilience in the face of economic challenges.
Will the tech giants maintain their momentum and continue to lead the mega-cap surge, or are there potential risks on the horizon?
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