Press Conference by Minister Saito (Excerpt)

*Note: This is a provisional translation for reference purposes only.

Friday, August 2, 2024
11:03 to 11:18 a.m.
Press Conference Room, METI Main Building

Opening Remarks

Publication of a company list regarding Price Negotiation Promotion Month

To begin, I would like to mention three points.
First of all, today, we will publish a list of companies regarding the status of price negotiations and price pass-through compiled by each order-placing company, which was based on the study conducted during Price Negotiation Promotion Month this March.
This aims to publish the transaction policies of order-placing companies, including not only those who were evaluated favorably by their subcontractors but also those who received unfavorable assessments in order to encourage these companies to improve the transaction policies.
This will be the fourth publication of such a list.  290 companies are listed on this current publication, marking the largest-ever such number. Of these, 190 companies were included in past lists, and it was reported that these 190 companies marked a price pass-through rate five percentage points higher than that of the 100 companies that were included for the first time. This demonstrates that these companies have improved their transaction policies in response to being included in the list.
We would like to ask all companies on the list to continue their efforts for appropriate price pass-through across their entire supply chains in consideration of the assessments given by their counterparts in the transactions.
The competent ministers will provide instructions and advice on improving transaction policies to the top management of a dozen order-placing companies that received unfavorable assessments by subcontracting small and medium enterprises (SMEs) based on the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises. In addition, it is extremely important for subcontracting, order-receiving SMEs to actively engage in price negotiations in order to secure funds for wage hikes.
Regarding the labor costs which have been difficult for subcontracting SMEs to negotiate and pass on in their prices, the government has developed guidelines on price negotiations and has also prepared various tools that such SMEs can make use of in price negotiations, such as establishing support and consultation offices　for subcontractors and SMEs, including Aid Offices for Subcontractors and the Yorozu general support station, which provide support towards proper price pass-through. I hope that those companies will not hesitate to propose a price negotiation by using those tools as well.
The spring labor-management negotiations this year marked a 4.45% wage hike among SMEs, the highest level in 33 years. We will continue to make our utmost efforts to support price pass-through and ensure the sign of a sea change will lead to a new growth-driven economy and that SMEs can steadily secure funds for wage hikes.
The administrative staff will provide a detailed briefing later.

METI Kids Day

Secondly, for two days on Wednesday, August 7, and Thursday, August 8 this year, METI will once again hold Kids Day.
This event will be held as part of the Children’s Day for Visiting Kasumigaseki, a campaign to be jointly conducted by ministries and agencies, aiming to broadly raise children's awareness of society during their summer vacation. This year’s event will also provide a variety of workshops and exhibitions in cooperation with companies and industrial associations that children and their parents can enjoy.
Among these exhibitions, METI is scheduled to feature some displays explaining Expo 2025 Osaka, Kansai, Japan, which will open next year, and the current state of the production areas of Wajima Lacquerware affected by the 2024 Noto Peninsula Earthquake and the efforts for reconstruction.
Along with this, METI will hold a hands-on job experience program for high-school and junior high-school students as a unique initiative. In addition to METI’s policy simulation program which will familiarize participants with the roles METI performs, this year, the program will focus on startups, business succession of SMEs, and AI by inviting people who are actively engaging in the respective areas to share their excitement for their work.
I hope that this will become a good opportunity for young participants to think about their own future. If time permits, I would like to visit the program.

Visit to Osaka

Third, I will visit Osaka Prefecture on Tuesday, August 6, next week.
I recognize the importance of local bookstores as cultural centers for communities and a basis for fostering creativity. Bearing this in mind, I will exchange views with business owners who run small local bookstores.
I will also visit Minase Innovation Center operated by Sekisui Chemical Co., Ltd., a company engaging in the research and development of next-generation Perovskite Solar Cells. I will exchange views with the staff.
Moreover, I intend to visit the Yumeshima Island site, the planned venue for the Expo 2025 Osaka, Kansai, Japan, to confirm the progress made in the construction of the venue.
I will end my remarks here.

Question-and-Answer Session

Revitalization of bookstores

Q: As you mentioned a little at the beginning of your comments, I would like ask you about the situation related to bookstores.
Some media reports that Tohan Corporation, a major publication wholesaler, has started an effort that allows new entrants to open bookstores that handle only a small number of books.
METI has established a project team directly under the Minister and has been placing weight on the efforts for vitalizing bookstores. Could you offer a comment on these movements?
In addition, could you once again explain your thoughts regarding the current situation of bookstores, the number of which is declining.

A: I recognize some media outlets are reporting that major publication wholesaler Tohan has started an effort for making it easier for new entrants to open small bookstores.
METI's Bookstores Promotion Project Team, during its interviews, discovered the  difficulties encountered in opening new bookshops. Currently, about a quarter of all municipalities or local governments across Japan have no bookstores. Accordingly, I strongly expect that the voluntary efforts of such private businesses will increase the opening of new bookstores in those regions with no bookstores.
The Basic Policy on Economic and Fiscal Management and Reform state that Japan should strive to vitalize the character and type culture of the written word, including books, and stimulate bookstores. METI aims to rapidly organize specific initiatives and then encourage efforts that contribute to stimulating bookstores.

Business partnership between Nissan Motor Co., Ltd. and Honda Motor Co., Ltd.

Q: Yesterday, Nissan and Honda announced elements of their business partnership in such efforts as standardization of the parts of electric vehicles (EVs) and research for software-defined vehicles (SDVs). They also announced that Mitsubishi Motors Corporation will join this framework.
Could you share your view on this movement? I think this may lead to the reorganization of the automobile industry. Could you make a comment, if any, on ideal approaches that METI should take to support this movement?

A: Yesterday, Nissan and Honda announced that they will work on the specifics of their business partnership areas, including joint research for the next-generation SDVs, based on the strategic partnership that they started discussing in March this year. I also recognize that Mitsubishi Motors will participate in this partnership.
The automobile industry has been increasingly focusing on digitalization as a competitive axis alongside electrification and is also facing intensifying international competition with emerging manufacturers with the development capabilities of advanced software. We share a strong sense of crisis with the industry.
Amid this situation, the Japanese automobile industry needs to improve its competitiveness in the SDV area, and, to this end, the government has formulated the Mobility Digital Transformation (DX) Strategy, which sets medium- to long-term goals for Japanese companies of achieving a 30% share in the global SDV market.
As the competitive environment surrounding the automobile industry has been dramatically changing, my greatest hope in this field is that Japanese automobile companies will proactively take on challenges and succeed amidst international competition. I also hope that these companies will make progress in specific efforts in a more rapid manner.