Suzuki Motor Corporation (7203) Earnings Call Transcript & Summary

Thank you very much for joining us for this online press conference despite the short notice and taking time out of your occupied schedules. We really appreciate your participation. We would like to start the joint press conference by Suzuki Motor Corporation, Daihatsu Motor Co. and Toyota Motor Corporation. First of all, I would like to introduce to you the people on the stage today. Representative Director and President of Suzuki Motor Corporation, Toshihiro Suzuki.

Good afternoon and good morning.

Representative Director and President of Daihatsu Motor Co., Soichiro Okudaira.

Nice to meet you all.

Representative Director and President of Toyota Motor Corporation, Akio Toyoda.

Nice to meet you all.

And President of Commercial Japan Partnership Technologies and also President of Toyota Motor Corporation's CV Company, Hiroki Nakajima.

Nice to meet you all online.

Now first of all, Toyoda will make a presentation.

Hello, everyone. I would like to share with you my thoughts on this partnership. We want to help improve people's lives. We want to help leave a better Japan and a better planet for the next generation. This is a mission of the automotive industry and the origin of the founding of the 3 companies present here today. The commercial business partnership announced in March by Isuzu, Hino and Toyota was prompted by the same idea. Initiatives are now underway for easing the work situations of troubled colleagues on the front lines of transportation and for protecting the prosperous lifestyles that transportation supports. With Suzuki and Daihatsu now joining us in this project, we will take on the challenge of improving the lives of people supported by the minivehicles. Of the 78 million cars owned in Japan, 31 million are minivehicles. In many rural areas, minivehicles account for more than 50% of owned vehicles. In Japan, 85% of roads are so narrow that they can only be used smoothly by minivehicles. Roads make cars. Minivehicles are collectively the people's car made by the roads of Japan. And they are a practical and sustainable lifeline of Japan that has continued to evolve along with people's lives. However, great challenges now lie ahead of us. The CASE resolution and the necessity to achieve carbon neutrality are now forcing the world of minivehicles to undergo a profound transformation. I believe that no matter how much the times have changed, we must not abandon either minivehicles or our customers. For more than 60 years, Suzuki and Daihatsu have been protecting this lifeline and driving the market. They continue to produce not only passenger cars but also commercial vehicles that support a variety of jobs, such as those in agriculture and delivery. Although mini-commercial vehicles present extreme challenges when thinking only in terms of profitability, they are indispensable to Japan. That's what has driven these 2 companies to make effort, come up with new ideas and keep going. In other words, what they have been true to are the mission of the automotive industry and a user's perspective that puts customers first. By working together, these 2 companies will be able to know the reality of nearly 70% of Japan's minivehicle users. Nothing could make Toyota happier than to be able to apply its CASE technologies to further evolve minivehicles and help improve people's lives. Moving forward, it is essential to think about vehicles as a set with infrastructure. Leadership in both the government and the private sector is now needed more than ever. Furthermore, achieving carbon neutrality is a challenge that can only be solved if all people and all industries work together. Following the announcement of the partnership among Isuzu, Hino and Toyota in March, many people, including local governments, infrastructure companies and transportation companies, have told us that they would like to work together. With Suzuki's and Daihatsu's joining this project and our working together, we'll be able to expand our circle of cooperation to not only cover commercial vehicles but also minivehicles. With this expansion, I believe that we'll be able to take one step closer to a better mobility society in which many people can be happier. With a strong will and passion and going beyond where we each normally belong, we are committed to taking action for Japan and the earth. I would like to ask for your understanding and support. Thank you very much.

Next, let me call up on President Suzuki, please.

Hello, everyone. I am Suzuki. While watching the Toyota, Hino and Isuzu press briefing to announce the CJP project in March of this year, I realized that we could enrich society even more by not only connecting the distribution bases of large trucks but also connecting those distribution bases to customers' homes. Speaking at a meeting of Suzuki's sales bases in early April, I shared my thoughts that to achieve this, mini-commercial vehicles, which account for 58% of all commercial vehicles, also need to participate in the project, and by doing so, we could contribute more to the world. Since minivehicle standards were established in 1949, minivehicles have been used for a variety of purposes, such as in local transportation, in agriculture, forestry and fisheries as well as in construction, retail and logistics to enrich people's lives by being close to them, including in their work. In Japan, every industry is now endeavoring to achieve carbon neutrality, and the world of minivehicles is no exception. Our mission is to bring to market minivehicles that are affordable and contribute to carbon neutrality and to continue to be an indispensable part of our customers' lives. However, accomplishing this mission on our own would be very difficult. The whole of society must work toward the same goal to achieve it. Daihatsu felt the same way, and we have been discussing what we could do together. And during such, Toyota approached us and invited us to work together to maintain Japan's lifelines. Because the philosophy and purpose of CJP resonated with us, we decided to join the project. When Toyota proposed that Daihatsu and Suzuki join CJP, I was very happy to learn that President Toyoda was thinking the same way I was. Our company's senior adviser, Osamu Suzuki, who had been recently referring to himself as unemployed, described minivehicles as works of art created under various restrictions such as those related to size, engine displacement and above all, an affordable price. We want to evolve minivehicles, which are collectively the people's car and lifeline, in stride with the changing times and to pass on to the future the baton of the works of art created by our predecessors as tools to enrich the lives of our customers. That is our mission and our hope. As like-minded colleagues, we would like to start by working together as 5 companies. Thank you very much.

Thank you. Next, Okudaira will make his remarks.

Okudaira is my name. Hello, everyone. I'd like to talk about the background and details of this partnership. As President Toyoda mentioned, there are 31 million minivehicles under ownership in Japan, which is about 40% of all owned vehicles in the market, with 8 million of them being mini-commercial vehicles. The number of in-use minivehicles is steadily increasing. There is a strong demand for mini-commercial vehicles not only among fleet customers but also among individual customers. With such a large number of customers using minivehicles, we, minivehicles manufacturers, believe that it is a responsibility to make people's lives safer, more secure and more prosperous by promoting carbon neutrality and by achieving the dissemination of CASE technologies and services for minivehicles. Meanwhile, we have been offering customers affordable, fuel-efficient technologies and advanced safety technologies by thoroughly pursuing low-cost manufacturing by way of simple factories, simple design elements and slim fixed costs. Also, our internal research shows that the current CO2 emissions of minivehicles from a life cycle assessment, LCA, perspective are about 30% lower than non-vehicle -- non-minivehicle compact cars and comparable to those of small hybrid electric vehicles. Our understanding is that it is no easy task to disseminate CASE technologies and services and to reduce CO2 emissions beyond the current level while keeping prices affordable. We have truly entered a once-in-the-century era of profound transformation. It is extremely difficult to independently address these issues, and that necessitates a collaborative effort that goes beyond conventional frameworks. Therefore, President Suzuki and I have been discussing for some time whether there were areas in which we could work together for the sake of our customers. We were then approached by President Toyoda, leading to what we are announcing today. I am convinced that adding Toyota's CASE technologies to Isuzu and Hino, which are commercial vehicle professionals, and participation in this project by Suzuki and Daihatsu, which have dedicated themselves to minivehicles, will create significant synergies. These include an integrated commercial vehicle infrastructure that covers, figuratively speaking, from the main arteries to the capillaries as well as the realization of electrification suitable for minivehicles through the fusion of advanced technologies and low-cost manufacturing. I would like to explain the specific details of our participation in this partnership, including what we will consider going forward. The first point is related to connected technologies. Japan has about 60,000 logistics companies, roughly 70% of which are small-scale companies with fewer than 20 employees or 1-person operations. And there is still a long way to go for automakers to meet the needs of individual customers. Through this partnership, we would like to seek frontline customer feedback that has thus far escaped us. And we would like to build an infrastructure that connects various elements, including data, of trucks to mini-commercial vehicles, which are responsible for the last mile, to improve the efficiency of logistics as a whole. The second point has to do with advanced safety technology, such as advanced driver assistance systems that protect our customers. We will bring together the technologies and know-how of each company and study the development of advanced safety technologies that are more affordable with a view toward future development. The third point concerns the electrification of minivehicles, including mini-commercial vehicles. Toward achieving carbon neutrality, we will take on the challenge of developing affordable electrified minivehicles through technological cooperation on electric components and by consolidating development resources. By collaborating on these 3 points, we will aim to include minivehicles in the societal implementation of CASE technologies and services. We, too, will put into practice President's Toyoda's give-it-a-try thinking. As of today, Suzuki and Daihatsu are now members of the Commercial Japan Partnership, a commercial vehicle project by Isuzu, Hino and Toyota, and we will begin our efforts with commercial vehicles as the starting point. To promote collaboration, Suzuki and Daihatsu will each acquire 10% of Commercial Japan Partnership Technologies, which is the joint venture for the project, through a share transfer. As a manufacturer of minivehicles, Daihatsu will continue to provide products and services while insisting on products that are compact, light and low cost so that minivehicles, which serve as a lifeline, will remain affordable and accessible to our customers. Through this partnership, we will accelerate such efforts. Thank you very much.

Now we would like to start the questions-and-answer session.

[Operator Instructions] Mr. [ Obi ] of NHK. [Operator Instructions]

Are you receiving the sound?

Yes, we can hear you.

My name is [ Obi ] of Hamamatsu Bureau of NHK. My question is addressed to Mr. Toshihiro Suzuki, President. You have decided to collaborate with those companies. You have joined this new group. In the context of this collaboration, what is the role of minivehicles? What is your thought about the role to be played by minivehicles in the context of collaboration? Please respond to that question.

Thank you for your question. Earlier, at the very outset of my presentation, I mentioned that 58% of commercial vehicles is accounted for by mini-commercial vehicles. And through connected technology -- connectivity technology, the nervous system, that is to say the major logistics, and also the last 1 mile of a small, [ large ] transportation can be combined and integrated together. In the past, the major large logistics, when it comes to the last 1 mile was connected by arteries, however, handing over the cargo. Was it connected through 1 single route? That wasn't the case. In the same case, the net of veteran people or experienced people connected to the last mile. However, using the connectivity technology, that can be fully integrated in the operations. If that happens, we were suffering from a driver shortage in the large logistics or the efficiency of [ overall ] package was not appropriate or not have. And those minivehicles that played an important role of capillary area, if it is involved in that, it can enhance the efficiency of logistics. That's how I view the role of minivehicles. And therefore, in terms of the capillaries, we would like to even make the more detailed artery system and flow or facilitate the flow as well. So those efforts fully merged with the carbon neutrality age, we'll be able to establish the logistics suitable for carbon neutrality. And by connecting large logistics and small minivehicles, that can realize the very efficient logistics overall. And I believe we'll be able to produce good results and achievements.

Going on to the next question then from Yomiuri Newspaper, Katori-san. [Operator Instructions]

Katori from Yomiuri Newspaper here. Earlier, you talked about some specifics of the collaboration to develop in the future, but could you be more specific? Because 2 new companies will be joining the CJP. What sort of project or what sort of results will be born or generated by you joining the project? Because I believe that the electrification of minivehicles is a major challenge, and so maybe I can ask this question to Nakajima-san or Toyoda-san.

Thank you. Thank you for that question. So let me, Okudaira, first respond. The CJP or this project will take a customer-centric view and try to identify the customers' challenges and resolve these issues. And especially issues relating to transportation and also achieving carbon neutrality would be the areas that we would like to collaborate to try and resolve. Now the areas that we would like to cooperate in, I already talked about, but first of all, integrated logistics from the large arteries to the capillaries, starting with large trucks to the mini trucks, and we wanted to integrate these logistics together. Already, the communications devices systems have been standardized, or at least specifications and joint development of such specifications were announced already in spring of this year by the interested parties. So we would like to add this factor into the CPJ (sic) [ CJP ] project. And we would like to implement them as a project at CPJ (sic) [ CJP ] to verify these technologies and make sure that they can service our customers. So in many ways, the truck artery logistics, I think, are becoming connected and integrated. But when it comes to the connectivity of the mini-commercial vehicles, we don't have such connectivity in the minivehicles themselves. We rely on the use of smartphones by the customers. So by introducing CASE, by connecting that together, everyone would be able to share data. And that, I think, would be a major benefit from this project. And this will enable all of us to provide better services to our customers, and logistics efficiency will be improved. And by so doing, we will be able to eliminate waste and redundancy in many areas. And for the drivers, I think that we will be able to provide a more worthwhile or better work environment for the drivers as well. And also, in order to contribute to safety and security, we want to develop specifications for advanced safety technology because safety is very important, and we have been developing low-cost safety technologies for many years. But going forward, we believe that we need more advanced ADAS or advanced driver assistance systems, which requires connectivity and also coordination of collaboration with the infrastructure as well. And therefore, we would like to provide the necessary data information, technology and use such data and technologies together. That should have a benefit for the entire market. And as for carbon neutrality and electrification and how it can contribute to carbon neutrality, up to now, electrification for the customers has covered the development of technologies at low costs to minimize the burden on the customers. But in order to approach carbon neutrality, we need to introduce newer technologies, which means we need to develop more low-cost new technologies. And -- so we would like to develop these technologies together through cooperation to resolve these issues. So these will be some of the specific activities to be covered by the CJP. But we have just only begun, so we will continue to study the specific details going forward.

If I may supplement, it was the same in the previous occasion, where we were joined by [ Isuzu ] and Hino. And both Suzuki and Daihatsu in terms of vehicle manufacturer are rivals against each other. But from the perspective of customers, collaboration between these 2 companies will serve the customers better. There are ways for these companies to serve the customers better. And that's why we established CJP together with Hino and Isuzu. So in that sense, this CJPT, President Nakajima of CJPT will be able to share with you more concrete project. By referring to specific project, he may be able to say that this is a way in which the large trucks and minivehicles together can produce the better results. And that can be explained by Mr. Nakajima.

Nakajima of the Commercial Japan Partnership Technologies. First of all, together with Hino and Isuzu, we established the CJP. And as we have already announced, in terms of concrete project, we established and started the usage of hydrogen generated in Fukushima. And those hydrogen manufacturers and the major convenient stores and also supermarkets are the parties of collaboration. And the hydrogen manufactured in the green way in Fukushima will be used for distribution. And therefore, we have established this basic project for the usage of hydrogen. And especially involving minivehicles, especially working together with those people engaged in the transportation of the last 1 mile, in terms of the concrete project, in a major city like Tokyo, metropolitan area is a center where many goods are concentrated and brought in. And that relates to the major artery logistics where the major trucks are involved and the [ oil ] transported to major warehouses and to deliver goods to customers, the minivehicles are used for the transportation of goods to customers. And therefore, from the producers and from the cargoes, it's transported to customers. We'll be able to connect from the large arteries to the capillaries as well. So as mentioned by Okudaira-san and Suzuki-san earlier, by considering the usage of open technology, we can achieve that integrated transportation. If the last 1 mile transportation can be connected, the role to be played by warehouses, the warehouses exist numerously in Tokyo, but that can be changed as well. So working with many different vehicles and as partners, with those 5 companies working together as partners, we'll be able to improve the logistics and transportation better, which reflects the customers' requirement further. And for customers that may help reduce the cost of transportation, and that may be one way of contributing to the sustainable society. The project in Fukushima and the project in major city like Tokyo, combining those, probably we will be able to expand the benefits throughout Japan. It may sound like a dream, but this is something we discussed amongst 5 companies.

Now going on to the next question, Mr. Shinya Yamamoto, please. [Operator Instructions]

Can you hear me?

Yes, we can hear you loud and clear. Please go ahead.

I am Shinya Yamamoto. I'm a freelance journalist. My question is the following. Well, minivehicles are very easy to use in terms of body size and their low cost, so it's one of the vehicles that's most suitable for Japan. But these cars have to adapt themselves to CASE as well as carbon neutrality. That would -- the path they take will be different from other vehicles because otherwise, you will lose the benefit of minivehicles. So I think there must be a unique pathway toward CASE and toward carbon neutrality for minivehicles. So my question is, for Okudaira-san, what will -- what's your view on this going forward? Also, Toyota, I believe, also sells GR Copen. And why are you so insistent on the minivehicles, on continuing the minivehicles, the tradition?

Mr. Okudaira?

Yes. About the general direction, whether there is a unique path for minivehicles, that's your question. Well, first of all, you said that minivehicles are probably the vehicles -- the type of vehicles that best match Japan. I totally agree with you. The size of the current minivehicles and the engine displacement, I think is -- the minivehicle is very important in terms of size. And as far as their agility, it only has a rotational nimbleness of a rotation size of 3.6 meters. So I think it's the roads, Japanese roads that created minivehicles. And carbon neutrality and also cars that can support the daily lives of Japanese people is, I think, minivehicles. And as with Suzuki, I think we have been endeavoring to make minivehicles more compact and lighter and also low cost. And at Daihatsu, we say to give attention to detail by reducing by 1 milligram or JPY 1 or 1 second. And we have been endeavoring and striving to achieve low cost through such attention to details, but I think that we have to continue that for the future. As for the introduction of CASE, introducing CASE technologies and services will, of course, be an add-on cost. But through collaboration and cooperation amongst these companies, I believe that we should be able to resolve that issue. So this project, I believe, is a project to explore a pathway toward making minivehicles CASE enabled. So we do want to work hard to create something very good.

As for my thoughts about minivehicles, I believe that minivehicles are actually the people's car that was created by Japanese roads. It's a very important lifeline that supports people's lives and work. At the same time, for the Japanese car culture, I believe it's a very, very important. At present, Suzuki and Daihatsu are driven by the sense of mission to make something that the society needs and also to support the livelihood and lives of people in the local vicinity -- local areas. And I think that is a founding philosophy of these 2 companies. And that's one of the reasons why I have true respect for these 2 companies which have been developing minivehicles in the past. And this is not only [ limited ] to Japan. And Suzuki in India and also Daihatsu in Malaysia have been utilizing the -- or minivehicle technologies to develop national cars for these 2 countries, and that has led to happiness for not only Japanese but overseas people. So however the times may change, I believe that we must safeguard the history as well as the culture of minivehicles and that -- and to develop. And that would be the mission of the automotive industry. Also, Morizo likes minivehicles. What is Morizo's favorite minivehicle? Do you know what it is?

Is it mini truck?

That's too straightforward an answer, Shinya Yamamoto-san. 2-seater Midship engine car. You should have known, Yamamoto-san. But that is, of course, a mini truck, you're right.

Sorry.

That's my answer. Thank you.

What about Mr. Suzuki?

Since you didn't designate me as a responder, I just remained silent. I mean, there are unique way of minivehicles to operate, and Mr. Yamamoto said that. And what we have to explore and pursue further is that we may be operating in the world where there's a difference of -- in the order of magnitude. And that's what we need to address ourselves, too. When we try to achieve what we are aiming at, minivehicles alone will not be able to achieve this. So by reducing the number of batteries, how can we make sure that the vehicle can operate on its own? And how can we just make sure that minivehicles can serve as shoes or Geta so to speak? And including the development of infrastructure, we must achieve the vehicles that can serve as shoes or Geta and create art. So in that sense, the small, lightweight and affordable, those objectives can be achieved involving suppliers and users, not just pursued by manufacturers. And by doing so, we would like to establish and fulfill the mission of minivehicles that can serve as the shoes or Geta for people at large.

Let us move on to the next question from Daily Automotive Newspaper, Mr. [ Fukui ], please. [Operator Instructions]

[ Fukui ] of Daily Automotive News. In terms of this framework of CJP, the dissemination of advanced safety technology as well as technological cooperation for electrification, those are indicated as objectives. In those areas, I believe, both Suzuki and Daihatsu are conducting their own development. But here, you're focused on commercial vehicles. Separating commercial vehicles and passenger vehicles for the development purpose, the need for separating them may not be that high. What is the advantage and benefit of focusing on commercial vehicles for electrification and also the safety technology? And the CASE technology that may be developed here for commercial vehicles may be applied to passenger cars as well. And on that, I'd like to invite both Mr. Suzuki and Mr. Okudaira to answer this question.

Allow me to respond to this question first. We do not intend to separate or differentiate between passenger cars and commercial vehicles. But as a starting point or as a trigger, to start with -- by starting with the commercial vehicles, we can clearly understand the pain points of users of those vehicles, minivehicles. And as we do that, when it comes to safety and also electrification as well as connectivity, in those areas, we would like to develop the new way and technology for commercial vehicles. And that technology can be further applied to passenger vehicles as well. And at the same time, within the context of commercial vehicles, we need to achieve further evolution as well. And in terms of vertical development, including large vehicles, what sort of technology is most appropriate can be further pursued, and we can further expand the area for application. So it doesn't mean that we would start with the commercial area and wouldn't apply to other areas. That's not the case. It was just a starting point and trigger. And if any technology -- good technology can be identified, it will be applied to passenger vehicles as well as on the global basis. So that's the idea for development.

May I? When you take the user's perspective, just technology must become -- can be used in an integrated manner. Therefore, as President Suzuki said, I think the customers' needs will become more visible. And also, we can propose an integrated solution end-to-end. And that would make it easier for us to develop technology and for us to plan for more business. It will make it easier for us to come up with new ideas and also make it easier for us to make new proposals and offers to customers, as President Suzuki said. We -- there's no need to distinguish between passenger cars and commercial cars when we develop. And we don't expect them to be totally different. But of course, the individual -- there will be some individual needs for commercial applications, which may require a unique solution. But I think that is a point to be considered for the future. Thank you.

Mr. [ Yada ] of Transportation Economics Newspaper. [Operator Instructions]

Yes. I am [ Yada ] from the Transport Economics. My question is to Nakajima-san of CJPT. Earlier, you did explain this point. But my question is, well, conventionally in the field of logistics, minivehicles and trucks were segregated -- segmented. So what would be the synergy between the two? And what sort of synergies can be expected or do you expect from this project? If possible, if you could talk about management -- or sorry, about the minivehicles and also about the environment initiatives, please?

Yes. Thank you very much, [ Yada-san ], for that question. Well, with the addition of the 2 minivehicle companies, what would be the synergies expected? Well, as was mentioned earlier, in the field of logistics, you have large trucks and also the minivehicles serving the last 1 mile. So how to link them together to improve the overall efficiency and how to achieve a just-in-time logistics system, I think, is the big thing. But there's another point. Suzuki and Daihatsu, within the field of minivehicles and limited space, have been developing even better cars and to answer to the customers' needs. So they're very good at developing high-quality goods at reasonable prices. And of course, we also offer various high technologies, but they must be lowered in cost to be actually usable in logistics and in the field. And as [ Yada-san ] knows, the trucks are operated for many, many years, which means that just because it's a new car, you don't introduce new systems in just new trucks. We wanted to be able to introduce low cost and very usable technologies for advanced safety and others in the existing fleet of trucks. So with Suzuki and Daihatsu joining the project, we believe that we'll be able to maximize the synergy for high-quality products at reasonable prices. And in the logistics and trucks industry, there is a lot of small- and medium-sized companies. So we want to able to provide to them low-cost technologies for advanced safety. As for environment, as was mentioned earlier, minivehicles themselves are environmentally friendly cars to begin with. And add to that, the improved logistics efficiency, if we can achieve that, and then, of course, carbon neutrality will be achieved not only by just electrification, by improving logistics efficiency because there are many, many vehicles -- minivehicles used for logistics that would reduce the fuel burn, which will lead to less CO2. And then in March, the CJP activity was launched with the help of other 2 companies. And the biggest question we had at that time was, well, Hino -- although it was a 3-party partnership of Isuzu, Hino and Toyota, the largest number of questions we had was whether the minivehicle companies are involved. So relatedly, when we investigate the use of these vehicles by our customers, it's not only just the large trucks, but also minivehicles are used as the logistics 1 last mile to deliver the goods to the customers. So maximizing the synergy effect will be the shortcut to carbon neutrality. And also, we do have the biggest contribution to the customers as well as to our operators. So we would like various companies as well as others who are like-minded and can, of course, identify with this aim for carbon neutrality. We would certainly like to expand this circle to many others as well. Thank you very much.

Now let us move on to the next question from Asahi Newspaper, Mr. Chiba, please. [Operator Instructions]

Asahi Newspaper, my name is Chiba. Can you hear me?

Yes, we can hear you.

In your presentation earlier, you talked about 60,000 logistics people. About 70% of that is a very small operator with employees numbering 10 or less or a single person operator, and that was included in the presentation. In terms of activities of CJP, by listening to the pain points of logistics operators or looking at the way the vehicles are used to identify their needs. But in the case of users of the mini trucks, I think they are quite diverse. And in capturing their needs and the way they actually use those vehicles, quite difficult compared with the large trucks where the large corporations are major users. So with Suzuki and Daihatsu joining CJP, the difficulty that I have just mentioned, can that be grasped and captured quite well? Can you expect synergy in that context? And on that basis, as we have been discussing and hearing about your intention of establishing integrated logistics solution or just-in-time logistics solution, how is that going to be achieved in the concrete manner? Could you talk about the specifics of that? Could I ask Mr. Nakajima to respond to this question?

Thank you very much for your question. As you mentioned in your question, first of all, the 2 manufacturers of minivehicles and also the way in which customers use that, we have less interface on the part of Toyota with customers and the supply to Isuzu or Hino and -- apply the same. With those minivehicles manufacturers, they can just come into the contact of customers to find the way in which they use those vehicles, and we were able to gain very valuable experience, offering the solutions based upon Toyota production system. And by doing so, we thought that we'll be able to make better contribution for satisfying customer needs. As you mentioned, the operators using minivehicles, in many cases, are individuals or very small operators. And it's not that we have very close contact with them, but the dealers of Suzuki and Daihatsu do have an in-depth contact point and interface with customers. So voices of those users, we can receive from Suzuki and Daihatsu's operators. And how can we improve the minivehicles? Or is there anything that we can specialize on minivehicle for the improvement of technology? And that kind of communication we can establish is the greatest benefit we can expect from that. We are going to make a new start, but we are not in a haste. By identifying customer needs one-by-one and offering solution one-by-one, I think, is the closest way for applying the solution. Another aspect of your question, that is to say the establishment of integrated logistics system, what are the concrete projects that can be established? Needless to say, the overall lead time coming from producers, the customers can be shortened substantially. And if that total time can be shortened, the warehouses that have been serving as an intermediate place for storage can be made more efficient. And for consumers, in a more timely manner, they can obtain what they need actually. And from the perspective of producers, the perishable things can be delivered to customers while they are fresh and new. So from truck -- spanning trucks and also the minivehicles that serve in the last 1 mile, connecting them can offer many new opportunities and possibilities. Identifying customers' pain points one-by-one and listening to them one-by-one at the front point -- front line, we would like to take up the new challenge of satisfying and realizing that new dream. I hope you extend your support and hands to us. Thank you very much.

Going on to the next question from Shizuoka Newspaper, [ Takamatsu-san ]. [Operator Instructions]

Can you hear?

Yes, we can hear you.

My question is to the President of Suzuki and Okudaira about the development of vehicles. And these 2 companies and Toyota will be cooperating together to develop cars. And regarding the development of EVs, I think, it will be the first attempt to develop EVs together for you. And of course, there's the Honda example. But in the first half of 2020s or maybe by the 2030s, what would be your target year for developing the EV? Also President Suzuki said that this is not limited just to commercial vehicles. But does that mean that the 2 of you and Toyota, the 3 companies, will develop not only minivehicles but also in the field of commercial vehicles as well as passenger vehicles, you will be developing EVs together? Is that the idea?

So Suzuki -- I'm Suzuki. Let me respond first. The role of the CJPT is, first and foremost, to plan for CASE-related initiatives, that is by identifying customers' challenges and also to identify those 3 needs and requirements for the minivehicles and the 2 -- 3 companies -- or the 5 companies together to plan what we can do to resolve these issues and customers' headaches. And based on that, then what sort of development should we engaged in would be the next step. So we have not actually discussed that specific details. So electrification, what sort of CASE actions we can take will be identified first before we can think about what these 2 companies can do or what each company can and should do. So we would like to identify the plan first.

Okudaira -- this is Okudaira. Technologically speaking, Suzuki, Subaru, Mazda, the EV cars' common architecture development and also the zero-emission vehicle factory have already announced in 2018 or 2017 joint development. So for electric vehicles, already a joint development framework has -- or architecture has already been launched. And we cannot set a specific target year of when, but within the CJPT, specific numbers, what sort of services can be developed, may be simulated. I think we'll most likely be simulating such matters. So all the while aiming for carbon neutrality, what we -- the minivehicle segment can do, I think, now -- can be considered with this platform or foundation. And projects that actually utilize the outcomes of this project, I think, will also be enabled. So we do believe that we should be able to materialize -- see some material developments going forward.

So there is no change to your philosophy to codevelop EVs with the 3 companies together?

Well, this project is not actually talking about the actual specific development of such EV cars. As in the past, we have been jointly developing through other frameworks such technologies to enable electric vehicles and to accelerate those developments. We do hope and expect that this new project will accelerate those efforts -- ongoing efforts.

There may be other questions, but since the planned closing time is approaching, I would like to ask the next 2 persons to be the last person to ask questions. Mr. [ Masatoshi ] of Daily Industrial Newspaper, please. [Operator Instructions]

[ Masatoshi ] of Daily Industrial Newspaper. Can you hear me?

Yes, we can.

Earlier in your presentations, both Mr. Suzuki and Mr. -- Daihatsu both said that President Toyoda approached both companies, and that was mentioned in the presentations. Now on the part of President Toyoda, what is the background that you approach these companies? And what are the thoughts behind your contacting these 2 companies? And furthermore, in this collaboration, including Hino and Isuzu, you are going to spend the entire industry starting from minivehicles role and contact vehicles overall. But what sort of role the Toyota is going to play in this collaboration?

First of all, as President of Toyota Motor Corporation, I have constantly said, let's build and create ever-better cars. I continue to say that. And also as President of [indiscernible], since I became President of [indiscernible], for the automotive industry, is now faced with the major transformation era, likes of which can happen only once in a century. And more specifically, I talked about achieving carbon neutrality or electrification. I mean, just making vehicles ever better, that doesn't offer a final solution. We need energy companies or infrastructure. So there are many challenges that only automotive industry alone can't find solutions. We need collaboration with other industrial sectors to find solutions jointly. And that's what we are faced with, according to my understanding. So in that context, involving the like-minded companies, in this case, identifying and listening to the pain points or difficulties facing logistics operators. So from that perspective, if automotive industries -- what can you do to cover the integrated system? So as a starting point, we focus on commercial vehicles. When we talk about commercial vehicles, we tend to look at small- and medium-sized trucks. But why are we talking about commercial vehicles to be best suited for CASE? Let me explain why commercial vehicles are appropriate for CASE operations. The commercial vehicles or electrification or creating battery EVs, it need to be offered in conjunction with infrastructure as well as a package. And when that happens, because of the way the service is offered, the commercial vehicles where the operation is more standardized operations, and that enables and helps the collaboration with infrastructure better. And that's why we started with our commercial vehicles. And in terms of achieving the integrated logistics system, we need to be able to cover the last 1 mile. And especially in rural areas, the minivehicles are playing a role as a lifeline, so to speak. Without considering that in the minivehicles, the CJP itself cannot be viable. We have been thinking in that way. And both Suzuki and Daihatsu are thinking along the same lines. And at the same time, we received many ideas from the people working in the logistics operators. And they made a proposal to Mr. Nakajima, President of CJP. So they do think that they need to find some solutions. The current situation should not be left unaddressed. And with CJP now established, they now have the entity that can listen to their consultations or listen to their challenges. And I'm not sure whether I responded to your question appropriately, so I'd like to ask Mr. Nakajima to respond as well.

Nakajima speaking here again. I mean, it's exactly what President Toyoda mentioned. How can we use case technology to benefit the entire society? Of course, we do have ordinary people. But in the world of logistics and operators of those, and we keep in mind the friends of 5.5 million people are colleagues. And out of that, some 2 million -- 2.7 million people are engaged in transportation and logistics. And listening to their challenges and difficulties, and if you can provide solutions to that, that will offer us the closer way to achieve carbon neutrality. And furthermore, the enhanced efficiency of logistics could help economy overall operate better. So the CASE technology that we have honed in the passenger cars should be improved further to serve the customers' needs further. And that really required the new partnership, which is announced today. And as I mentioned earlier, many people really approached us with various advice and questions, and that brought us to realize anew that minivehicles are playing a very important role for the Japanese society overall. So in that sense, I think there's the new starting line established with CJP to start its operations. So with those companies working together, we would like to create -- offer a better strategy for Japan and to serve the logistics industry better in this manner. So I hope I would like to ask for your support and cooperation as well.

This will be the final question from Chunichi Newspaper, [ Suzuki-san ], please. [Operator Instructions]

Can you hear me?

Yes, yes, we can hear you.

[ Suzuki ] from Chunichi Newspaper here. My question is to President Toyoda, please. I was in charge of Suzuki Motor Corporation in Hamamatsu, and this question may not be directly related to this project. But as you know, there was -- Mr. Osamu Suzuki, the former Chairman of Suzuki, who retired last month, had a special passion for minivehicles. And I believe that even during his days as a Chairman, you had a very close relationship with Mr. Suzuki, Osamu. So if you could share with us your thoughts and your feelings towards the past Chairman?

Well, past Chairman, Mr. Osamu Suzuki, who is currently the senior adviser of Suzuki, was the person who gave birth to minivehicles and nurtured the minivehicles and also developed the minivehicles here in Japan. And he was the person who actually grew the minivehicles into the so-called people's car of Japan. He was the father of minivehicles. And somebody talks about him referring to minivehicles as an art of work. But I believe he was the driver of the minivehicles market in Japan. He was the father. His true son is sitting near me -- or beside me. But I believe he was one of my fathers, too. And when he retired, I remember something that he said to the media that left a strong impression. He said, my work is my life passion and -- because to continue to challenge is life itself, I hope that you will also continue to work in challenge. And he said bye-bye. And so he left his post on a very grateful note. And he said, everyone, please continue your work. And everyone here refers to everyone here as well as the 5.5 million people who are involved in the Japanese auto industry. That's his final message. When he was still President and Chairman in his active years and also when he developed the business in India, former Chairman Suzuki always referred to Suzuki as a small- and medium-sized company. But I believe in India, Suzuki was a major company, a large company. And Toyota in India was an SME. So the father of an SME company, you have to be careful when you use that word, father or the daddy, depending on which country you're in. So we had a very close relationship. And he said, everyone, continue to work. That's what Mr. Suzuki, the father, said. And I think that given his words, the current active generation must continue to work hard. And so when Mr. Suzuki leaves his office, then he can maybe thank us for having developed the automotive industry and the minivehicle industry. So I -- we must work hard to do that. And of course, when this succeed, I would like to report to Mr. Suzuki. And to the media, I do ask you to convey this message to the former Chairman Suzuki.

Thank you, and thank you for that question. So since it's time, we would like to close the press conference. And there will be a photo session online. And if you need some photos or video, then please take the photo or video online, and we will also be posting the still photographs on the site later. [Statements in English on this transcript were spoken by an interpreter present on the live call.]