President Shitara Explains the New Medium-term Management Plan and Long-term Vision

Regarding EVs and hybrid vehicles, two-wheeled vehicles are subject to less strict regulations and fewer subsidies compared with four-wheeled vehicles. Why is Yamaha Motor promoting the development of EVs? In particular, hybrid vehicles seem to have fewer advantages compared with four-wheeled vehicles, so how do you find a winning path? Please tell us about the market launch and areas.

We're developing EVs; however, they won't become widespread without sufficient infrastructure first. We expect them to become popular when the government is able to provide subsidies, but this varies from country to country. Furthermore, the situation will be quite different depending on whether it is regarded as a measure for carbon neutralization (CN) or as a multi-pathway approach. We think the right solution is to proceed with development with various combinations of bioethanol, hydrogen, and other alternative fuels depending on the situation in each country.

Four-wheeled EVs have become popular because of government subsidies, but their acceleration has slowed at present. We want to take measures as we monitor the situation. In India, many voters are engaged in agriculture, so the use of bioethanol is preferred. Once we get past this issue, we'll finally work on batteries. We'll continue to consider measures in step with this, and by 2050, the path forward will be visible.

In the case of two-wheeled vehicles, hybrid systems are auxiliary systems, so we handle them in a manner different from four-wheeled vehicles. We're working on them while monitoring the situation, including the disadvantages.

How much investment is expected for two-wheeled EVs and how soon products are planned to be launched in the market? And please tell us about the revenue outlook.

In our Medium-term Management Plan, an investment of 420 billion yen was presented. Since 234 billion yen is presented for our core businesses, about 50% will be invested into our core businesses. These include our marine and MC businesses, which includes electric vehicles. Although we haven't announced the amount of investment for electric vehicles only, they and their platforms will be a development theme, so we'll allocate our investment appropriately.

As for revenue, if we're talking about the outlook up to around 2030, the impact of EVs is less than it used to be. The trend for four-wheeled EVs is declining, and the situation is the same for two-wheeled vehicles. There is some concern about the impact of costs once 100% of vehicles are EVs, but in our case, our calculations don’t indicate that we'll be significantly impacted by EVs by 2030. Bioethanol, hydrogen, and other alternative fuels are among the options included in our calculations. In addition, we don’t expect a large profit from EVs. Battery costs account for 30% to 40% of their costs. We intend to explore corporate efforts to reduce battery costs.

At the moment, the demand is still unknown, so we can't calculate precise values, but the thing that matters the most is that we'll significantly fall behind if the impact of the costs cannot be absorbed when the majority of vehicles become EVs. We're assessing the timing for this. Although the situation of EVs among four-wheeled vehicles is currently difficult, we don’t think that EVs will be a staple of two-wheeled vehicles.

How many of the 20 models scheduled for launch in the Medium-term Management Plan are EV models? As a category, how many cc are they in terms of gasoline engine displacement?

I'd like to avoid giving concrete numbers. However, we're preparing about 1/4 to 1/3 of them as EV models and plan to divide them into categories and set the platforms for launch. In addition to investing in our company, we're also investing in an Indian start-up, World of River Limited, Inc., so their models might be launched. Furthermore, since we're undertaking a variety of efforts, including electrification of current models, we're assessing if they are a perfect fit for people around the world.

The most widespread electric models will be 125 cc to 200 cc in terms of gasoline engine displacement. If it is larger than that, the battery will be heavier or the balance will be off, so we think we should manage our 50 cc to 125 cc models well.

"Indie" electric scooter of World of River Limited, Inc.

Tell us about your mindset as a motorcycle rider. The motorcycles you have ridden so far have classical features, including the throb of the engine and sense of unity, but at some point, I assume there may come a phase when electric motors will become widespread. Even if this does happen, what kind of motorcycles do you want Yamaha Motor to make, and what kind of company do you want it to be?

For the future of two-wheeled vehicles, we assume that the power source will change; however, without the sense of exhilaration at their core, two-wheeled vehicles would be no different from four-wheeled vehicles. So Yamaha Motor is taking on the challenge of making full use of devices and sounds to create a sense of exhilaration and tuning to produce a vibrant feeling, even with an electric motor. Yamaha’s products shall always cherish parts that appeal to the senses. As one of our initiatives, we're conducting joint research with Yamaha Corporation to produce satisfying sounds even for EVs. Since EVs are completely silent when operated, we're conducting research on satisfying artificial sounds for them. Though still in the research stage, Yamaha Motor is conducting research to ensure customers are happy when they ride EVs.

What measures are you taking to secure appropriate production capacity to meet the trends in the market?

Our marine business and MC business account for 2 trillion yen of our 2.5 trillion yen in sales, so it is a must to improve these two cornerstone businesses of the company. The new Medium-term Management Plan focuses more on these cornerstone businesses than the previous Medium-term Management Plan.

Securement of production capacity is very important, and looking at the marine business, we could have supplied more products in the period of increased demand after the COVID-19 pandemic. Including the product lineup, our timing in stepping on the accelerator was slightly late. On the other hand, we supplied too much when it was time to step on the brakes. We want to enhance our production capacity because of these kinds of opportunity losses. Balancing supply and demand must be done sensitively.

As for the MC business, our sales are in the high added-value range. Since we focus on a strategy of increasing our added value per unit, we want to enhance our production capacity in the high added-value range. Capacity enhancement is a question of setting, not scale, and we have sufficient capacity if we add our production capacities in each country together.

Unfortunately, the robotics business and electrically power-assisted bicycle business are driven by demand. A rise in demand occurred for electrically power-assisted bicycles, but we've got excess inventory. We're reviewing it now, and demand is levelling off. Once conditions return to normal, we will be working to respond to demand. This category has a market, and last month, we acquired a subsidiary of the bicycle drive unit (e-Kit) business of a German automobile parts manufacturer, Brose Fahrzeugteile GmbH & Co. KG, so we're striving to meet demand opportunities.

As for the robotics business, semiconductor-markets are highly volatile, so the conditions in each region have ups and downs. Since the supply system is insufficient to meet the demand for generative AI servers, we want to reinforce it by expanding production. The market itself changes drastically during ups and down, so we want to be able to reliably capture the changes in the market.

Bicycle drive unit (e-Kit) of Brose Fahrzeugteile GmbH & Co. KG

[Related material] Medium-term Management Plan 2025 - 2027

Medium-term Management Plan – Corporate Information | Yamaha Motor Co., Ltd.