Status and Vision of the Japan Foundry Industry

1. The status of the Japan foundry industry
In 2015, the total output of the Japan foundry industry was 5.4 million tons, which was the fourth largest production volume in the world. The production value was 1,951.2 billion yen. Looking at the trend in the production value, with peaks at about 2.5 trillion yen in 1990, it turned to a decline until 2002. After that, it recovered to about 2.5 trillion yen in 2008, but it fell to 1.6 trillion yen due to the financial crisis and the Lehman shock in 2009. Although it recovered again from 2010, it has been at a level of about 2 trillion yen or less. Similarly, the production volume turned to a peak at 8.2 million tons in 1990 and decreased to 5.75 million tons in 2002. After that, it recovered to 6.71 million tons in 2008, but it fell to 4.38 million tons due to the Lehman shock in 2009.

The number of factories decreased 55% in 25 years from 4,241 in 1990 to 1,888 in 2014. In particular, it has decreased by about 30% in the decade since 1990. In particular, it has decreased by about 30% in the decade since 1990. This is proportional to the 30% decrease in production volume during this period. Looking at the scale of the factories that have declined, most small business with nine or fewer employees.

Casting parts for automobile account for about 70% of casting demand structure in Japan. In particular, more than 90% of aluminum castings and die castings are cast parts for automobiles. In regional production, Aichi prefecture in the Tokai region has a production volume exceeding 1 million tons.

The quantity of import or export of castings is no more than 200,000 tons. Statistically, many castings are imported or exported as mechanical parts. As 80% of the total casting production is for automobiles, machine tools and construction machinery, therefore many castings are indirectly exported from Japan as demand parts of these products.

2. The economic environment surrounding the Japan foundry industry
Domestic demand is on a downward trend as the current economic environment surrounding Japan. This is caused by the decline in GDP growth rate, and the decrease of population, coupled with the increase in the overseas production ratio of the automobile industry, the electric industry and others. The automobile industry as the biggest demand destination had a production ratio of 6 to 4 in 1999, which is 9.9 million units in domestic production volume and 5.78 million units in overseas production volume. In 2012, the domestic production volume is still 9.9 million units, but the overseas production volume is 15.83 million units, which is an increase of about 10 million units in 12 years, the production ratio was reversed to 4:6.

3. The characteristics and vision of Japan foundry industry
As characteristics of the Japan foundry industry, its strengths are high quality of casting products, stable supply, response to short delivery times, employees’ multi task education, and a fulfilling factory maintenance system, etc. As a weakness, since the ratio of small and medium-sized enterprises is high, their products proposal ability is weak, and factory productivity is low. The lack of capital and talent is also weakness. Although Japan has the world’s fourth largest market, it is a challenge to cope with the rise in the electricity cost during recent years. To deal with these issues, Japan Foundry Society has created a foundry industry vision, will focus on the following aspects: (1) improving technical capabilities, (2) improving trading practices, (3) strengthening cooperation within the industry, (4) promote the overseas development, (5) human resource development, (6) Strengthening environmental and energy countermeasures.