Japan Automotive Engine Oil Market: Industry Analysis and Forecast (2024-2030)

Japan Automotive Engine Oil Market Overview

Navigating through the vibrant landscape of Japan's automotive industry, the comprehensive report provides an insightful overview of the Automotive Engine Oil Market. The scope of the report is expansive, aiming to offer stakeholders a detailed understanding of the key dynamics shaping the crucial sector.

• In Japan, sales of LDVs declined by more than 10% since the pandemic and remained roughly constant thereafter.

Delving into the essence of the market, the report encapsulates an in-depth overview of the Automotive Engine Oil Market in Japan, examining its current state and historical evolution. By unraveling the intricate layers, it paints a vivid picture of market trends, challenges, and opportunities. Additionally, the report strategically explores the growth factors influencing the market, including emerging technologies, regulatory landscapes, and shifting consumer preferences. The report offers an all-encompassing view of the Japan automotive engine oil industry, encapsulating its current landscape and future projections. The report offers a holistic view of the Japan Automotive Engine Oil market in 2023.

• Japan shares a high reliance on oil imports. As 4.9 Million barrels per day (bpd) of crude oil.
• The significant resilience of small cars also points to a strong peculiarity in the Japanese market.

The current Top Runner program began in 2022 and runs through 2030 – targeting a 32.4% improvement in fuel consumption by 2030 compared with the 2016 fleet average.

Japan Automotive Engine Oil Market Dynamics:

Japan's Automotive Engine Oil Market Pivots towards Hybrid Vehicles

In the ever-evolving landscape of the automotive industry, a significant trend is emerging in Japan's automotive engine oil market, and it's steering towards hybrid vehicles. Hybrid vehicles, recognized for their energy efficiency compared to traditional gasoline-fuelled counterparts, are now driving a substantial portion of the automotive market in Japan. Not only do these vehicles promise commendable energy savings, but they also champion a cleaner environment by significantly reducing air pollutant emissions in comparison to their diesel-powered counterparts. Japan, at the forefront of automotive innovation, has pioneered the adoption of hybrid technology, with approximately one-quarter of total vehicle sales in 2023 now comprising these eco-friendly marvels. As the demand for hybrid vehicles continues to surge, the Japan Automotive Engine Oil Market is witnessing a transformative shift, adapting to meet the specific lubrication needs of these ground-breaking machines.

• Japan is a country with high income, high density, high PPP fuel tax, and domestic auto manufacturing (and export) capacity (with legacy OEMs, some of which have strong EV ambitions). Japan is an oil importer, with an interest in energy diversification despite limited opportunities to shift towards renewables.

Japan's Automotive Engine Oil Market Grapples with Shifting Vehicle Tax Dynamics

The Japan Automotive Engine Oil Market finds itself at a crossroads as it confronts a significant challenge tied to the dynamic landscape of vehicle taxation. The traditional approach in Japan, where fiscal incentives for Kei-cars were designed to curtail energy consumption rather than focusing on the weight of vehicles or batteries, is now facing scrutiny. The unique strategy stemmed from Japan's heavy dependence on fossil energy imports and aimed at mitigating negative impacts on its trade balance. However, the evolving understanding of battery materials as critical commodities prompts a reconsideration of these policies.

The spotlight is on whether similar instruments could be effective, particularly in scenarios where battery material availability is constrained, and for nations lacking access to these essential resources either domestically or through trade partnerships. As the industry grapples with these changes, the Japan Automotive Engine Oil Market must adapt to the shifting paradigms of taxation and ensure optimal lubrication solutions for the diverse vehicles affected by these policy adjustments.

• Taxation favored the adoption of smaller cars for a long time in Japan, where “Kei-cars” benefited from tax exemptions since their designation as the smallest vehicle segment in Japan, resulting in major contributors to the consistently high market shares of these vehicles in the country. Additionally, local policies exempt Kei-cars from the requirement that applies to all other private cars to own a “garage certificate” – a dedicated parking spot permit. However, like all cars, they are not allowed to use on-street parking overnight.

Japan Automotive Engine Oil Market Segment Analysis:

Based on Engine Type, the Gasoline segment held the largest market share of more than 70% and dominated the Japan Automotive Engine Oil industry in 2023. The segment is further expected to grow at a CAGR of 1.6% and maintain its dominance during the forecast period.  The rising demand is driven by factors such as the increasing widespread prevalence of gasoline-powered vehicles in the country techniques have been expected to be the major factor driving the segment growth. Despite the decline, the high number of gasoline vehicles on the road ensures a stable demand for gasoline engine oil in the forecast period.

• The decline is expected due to the growing popularity of hybrids and electric vehicles.
• Annual consumption: Approximately 230-245 million liters

Besides that, the Diesel segment is expected to grow at a rapid CAGR and offer lucrative growth opportunities for Japan Automotive Engine Oil manufacturers all across Japan during the forecast period. The segment is primarily driven by commercial vehicles and light trucks that utilize diesel engines for their power and torque. The rising demand in the forecast period is thanks to several factors, such as stringent emission regulations favoring cleaner diesel technologies like common-rail injection and diesel particulate filters, growing demand for fuel-efficient commercial vehicles in logistics and transportation sectors, the continued presence of sizeable diesel vehicle fleet on the road are expected to be the major factors driving the segment growth.

• Annual consumption is approximately 70-80 million liters in 2023
• The average price per liter is 6.06 to 9.43 USD (depending on brand and quality)

The major key players in the Japan Automotive Engine Oil Market are AKT Japan Co. Ltd, Motul, Castrol, and ENEOS Corporation.  Thus, increasing demand for the Japan Automotive Engine Oil Market supports the segment growth.

Japan Automotive Engine Oil Market Scope:

Japan Automotive Engine Oil Market Key Players:

• Cosmo Energy Holdings Co. Ltd
• ENEOS Corporation
• ExxonMobil Corporation
• Idemitsu Kosan Co. Ltd
• Royal Dutch Shell Plc
• Fuchs Japan Ltd.
• Japan Sun Oil Company, Ltd.
• AKT Japan Co. Ltd
• Motul
• Castrol