As global groupings of carmakers force auto parts makers to intensify domestic competition, Inergy Automotive Systems SA, a French plastic fuel-tank maker, is gearing up to take a larger bite of the fuel tank market in Japan with its advanced technology and worldwide activities.

Despite the sluggish economy, Japan has high potential for the firm to expand its businesses, said Vincent Pairet, president of Inergy Automotive Systems K.K., a Japanese unit based in Tokyo’s Shibuya Ward.

“Many Japanese car companies use steel fuel tanks. We believe there is a shift from steel tanks to plastic ones (in Japan),” the Belgian president said in an interview.

The Paris-based firm was created Aug. 1 by a merger between Plastic Omnium of France, a plastic processing company, and Solvay S.A. of Belgium, a pharmaceutical and chemical group.

Operating 31 plants in 17 countries, including two factories in Japan, Inergy holds 35 percent of the global market for plastic automotive fuel tanks.

While more than 80 percent of vehicles in Europe and in the United States are equipped with plastic fuel tanks, the portion in Japan is only 6 percent, according to Pairet.

Pairet explained that a plastic tank has various advantages: It can serve as an insulator if a car catches fire in a crash, reduces the weight of a car, does not corrode and has design flexibility to increase fuel capacity.

These advantages are not considered as critical in Japan because domestic manufacturers have developed technology to make light steel tanks. In addition, driving conditions in Japan differ from those in Europe, where people often drive longer distances at higher speeds in more extreme weather, according to Pairet.

But Pairet predicted that global competition will soon motivate Japanese carmakers to produce vehicles of the same quality as their European and U.S. counterparts and to reduce production costs. When that happens, Japanese firms will opt to use plastic tanks in more of their vehicles, offering his company an opportunity to profit.

However, that will also be when competition intensifies.

Although few Japanese auto parts makers currently produce plastic tanks, more will enter the market in cooperation with their group carmakers, he explained.

Pairet admitted that foreign firms consider Japan a difficult market to enter due to differences in business practices and language, but he said: “We should consider it a demanding market.”

With this motto, Pairet, as president of the Belgian-Luxembourg Chamber of Commerce in Japan, educates member companies and organizes fairs and programs to help Belgian firms establish and expand their business here.

The chamber currently has about 70 member companies from Belgium and Luxembourg as well as about 50 Japanese firms with business interests in those countries.

Inergy seems to be developing smoothly. A day before the merger of Solvay with Plastic Omnium, Solvay Automotive System K.K., a former unit of Inergy’s Japan branch, acquired two plastic fuel tank plants, in Kanagawa and Fukuoka prefectures, from Nissan Motor Co.

“Acquisition of the two plants gave us the credibility to do business in Japan,” said Pairet, pointing out that the Japan branch plans to produce 300,000 plastic fuel tanks in Japan this year to achieve sales of 3.2 billion yen.

Even if more Japanese auto parts makers start producing plastic fuel tanks, Inergy will aim to be a leading supplier and maintain at least a 30 percent market share in Japan, Pairet said.

With Inergy’s advanced technology for the products and worldwide activities that enable the firm to offer competitive prices, Pairet is confident the firm will achieve its sales targets of 6 billion yen in 2005.

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