Railway Technologies & Services Japan Market Study

Railway Technologies & Services

Japan Market Study

JULY 2019

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The information and views set out in this study are those of the author(s) and do not necessarily reflect the official opinion of the European Union. Neither the European Union institutions and bodies nor any person acting on their behalf may be held responsible for the use which may be made of the information contained therein. The contents of this publication are the sole responsibility of EU Gateway | Business Avenues and can in no way be taken to reflect the views of the European Union. The purpose of this report is to give European companies selected for participation in the EU Gateway | Business Avenues Programme an introductory understanding of the target markets countries and support them in defining their strategy towards those markets. For more information, visit www.eu-gateway.eu.

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Railway Technologies & Services - Japan Market Study - Page 3 of 143

EU Gateway to Japan

Central Management Unit

Japan Market Study

July 2019

Submitted to the European Commission on 22 July 2019


Table of contents

LIST OF ABBREVIATIONS ........................................................................................................................................ 7

EXECUTIVE SUMMARY ............................................................................................................................................. 9

2. WHAT ARE THE CHARACTERISTICS OF JAPAN? .......................................................................................... 18

2.1 POLITICAL OVERVIEW OF JAPAN ............................................................................................................. 19

2.2 ECONOMIC OVERVIEW OF JAPAN............................................................................................................. 20

2.3 TRADE OVERVIEW BETWEEN EU AND JAPAN ........................................................................................... 23

3. MARKET OVERVIEW & EU ENTRY OPPORTUNITIES IN JAPAN .................................................................... 26

3.1 THE JAPANESE RAILWAY TECHNOLOGIES & SERVICES INDUSTRY ............................................................ 26

3.1.1 Historic Overview ............................................................................................................................ 26

3.1.2 Market Overview ............................................................................................................................. 38

3.1.3 Japanese Railway Companies ....................................................................................................... 41

3.1.4 Railway Business Trends ............................................................................................................... 47

3.1.5 Procurement Insights ...................................................................................................................... 57

3.2 ROLLING STOCK AND LOCOMOTIVES ....................................................................................................... 70

3.2.1 Market Overview ............................................................................................................................. 70

3.2.2 EU Entry Opportunities .................................................................................................................. 84

3.3 RAILWAY INFRASTRUCTURE, SERVICE PROVISION AND MAINTENANCE ...................................................... 86

3.3.1 Market Overview ............................................................................................................................ 86

3.3.2 EU Entry Opportunities .................................................................................................................. 92

3.4 RAILWAY COMMAND, CONTROL AND COMMUNICATIONS ........................................................................... 95

3.4.1 Market Overview ............................................................................................................................ 95

3.4.2 EU Entry Opportunities ................................................................................................................... 99

3.5 RAILWAY SECURITY, SAFETY AND CRISIS PREVENTION AND MANAGEMENT ............................................ 101

3.5.1 Market Overview .......................................................................................................................... 101

3.5.2 EU Entry Opportunities ................................................................................................................. 106

4. REGULATIONS ................................................................................................................................................... 109

4.1 TECHNICAL RAILWAY STANDARDS ........................................................................................................ 109

5. ANNEXES ................................................................................................................................................ 113

BUSINESS DEVELOPMENT TO THE RAILWAY INDUSTRY IN JAPAN .................................................................. 113

LIST OF JAPANESE RAILWAY EQUIPMENT MANUFACTURERS ........................................................................ 131

IMPORTANT BIBLIOGRAPHY ......................................................................................................................... 138

USEFUL CONTACTS IN JAPAN ..................................................................................................................... 141


List of Figures

Figure 1: © Abenomics Targeting GDP of JPY 600 trillion, Cabinet of the Prime Minister website ........................................................................................................................ 21

Figure 2: © Inward FDI in Japan as of End 2017, JETRO .......................................................... 22

Figure 3: © Trade Flows Total Goods with Japan, 2008-2018, European Commission .............. 23

Figure 4: © Trade Imbalance in Railway Segment between EU and Japan................................ 25

Figure 5: © Shinagawa Station in 1885....................................................................................... 27

Figure 6: © 1000 type subway train 1927, Japan Subway Association ....................................... 28

Figure 7: © English Subway Map of Tokyo ................................................................................. 29

Figure 8: © Present & Future Shinkansen Tracks 2018, Environmental and Energy Study Institute ....................................................................................................................... 30

Figure 9: © E7 Model Hokuriku Shinkansen ............................................................................... 32

Figure 10: © H5 Model Hokkaido Shinkansen, Aomori Tourist Agency ...................................... 33

Figure 11: © The Newest E956 Model Tohoku Shinkansen ....................................................... 34

Figure 12: © N700A series on Tokaido Shinkansen Line, JR Central ......................................... 35

Figure 13: © 7-Minute Miracle, City of Tokyo .............................................................................. 36

Figure 14: © Maglev Road Map, Abenomics, website of the Prime Minister ............................... 37

Figure 15: © L0 series Maglev train with 12 cars at Yamanashi Test Track, Saruno Hirobano .. 38

Figure 16: © Railway Types in Japan ......................................................................................... 39

Figure 17: © Railway Manufacturing Market Value 2017, JARi .................................................. 40

Figure 18: © Takanawa Gateway, the New Yamanote Loop Line Station, JR East ................... 49

Figure 19: © Average Retail Sales per sqm in Stations, Nikkei website ..................................... 50

Figure 20: Rush Hour Commute Crowd Level, Private Railways Big 16 Databook 2015 ........... 52

Figure 21: © Nationwide Suica Cards ......................................................................................... 54

Figure 22: © Welcome Suica Card for Overseas Visitors ........................................................... 55

Figure 23: © Tim Cook Apple Pay Launch in Japan ................................................................... 56

Figure 24: © EU-Japan Railway Industrial Dialogues, G.S., EU, 2014 ....................................... 59

Figure 25: JR East Procurement Results FY2018, JR East Website ......................................... 62

Figure 26: © JR East Procurement Registration Flow, JR East Website .................................... 63

Figure 27: © Rolling Stock and Facilities Procurement Examples, JR East Website .................. 65

Figure 28: © Niigata Transys Winning Yellow LRT Design for Utsunomiya City 2019 ................ 66

Figure 29: © Rerailing System for JR East, Holmatro Industrial Equipment 2019 ...................... 67

Figure 30: Tokyo Metro Website Procurement Results FY2018 ................................................ 68

Figure 31: © Supplier Registration Procedures for Tokyo Metro Procurement, Tokyo Metro Website ..................................................................................................................... 69

Figure 32: Rolling Stock Inventory 2018, Japan Rolling Stock Association (JARi) ..................... 70

Figure 33: Rolling Stock Production per Year, Japan Rolling Stock Association (JARi) ............ 71

Figure 34: Rolling Stock Inventory per Type FY2018, Japan Rolling Stock Association (JARi) . 72

Figure 35: Manufacturer Share Shinkansen Cars 2000-2015, Toyo Keizai Net ......................... 73

Figure 36: © Car Product Line Up, Nippon Sharyo Website ....................................................... 75

Figure 37: © Product Line Up, Kawasaki Rolling Stock Website ................................................ 77

Figure 38: © Total Rail Systems Supplier, Hitachi Railway Systems Website ............................ 78

Figure 39: © Car Product Line Up, J-TREC website ................................................................... 79


Figure 40: © Car Product Line Up, Kinki Sharyo Website ........................................................... 81

Figure 41: © Qatar Railways, Kinki Sharyo Website ................................................................... 82

Figure 42: © Car Product Line Up Niigata Transys Website ....................................................... 83

Figure 43: © Tram Product Line Up, Japan Overseas Railway System Association .................. 84

Figure 44: Big 16 Long Term Investments, Private Railways Big 16 Data Book 2018 .............. 90

Figure 45: © Product Line Up, Nabtesco Website ...................................................................... 91

Figure 46: © Shinkansen, Osamu Tsujimura .............................................................................. 93

Figure 47: © Disc brakes on both sides of the wheels, yanmo/PIXTA ........................................ 94

Figure 48: © New Sustina E235 series car, JR East Website ..................................................... 96

Figure 49: © Product Range, Meidensha Website ...................................................................... 98

Figure 50: © Signal System Line Up, Kyosan Electric Website .................................................. 98

Figure 51: © Ethernet Connectors, Harting Japan website ......................................................... 99

Figure 52: © Tokyo Monorail’s new 10000 series ..................................................................... 100

Figure 53: © Type 1 and Type 2 Signalization at Railroad Crossings ....................................... 102

Figure 54: © Floor-Ceiling Walls, Kawasaki Heavy Industries Website .................................... 103

Figure 55: © JR East New Style Smart Home Doors ................................................................ 104

Figure 56: © Product Line Up, Nippon Signal Website ............................................................. 105

Figure 57: © Product Line Up, Daido Signal Website ............................................................... 106

Figure 58: © Mermec V-Cube Technology, Railway Gazette .................................................... 108

Figure 59: © Railway Operations Law, Naoto YANASE ........................................................... 109

Figure 60: © Technical Standards System in Japan, Railway Bureau, MLIT ............................ 110

Figure 61: © Framework of the compulsory railway technical standards in Japan .................... 111

Figure 62: © Table of Content Ordinance of the Ministry for Technical Standards for Railway . 112

Figure 63: © Examples of Domestic Railway Equipment, JORSA website ............................... 114

Figure 64: © Total Railway Systems Supplier, Hitachi Railway Systems Website .................... 123

Figure 65: © Intercity Express Train, Hitachi Railway Systems Europe Website ...................... 125

Figure 66: © East Anglia Cars, BBC website ............................................................................ 127

Figure 67: © Product Range, Kawasaki Heavy Industries Global Website ............................... 128

List of Tables

Table 1: Japan Railways Group Turnover FY2017 .................................................................... 41

Table 2: © JR East Consolidated Subsidiaries, JR East website ................................................ 45

Table 3: © JR East Equity-Method Affiliated Companies JR East website ................................. 45

Table 4: Major Private Railway Companies, Japanese websites of Big 16 railway operators .... 46

Table 5: Top 10 Busiest Stations Worldwide .............................................................................. 47

Table 6: Procurement Outlook FY2020, JR East Website ......................................................... 64

Table 7: Big 16 Low Energy Cars, Private Railways Big 16 Data Book 2018 ............................ 75

Table 8: JR East Investment Value, JR East Website ............................................................... 87

Table 9: JR Central, West, Kyushu and Freight Investment Plans, respective websites of each JR operator ...................................................................................................... 87


List of Abbreviations

AC Alternating Current

AFC Automatic Fare Collection

AGT Automated Guideway Transit

ATACS Advanced Train Administration & Communications System

ATC Automatic Train Control

ATOS Autonomous Decentralized Transport Operation Control System

ATP Automatic Train Protection

ATS Automatic Train Stop

b billion

CBTC Communication Based Train Control

CEO Chief Executive Officer

CER Community of European Railway and Infrastructure Companies

COP21 Conference of the Parties

CRCC China Railway Construction Corporation

CVS Convenience Stores

DC Direct Current

DMS Diesel Multiple Units

DPJ Democratic Party of Japan

EBC European Business Council

EMU Electric Motor Units

EPA Electric Multiple Units

ETCS European Train Control System

EU European Union

FDI Foreign Direct Investment

FTA Free Trade Agreement

FY Fiscal Year (April-March)

GDP Gross Domestic Product

GPA Agreement on Government Procedure

GPS Global Positioning System

HSR High-Speed Rail

HST High-Speed Train

IC Integrated Circuit

ICT Information and Communication Technology

IEC International Electric Standards

IEP Intercity Express Programme

IHI Ishikawajima-Harima Heavy Industries

INTEROS Integrated Train communication/control networks for the Evolvable Railway Operation System

IPO Initial Public Offering


ISO International Organization for Standardization

JIS Japan Industrial Standards

JIT Just-in-Time

JNR Japanese National Railways

JORSA Japan Overseas Railway System Association

JPY Japanese Yen

JR Japan Railways

J-TREC Japan Transport Engineering Company

LCD Liquid Crystal Display

LDP Liberal Democratic Party

LED Light Emitting Diodes

LRT Light Rail Transit

m million

M&A Merger & Acquisition

Mbps Megabits per second

MLIT Ministry of Land, Infrastructure, Transport and Tourism

MOU Memorandum of Understanding

N/A not available

NFC Near Field Communication

NTT Nippon Telegraph and Telephone

OCS Overhead Catenary Systems

OSC Operational Safety Clause

PAX Passengers

R&D Research & Development

SME Small and Medium Sized Enterprises

SNCF French National Railway Corporation

SNS Social Network Services

SQM Square Metre

t trillion

TCN Train Communications Network

TOC Train Operation Control

TRA Taiwan Railways Administration

UK United Kingdom

UNIFE Association of the European Rail Industry

US United States of America

USD US Dollars

VAT Value Added Tax

VVVF Variable Voltage Variable Frequency

WMATA Washington Metropolitan Area Transit Authority

WTO World Trade Organization


Executive Summary

Railway Market Introduction

Following the model of the Industrial Revolution in Europe 100 years earlier, Japan decided to

Westernise the country at the beginning of the Meiji Restoration in 1868. With this, the

government decided to build a domestic railway system based upon British hardware and

technology.

In 1871, the first imported rolling stock from the United Kingdom arrived at Yokohama seaport,

and in June 1872, the first daily passenger rides between Yokohama Terminal and Shinagawa

Station in Tokyo commenced services. This inaugural service took 35 minutes and ran on

29 kilometres of newly laid tracks. One year later, railway freight services started with Shinbashi

as the main terminal.

Presently, Japan manages an extensive nationwide railway network covering over

27,000 kilometres of tracks, which are primarily operated by seven (six + JR Freight) Japan

Railway Group companies (20,000 km. of track, 60% of all railway business) and the 16 Big

private railway operators (3,000 km. of track, 15 billion passengers annually). The remaining

4,000 kilometres of track are managed by over 100 smaller, regional railway companies

throughout the wide Japanese archipelago.

Considering these passenger figures, it is not surprising that all ten of the busiest railway stations

in the world are located in Japan.

The Asakusa line in Tokyo was the first subway service and launched in 1927. This ran between

Ueno and Asakusa stations, covering 2.2 km. At that time, steam locomotives were mainly used,

but Japan decided to develop their own electric subway locomotives, which were better suited to

subway services. This era marked the start of domestic manufacturing of railway rolling stock and

equipment by Japanese companies. Nowadays, 12 major Japanese cities operate

45 underground lines stretching over 800 km and carrying over 16.7 million passengers daily.


Connecting Tokyo and, Osaka via the Tokaido line, the Japanese Shinkansen (bullet train) was

the first High Speed Rail (HSR) network in the world when it was launched in 1964. Since then,

top speeds have risen from 210 km/h to 320 km/h and meticulously executed safety and security

measures have kept Shinkansen-related casualties for over 10 billion passengers to zero over

more than 50 years of service.

At the end of FY2017 (March 2018), 134,000 Shinkansen1 ran annually, representing more than

420 million passengers 2 , while the average delay per run was below one minute. This is

remarkable, considering that the shortest intervals between train departures is only 4 minutes

during peak hours, or up to 15 trains per hour leaving Tokyo station.

Presently, there are seven main Shinkansen lines include Tokaido (552.6 km), Sanyo (622.3 km),

Kyushu (288.9 km), Tohoku (713.7 km), Hokuriku (450.5 km), Joetsu (333.9 km) and Hokkaido

(148.8 km). Together these lines span over 3,100 kilometres of HST tracks nationwide,

connecting Kyushu in the south, over main island Honshu to Hokkaido in the north.

Near future Shinkansen extensions include the Hakata-Nagasaki (2022, 66 km) route on the

Kyushu line, the Kanazawa-Tsuruga extension (2022, 113 km) on the Hokuriku line and the Shin-

Hakodate-Sapporo (2030, 201 km) extension on the Hokkaido Shinkansen line.

Finally, as Japan continuously develops, tests and implements new railway technologies, next is

the Maglev (Linear) service, designed to run at over 500 km/h. During initial testing, a Maglev test

ride set a new world speed record of 603 km/h in April 2015.

The Maglev Chuo Line, connecting Shinagawa Station with Nagoya Station, is expected to

commence commercial operations from 2027 onwards. Tokyo station will be connected with

Osaka Terminal by 2037, 8 years earlier compared to the initial plan of 2045.

With over 25 billion passengers transported per year and employing approximately 160,000

people in FY20173, Japan is the biggest railway market in the world. The total business retail

1 https://company.jr-central.co.jp/ir/annualreport/_pdf/annualreport2018.pdf 2 https://biz-journal.jp/2018/06/post_23575.html 3 https://www.mlit.go.jp/k-toukei/tetsuyu-kekka.html


value in Japan is estimated at JPY 16 trillion (EUR 133 billion), which is on par with similar value

of all EU member states combined.

Railway Market Overview

The total domestic railway business during fiscal year 2017 was estimated at a market value of

JPY 495.4 billion (EUR 4.12 billion). The breakdown for fiscal year 2017, ending at March 2018,

includes rolling stock at JPY 202.8 billion (EUR 1.69 billion; 26.1% export), electric parts at

JPY 204.6 billion (EUR 1.705 billion; 36% export) and spare parts at JPY 158.9 billion

(EUR 1.32 billion; 11.6% export).4 The workforce in the industry is estimated at 17,500 people in

manufacturing and approximately 7,500 in the security and safety market segment.

About 1,850 new cars were produced on average in the last 10 years, of which almost 97% are

electric cars nowadays. The JR group companies use 700 new cars for conventional rail and 300

new Shinkansen cars for HST. The Big 16 private operators have a combined demand of about

600 new cars annually.5 The remaining 15% of domestic production is exported to overseas

markets, mainly Asia. For European and US markets, local in-country subsidiaries of the

Japanese parent company usually manufacturers the cars.

In production value, JR represents approximately 50% of total domestic output, which includes

the rather hefty price tag of Shinkansen cars, priced at around JPY 300 million (EUR 2.5 million)

each. In comparison, conventional railway passenger cars are priced at JPY 100 million

(EUR 833,000) per car.

As of April 2018, the total inventory of rolling stock in the Japanese market amounted to 61,300

cars. This includes 49,000 passenger cars, 7,450 freight cars, 4,850 Shinkansen units,

560 electric locomotives, 360 diesel locomotives and 21 steam locomotives.6

Japan still has nine major domestic rolling stock manufacturers but the biggest are Nippon

Sharyo, Hitachi Railway Systems and Kawasaki Rolling Stock Company. All Japanese rolling

4 https://www.tetsushako.or.jp/english/english01.html 5 https://www.tetsushako.or.jp/data.html 6 https://www.tetsushako.or.jp/data04.html

https://www.tetsushako.or.jp/english/english01.html


stock manufacturing companies nowadays either belong to a bigger industrial conglomerate or

are owned by major railway operators.

The three biggest rolling stock manufacturers mentioned above are also the most active players

in new overseas railway projects. In particular, Hitachi Railway Systems became a dominant

player in Europe in recent years through their local UK entity and the complete acquisition of

Ansaldo STS in Italy at the end of January 2019.7

Railway Market Trends

Long-term planning combined with continued investments in public infrastructure and real estate

are very typical for Japan. This proactive approach keeps the existing infrastructure in top shape

while enhancing urban lifestyle convenience and public transportation comfort.

All long-term investments by the railway companies are related to safety/ security improvements

(their key area of focus), proactive infrastructure maintenance aims to prevent accidents while

enhancing the safety, comfort and service levels for passengers. Examples of current major

investment project include:

■ Ongoing upgrades and refurbishments of existing prime real estate like Shibuya station, one

of the six main terminals on the JR Loop line in Tokyo, where the first phase of a major

transformation will be completed before the Tokyo Olympics in 2020;

■ Continuous and enhanced revenue schemes, including retail sales in and around major

terminals, payments via electronic money cards and cashless mobile apps for smartphones

like Mobile Suica;

■ Implementation of environmentally friendly and sustainable policies, recycling and reuse of

materials and low maintenance requirements for the new Sustina passenger cars on the

Yamanote line;

7 https://www.railwaygazette.com/news/business/single-view/view/hitachi-completes-ansaldo-sts-takeover.html


■ Use of light-weight materials, further reduction of CO2 emissions, comfortable car interiors

with expanded passenger capacity during rush hours, like the Sustina car of J-Trec on JR’s

Yamanote loop line circling Tokyo centre;

■ Enhanced barrier-free and universal access design stations through installation of additional

escalators and elevators;

■ Faster installation of new light-weight platform doors (ceiling height and half size) to avoid

passenger and train contact accidents;

■ Additional pushes into new overseas markets with state-of-the-art Japanese HST railway

technology for Asian markets but also in the US and European markets through affiliated

local subsidiaries.

For large-scale global railway projects with big financial impact, major Japanese trading houses,

with extensive worldwide networks of offices and local companies, are also getting involved as

consortium partners.

According to a 2011 study done by the Railway Bureau of the Ministry of Land, Infrastructure,

Transport and Tourism (MLIT), these continued countermeasures to improve railway safety and

security have resulted in notable lower accident rates in Japan compared to Europe and the US.

■ Japan: 0.009 accidents per million train kilometres

■ EU: 0.050 accidents per million train kilometres

■ US: 1.426 accidents per million train kilometres

Since 1965, Japan has been systematically replacing all older signals systems at road crossings

with equipment that is modern, safer, automated and remote-controllable. In addition, elevated

railway tracks have increased in densely populated urban areas. These ongoing efforts have paid

off with a remarkable 90% reduction in road crossing-related accidents.

Even during the devastating Tohoku earthquake in March 2011, the 4th biggest ever registered,

all running trains stopped within 90 seconds after the initial alert and zero railway casualties were

directly linked to the earthquake.


Public Procurement Insights

UNIFE, the Association of the European Rail Industry, estimates that only 2% of total public

railway procurement volume in Japan is open to overseas railway equipment manufacturers, and

of that percentage, only 15% is awarded to non-Japanese companies.

As Japan is a member of the World Trade Organisation (WTO) and the Agreement on

Government Procurement (GPA) clause, reciprocal and non-discriminatory market access is a

core value.

The main issues faced by overseas railway business companies during public procurement

projects in Japan can be summarised as:

■ For decades, Japan implemented specific technical, customised and domestic standards,

which make the preparation of financial and solution proposals often complex and time

consuming for non-Japanese companies. The most famous example is the Operational

Safety Clause (OSC) for product operation and safety during major earthquakes. The

elimination of the OSC is a core element of the 2019 ratified European Economic

Partnership Agreement (EPA) between the EU and Japan;

■ Tight submission deadlines, typically within two or three months after publication of the

required tender documents, create extra hurdles for overseas manufacturers;

■ Nowadays, major railway companies publish their procurement documents in both Japanese

and English, but second-tier operators usually publish in Japanese only;

■ Local presence in Japan is an important factor for success as Japanese customers are

meticulous and demanding when it comes to swiftly handling quality problems, after-service

and long-term, ongoing maintenance of delivered products.

Procurement by Major Railway Companies

As for potential business contracts, four of seven (six + JR Freight) JR companies, namely JR

East (Tokyo & Northern Japan), JR Central (Nagoya, Tokaido Shinkansen and Maglev Chuo


Line), JR West (Osaka to Kyushu Shinkansen and conventional lines) and JR Kyushu, are

publicly-traded companies and tend to be more open to new suppliers, including overseas

manufacturers. They publish regularly updated English website pages with their actual past and

future procurement needs.

Procured equipment and products are often in small quantities from an overseas supplier

viewpoint, as Japanese railway companies favour Just-in-Time deliveries instead of keeping

inventory. Although real estate and overhead costs for stock storage facilities is a prohibitive

reality, this business style reduces the economic scale merits for foreign suppliers.

Tokyo Metro, operating nine subway lines in Tokyo, had total procurements of JPY 45.8 billion

(EUR 381 million) in FY 2018, and is expected to open and award tenders to foreign suppliers in

the near future.

Among the market leaders, JR East is the pioneer in sourcing, awarding and implementing

innovative European railway technology in their day-to-day operations. In 2018, they procured a

total value of JPY 223.5 billion (EUR 1.86 billon) in new equipment, both from domestic and

overseas vendors.8

JR East will continue this trend of international procurement in the Japanese railway business by

improvements like their real-time updated procurement website pages in English and faster

harmonisations of technical standards to ease market access and actual deployment.

Public Procurement Improvements

Regarding public procurement in the Japanese railway industry, the aforesaid EPA is gradually

eliminating these hurdles being,

■ Harmonisation of technical and regulatory standards

■ Transparent and non-discriminatory regulatory standards

8 https://www.jreast.co.jp/order/procurement/results_and_procured.html


■ Equal and reciprocal market access

■ Mutual approval of test results

The regularly high-level EU-Japan Railway Industry Dialogues, held already seven times to date

and alternatively hosted in Brussels and Tokyo, have been very effective in enhancing mutual

understanding and increasing the railway business volume of European companies in Japan.

The European Business Council (EBC), the umbrella organisation of all European Chambers of

Commerce in Japan, has its own Railway Committee, and it formulates concrete industrial

recommendations in its annual White Paper to improve business conditions for European

companies in the Japanese market.

Business Opportunities

European manufacturers of innovative and top-quality railway equipment, products, solutions,

services and systems, in combination with a track record of global sales references, can expect

potential business opportunities in the following areas:

■ Systems and products preventing derailments and secondary accidents are considered the

key future investment target of all major railway companies;

■ Solutions and technologies improving free-gauge systems (Japan has two systems – wide-

gauge Shinkansen at 1435mm and conventional gauge at 1067mm, the latter being 87% of

the entire network) has been decided for implementation in the new Hakata-Nagasaki route

of the Kyushu Shinkansen line in 2022;

■ Brake systems and technologies that assure safe operations at high speed, especially in the

300-400km/h speed range (Japan has already announced future Shinkansen lines to

operate at 380~420 km/h);

■ Maglev-related technology for high speed operations exceeding 500 km/h;

■ Automatic train control systems for both high speed rail (four-minute departure intervals

between trains) and conventional rail (two-minute intervals);


■ Advanced snow melting systems and products for HST for future Shinkansen extensions of

Hokuriku and Hokkaido lines in mountainous areas with heavy snowfall during winter;

■ Automated cruise control systems to eliminate human error;

■ Systems for optimal fleet and staff deployment;

■ Rolling stock fleet maintenance technology;

■ Train operation control systems;

■ Systems monitoring and managing optimal electric power supply;

■ Low energy consumption LED displays and signalisations

■ Signalling systems like CBTC technology

European Success Stories

In 2004, JR East began testing Germany’s Knorr-Bremse friction brakes sets on their FASTECH

360 test car for Shinkansen lines (operating at top speeds of 320 km/h) in the northern

mountainous areas of Japan under harsh conditions. After extensive testing spanning several

years, Knorr-Bremse friction brakes were selected based upon superior performance compared

to domestically manufactured brake sets. The brake sets were delivered to JR East in 2010.

Knorr-Bremse friction brake sets are installed on E5, H5, E7 and W7 series Shinkansen cars,

all operating at top speeds exceeding 300km/h on the Tohoku, Akita and Hokuriku Shinkansen

lines.

In 2015, JR West awarded a large public procurement contract to Mermec of Italy, for the

implementation of three inspection sets for measurement, track surface and head-check, based

upon the V-Cube technology developed in-house by Mermec. Delivery was done in 2017 and

total contract value is estimated at EUR 6.65 million. This contract was announced during the 3rd

EU-Japan Railway Industry Dialogue, held in Belgium.


2. What are the Characteristics of Japan?

Japan Factsheet

Population (2018; Final Estimate) 126,435,000 inhabitants9

Land Area 377,962 km2

Capital Tokyo

Currency Japanese Yen (JPY)

Gross Domestic Product (GDP) 2018 JPY 549 trillion (EUR 4.5 trillion)10

Sovereign Debt (2018) JPY 1,100 trillion (EUR 9.16 trillion)11

Foreign Direct Investment (FDI) FY2017 JPY 28.6 trillion (EUR 238 billion)12

Consumption Tax (Value Added Tax) 8%

Unemployment Rate FY2018 2.4%13

Life expectancy (men) FY2018 81.09 years14

Life expectancy (women) FY2018 87.26 years15

It is well known that Japan rapidly increased its position in the global economy during the post-

war period. Historically, the primary drivers of Japan’s strong economic growth have been high

rates of investment in production plants and equipment, application of efficient industrial

techniques, a high education standards, good relations between labour and management, ready

access to leading technologies with significant investments in research and development, an

increasingly open world trade framework and a large domestic market of discerning consumers –

all of which have given Japanese businesses an advantage in scale of operations.

9 http://www.stat.go.jp/english/data/jinsui/tsuki/index.html 10 https://www.japan.go.jp/abenomics/_userdata/abenomics/pdf/1903_abenomics.pdf 11 https://www.mof.go.jp/english/jgbs/reference/gbb/e201812.html 12 https://www.japan.go.jp/abenomics/_userdata/abenomics/pdf/1903_abenomics.pdf 13 https://www.stat.go.jp/data/roudou/sokuhou/tsuki/index.html 14 https://www.nippon.com/en/features/h00250/life-expectancy-for-japanese-men-and-women-at-new-record-high.html 15 https://www.nippon.com/en/features/h00250/life-expectancy-for-japanese-men-and-women-at-new-record-high.html

http://www.stat.go.jp/english/data/jinsui/tsuki/index.html

https://www.japan.go.jp/abenomics/_userdata/abenomics/pdf/1903_abenomics.pdf

https://www.mof.go.jp/english/jgbs/reference/gbb/e201812.html


https://www.stat.go.jp/data/roudou/sokuhou/tsuki/index.html

https://www.nippon.com/en/features/h00250/life-expectancy-for-japanese-men-and-women-at-new-record-high.html

https://www.nippon.com/en/features/h00250/life-expectancy-for-japanese-men-and-women-at-new-record-high.html


The rapid aging of the population will have tremendous implications for the structure of the future

workforce, the savings rate of the working population and hence, the government tax revenue

budget.

2.1 Political Overview of Japan

Japan is a constitutional monarchy, with the Emperor as the symbolic head of state. The system

is a parliamentary democracy with the National Diet the sole legislative body. The Diet is

composed of an Upper House (House of Councillors) and a Lower House (House of

Representatives). The Prime Minister, chosen by a Diet ballot, appoints a cabinet, with the

majority required to be Diet members.

Japan’s voting system is non-obligatory, and the voting age was lowered from 20 to 18 years in

2015, resulting in 104 million Japanese eligible to cast votes.

The Liberal Democratic Party (LDP) has governed Japan for most of the last 70 years, only being

briefly out of power in 1993-1994 and in 2009 when the Democratic Party of Japan (DPJ), led by

Yukio Hatoyama, secured a historical victory putting the DPJ into governing powers, albeit for a

short period.

Since then, following a landslide election victory for the Liberal Democratic Party (LDP), Prime

Minister Shinzo Abe took office as Japan’s 97th re-elected Prime Minister in 2012. Since the

general election in 2017, Abe retained his two-thirds majority with Komeito. Abe’s Cabinet has 20

ministers16, including the Prime Minister himself. Under his reign, Japan’s economic and financial

situations have undergone noticeable changes.17

The Upper House

The Upper House (Sangi-in, House of Councillors) currently has 242 seats, each with six year

terms. Following the July 2016 elections, the LDP coalition won a comfortable 146 seats out of

16 https://japan.kantei.go.jp/98_abe/meibo/daijin/index_e.html 17 http://japan.kantei.go.jp/

http://japan.kantei.go.jp/


the 242 seats, thus enabling Prime Minister Abe and his Cabinet to continue their political,

economic and financial reforms.

The Lower House

The Lower House (Shugi-in, House of Representatives) has 475 seats, selected by proportional

representation. The Lower House is elected every four years, but elections are often held before

a term is completed. The House of Representatives is the more powerful of the two houses, able

to override vetoes on bills imposed by the House of Councillors with a two-thirds majority and it

can be dissolved at-will by the Prime Minister.

Since the October 2017 election, the LDP majority coalition, together with the Komeito Party,

occupies 312 out of 465 seats.18

The Supreme Court

The Supreme Court system is similar to that of the US. Judges are appointed by the cabinet, and

they preside over a legal system of lower courts divided into four arms: High courts, district courts,

family courts and summary courts.

Under Article 76 of the constitution, all judicial power is vested in the Supreme Court, which

administers eight high courts. Since May 2009, the Supreme Court has a jury system and in

general, judicial precedent is considered binding in Japan.

2.2 Economic Overview of Japan

Today, aiming for a future GDP of JPY 600 trillion (EUR 5 trillion), Japan is still the 3rd biggest

global economy, after the US and China. Japan’s main industries are automotive, consumer

electronics, computers, other electronics and pharmaceuticals. Services are 75% of the GDP,

industrial activities 23.5% and agriculture 1.5%.

18 http://www.shugiin.go.jp

http://www.shugiin.go.jp/


Following the financial and real estate bubble burst in the early 1990’s, and after more than two

decades of economic stagnation, Prime Minister Shinzo Abe and his Cabinet unveiled a

comprehensive economic policy package to sustainably revive the Japanese economy while

maintaining fiscal discipline. This programme became globally known as Abenomics.

The centrepiece of Abenomics is the “Three Arrow Policy” targeted at an active monetary policy,

a flexible and stimulant fiscal policy and a sustainable long-term growth strategy all carried out

through structural reforms that sparks private investments. The economic parameters mainly

focus on boosting productivity, driving innovation and trade, and stimulating corporate activity. As

a result of the aforesaid measures, the exchange rate of the JPY has been hovering around 120

for 1 Euro, in recent years.

Figure 1: © Abenomics Targeting GDP of JPY 600 trillion, Cabinet of the Prime Minister website

Given the long-term low interest rates by the Central Bank of Japan, it is believed that the yen will

remain relatively strong for the near future versus other global currencies, including the euro, thus

creating ample export business opportunities for overseas manufacturers and suppliers.

Since 2016, multinationals like Apple (US), Nexeon (UK)19 and Gestamp (ES) have created local

Research and Development (R&D) centres in Japan. Internet companies like Facebook, Google

19 https://www.jetro.go.jp/invest/newsroom/2016/c81cf91c963e7d75.html

https://www.jetro.go.jp/invest/newsroom/2016/c81cf91c963e7d75.html


and Amazon have also been present in the country for some time now, but in recent 3 years, newer

internet companies like Airbnb and Spotify also have established representative offices in Japan.

Tokyo is and remains the favourite city to establish a presence (67%) while Osaka takes about

6% of the total Foreign Direct Investment (FDI) value. Nagoya remains a popular destination for

automotive manufacturing and related businesses, given Toyota Motors has their global

headquarters there. Yokohama is especially popular for larger scaled R&D centres with an FDI

share of 10%. Of all foreign direct investments in Japan, totalling JPY 28.55 trillion

(EUR 237 billion) at the end of FY2017, Europe represented 49.4%, North America 24% and Asia

18.6%.20

Figure 2: © Inward FDI in Japan as of End 2017, JETRO

Since Prime Minister Abe took office in 2012, the annual corporate profits have increased to

JPY 81 trillion (EUR 675 billion) in FY 2018. As an indicator, the Nikkei 225 Index has remained

in the JPY 22,000 range during the same period.

These results were mainly obtained through large-scale monetary easing policies, consecutive

tax reforms (corporate tax ratio was 37% in 2013 and Abe’s cabinet realised a lowered rate of

29.74% in FY201821) and major market deregulations like the complete liberalisation of the

electric supply retail market in 2016.

20 https://www.jetro.go.jp/ext_images/invest/ijre/report2018/pdf/jetro_invest_japan_report_2018en.pdf 21 https://www.japan.go.jp/abenomics/_userdata/abenomics/pdf/1903_abenomics.pdf

https://www.jetro.go.jp/ext_images/invest/ijre/report2018/pdf/jetro_invest_japan_report_2018en.pdf



2.3 Trade Overview between EU and Japan

Japan and EU business in Figures

Japan is the EU’s 2nd biggest trading partner in Asia, after China, while Europe is Japan’s 3rd

biggest partner worldwide.22 The total trade value in actual goods between the EU and Japan

accounted for EUR 135.1 billion in 2018, with a trade deficit on the EU side at EUR 5.6 billion.23

Figure 3: © Trade Flows Total Goods with Japan, 2008-2018, European Commission

On the other hand, in 2017, the EU exported a value of EUR 34.7 billion of services to Japan,

while imports of services from Japan amounted to EUR 18.3 billion. For services, the EU had a

surplus of EUR 16.3 billion in 2017.24

22 http://www.customs.go.jp/toukei/suii/html/data/y3.pdf 23 http://ec.europa.eu/trade/policy/countries-and-regions/countries/japan/ 24 http://ec.europa.eu/trade/policy/countries-and-regions/countries/japan/

http://ec.europa.eu/trade/policy/countries-and-regions/countries/japan/



EU Japan Economic Partnership Agreement (EPA)

The EU-Japan Economic Partnership Agreement (EPA), initiated in March 2013 by the then

Commissioner Karel De Gucht, entered into force on 1 February 2019. The EPA is one of the

world’s largest bilateral free trade deals ever and will eliminate nearly all customs duties on

products traded between the EU and Japan. It will also be a model for 21st century economic

order, based on free and fair-trade rules.

The EU and Japan together account for 33% of the world’s GDP and have a combined population

of 635 million people.25

Japan is and remains a major direct foreign investment player in the European market with over

3,750 in-country local branches and employment of 470,000 people, which represents 0.2% of

the total work force in Europe. In FY2017, Japan’s FDI in EU-28 amounted to EUR 228.9 billion

versus EUR 99.4 billion from the EU-28 Member States into Japan.26 Hence, easy and continued

market access to the EU is key for Japan’s future sustainable economic growth.

The EU hopes that the EPA will result in enhancing access for European enterprises to Japan’s

railway procurement market, in which the European railway industry has a large interest. This

slightly older but still very relevant 2014 graph below clearly shows the significant imbalance of

the bilateral imports between Japan and the EU within the railway industry segment.

25 http://trade.ec.europa.eu/doclib/press/index.cfm?id=1976 26 http://ec.europa.eu/trade/policy/countries-and-regions/countries/japan/

http://trade.ec.europa.eu/doclib/press/index.cfm?id=1976



Figure 4: © Trade Imbalance in Railway Segment between EU and Japan27

27 Trade Sustainability Impact Assessment of the FTA between EU and Japan, Final Report 2016, Directorate-General for Trade; unit: millions

of euros


3. Market Overview & EU Entry Opportunities in Japan

3.1 The Japanese Railway Technologies & Services Industry

3.1.1 Historic Overview

Railway History

Near the end of 1869, Harry Parkes, the British Minister to Japan, urged the Meiji government

officials to start domestic railway construction as soon as possible. The necessary financing funds

for these public works were to be procured through Horatio Nelson Lay, an Englishman introduced

by Parkes.

Through Lay’s introduction, many British engineers were hired to design and build railways in

Japan. Their specialities ranged from civil engineering and machinery for manufacturing and

repairing rolling stock, to scheduling train services and operations. Simultaneously, Lay also

began purchasing the necessary railway equipment for the Meiji government.

The first locomotives and 58 two-axle passenger carriages, imported directly from the United

Kingdom, arrived in Yokohama in September 1871.

On 12 June 1872, less than a year later, two daily rides between Shinagawa (Tokyo city) station

and Yokohama (Kanagawa prefecture) station were launched. The 29 kilometres of newly laid

track marked the true start of railway passenger travel services in Japan. The ride itself took 35

minutes from terminal to terminal. A mere two days after official opening, the rides were increased

to six services daily.


Figure 5: © Shinagawa Station in 188528

A year later, on 15 September 1873, domestic freight railway services began, with Shinbashi

station functioning as the main terminal.

On 11 May 1874, regular passenger service between Kobe and Osaka was launched, thanks

again to the tremendous support and railway business know-how of the UK. This line also

included the first wrought-iron bridge and first tunnel ever in Japan.

Subway History

Subway services started in Tokyo as early as in 1927, with services between Ueno and Asakusa

on the Asakusa line spanning 2.2 kilometres. At that time, steam locomotives were the main

choice for rail, but Japan quickly developed a special electric subway locomotive named the 1000

series, which also marked the start of Japan developing their own domestic railway equipment.

28 www.koken-archi.xsrv.jp

http://www.koken-archi.xsrv.jp/


Figure 6: © 1000 type subway train 1927, Japan Subway Association

In 1933, Osaka opened its own subway network between Umeda and Shinsaibashi, followed by

Nagoya city during the 1950s. Presently, 12 major cities in Japan operate 45 underground lines

that serve over 16 million passengers daily over a combined total of 800 kilometres.

To put the total market scale into perspective, in Tokyo alone, Tokyo Metro Lines operate nine

lines (Chiyoda, Fukutoshin, Ginza, Hibiya, Marunouchi, Namboku, Tozai, Yurakucho, Hanzomon)

and Toei Subway Lines operate four (Asakusa, Oedo, Mita, Shinjuku) lines, connecting 142

unique subway stations. Most subway lines continue above ground in direct connection with

private railways to increase convenience for passengers, especially during the morning peak

commuting hours into central Tokyo.


The map below shows the vast subway network of the greater Tokyo metropolitan area.

Figure 7: © English Subway Map of Tokyo29

Shinkansen History

Probably the Japanese railway transport system best-known to the rest of the world is the epic

Shinkansen (Bullet Train). The Shinkansen was the first commercial High Speed Rail (HSR)

network ever globally, and its operations began in 1964, when the Tokyo Olympics were held.

29 http://toursmaps.com

http://toursmaps.com/


Figure 8: © Present & Future Shinkansen Tracks 2018, Environmental and Energy Study Institute30

30 https://www.eesi.org/papers/view/fact-sheet-high-speed-rail-development-worldwide

https://www.eesi.org/papers/view/fact-sheet-high-speed-rail-development-worldwide


Typical for Japan is a long-term strategy to constantly invest in public works and transport

infrastructure, especially for large projects like new Shinkansen lines in order to unlock the

potential of remote but important economic areas within the Japanese archipelago.

Independent from the operational JR Railway companies, the Ministry of Land, Infrastructure,

Transport and Tourism (MLIT) has allocated a total FY2019 budget of JPY 396.3 billion 31

(EUR 3.3 billion) for large infrastructure works for the future approved Shinkansen line

extensions.

1. Hokkaido Shinkansen: Shin-Aomori~Shin-Hakodate Hokuto: JPY 8 billion (EUR 66 million)

2. Hokkaido Shinkansen: Shin-Hakodate Hokuto~Sapporo: JPY 48.7 billion (EUR 405 million)

3. Hokuriku Shinkansen: Kanazawa~Tsuruga: JPY 263.8 billion (EUR 2.19 billion)

4. Kyushu Shinkansen: Takeo Onsen~Nagasaki: JPY 75.8 billion (EUR 631 million)

These new extensions aim at increased local and inbound tourism, with minimal environmental

burden, maximal safety and barrier free access for an all-inclusive society.

Important to note is the importance of free gauge technology32, allowing eased switching forth

and back to the wider shinkansen tracks (1,435mm with expected speeds of 270km/h) from

smaller local high speed tracks (1,67mm with expected speeds of 130km/h33),will be pro-actively

promoted by MLIT, both from a cost and environmental perspective, This technology, being tested

since FY2015, will be applied at the new Kyushu Shinkansen routes and the Hokuriku

Shinkansen, including snow melting features. The central government is shouldering ⅔ of the

total development and testing budget of +30,000 kilometres for this new technology.

This new Free Gauge Train Technology (FGT) is said to save about JPY 530 billion 34

(EUR 4.41 billion) in costs for the 50 kilometre route between Shin-Tosu station and Takeo Onsen

in Saga Prefecture and would allow to be operational 9 years earlier compared to the initial planning.

31 http://www.mlit.go.jp/common/001266324.pdf 32 http://www.mlit.go.jp/common/001061722.pdf 33 https://www.sankei.com/west/news/180330/wst1803300051-n2.html 34 http://www.mlit.go.jp/common/001229421.pdf

http://www.mlit.go.jp/common/001266324.pdf

https://www.sankei.com/west/news/180330/wst1803300051-n2.html


In 2004, the 290 kilometre Kyushu Shinkansen line from Hakata (Fukuoka) to Kagoshima was

inaugurated and is operating 119 runs per day as of March 2018. In addition, the Nagasaki

extension of the Kyushu line is slated to start operations in 2023, adding another 66 kilometres of

Shinkansen tracks to the Kyushu network.

In 2015, the Hokuriku Shinkansen was extended from Nagano Station to Kanazawa-city in

Ishikawa prefecture, resulting in a tourism and economic boom to the city of Kanazawa. Since the

extension, the E7 model (rolling stock of 228 cars) is operating at a speed of 260 km/h.

An extension from Kanazawa to Tsuruga is scheduled to begin operations in 2023.

Figure 9: © E7 Model Hokuriku Shinkansen35

On 26 March 2016, the first leg of the Hokkaido Shinkansen was launched from Shin-Aomori

station to Shin-Hakodate, on the most northern island of Hokkaido. The total length of almost

150 kilometres include a tunnel nearly 54 kilometres long that runs for 23 kilometres under the

sea, connecting the Honshu and Hokkaido islands. The extension from Shin-Hakodate to

35 www.jreast.co.jp

http://www.jreast.co.jp/


Sapporo-city is scheduled to open in 2030, and once completed, the Hokkaido Shinkansen

network will cover 360 kilometres in total length.

Figure 10: © H5 Model Hokkaido Shinkansen, Aomori Tourist Agency

Since May 2019, JR East is testing the E956, aka ALFA-X, with 10 cars on the Tohoku

Shinkansen tracks (Sendai-Shin-Aomori) with a new top speed ranges between 360 to 400 km/h.

These tests will continue till March 2022 at a pace of 2 runs per week, during night-time.


Figure 11: © The Newest E956 Model Tohoku Shinkansen36

These tests are in line with JR East’s ‘Change 2027’ plan aiming at:

■ Enhanced Safety and Stability

■ Improved Comfort

■ Reduced Environmental Impact

■ Reduced Maintenance through Innovation

36 www.pixer.com

http://www.pixer.com/


During peak times on the main Tokaido Shinkansen line, that connects Tokyo with Osaka,

JR operates between 12 to 15 trains per hour, transporting 466,000 passengers on average per

weekday in FY2018.37

Passengers can select from the Nozomi (300 km/h) super express with the famous 700 series

(2 hours and 30 minutes), the Hikari semi-express services (3 hours) and the Kodama local

services (+4 hours). Tokyo station, a terminal servicing several Shinkansen lines, sees 368

departures daily with an average of 1,300 seats per train.

Figure 12: © N700A series on Tokaido Shinkansen Line, JR Central

Although the Shinkansen runs on a globally unprecedented seconds-based schedule, it has an

extremely low incident rate. In fact, it boasts a track record of zero death-related accidents in over

50 years of operations. More remarkably is that the average delay is a mere 42 seconds for a

cumulative 134,000 Shinkansen trains in FY2018, thus reflecting meticulous time management.

37 https://company.jr-central.co.jp/ir/annualreport/_pdf/annualreport2018.pdf

https://company.jr-central.co.jp/ir/annualreport/_pdf/annualreport2018.pdf


In 2015, the YouTube channel of Tokyo City, published a movie called “7-Minute Miracle”.38

It documented the true story of Shinkansen trains being completely serviced in only 7 minutes

before their next run. This video quickly gained international media attention resulting in over

6.5 million views. This video also clearly shows the obsessive need of Japanese railways to

maximise customer service in a clean and hygienic environment under all circumstances.

Figure 13: © 7-Minute Miracle, City of Tokyo

In Japan, it is said that HST services like the Shinkansen can compete with domestic air transport

for distances up to 900 kilometres, when considering a total travel time of four hours’ door-to-

door. In the greater Tokyo and Osaka metropolitan areas, for a total travel time below four hours,

71% of users will select trains, 19% will choose air travel and 10% will use private cars.

38 https://www.youtube.com/watch?v=kt92-ZDm-HM

https://www.youtube.com/watch?v=kt92-ZDm-HM


Maglev (Linear) Chuo Line

Finally, the Maglev (Linear) Chuo Line between Shinagawa and Nagoya (286 kilometres), with

expected operational speeds over 500km/h, is scheduled to open in 2027, while the extension

from Tokyo Station to Osaka Terminal is slated for 2037, initially planned for 2045, bridging the

total distance of 438 kilometres between Japan’s 2 major cities in a mere 67 minutes. At present,

the total budget for the Maglev project is estimated at JPY 90 trillion (EUR 750 billion).39

Figure 14: © Maglev Road Map, Abenomics, website of the Prime Minister

The new Maglev train, combined with the traditional Tokaido Shinkansen, is expected to carry

165 million passengers per year which is equivalent to 12 times air travel capacity. During peak

hours, it will operate a maximum of 15 trains per hour, meaning leaving Tokyo Station every

4 minutes.40

Given the high priority that Prime Minister Abe41 and Japan has placed on increasing tourism to

60 million visitors by 2030, additional Shinkansen and future Maglev construction investments are

key cornerstones for sustainable economic growth and increased inbound tourism. In FY2018,

31 million foreign tourists visited Japan, spending a total amount of JPY 4.5 trillion

(EUR 37.5 billion)

39 https://www.mlit.go.jp/common/001292355.pdf 40 https://linear-chuo-shinkansen.jr-central.co.jp/future/ 41 www.kantei.go.jp

https://www.mlit.go.jp/common/001292355.pdf

https://linear-chuo-shinkansen.jr-central.co.jp/future/

http://www.kantei.go.jp/


Figure 15: © L0 series Maglev train with 12 cars at Yamanashi Test Track, Saruno Hirobano

3.1.2 Market Overview

Given the geographic isolation of Japan, a long archipelago of 4 major islands from Hokkaido in

the north, Honshu (main island), Shikoku to Kyushu in the south, it is understandable that the

railway market became closed to overseas railway manufacturers from 1925 on, when Japan

gradually established its own domestic railway production technology.

From then on, the need for importing overseas railway technology weakened, and for decades

through the early 1990’s, all procurement was done almost exclusively using domestically

manufactured railway products and services. The visual below shows the main types of railways

currently used in Japan.


Figure 16: © Railway Types in Japan42

From the 1990’s on, there was a small revival of railway-related imports from Europe for global

standardised railway products resulting in initial cost reductions at time of procurement. State-of-

the-art European railway technology that was not yet developed or deployed in Japan also saw

increased demand, but the overall business volume remained limited.

One of the main reasons behind this increase of imported railway products was political pressure

(often referred to as “gaiatsu” in Japanese) following distorted trade imbalances between Japan

and Europe.

42 Railway Bureau, Ministry of Land, Infrastructure, Transport and Tourism


However, once these imported European products and services were put into operation in Japan,

smaller quality and performance issues surfaced, such as with the motor units Siemens delivered

to Keikyu Railway at the end of the 1990’s. Because of this unsatisfactory experience with

overseas procurement, Japanese railway operators went back to their more reliable domestic

suppliers with swift after-service that immediately address any quality issue.

Therefore, when doing business with Japan, it is necessary to not only grasp and understand the

past delivery results of both overseas and Japanese competitors, but also the quality expectations

of the final customers, standard business practices, recent business consolidations and their

financial, strategic and “keiretsu” alliances with major operators.

The total domestic railway manufacturing business during fiscal year 2017 was estimated at a

market value of JPY 495.4 billion (EUR 4.12 billion). The breakdown for fiscal year 2017, ending

at March 2018, includes rolling stock at JPY 202.8 billion (EUR 1.69 billion; 26.1% export),

electric parts at JPY 204.6 billion (EUR 1.705 billion; 36% export) and spare parts at

JPY 158.9 billion (EUR 1.32 billion; 11.6% export).

Figure 17: © Railway Manufacturing Market Value 2017, JARi

Cars34%

Electric Parts37%

Spare Parts29%

Total Manufacturing Value 2017: JPY 495.4 billion (EUR 4.12 billion)

Cars Electric Parts Spare Parts


The total domestic railway-related workforce is estimated at 17,500 people in manufacturing and

another 7,500 in the security/safety market segments.

3.1.3 Japanese Railway Companies

Japan Railways Group

The biggest railway operator is the Japan Railways (JR) Group operating an extensive nationwide

railway network of over 20,000 kilometres. The JR Group was originally a state-owned company

known as Japanese National Railways (JNR), which accumulated total losses of JPY 2 trillion

(EUR 16 billion) in 1987. As a result, it was privatised and split into seven JR companies (6 + JR

freight), each serving a specific geographic region in the Japanese market.

Japan Railways Group (non-consolidated, FY2017)

Main Area Turnover (JPY) Kms Cars Stations Pax (mio)

JR Hokkaido Hokkaido 90b 2,536 1,001 408 136m

JR East Greater Tokyo 2.093t 7,457 12,876 1,666 6.5b

JR Central Nagoya 1.427t 1,970 4,840 405 580m

JR West Osaka 976b 4,901 6,498 1,169 1.9b

JR Shikoku Shikoku 28b 855 432 259 47m

JR Kyushu Kyushu 220b 2,273 1,669 568 331m

JR Freight Nationwide 155b 7,961 616 242 N/A

Table 1: Japan Railways Group Turnover FY2017


Figure 19: © JR Logos, JR East website

JR East Consolidated Subsidiaries (FY 2018)43

Company Name Core Business Voting Right (%)

1. Tokyo Monorail Railway passenger transport services 79.0

2. JR Bus Kanto Bus services 100.0

3. JR Bus Tohoku Bus services 100.0

4. Japan Transport Engineering Company Railcar manufacturing operations 100.0

5. JR East Retail Net Retail sales 100.0

6. JR East Water Business Retail sales 100.0

7. JR East Tohoku Sogo Service Retail sales 100.0

8. JR East Station Retailing Retail sales 100.0

9. Tokky Retail sales, hotel operations, shopping centers

100.0

10. Kinokuniya Retail sales 100.0

11. Nippon Restaurant Enterprise Restaurant business, retail sales, hotel operations

100.0

12. JR East Food Business Restaurant business 100.0

13. Lumine Shopping center operations 95.1

43 JR East, Annual Report 2016



14. Atre Shopping center operations 92.1

15. JR East Urban Development Corporation Shopping center operations 100.0

16. JR East Department Store Shopping center operations 84.6

17. JR Tokyo West Development Shopping center operations 93.3

18. Station Building Midori Shopping center operations 100.0

19. Tetsudo Kaikan Shopping center operations 100.0

20. Chiba Station Building Shopping center operations 100.0

21. Shonan Station Building Shopping center operations 90.7

22. Yokohama Station Building Shopping center operations 90.3

23. Kinshicho Station Building Shopping center operations 71.3

24. JR Chuo Line Mall Shopping center operations 100.0

25. JR East Aomori Business-Development Company

Shopping center operations 100.0

26. JR East Building Leasing of office buildings 100.0

27. Viewcard Credit card business 100.0

28. Nippon Hotel Hotel operations 100.0

29. Sendai Terminal Building Hotel operations and shopping center operations

99.5

30. Morioka Terminal Building Hotel operations and shopping center operations

100.0

31. Akita Station Building Hotel operations and shopping center operations

98.2

32. East Japan Marketing & Communications Advertising and publicity 100.0

33. Tokyo Media Service Advertising and publicity 100.0

34. Shinjuku South Energy Service Supplying thermal energy 57.6

35. JR-East Energy Development Supplying wind energy 80.0



36. The Orangepage Publishing 100.0

37. JR East View Travel Service Travel agency services 73.8

38. East Japan Railway Trading Wholesale 100.0

39. JR East Logistics Truck delivery services 100.0

40. JR East Information Systems Company Information processing 100.0

41. JR East Net Station Information processing 100.0

42. JR East Management Service Information services 100.0

43. JR East Green Partners Inventory control, issuance, collection operation for uniforms of JR East employees

100.0

44. JR East Personnel Service Seminar and staff sending business 100.0

45. JR East Station Service Stations operations 100.0

46. East Japan Eco Access Cleaning services 100.0

47. JR Chiba Railway Services Cleaning services 100.0

48. JR Takasaki Railway Services Cleaning services 100.0

49. JR Mito Railway Services Cleaning services 100.0

50. JR East Transportation Services Cleaning services 100.0

51. JR East Tessei Cleaning services 100.0

52. JR Technoservice Sendai Cleaning services 100.0

53. JR Niigata Railway Service Cleaning services 100.0

54. Morioka Railway Servicing Cleaning services 100.0

55. JR Akita Railway Services Cleaning services 100.0

56. JR Nagano Railway Services Cleaning services 100.0

57. JR East Sports Athletic club operations 100.0



58. Gala Yuzawa Ski resort operations 92.7

59. JR East Rental & Lease Car leasing 89.4

60. Union Construction Construction 90.0

61. JR East Mechatronics Maintenance services 100.0

62. JR Higashinihon Linen Linen supply 100.0

63. JR East Rail Car Technology & Maintenance Machinery and rolling stock maintenance

100.0

64. JR International Consultants for Transportation Consulting 52.5

65. JR East Consultants Company Consulting 100.0

66. JR East Design Corporation Consulting 100.0

67. JR East Facility Management Building maintenance 100.0

Table 2: © JR East Consolidated Subsidiaries, JR East website

JR East Equity-Method Affiliated Companies (FY 2018)44

Company Name Main Business Voting Right (%)

1. UQ Communications Internet connect service 17.6

2. Central Security Patrols Security business operations 25.4

3. JTB Corporation Travel agency services 21.9

4. Nippon Densetsu Kogyo Construction 19.1

5. Nippon Rietec Construction 17.3

Table 3: © JR East Equity-Method Affiliated Companies JR East website

44 JR East, Annual Report 2017


Private Railway Companies (Big 16)

In addition to the JR group, Japan has 16 major private railway companies that operate near

Japan’s major urban clusters like Tokyo, Osaka, and Nagoya on the main island of Honshu, and

Fukuoka in Kyushu. In FY2017, the Big 16 carried more than 10 billion passengers.45

Major Private Railway Companies (non-consolidated, FY2017)

Line Area Turnover (JPY)

Km Cars Stations Pax (mio)

Keikyu Railway Tokyo 132b 87 790 73 476

Keio Railway Tokyo 126b 85 881 69 670

Keisei Railway Chiba 82b 152 598 69 287

Odakyu Railway Tokyo 170b 120 1,083 70 755

Tokyo Metro Tokyo 392b 195 2,728 179 2,709

Seibu Railway Saitama 145b 177 1,276 92 658

Tobu Railway Tokyo 222b 463 1,916 204 920

Sotetsu Railway Yokohama 33b 36 398 25 232

Tokyu Corporation Tokyo 269b 105 1,234 97 1,178

Meitetsu Railway Nagoya 108b 444 1,072 275 387

Hankyu Corporation Osaka 194b 144 1,295 90 655

Hanshin Railway Osaka 86b 49 358 51 242

Keihan Railway Osaka 58b 91 706 89 294

Kintetsu Corporation Osaka 163b 501 1,905 286 578

Nankai Railway Osaka 99b 155 688 100 238

Nishitetsu Railway Fukuoka 153b 106 316 72 103

Table 4: Major Private Railway Companies, Japanese websites of Big 16 railway operators

45 https://www.mintetsu.or.jp/activity/databook/pdf/18databook_p02-05.pdf


The less populated geographic areas are covered by more than 100 smaller and local railway

companies operating specific lines nationwide.

3.1.4 Railway Business Trends

At the end of FY2018, Japan Railways operated over 20,000 km of railways (13th on a global

scale) and carries more than 25 billion passengers annually, making it the top railway carrier

globally from a passenger perspective.

The Big 16 Private Railway companies together manage another 3,000 kilometres of railway

tracks. All railway companies together, besides the JR Group, carried over 15 billion passengers

during FY2017, ending in March 2018.46

The retail railway market size in 2017 was estimated at JPY 14.6 trillion (EUR 121 billion), with a

total workforce of 156,000 employees. In Japan’s major cities, a person boards a train on average

750 times/year. Additionally, given that all ten of the world's busiest train stations are located in

Japan, lucrative business opportunities exist in and around stations.

Top 10 busiest stations globally (per annum)

1. Shinjuku Station Tokyo city 1.27 billion pax

2. Shibuya Station Tokyo city 1.09 billion pax

3. Ikebukuro Station Tokyo city 910 million pax

4. Umeda Station Osaka prefecture 820 million pax

5. Yokohama Station Kanagawa prefecture 760 million pax

6. Kita-Senju Station Tokyo City 530 million pax

7. Nagoya Station Aichi prefecture 410 million pax

8. Tokyo Station Tokyo City 390 million pax

9. Shinagawa Station Tokyo City 350 million pax

10. Takadanobaba Station Tokyo City 315 million pax

Table 5: Top 10 Busiest Stations Worldwide

46 https://www.e-stat.go.jp/stat-search/files?page=1&layout=datalist&toukei=00600350&kikan=00600&tstat=000001011026&

cycle=8&year=20171&month=0&result_back=1&result_page=1&second=1&second2=1&tclass1val=0

https://www.e-stat.go.jp/stat-search/files?page=1&layout=datalist&toukei=00600350&kikan=00600&tstat=000001011026&cycle=8&year=20171&month=0&result_back=1&result_page=1&second=1&second2=1&tclass1val=0

https://www.e-stat.go.jp/stat-search/files?page=1&layout=datalist&toukei=00600350&kikan=00600&tstat=000001011026&cycle=8&year=20171&month=0&result_back=1&result_page=1&second=1&second2=1&tclass1val=0


Real Estate Revenues

One of the current most visible railway projects is the complete overhaul of Shibuya station and

the surrounding area. The renovation started in 2013, the 1st phase scheduled to be completed

during 2019 and the final phase by 2027. The station overhaul investment value alone is

estimated at JPY 63.1 billion (EUR 525 million).

This joint venture, is led by the three Shibuya station operations partners Tokyu Corporation, JR

East and Tokyo Metro in close cooperation with the Urban Renaissance Agency.

The total redevelopment covers 276,000m2 including a brand-new East, Center and West

skyscrapers. The multiplexes will also have 73,000m2 of high-grade office space and 70,000m2

of commercial space.

One of the reasons why railway operators are investing heavily into their stations of prime real

estate value is to offset the expected decline of future ridership and ticket revenues due to a

shrinking and aging population.

In 2016, JR East also announced the building of a new station on the Yamanote line, becoming

the 30th station of the famous loop line around Tokyo. This was big news as the last new

Yamanote station dates back to the opening of the Nishi-Nippori station in 1971.

Located on a 13-acre former JR freight depot between Shinagawa and Tamachi stations, the new

station will be named Takanawa Gateway, and is scheduled to open before the 2020 Olympics.

The total redevelopment cost for this is budgeted at JPY 500 billion (EUR 4.16 billion).

JR East gave three major reasons for this new station:

■ Proximity to Haneda airport, which is being upgraded from a domestic to international hub

■ Future Maglev services connecting Tokyo and Nagoya in 2027

■ Shorten the longest stretch (2.2 kilometres) between the two stations on the Yamanote line


Architect Kengo Kuma, known as the designer of the main 2020 Olympic Stadium, also designed

this station in a Japanese style.

Figure 18: © Takanawa Gateway, the New Yamanote Loop Line Station, JR East

Harajuku JR station, famous for its old wooden structure of 1924, will also get a major overhaul

by 2020, together with the neighbouring JR Sendagaya and JR Shinanomachi stations. These

three stations will act as key gateways to the new 2020 Olympic venue as they are all in walking

distance. The total renewal budget for these stations is estimated at JPY 25 billion

(208 million Euro).

This renewal trend is not limited to only Tokyo. Other main terminals Yokohama, Chiba, Saitama,

Atami and Sendai stations will also be renewed in the coming years.

Eki Naka and Eki Soto Business Model

Since 2003, the Eki Naka (retail businesses inside the automatic ticket gates in stations) and Eki

Soto (retail businesses outside the ticket gates but within the station building itself) economic

business models, have become key revenue streams for most railway operators in business

segments like real estate rents, sales commissions on realised turnover (profit sharing model)


and tenders that allocate sales spaces to winning bidders, often larger retail chains with a strong

brand image.

Electronic money and mobile payments via Suica, the JR brand, are also bringing in sales

commissions with each transaction. For a company like JR East, with +17 million passengers47

using their Tokyo region stations daily, this cash flow is not to be underestimated.

Shops in and around major stations are often managed by JR-related subsidiaries but in recent

years, there has been a remarkable inflow of convenience store operators and other external

commercial tenants with ample retail experience.

This slightly older data from a www.nikkei.com 2007 article shows clearly that on average, 1m2 of

retail sales in a station generates almost eight times the value in traditional retail outlets.

For books and magazines, the sales in stations exceed eleven times.

Figure 19: © Average Retail Sales per sqm in Stations, Nikkei website

47 https://www.moblab-conference.ch/Current-Strategy-under-Competitive-Transport-market-and-future-vision-JR-East-bea39400?i=1

5,1

30,0

00

2,9

60,0

00

5,2

20,0

00

4,2

40,0

00

1,3

20,0

00

5,6

60,0

00

4,8

60,0

00

660,0

00

470,0

00

890,0

00

1,4

00,0

00

960,0

00

500,0

00

410,0

00

T O T A L F A S H I O N B E V E R A G E S C V S C O S ME T I C S MA G A Z I N E S O T H E R S

AVERAGE RETAIL SALES PER SQM IN STATIONS (2007)

Eki Naka Retail

http://www.nikkei.com/

https://www.moblab-conference.ch/Current-Strategy-under-Competitive-Transport-market-and-future-vision-JR-East-bea39400?i=1


At the beginning of October 2018, JR East managed 188 commercial facilities totalling

2.4 million m2 of commercial retail space. It also has lease agreements to third parties for

350,000m2 of office space.48

Environment and Ecological Friendly

One of the reasons why Japan keeps on investing in both new and improved railway

infrastructure, not only in major urban areas but nationwide, is to continue reducing future CO2

emissions targets, following the Kyoto Protocol, effective since February 2005, and the more

recent COP 21 Paris Agreement.

In 2008, the Japanese government enacted the Green New Deal on a Global Scale, a total

investment of JPY 51 trillion (EUR 425 billion) which includes JPY 20 trillion (EUR 166 billion)

allocated to future railway investments and continued infrastructure improvements via major

public works.

Railway operators have implemented energy saving lighting and air conditioners in addition to

lighter materials in cars to become ecological friendly. Renewable energy sources are also used

for reduce the environmental impact as much as possible.

Rush Hour Commuting

A famous but nowadays bit dated Japan railway image, is the station staff with white gloves

pushing Japanese businesspeople into the passenger cars during the morning rush hour.

The effect of extremely crowded trains has been fought off gradually in the last decade thanks to

the introduction of flexible working hours at major companies, campaigns by the railway operators

to avoid rush hour commuting and teleworking from home on an awareness level. Passenger cars

with larger transportation capacities combined with longer trains on the newer railway and subway

lines have reduced the morning rush commute stress.

48 https://www.jreast.co.jp/investor/factsheet/pdf/factsheet_05.pdf

https://www.jreast.co.jp/investor/factsheet/pdf/factsheet_05.pdf


Figure 20: Rush Hour Commute Crowd Level, Private Railways Big 16 Databook 2015

During fiscal year 2017, the JR East Sobu line, between Kinshicho and Ryogoku stations, carried

over 76,000 passengers during the 7:30am~8:30am rush hour slot, representing a congestion

ratio of 197%.

For a similar example, the JR East Chuo rapid service line between Nakano and Shinjuku stations

carried over 81,000 passengers during the 8am ~ 9am morning rush hour, representing a 184%

congestion ratio despite having trains timed at 2-minute intervals.49

Tourism and Airport Links

In 2018 for the first time ever, over 30 million overseas tourists visited Japan. The government

hopes to increase this figure to 40 million by 2020, the year the Olympics will be held in Tokyo

and the surrounding areas. Following this trend of increased inbound tourists, JR railway

companies have opened several duty-free counters in their commercial facilities in station

buildings.50

Tourists visiting Japan often make long distance trips using the popular Japan Rail Pass, which

is available only to short-term visitors to Japan. For FY 2022, JR East targets JPY 38 billion

(EUR 316 million) in sales of inbound tourism, mainly consisting of Japan Rail Passes.51 All major

49 https://www.mlit.go.jp/common/001245347.pdf 50 https://www.jnto.go.jp/jpn/statistics/since2003_visitor_arrivals.pdf 51 https://www.jreast.co.jp/investor/moveup/pdf/all.pdf

https://www.mlit.go.jp/common/001245347.pdf

https://www.jnto.go.jp/jpn/statistics/since2003_visitor_arrivals.pdf

https://www.jreast.co.jp/investor/moveup/pdf/all.pdf


railway operators are making efforts to provide English content for their websites, online

reservation systems and various smartphone applications.

This surely creates new business opportunities for overseas companies that have vast experience

and global sales in these segments. The railway operators pin their hopes on the increased

inbound tourists to curb their declining future domestic ridership especially in more remote tourist

areas. In urban areas, the ridership has remained constant in recent years.

Therefore, Japan has been proactively investing in better railway connections between airports

and urban centres over the last decade. Yet another example of this is the 2010 Keisei Rapid

Limited Express Skyliner service that connects in only 36 minutes Nippori Station on the

Yamanote Line with Narita International Airport.

Payment Methods

Fare payments with electronic money cards at the entrance gates of stations were introduced by

JR’s Suica card as early as 2001, followed by the subway operators’ Pasmo brand in 2007. Since

2008, both card systems can now be used interchangeably on both lines. Since 2013, all nine

major national brands of electronic money cards are compatible nationwide.

Most of the cards below can also be used for paying bus or taxi fares, in addition to micro

payments at shops within stations. At the end of March 2018, +895,000 shops and vending

machines outside the typical railway ecosystem also accept these electronic money payments

nowadays. On average, over 6.5 million Suica cashless transactions are recorded on a daily basis

nationwide.52

52 https://www.jreast.co.jp/youran/pdf/2018-2019/jre_youran_group_p68-73.pdf

https://www.jreast.co.jp/youran/pdf/2018-2019/jre_youran_group_p68-73.pdf


Figure 21: © Nationwide Suica Cards53

Since 2010, automatic re-charging via credit cards was added and is now one of the most popular

features, taking away the hassle of adding cash payments via ticket booths when the card balance

is down.

Over 390 million electronic money cards have been issued since 2001 and the total user base

surpasses 50 million registrants.

As for the latest trend in Suica business, JR East announced on 15 February 2019 their brand

new Welcome Suica card for overseas visitors to Japan. The most typical characteristic of this

card is its Japanese style design combined with no requirement for the normal JPY 500 (EUR 4.1)

deposit. The new card is usable for 28 days and will go on sales on 1 September 2019.

53 www.kinri.jp

http://www.kinri.jp/


Figure 22: © Welcome Suica Card for Overseas Visitors54

Payments via mobile phones have been available since 2006 by all three major Japanese mobile

phone carriers NTT DoCoMo, au and Softbank. Android smartphones sold by the same carriers

have been payment enabled since 2011. With already +11.5 million registered users in Japan,

mobile cashless payments are the next big thing in the domestic railway business.55 Market

forecasts predict 20 million mobile cashless users by 2021.56

Apple’s CEO Tim Cook was the first to use Apple Pay on JR’s Yamanote Line in Tokyo on

23 October 2016, with the actual service starting on 25 October 2016, following the iOS 10.1

update release.

54 https://www.jreast.co.jp/press/2018/20190221.pdf 55 https://www.jreast.co.jp/youran/pdf/2018-2019/jre_youran_group_p68-73.pdf 56 ICT Research Institute 2018

https://www.jreast.co.jp/press/2018/20190221.pdf

https://www.jreast.co.jp/youran/pdf/2018-2019/jre_youran_group_p68-73.pdf


Figure 23: © Tim Cook Apple Pay Launch in Japan57

Overseas Business Expansion

Some of the biggest Japanese companies like Hitachi Railway Systems, Kawasaki Rolling Stock,

Nippon Sharyo, Mitsui & Co, JR East, are now bidding, winning and delivering new projects as

active players in the global railway business.

It is believed that the global railway market will grow at an annual pace of 2.5%, to reach a total

value of JPY 22 trillion (EUR 183 billion) by 2020. As the scale, value and complexity of new

57 www.twitter.com/tim_cook

http://www.twitter.com/tim_cook


projects becomes bigger at a very fast pace, the market expects more consortium bids and

strategic business alliances among the major global market players.

A first successful project with a Japanese business partner overseas, could be a smart move to

enter the Japanese market together on a long-term basis.

3.1.5 Procurement Insights

In recent years, JR, Tokyo Metro and the Big 16 private railway operators have been open to

overseas procurement following the EPA between EU and Japan. JR East recently awarded a

new project for friction brakes to Knorr Bremse of Germany.

Obstacles like smaller quantities (limited scale merits for foreign suppliers), specific domestic

standards (resulting in complex adaptations and time-consuming calculation in preparing bids),

tight deadlines (for example, within 2-3 months after publication) and procurement information

only available in Japanese, still remain.

That said, for European companies, it is also important to understand that a domestic presence

in Japan for after-service and maintenance are key for the procurement policies of the seven JR

Group companies, which collectively account for 60% of the total railway market in Japan.

A March 2016 report by UNIFE, the European Rail Industry Organisation, points out that only 2%

of rail market is open in Japan, as calculated in accordance with international procurement rules.

Of this 2%, a mere 15% is awarded to non-Japanese firms on grounds of operational safety in

case of earthquakes.

Conversely, Japan has been exporting Javelin trains (valued at EUR 435 million) to Europe and

in 2009, Hitachi Railway Systems won the Intercity Express Programme bid (IEP, valued at

EUR 5.3 billion), creating a huge railway sector imbalance when compared to the export and

business volume of European companies to Japan. It was Bombardier’s local manufacturing plant

in Derby that lost the IEP project, considered the world’s largest ever single rail contract, to Hitachi

Railway Systems.


A January 2016 article by Keith Barrow of the International Railway Journal, mentions as follows.

“East Japan Railway Company (JR East) invested EUR 1.64 billion in new equipment in 2015 but

EU suppliers accounted for less than 5% of this. Japan’s total market for railway equipment is

worth EUR 5.8 billion but only 0.03% of rolling stock is imported”

UNIFE claims that, although Japan is a member of the Agreement on Public Procurement (GPA)

of the World Trade Organisation (WTO), overseas companies only won 0.25% of the Japanese

rolling stock market.

For easier market entrance, several organisations like UNIFE, the European Business Council

(EBC) and the EU-Japan Railway Industry Dialogues, have been putting forward the following

points that need improvement or change.

■ Recognition and harmonisation of European regulatory standards and test results by Japan;

■ Assure that all received bids are evaluated in a clear, transparent and non-discriminatory way,

including the evaluation of the extensive Operational Safety Clause (OSC), which covers

earthquake safety for railway projects in Japan. This OSC is one of the main non-tariff barriers

for European railway companies wishing to do business in Japan;

■ Japan should live up to its unilateral commitment and make concrete proposals before the

Review Clause;

■ As a member of the World Trade Organisation (WTO) Agreement on Government

Procurement (GPA), Japan should ensure that public procurement is carried out in

accordance with its provisions of transparent and non-discriminatory public procurement

procedures. To date, public tenders are still too complex, ambiguous and lack sufficiently long

deadlines;

■ Broader public procurement coverage on a reciprocal basis.


EU-Japan Railway Industrial Dialogues

The first Railway Dialogue was held in Brussels on 27 March 2014, when the EU was represented

by 30 participants from railway business organisations and companies like CER, SNCF, UNIFE,

Alstom and Bombardier as well as EU officials.

Japan had a delegation of almost 70 representatives that included government officials as well

as, private representatives from all JR companies, Tokyo Metro, Tokyo Metropolitan Bureau of

Transportation, Osaka Municipal Transportation Bureau, Hitachi Railway Systems, Mitsubishi

Electric, Mitsui & Co and JORSA.

UNIFE has been especially active and effective in levelling the playing field between the EU and

Japan over the last couple of years, the railway business market access is gradually becoming

more reciprocal, now also with the EPA in place since early 2019.

Figure 24: © EU-Japan Railway Industrial Dialogues, G.S., EU, 2014


During the 3rd Railway Dialogue, held in Brussels on 21 May 2015, the General Manager of JR

West announced the joyful news that their machine-vision inspection project was awarded to

Mermec from Italy. Mermec became the first overseas company to deliver such systems to Japan.

The agenda of the 5th EU-Japan Industrial Dialogue on Railways mainly focused on the removal

of the Operation Safety Clause, improved market access similar to the level that Japanese railway

companies enjoy in Europe and more understandable railway procurement procedures in general.

During his closing speech of the 5th dialogue, Yuji Morimoto, Executive Director of JR East,

pointed out that they are pro-actively seeking business opportunities related to innovative and

quality products produced by European railway companies. The 7th and last Industrial Dialogue

on Railways was held on 24 September 2018 in Brussels, aiming for tangible outcomes in the

future EPA between the EU and Japan.

Some obstacles that still need to be tackled are a lack of transparency in English of an online and

centralised information system for public tenders and procurement in general, and discriminatory

procurement procedures, which are very often based on unfounded domestic railway safety

criteria. Harmonization of European and International Railway Standards makes the list complete.

Some concrete changes and results of these past rounds of dialogue are the redesign by some

Japanese railway companies of their websites with English information on material procurement,

lists of main procurements expected in the fiscal year, and an overview of contractual procedures

and elements to be considered during supplier screening.

Since the start of the Railway Industrial Dialogues, especially JR East has been actively reaching

out to overseas manufacturers by opening a new international tender process for the procurement

of railcars and by holding seminars to promote mutual understanding with European suppliers

while exchanging information on procurement procedures, existing products and domestic

technologies.


JR East Procurement Philosophy

In recent years, JR East has been the forerunner of international procurement, especially for

products and services from Europe. Interested vendors can register themselves online at the JR

East procurement website, available in English. They are mainly looking for products and services

that comply with the following basic procurement guidelines and corporate philosophy.

■ Safety Improvements: By far the top priority of the group

■ Technology Improvements: Continuous pro-active joint-development of high quality

innovative technologies with manufacturers and research institutes

■ Overseas and Domestic Procurement: Reasonably-priced top quality products,

maintenance-friendly, swift and satisfying after-care service

■ Fair Business Conditions: Objective selection approach via study, selection, technology

disclosure and tests based upon rational economic aspects such as reliability towards quality

and safety, technological capacity, price, delivery, accident response time and after-care

service

■ Business Conditions for Mutual Growth: Mutual trust and communication, long-term and

sustainable relations for continuous product improvements, product availability, reliability and

just-in-time delivery

■ Corporate Social Responsibility and Privacy Policy: Legal compliance and environmental

responsibility, intellectual property protection and strict privacy policy

■ Japanese and English real time Procurement Updates and Information Disclosure on Website


Figure 25: JR East Procurement Results FY2018, JR East Website


JR East Registration Flow for New Suppliers

Figure 26: © JR East Procurement Registration Flow, JR East Website

JR East Outlook Procurement Items FY 2020

JR East Outlook Procurement Items FY 2020

Rolling Stock58 500 new railcars, bogie frame parts, foundation brake supplies, axle box supplies, internal combustion railcar supplies, transmission supplies, other internal combustion railcar supplies, wheelset supplies, gear unit supplies, current collection control supplies, rotators, stationary induction apparatus, rectifiers, resistor, condenser, lighting supplies, general electric supplies, brake supplies for railcars, car body, power supplies, measuring instrument supplies, springs, non-metallic products, air conditioning supplies, rolling bearing, wash room supplies, coupling device supplies, other general supplies for rolling stock

Facilities59 rails, other rails, rail spikes, joint supplies, fastening supplies, expansion joint supplies, guard angle, other rail accessories, wood sleeper, concrete sleeper, synthetic sleeper, special layout turnover, point, crossing, guard, turnout rail, other turnout supplies, track supplies

58 https://www.jreast.co.jp/e/data/procurement/pdf/rolling_stock_related_products.pdf 59 https://www.jreast.co.jp/e/data/procurement/pdf/facilities_related_products.pdf

https://www.jreast.co.jp/e/data/procurement/pdf/rolling_stock_related_products.pdf

https://www.jreast.co.jp/e/data/procurement/pdf/facilities_related_products.pdf


Electric Goods60

breaker equipment, capacitor, power convertor, generator and substation equipment, transformer for generator and substation, transformer for signal, connection equipment, communication cable, signal cable, power cable, insulated cable, bare wire, battery equipment

Signalling & Communication61

relay equipment, train spacing control equipment, signal device resource, point machine equipment, electric crossing equipment, train route control, track circuit equipment, other electric signal equipment, telephone terminal device equipment, data communication terminal device, mobile radio communication device equipment, switching equipment

Table 6: Procurement Outlook FY2020, JR East Website

Pictures of Actual JR East Procurement Products

60 https://www.jreast.co.jp/e/data/procurement/pdf/electric_related_products.pdf 61 https://www.jreast.co.jp/e/data/procurement/pdf/signaling_communication-related_products.pdf

https://www.jreast.co.jp/e/data/procurement/pdf/electric_related_products.pdf

https://www.jreast.co.jp/e/data/procurement/pdf/signaling_communication-related_products.pdf


Figure 27: © Rolling Stock and Facilities Procurement Examples, JR East Website62

Overall, the JR Group consists of seven companies but the four publicly listed companies below

are the most active and offer real business procurement potential for European companies

through their online bilingual updates, actual volume and commitment to purchase competitive

overseas products.

JR East: www.jreast.co.jp/e/data/procurement

JR Central: https://global.jr-central.co.jp/en/company/material_procurement/

62 www.jreast.co.jp/order/procurement/trackrecords.html

http://www.jreast.co.jp/e/data/procurement

https://global.jr-central.co.jp/en/company/material_procurement/

http://www.jreast.co.jp/order/procurement/trackrecords.html


JR West: www.westjr.co.jp/global/en/procurement

JR Kyushu: www.jrkyushu.co.jp/company/business/procurement/info.html

City of Utsunomiya: LRT Car Tender FY2017

In November 2017, the City of Utsunomiya in Tochigi prefecture announced a public tender for

barrier free LTR cars, to which 3 companies, including 1 overseas manufacturer, confirmed their

interest but only one company, namely Niigata Transys applied by the deadline of February 2018.

The total budget of this LRT project is estimated at JPY 45.8 billion (EUR 381 million) of which

half is borne by Utsunomiya City and the remaining part by the central government of Japan.

The tracks of the new LRT line will be launched in 2022 and will run from Utsunomiya Station to

the Industrial Area of Takanezawa over a length of 14.6 kilometres, covering the distance with 19

stops in approximately 45 minutes. The final winner of the project was the only bidder, namely

Niigata Transys and their winning design was as per below.

Figure 28: © Niigata Transys Winning Yellow LRT Design for Utsunomiya City 2019

http://www.westjr.co.jp/global/en/procurement

http://www.jrkyushu.co.jp/company/business/procurement/info.html


JR East: Rerailing System from Holmatro B.V.

The rerailing system of Holmatro Industrial Equipment, from The Netherlands, is a set of

instruments that can return derailed rolling stock to rail tracks. The system is composed of

hydraulic jacks, beams, a remote control for operation and a power generator, amongst others.

This product made by Holmatro was superior to previous other models in terms of transport and

operation due to the more lightweight design. It now can also be used with a remote-control

device. It was delivered to JR East’s Omiya General Rolling Stock Center in March 2019, by

Daisen Sangyo, the Japanese agent of Holmatro, following quality approval in May 2018.

Figure 29: © Rerailing System for JR East, Holmatro Industrial Equipment 2019

Tokyo Metro Procurement

Tokyo Metro, operating nine major subway lines, procures materials, components and supplies

ranging from rails and other track material, passenger car components, signal and communication

systems, power transmission systems, machinery to work instruments and motor vehicles.

Following the footsteps of pioneer JR East and following its active presence at all EU-Japan

Railway Industry Dialogue meetings held in the past, Tokyo Metro, will also begin awarding

contracts to excellent overseas railway industry companies.


Figure 30: Tokyo Metro Website Procurement Results FY2018

For FY 2019~2022, Tokyo Metro is scheduled to procure traction motors, traction inverters, brake

equipment, rails, track motor cars, onground ATP equipment, transportation and sales system,

breath alcohol testers, warning signages for platform screen doors and floor signages to name

only a few. 63 For details, please visit Tokyo Metro English Procurement website pages at

www.tokyometro.jp/lang_en/corporate/business/procurement .

63 https://www.tokyometro.jp/lang_en/corporate/business/procurement/pdf/procurement_plan_gpa_railway_products_fy2019_20-

2021_22_en.pdf

http://www.tokyometro.jp/lang_en/corporate/business/procurement

https://www.tokyometro.jp/lang_en/corporate/business/procurement/pdf/procurement_plan_gpa_railway_products_fy2019_20-2021_22_en.pdf

https://www.tokyometro.jp/lang_en/corporate/business/procurement/pdf/procurement_plan_gpa_railway_products_fy2019_20-2021_22_en.pdf


Supplier Registration Procedures for Tokyo Metro Procurement

Figure 31: © Supplier Registration Procedures for Tokyo Metro Procurement, Tokyo Metro Website64

Japan Railway Market Webinar

On 27 September 2016, the Brussels Office of the EU-Japan Centre for Industrial Cooperation,

held a webinar titled, “What are the current developments in the Japanese railways market and

do EU SMEs have business opportunities there?” by speaker Lyckle Griek of Japan Unlimited.

This webinar is archived and can be viewed online, free of charge, but prior user registration is

required and subject to internal approval, which can take a couple of working days.

www.eu-japan.eu/events/webinar-78-japanese-railway-market

64 http://www.tokyometro.jp/en/corporate/procurement/pdf/process.pdf

http://www.eu-japan.eu/events/webinar-78-japanese-railway-market

http://www.tokyometro.jp/en/corporate/procurement/pdf/process.pdf


3.2 Rolling Stock and Locomotives


As of April 2018, the total inventory of rolling stock in the Japanese market amounted to

61,300 cars. This includes 49,000 passenger cars, 7,450 freight cars, 4,850 Shinkansen units,

560 electric locomotives, 360 diesel locomotives and 21 steam locomotives.

Figure 32: Rolling Stock Inventory 2018, Japan Rolling Stock Association (JARi)

In recent years, Japanese railway operators had a constant domestic demand of 1,700 passenger

cars per annum. However, from 2000 through 2010, the average annual production, including

overseas deliveries, was around 2,000 cars. This downsizing created some negative effects on

the business results of major domestic rolling stock manufacturers and resulted in corporate

consolidations in the market.

Electric Cars79%

Freight Cars12%

Shinkansen8%

Others1%

Total Rolling Stock Inventory 2018

Electric Cars Freight Cars Shinkansen Others


Figure 33: Rolling Stock Production per Year, Japan Rolling Stock Association (JARi)

Over the past two decades, JR Railway Group has had an average demand of 700-800 new cars

per year, while Shinkansen services required 500-600 new Shinkansen cars. Private railways

needed about 500 new cars per year, representing a market share on average of 35%. The export

ratio of rolling stock manufactured in Japan, given a fluctuating exchange rate, varies from year

to year but usually hovers around 15%.

For value shares, JR represents almost 50% of the total as the Shinkansen cars are known to be

expensive, averaging JPY 300 million (EUR 2.5 million) per car and costing almost triple the cost

of a normal commuter cars at JPY 100 million (EUR 833,000) each.

The export of new cars was limited to 200-300 per year, and this number has decreased even

further over the past five years. However, this is due mainly to increased production capacity at

local Japanese manufacturer plants overseas both in Europe and the US. Players like Hitachi

Rail, Kawasaki and Nippon Sharyo have become active global suppliers of rolling stock, especially

in the segments of high-end HST cars, urban public transport lines and subways.

Current inventory consists mainly of the following types of rolling stock.

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Export 463 328 276 38 184 97 53 186 94 297

Private 795 673 465 535 470 423 452 628 699 699

JR 669 737 741 618 673 764 722 712 782 872

Shinkansen 352 408 513 400 336 290 385 250 193 252

ANNUAL ROLLING STOCK PRODUCTIONShinkansen JR Private Export


Figure 34: Rolling Stock Inventory per Type FY2018, Japan Rolling Stock Association (JARi)

The total inventory of all JR rolling stock in 2018 stood at 33,422 cars, which includes 18,011

passenger cars, 7,448 freight cars, 4,857 Shinkansen cars and 2,226 electric cars. Total private

railway rolling stock was 27,884 cars, of which 26,588 are passenger cars.

A breakdown of new Shinkansen cars manufactured during 2000-2015 shows that approximately

4,500 new cars were manufactured by the following companies: Nippon Sharyo (1,600 cars),

Hitachi (1,400 cars), Kawasaki (1,200 cars), Kinki Sharyo (200 cars) and J-TREC (100 cars).

Electric Cars78%

Freight Cars12%

Shinkansen8%

Others2%

Rolling Stock Types FY 2018

Electric Cars Freight Cars Shinkansen Others


Figure 35: Manufacturer Share Shinkansen Cars 2000-2015, Toyo Keizai Net

There is also a strong link between the geographic location of each manufacturer’s plants and

their respective final local customers, the railway operators, from the perspective of deliveries,

after-service and maintenance.

Due to shrinking domestic demand of new cars, Japan no longer has real independent rolling

stock manufacturers as they either belong to railway operators or are part of a bigger industrial

conglomerate. That is why it is so important to bear in mind the financial liaisons between the

manufacturer and the final customer.

■ Nippon Sharyo in Nagoya is 50% owned by JR Central

■ J-TREC in Yokohama is a 100% owned by JR East

■ JR West owns 5% holding shares of Kinki Sharyo in Osaka while Kintetsu owns another 48%

■ Alna Sharyo is 100% owned by Hankyu Railways

Nippon Sharyo36%

Hitachi31%

Kawasaki27%

Kinki Sharyo

4%

JTREC2%

Manufacturer Share Shinkansen Cars 2000-2015

Nippon Sharyo Hitachi Kawasaki Kinki Sharyo JTREC


Niigata Transys is part of the bigger IHI Group, while both Hitachi Railway Systems and Kawasaki

Rolling Stock Manufacturing, are sub-companies of their larger parent group companies. Quite

often, a Japanese company is hesitant when approached about potential business which does

not link back directly to the present financial and business structure of the parent company.

Market Trends

■ Light weight cars with regenerative brakes;

■ Low remittance CO2 (light materials like stainless steel and aluminium). Typical Shinkansen

cars weigh less compared to high speed rolling stock in Western countries. As their carriage

bodies are made of a special aluminium alloy, they are relatively light, which leads to higher

speeds in combination with economic efficiency;

■ Comfortable interior car space (between chairs but the width of the cars is also key);

■ Large transportation capacity (extra added cars per locomotive plus more passengers to travel

comfortably in the car);

■ Low maintenance costs (light materials reduce rail wear and tear);

■ Sustainable, light but durable, eco-friendly interiors;

■ Extra space for wheelchair users (almost 40% of the Big 16’s private railway cars have

designated spaces for wheelchair users).


Big 16 Low Energy Cars

Control System Total Cars Light Weight Cars of Total

Cars with regenerative brakes VVVF 11,819 10,630

Chopper 2,323 1,171

Resistance, other 616 237

Cars without regenerative brakes Resistance, other 2,460 304

Total Cars 17,218 (A) 12,342

Low Energy Cars (regenerative brakes or light weight) 15,062 (B)

Ratio Low Energy Cars 87.5% (B/A)

Table 7: Big 16 Low Energy Cars, Private Railways Big 16 Data Book 2018

Rolling Stock Market Players: Nippon Sharyo

Nippon Sharyo has been the leader in the domestic rolling stock manufacturer category ever since

its establishment in 1896. The company’s core business is focused mainly on the manufacturing

of passenger cars. Having manufactured over 4,000 Shinkansen cars in the past, it is still the only

domestic manufacturing company that has delivered more than 4,000 cars for Shinkansen use.

Figure 36: © Car Product Line Up, Nippon Sharyo Website

The group employs 1,900 employees 65 , operates three manufacturing plants and is

headquartered in Nagoya. Its Toyokawa manufacturing plant mainly focuses on rolling stock

65 https://www.n-sharyo.co.jp/company/index.html

https://www.n-sharyo.co.jp/company/index.html


production, with an annual turnover of JPY 89 billion (EUR 741 million) in 2018. Since 2008, the

company has been a 50% subsidiary of railway operator JR Central.

Nippon Sharyo also launched a new manufacturing plant with an annual production capacity of

120 cars in Rochelle, Illinois (US) in 2012. In August 2016, the 160th High Liner II for METRA

(Northeast Illinois Regional Commuter Railroad Corporation) was delivered from the Rochelle

plant, which was closed at the end of September 2018.66

Other export projects include Virginia Rail, diesel cars to Canada, Taiwan HST trains, 296 cars

(JPY 44 billion value, EUR 366 million) to Taiwan Railways Administration (TRA) together with

Sumitomo Corporation in 2012, another 136 tilted cars (JPY 30 billion value, EUR 250 million) to

TRA in 2011, and Venezuela.

In 2012, the California Department of Transportation (Caltrans) awarded Nippon Sharyo a

contract for 130 High-Speed Bi-Level Passenger Railcars via the main contractor Sumitomo

Corporation of America. The contract includes a base order of 130 railcars for EUR 335 million

along with an option to purchase an additional 300 railcars for EUR 850 million, bringing the

contract total to almost EUR 1.2 billion.

In 2015, 96 subway cars were manufactured by Nippon Sharyo for Indonesia’s first subway line,

the North-South Line of the Jakarta Mass Rapid Transit system. The contract value is estimated

at JPY 13 billion (EUR 108.3 million).

Despite being a major market player, Nippon Sharyo has no real links with Europe yet as it

focuses mainly on the USA and Taiwan markets for global projects.

As Shinkansen projects are planned far in advance, and if European businesses are focused on

HST in general, Nippon Sharyo could make a good fit as a long-term business partner in the

Japanese HST market. Top-notch quality, impressive global sales references at the right pricing,

66 https://www.n-sharyo.co.jp/finance/irinfo20180724.pdf

https://www.n-sharyo.co.jp/finance/irinfo20180724.pdf


combined with impeccable after-service are conditions sine qua non to break into the HST market,

which just might be easier with a local partner like Nippon Sharyo.

Shinkansen standards are said to be amongst the most stringent globally, but if you can clear

them, it will positively affect all other global HST business. Keep in mind, however, that revenues

might vary widely from year to year.

Rolling Stock Market Players: Kawasaki Rolling Stock Company

Kawasaki Rolling Stock Company has been in the railway car manufacturing business for over

100 years and is operates two manufacturing plants in Hyogo prefecture (Osaka area). The

company itself is part of the larger and globally operating Kawasaki Heavy Industries Group.

Figure 37: © Product Line Up, Kawasaki Rolling Stock Website

The sales breakdown of Kawasaki Rolling Stock for FY 2017 was: 33% in Japan, 33% for the

combined US and Europe markets and 33% in Asia. Their long-term business plan is to grow


through increased global Mergers and Acquisitions (M&A) to reach a JPY 300 billion

(EUR 2.5 billion) turnover in 2030.67

Rolling Stock Market Players: Hitachi Railway Systems

Hitachi Railway Systems (HRS), is a 100% subsidiary of the global Hitachi conglomerate and is

very active on the global railway market, especially in Europe. In September 2015, HRS opened

its new manufacturing plant in Newton Aycliffe (UK). In the same year, HRS also acquired 40%

of the Italian Ansaldo STS/Breda shares for EUR 761 million.

The product line of the Hitachi Railway Business unit, is quite varied and covers rolling stock, on-

board components, power supplies, depot systems, signalling systems and traffic management

to station equipment.

Figure 38: © Total Rail Systems Supplier, Hitachi Railway Systems Website

The complete business employs 12,400 people globally (including 4,300 employees at Ansaldo

STS) with manufacturing plants in Japan, UK, Italy and the US.68

Global sales turnover exceeded JPY 500 billion (EUR 4.16 billion) for the first time ever in 2016,

and consisted of 56% in cars, 29% in transportation systems and 15% is turnkey solutions.

67 https://toyokeizai.net/articles/-/237684?page=2 68 https://www.hitachi.co.jp/New/cnews/month/2018/06/0608/20180608_05_rs_presentation_ja.pdf

https://toyokeizai.net/articles/-/237684?page=2

https://www.hitachi.co.jp/New/cnews/month/2018/06/0608/20180608_05_rs_presentation_ja.pdf


Keeping in mind that total sales were JPY 168 billion (EUR 1.4 billion) in 2014, this growth is both

remarkable and sustainable as the turnover in FY 2017 is JPY 560 billion (EUR 4.67 billion) and

the order book balance stands at JPY 2.85 trillion (EUR 23.7 billion).

Rolling Stock Market Players: Japan Transport Engineering Company (J-TREC)

Founded in 1946, became Tokyu Car in 1953 and in 2012, the company was rebranded to J-

TREC. J-TREC is a total transport engineering firm manufacturing rolling stock, cargo containers,

railway tracks and turnouts. J-TREC is a 100% subsidiary of JR East since April 2014.

Figure 39: © Car Product Line Up, J-TREC website

Headquartered in Yokohama, its main car manufacturing plant is located in Niitsu, Niigata

prefecture. Railway containers are manufactured at the Wakayama plant in the Kansai (Osaka

area) region. The workforce of 1,197 employees generated a sales turnover of JPY 56 billion

(EUR 466 million) in FY 2017.

J-TREC is the leading stainless steel (comparable to aluminium weight, eco-friendly) car

manufacturer with a total volume of over 23,000 cars since 1958, including more than 14,000 cars

manufactured in stainless steel, J-TREC’s signature product.


Export experience and overseas projects are limited but since 1993, J-TREC delivered a total of

68 Electric Multiple Units (EMU) and Diesel Multiple Units (DMS) to Irish Rail for fleet

replacements and deployment on Dublin Area Rapid Transit (DART). The first overseas Sustina

cars were shipped to Bangkok for servicing the Purple Line in September 2015.

Sustainability is currently the top priority company policy, and their newest product “Sustina" is

the crystallisation of that. The first domestic Sustina cars were delivered on March 2015 to JR

East for deployment on the JR Yamanote loop line around Tokyo. There are 3 Sustina models

being the commuter, regional and intercity version. There is also a hybrid variant for diesel and

battery. Major advantages of hybrids are 60% NOx and other harmful exhaust reductions, 10%

fuel efficiency improvement and 30dB noise reduction while stopped at stations.

In Europe-related news, in 2013, J-TREC signed a Memorandum of Understanding (MoU) with

Alstom (France) for introducing their Citadis (Light Rail Transit) tram cars into the Japanese

market. More than 1600 Citadis trams are used in over 40 countries like France, Germany,

Turkey, Tunisia, Australia, Morocco, Argentina, mainly due to low energy consumption and

barrier-free concept, which are also key aspects in the Japanese market.

The key takeaway for J-TREC is that they are now a 100% subsidiary of JR East, their biggest

client, together with Tokyu Railway. Given their limited international business experience, besides

their agreement with Alstom for Citadis, joint sales in the European market will definitely help in

getting into the international procurement system of JR East.

As sustainable business is high on their corporate agenda, any product or services re-using

materials, recycling, noise-reduction or lighter weight materials could make J-TREC a perfect

match partner in Japan.

Rolling Stock Market Players: Kinki Sharyo

Kinki Sharyo was established in and has been headquartered in Osaka since 1920. Its core

business focuses on manufacturing passenger cars. With its 1,000 staff, it has a production

capacity of 600 cars per annum, resulting in JPY 42 billion (EUR 350 million) turnover for 2018.


Target sales turnover, when the company celebrates its 100th anniversary in 2020, is set at

JPY 50 billion (EUR 416 million).

Figure 40: © Car Product Line Up, Kinki Sharyo Website

Kinki Sharyo is the manufacturer of the famous super-deluxe Mizukaze Twilight Express Train,

delivered to JR West at the end of December 2016.

Shareholders include 48% for the Kintetsu Group and 5% for JR West, since 2012. Main client is

JR West but also numerous regional private railway operators in the Kansai region use their cars.

Quite remarkable is that 76% of all sales is generated from overseas projects. In 1962, Kinki

Sharyo started exports to Egypt of trams and subways reaching a total volume of over 1600 cars

to date. During the fiscal years 2015-2016, cars were delivered from Japan to the Hong Kong

Metro project.

Kinki Sharyo International (KSI) is located in El Segundo, US and was incorporated in 1991.

KSI has exported 225 cars for subway projects in Dubai, 60 trams to Los Angeles County MTA

followed by a contract option for 175 cars exercised in 2012-2013. In addition, 35 cars were

delivered to New Jersey Transit and another 35 trams in 2014 following the execution of the

contract option. KSI will also provide additional 105 cars to Qatar Railways Company from 2020.


Figure 41: © Qatar Railways, Kinki Sharyo Website

Kinki Sharyo, besides having extensive selling and production experience overseas, is also open

to procurement from reliable overseas companies.

Rolling Stock Market Players: Niigata Transys

The company started out as an independent operation in 1910, then delivering its first diesel

engine in 1919. In 1949, it went public but filed for bankruptcy protection in 2001. It was reborn

as Niigata Transys in 2003, a 100% subsidiary company of the large Ishikawajima-Harima Heavy

Industries (IHI) group. Turnover stood at JPY 19.9 billion (EUR 165 million) in 2018 with 341

employees.

Its main business line focuses on rolling stock manufacturing, automated guideway transit, light

rail transit, maintenance vehicles for railway and passenger cars.


Figure 42: © Car Product Line Up Niigata Transys Website

Overseas sales mainly originate from its Hong Kong and Taiwan projects in recent years. In 2004,

Niigata Transys signed a technology licensing agreement with Bombardier for low floor light rail

car production in Japan.

It is among the smaller rolling stock production companies, but being a member of the large IHI

group, it can be an interesting business prospect in the future.

As it has had an agreement in place with Bombardier for over a decade, it is open to innovative

overseas technologies and services if those can help grow its business in Japan.

Rolling Stock Market Players: Alna Sharyo

Started as Naniwa Industries in Hyogo prefecture, became Alna in 1975 and Alna Sharyo in 2001,

when it also became a 100% subsidiary of Hankyu Railway. The smallest company in the rolling

stock production segment employs 133 people and specialises in delivering locally to Osaka and

smaller railway operators nationwide.

Historically, Hankyu Railways in Osaka and Tobu Railways in Tokyo have been its major clients

and the cumulative actual sales quantity surpasses 1,000 cars in total to each of them. In total,

the production output counter stands at +5,000 cars.


One of its core competences is the manufacturing of tram cars and to date, it has delivered over

700 trams to numerous railway operators all over Japan.

Alna Sharyo also produces passenger cars, performs maintenance services and car overhauls,

combined with the manufacturing of spare parts and other railway related equipment.

Figure 43: © Tram Product Line Up, Japan Overseas Railway System Association69

Alna Sharyo is a smaller domestic rolling stock manufacturing company with no direct

international business relations, but its acquisition in 2001 by Hankyu Railways, one of Osaka’s

major railway operators, might change that in the future.

For European railway companies with a business line related to trams, Alna Sharyo could be an

interesting and potential business lead.

3.2.2 EU Entry Opportunities

European railway industry companies that have safe, top-notch, advanced and financially

competitive products, systems and technologies for application in rolling stock and locomotives

have concrete business opportunities in the future Japanese railway market.

■ High performance wheel-mounted friction brakes for Shinkansen and High Speed Train (HST)

lines that enhance safe operations at maximum speeds over 300km/h;

69 www.jorsa.or.jp/en/members/alna/

http://www.jorsa.or.jp/en/members/alna/


■ Back up brake systems;

■ Earthquake emergency brake systems;

■ Remote and external control systems that can monitor brakes, endurance and status

(temperature, wear level of brake pads and disks);

■ Shorten brake distance systems (newest Shinkansen cars need 20% less braking distance to

full stop compared to earlier model cars);

■ Fleet maintenance, track and structure control systems and technology;

■ Train Operation Control (TOC) systems with Global Position Systems (GPS) embedded:

provide updates on exact status, route and location of car in real time;

■ Software for optimal crew and rolling stock utilisation ;

■ Fully active suspensions to enhance passenger comfort;

■ Electric power management systems to assure optimal operations;

■ Signals and telecommunications for Automatic Train Control (ATC);

■ Eco-friendly and energy saving technologies (newest Shinkansen cars consume 16% less

energy and CO2 emissions are now 1/12 the levels of airplanes);

■ Products, systems and technologies allowing safe operation at increased speed;

■ Bogie vibration detection systems;

■ Advanced cruise control systems.

European Companies active in Japan

Case Study: J-TREC and Alstom

In June 2013, J-TREC, a subsidiary of JR East and headquartered in Yokohama, and Alstom

from France signed a Memorandum of Understanding (MOU) regarding the introduction of Citadis

into the Japanese market.


Citadis is a class of low-floor trams developed by France based transportation company Alstom.

It is built on a standard platform which can be easily customised according to the needs of each

specific operator, an important feature for business success in the Japanese railway market.

Domestically, Alna Sharyo is the only real competitor when it comes to the manufacturing of low

floor trams.

J-TREC will review the Japanese market potential for Light Rail Transit (LRT) business

opportunities through in-depth market research. In the first phase, to be reviewed by both

partners. J-TREC was especially excited about the superior features of Citadis such as 100% low

floors enabling barrier-free boarding, no need for overhead wires, acceleration performance and

the smooth riding on the designated tracks.

Given the impressive global track record of Citadis over the past couple of years, combined with

the fact that most Japanese trams and existing LRT services, have been in operation for over 30

years, replacement business chances could be perfect timing. Key issues for business will be to

overcome the detailed Japanese technical specifications and the specific requirements of the

regional operators.

3.3 Railway Infrastructure, Service Provision and Maintenance


For FY 2019, JR East intends to invest a total of JPY 515 billion (EUR 4.29 billion), for improvements

and maintenance of their existing rolling stock, infrastructure and environmental services. This is an

increase of JPY 83 billion (EUR 69 million) versus their FY 2018 investment results.


JR East Investment Value (billion JPY)70

2019 Plan 2018 Results 2017 Results 2016 Results

Transport Services 5,150 4,323 4,244 3,831

Other Services 2,530 1,976 1,260 1,235

Total 7,680 6,299 5,504 5,067

Table 8: JR East Investment Value, JR East Website

JR Central, the future operator of the Maglev Line, announced a total investment value of

JPY 583 billion (EUR 4.86 billion) for FY 2019. This amount includes JPY 312 billion (EUR 2.6 billion)

for Shinkansen-related investments of which JPY 159 billion (EUR 1.32 billion) is allocated to generic

safety improvements. Almost half of the total budget, JPY 310 billion (EUR 2.58 million), will be used

for the Maglev construction work. Investments into Maglev infrastructure should only rise over the

next decade given the expected inauguration of the service in 2027.

JR Central, West, Kyushu and Freight Investment Plans (billion JPY)71

JR Central 2019 JR West

2017-2022

JR Kyushu 2019-2021

JR Freight

2016

Transport Services 62 280 60 13

Safety 159 530 70 20

Shinkansen 312 (Maglev) 380 N/A N/A

Others 50 80 210 0

Total 583 1,270 340 33

Table 9: JR Central, West, Kyushu and Freight Investment Plans, respective websites of each JR operator

As for multi-annual long-term investments, the major railway companies have announced as follows.

■ JR Central will invest a total of JPY 700 billion (EUR 5.83 billion) for major improvements into

the present Shinkansen infrastructure from 2014 through 2024.

70 https://www.jreast.co.jp/press/2018/20180414.pdf 71 https://www.jreast.co.jp/press/2018/20180414.pdf


https://www.google.com/url?q=https://www.jreast.co.jp/press/2018/20180414.pdf&sa=D&ust=1560080363203000&usg=AFQjCNH9AwBESNc5eGGLXUpkLbJzKZHKqA


■ JR West will perform a major overhaul of the Sanyo Shinkansen cars and tracks spread out

over 5 years, from 2017 until 2022 with a budget of JPY 380 billion (EUR 3.2 billion).

■ JR Kyushu, considering their Shinkansen services to Kagoshima and their recent Initial Public

Offering (IPO) in October 2016, will likely see similar long-term investment budgets in the

future, creating new business opportunities for European railway industry related companies.

At the beginning of 2017, its market capitalization was over JPY 600 billion (EUR 5 billion).

Separately, in the last 3 years, JR Kyushu invested about JPY 200 billion (EUR 1.66 billion)

in real estate development projects around Hakata and Kumamoto Station.72

Historically, Japan has operated trains on two different gauge systems namely the 1435mm (13%

of all tracks) wider standard gauge for high speed Shinkansen services and the 1067mm (87% of

all tracks) narrow gauge for conventional railway tracks.

Following market deregulations in 2002 specifying that final safety responsibility lies with the

railway operator, free-gauge trains will be deployed on the new Kyushu Shinkansen route from

Hakata (Fukuoka) to Nagasaki, scheduled for service launch in 2022. These new trains will

automatically adapt the distance between their car wheels to fit the different gauges.

Most of Shinkansen railway maintenance work is done overnight, between the arrival of the last

train in the evening around 11:30 pm and the departure of the first in the morning, at around 6 am.

For example, the Tokaido Shinkansen line is inspected by the famous “Doctor Yellow” car every

ten days at speeds of 270 km/h, covering over 1,100 kilometres from Tokyo to Fukuoka (Hakata

Terminal).

As for the spare parts market segment, this is directly linked to the long-term maintenance plans

of the major railways. The total market value was estimated at JPY 142.7 billion (EUR 1.2 billion)

in FY 2016, with the majority share of 87% for the domestic market and the remaining 13% for

exports.

72 https://www.jrkyushu.co.jp/company/ir/policy/pdf/plan2019_2021.pdf

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During FY 2017, the Big 16 railway companies, of which 14 are publicly listed, invested a total

amount of JPY 456.8 billion (EUR 3.81 billion) in transportation, infrastructure, maintenance and

service improvements. It is interesting to note here that the combined investment value of

JPY 456.8 billion (EUR 3.81 billion) is still smaller than the JPY 515 billion (EUR 4.29 billion)

invested by JR East alone.73

The biggest share of JPY 236.5 billion (EUR 1.97 billion) was set apart for safety

countermeasures like replacing old rolling stock with new and improved cars, cross road safety

enhancements like new signals, emergency stop buttons, objects hindering detection, home

doors on platforms, track obstruction detection, evacuation space under platform next to tracks,

earthquake resistant improvements and bringing ground tracks to elevated bridged level.

JPY 66.5 billion (EUR 554 million) was allocated to enhancing transport capacity, smoother

connections with lines to/ from the centre of Tokyo and upgrading of stations74.

On a service level, JPY 150.4 billion (EUR 1.25 billion) was invested in both new and extra

escalators, including elevators for improved barrier-free access to stations and tracks during FY

2017. New train schedule displays with bilingual functions were also largely implemented. 75

There are some differences year by year but on average the private operators invest about 15%

in better transportation capacity, around 60% in safer crossroads and maintenance in general,

24% for better services and 1% goes to miscellaneous investments.

73 https://www.mintetsu.or.jp/activity/databook/pdf/18databook_full.pdf

75 https://www.mintetsu.or.jp/activity/databook/pdf/18databook_full.pdf

https://www.mintetsu.or.jp/activity/databook/pdf/18databook_full.pdf


Figure 44: Big 16 Long Term Investments, Private Railways Big 16 Data Book 2018

Market Trends

As mentioned before, all major Japanese railway operators are continuously improving passenger

comfort and convenience through long-term investments into railway equipment, increased

transport capacity, service enhancements and expansion of barrier free provisions.

■ Increase passenger comfort in stations and in cars;

■ Create smooth and easy connections between with new and existing railway lines, operated

by other railway operators (interconnectivity);

■ Adopt common Integrated Circuit (IC) cards for commuter passes and electronic fare payments;

■ Expand ICT media investments through updated and bilingual Japanese and English websites;

■ Mobile devices and smartphones announcements via mailings, social network services (SNS)

updates on popular platforms like Twitter, Facebook and LINE;

■ Automatic issuances of digital certificates for train delays;

■ Digital tickets for online reservations, online seat reservations;

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Infrastructure 86 87 79 80 57 33 33 32 32 18

Service 542 548 679 536 813 643 760 1011 1038 1496

Maintenance 2066 2123 1803 1646 1633 1753 1835 2245 2287 2365

Rolling Stock 1329 1185 1021 608 593 566 502 612 598 665

BIG 16 LONG TERM INVESTMENTS: 2008-2017

Rolling Stock Maintenance Service Infrastructure


■ Credit card payments via mobile phones;

■ Online real time lost & found systems;

■ Multilingual passenger guidance and explanation by using tablets;

■ Announcements on operational service disruptions, in real time via newly designed

applications for both Apple and Android smartphones. (the regularly updated Tokyo Metro

smartphone application is popular among users in the Tokyo area as it provides a wide variety

of useful information as hours, train transfer instructions, station layouts and exits);

■ Install multilingual displays with real time information (JR East recently installed information

displays at 249 stations);

■ Expand barrier-free environmental enhancements as elevators, escalators, wider slopes,

guide blocks for the vision and hearing impaired, and specially equipped restroom facilities for

wheelchair users.

Market Players Infrastructure, Maintenance and Service Provisions: Nabtesco Corporation

Nabtesco’s main products like brake shoes, brake systems and door operating units, seat turning

equipment, various test equipment and snow removal devices are delivered to both domestic and

overseas markets. It has a 50% market share for brake systems and a 70% share for door

operating units in passenger cars in Japan. Nabtesco’s door operators are installed on all

carriages of the N700 Series Shinkansen.

Figure 45: © Product Line Up, Nabtesco Website76

76 www.nabtesco.com/en/products/railway.html

http://www.nabtesco.com/en/products/railway.html



■ Fleet maintenance, track technology and structure control systems;

■ Fully active suspension to enhance passenger comfort;

■ Innovative technologies that assist safe railway operations of free gauge trains in high speed

networks;

■ Electric power management systems to assure optimal operations;

■ Products, systems and technologies allowing safe operations at increased speed up to 360 km/h;

■ Snow melting systems for stable railway operations such as warm-water plates, warm-water

jet machines or sprinkler snow melting systems in mountainous areas for application on the

Tohoku, Joetsu, Akita and Hokkaido Shinkansen lines;

■ Bogie vibration detection systems;

■ Advanced cruise control systems;

■ Automated platform doors to enhance safety near railway tracks;

■ Multilingual signage boards with smart internet connections and low-energy consumption

features;

■ Universal design equipment for stations to enhance barrier-free access.


Case Study: Shinkansen Cars with Knorr-Bremse Friction Brakes

For the development of new Shinkansen cars with maximum speed capacity exceeding 300 km/h,

in 2004 JR East did long-term runs using both German and Japan made brake discs installed on

a FASTECH 360 test car.

Based on the test results, Knorr-Bremse friction brakes were officially selected as the main brake

system on all the E5 Shinkansen series that operate at a top speed of 320 km/h. In 2010, Knorr-

Bremse delivered the Shinkansen brakes to JR East.


■ Knorr-Bremse friction brakes are installed on the E5 and H5 series running on the Tohoku

Shinkansen and on the E6 series of the Akita Shinkansen lines – both lines run at a maximum

speed of 320 km/h

■ Knorr-Bremse friction brakes are also installed on the E7 and W7 series of the Hokuriku

Shinkansen line running between Takasaki and Karuizawa, where the tracks can

ascend/descend 30 meters in a 1000 meter stretch, profoundly burden the braking systems

of high speed cars. These severe operational conditions in mountainous areas clearly

demonstrate the durability of the German-made brakes.

From a risk management perspective, in order to avoid complete reliance on overseas products,

some E5 Shinkansen cars are equipped with similar domestically made brake systems.

Figure 46: © Shinkansen, Osamu Tsujimura

One of the main reasons why Knorr-Bremse friction brakes are superior in durability and quality

to similar domestic brake systems is historical. In Europe, usually locomotives pull passenger

cars, often under severe operating conditions through mountainous areas.


As a result of that, friction brakes are the default brake system for high speed trains in Europe.

These conditions necessitated continuous research and development of the structure, materials

and cooling of the brake discs and pads, resulting in friction brake systems of superior quality.

In Japan, where nearly all the high-speed Shinkansen cars have motors embedded in each car,

electric brakes have been used for reducing speed. Under speed loads under 300km/h, the

default electric brakes did not show any major quality issues but once the maximum speed

exceeded 300 km/h on newer Shinkansen lines, problems began to surface. In Japan, friction

brakes were mainly used as a sub-brake system to be activated only in emergencies or just before

the train comes to a complete stop.

As a note, the complete friction brake set includes the callipers, friction pads (lining) and discs

connected to both sides of the wheels. The system that controls the air pressure sent to the

callipers is manufactured domestically. Till recent, the complete brake set for Shinkansen cars

were made in Japan.

Figure 47: © Disc brakes on both sides of the wheels, yanmo/PIXTA


3.4 Railway Command, Control and Communications


Automatic Train Protection (ATP) systems and Automatic Train Control (ATC) systems have been

used widely in Japan since 1945. Via remote control rooms monitoring all railway traffic, these

systems provide back-up to prevent operational errors by train drivers and staff.

For some Shinkansen operations and certain regional JR railway operators, Japan employs

systems similar to the European Train Control System (ETCS). The high accuracy level allows

Shinkansen to safely run at over 300 km/h, even at mere 4-minute intervals between trains.

In 1996, JR East put in use the Autonomous Decentralised Transport Operation Control System

(ATOS) for 19 conventional lines around Tokyo. It was first used on the Rapid Express Chuo Line.

After 15 years of extensive ATOS usage, JR started to add gradually on-board Advanced Train

Administration and Communications System (ATACS) Radio Train Control System devices,

where older systems required ground equipment for train detection and control.

In 2016, JR East deployed a 100 Mbps Ethernet-based Train Communications Network (TCN)

called Integrated Train Communication/ Control networks for the Evolvable Railway Operation

System (INTEROS) in the new E235 series Sustina passenger cars on the Yamanote loop line in

Tokyo.

At speeds 10 times faster the previous system, INTEROS operates in real time and allows optimal

information sharing among the driver, onsite staff, control centre and maintenance depot.

INTEROS is also fully compliant with the International Electric Standard IEC61375-3-4.

Regarding the value of the electric components market, it is split between 64% for domestic use

and 36% exports. The total value of this market for the railway industry in Japan is estimated at

JPY 204.6 billion (EUR 1.7 billion) for FY 2017.77

77 https://www.tetsushako.or.jp/english/english01.html


Market Trends

To further reduce future human errors leading to accidents, Japanese railway operators are

constantly looking for faster, more reliable, real-time control and communications systems.

Examples of smart monitoring systems like temperature sensors, electricity and track facility

monitoring devices are shown below for the new Sustina E235 series car, operating on the

Yamanoto line since 2016.

Figure 48: © New Sustina E235 series car, JR East Website

In 2015, JR East decided to test the new Communications-Based Train Control System (CBTC)

technology of Thales from France for potential deployment in 2020 on the Joban line. It was

evaluated against the domestic Advanced Train Administration & Communications System


(ATACS). However, at the end of 2017, JR East announced that it decided to stop the CBTC pilot

project with Thales from France due to technical and financial aspects. JR East will continue with

the new wireless ATACS system, jointly developed by Hitachi and Mitsubishi Electric given the

optimal compatibility with the existing ATOS system of JR East.78

JR East debuted the ATACS system on 12 November 2017 on their Saikyo Line, between

Ikebukuro and Omiya over a distance of 23.5 kilometres.79

Market Players Command, Control and Communications: Meidensha

Meidensha has a consolidated turnover of JPY 241 billion (EUR 2 billion) for FY2018, with 10%

generated by its railway business. It is the market leader for supplying Alternating Current (AC)

and Direct Current (DC) traction power supply systems to railway operators (35% market share

for Shinkansen, 15% for JR and Big 16 operators).

It also supplied the new 149 kilometres long Hokkaido Shinkansen line’s 3 new stations with

traction power supply systems. This project was completed by the end of FY2017 at a contract

value of JPY 10 billion (EUR 83 million).80

Meidensha is an active global player and is especially strong in Asia with recent projects in

Singapore (JPY 40 billion [EUR 333 million], 102 kilometres, 23 stations), Malaysia

(JPY 12 billion [EUR 100 million], 51 kilometres, 31 stations) and India. Meidensha is aiming for

a 1.6% global market share by 2020.

Meidensha also manufacturers Overhead Catenary Systems (OCS), inspection systems and

power monitoring systems.

78 https://www.nikkan.co.jp/articles/view/00446042 79 https://www.jreast.co.jp/press/2017/20171004.pdf 80 https://www.meidensha.co.jp/news/news_03/news_03_01/__icsFiles/afieldfile/2015/04/20/141106dentetsu.pdf

https://www.nikkan.co.jp/articles/view/00446042



Figure 49: © Product Range, Meidensha Website81

Market Players Command, Control and Communications: Kyosan Electric Manufacturing

Kyosan Electric Manufacturing is a major player in domestic railway signalling systems, Automatic

Train Control (ATC) and Automatic Train Stop (ATS) equipment, platform safety gates, traffic

control systems, traffic control centrum, signal and info boards and power supply units for signals.

For FY 2018, consolidated turnover was JPY 111 billion (EUR 925 million) with 4,096 employees.

Kyosan Electric mainly exports its products to Asian markets, but the US, Brazil and Venezuela

have been serviced in the past.

Figure 50: © Signal System Line Up, Kyosan Electric Website82

81 www.meidensha.com/products/railwaysystem/index.html 82 www.kyosan.co.jp/english/

http://www.meidensha.com/products/railwaysystem/index.html

http://www.kyosan.co.jp/english/



As for EU business and market entrance opportunities in the Japanese Railway Command,

Control and Communications segment, the below mentioned bullet points show the largest

potential for innovative European railway technology manufacturers.

■ Fleet maintenance, track and structure control systems and technology;

■ Train Operation Control (TOC) systems providing real time status, route and car location;

■ Software for optimal crew and rolling stock utilisation;

■ Electric power management and control systems to optimise operations;

■ Signalisation and telecommunications for Automatic Train Control (ATC) and Automatic Train

Stop (ATS) systems;

■ Signalisation and Indicators using Light Emitting Diodes (LED) for reduced power

consumption (1/4 of traditional signals) and less frequent light bulb replacements;

■ Advanced cruise control systems

European Companies Active in Japan: Command, Control and Communications

Case Study: Tokyo Monorail and Harting Ethernet Connection

At the end of 2014, Harting Japan, a subsidiary of the Harting technology group from Germany,

announced that its Ethernet connectivity products were adopted for the on-board network of all

new 10000 series Tokyo Monorail trains.

Figure 51: © Ethernet Connectors, Harting Japan website83

83 www.harting.co.jp/news/page_10096/detail/article/10000-002923/

http://www.harting.co.jp/news/page_10096/detail/article/10000-002923/


For Harting Japan, this is its second important order from a major Japanese railway operator,

following deployment in the new 50000 series rapid express Shimakaze for Kintetsu in the Osaka

region in 2013.

Its products provide a seamless Ethernet connection at 100Mbps per second, including intercar

jumpers that ensure high transmission quality that enable reliable train operations and multilingual

passenger information services in up to four languages on on-board LCD screen. This helps keep

international passengers informed while they travel to and from Haneda Airport.

Figure 52: © Tokyo Monorail’s new 10000 series84

Case Study: Japanese Railway Cars and Siemens Mobility Japan

Siemens Japan was established in 1981 and its railway division, Siemens Mobility Japan, has

been delivering key electrical parts for various Japanese railway operators since then. Its

components are included in cars of the E501 series, E2 series Shinkansen cars and ED57 series

of JR, Tokyu 2100 series, Tokyu Shin 1000 series, Enoshima Railway 1 series, Meitetsu Bisai

EL1 series, Hiroshima Railway 5000, Joshin Railway DeHa 1 and SaHaNi 1 series, Joshin

Railway DeKi 1 series and Tokyo Metro E5000 series.

84 www.harting.com

http://www.harting.com/


3.5 Railway Security, Safety and Crisis Prevention and Management


From its establishment in 1987 until 2018, JR East has invested nearly JPY 4 trillion

(EUR 33.33 billion) in the security, safety and prevention segment. For the 5-year period

beginning 2019, JR East will invest almost JPY 1.5 trillion (EUR 12.5 billion) in safety-related

areas in order to target zero railway related accidents in the future. A similar approach in security

and safety investments can be seen at all other JR companies and major railway operators

nationwide.

Although the data85 are from 2011, a comparison between the number of accidents (including

collisions, derailments and fires) in Japan, EU and the US, clearly shows the high safety level in

the Japanese railway business.

■ Japan: 0.009 accidents per million train kilometres

■ EU: 0.050 accidents per million train kilometres

■ US: 1.426 accidents per million train kilometres

Even during the 2011 Tohoku earthquake in Japan, no casualties were linked to Shinkansen

operations. As Shinkansen cars are equipped with a state-of-the-art early earthquake detection

system, all trains in operation stopped safely within 90 seconds of sensing the earthquake, even

those that were running in excess of 300km/h at the time the earthquake hit Japan.

From 1965 to 2015, all Japanese railway operators have been replacing the older Type 2 signals

at railroad crossings with safer and automatic Type 1 signals and bars. Thanks to these

replacements, total incidents have decreased from 1,298 in 1965 to 248 in 2018. Presently, 99%

of all railway crossings nationwide are Type 1.

85 Railway Bureau, Ministry of Land, Infrastructure, Transport and Tourism


For the remaining 1%, most of the railway operators are negotiating with the local municipalities

for the installation of Type 1 signals and bars.

Figure 53: © Type 1 and Type 2 Signalization at Railroad Crossings86

Increased safety and security measures are not limited to signal replacement only. Some

operators like Odakyu and Seibu have elevated their ground tracks, thus reducing the incident

rate to zero for both passengers and vehicles.

Given the rather high suicide rates involving trains and subways, a strong emphasis is placed on

the instalment of platform doors in recent years. These doors not only reduce accidents of

disabled passengers but have also proven effective in reducing incidents involving drunk

passengers.

There are two kinds of safety doors - floor-ceiling walls, usually installed on new lines, and shown

below on the Namboku Subway Line in Tokyo.

86 Railway Bureau, MLIT


Figure 54: © Floor-Ceiling Walls, Kawasaki Heavy Industries Website87

Half-sized walls and doors are usually added to existing lines to increase safety and security on

the platforms near the tracks. These are more common for outdoor installations and at older

stations that lack the physical structure to support the full floor to ceiling type.

87 www.khi.co.jp

http://www.khi.co.jp/


Figure 55: © JR East New Style Smart Home Doors

JR East will add these new light weight home doors at 15 extra stations by the Tokyo 2020

Olympics in July 2020.

Market Trends

New control and management systems continue to be introduced to achieve zero accidents and

to reduce internal management risks through active utilisation of innovative developments in ICT,

big data analysis, and Global Positioning Systems (GPS).

Additionally, technologies and systems that minimize or decrease effects of external risks and

natural disasters such as torrential rains, strong winds and worst case scenarios, major

earthquakes like the Hanshin (1995), Tohoku (2011), Kumamoto (2015) and Hokkaido (2018), all

of which created major operational disruptions are needed.


Especially, products and systems preventing derailments in any case are being sought after by

many Japanese railway companies at present.

Market Players: Nippon Signal

Nippon Signal is one of the main domestic players in signal, control and safety systems such as

railway signal systems, traffic information systems, Automatic Fare Collection (AFC) systems,

and Communications-Based Train Control (CBTC) systems. The group, with 1,255 employees

realized a consolidated turnover of JPY 99 billion (EUR 825 million) in FY 2018. The signal and

traffic business segment represents about 55% and the AFC segment is the remaining 45% of its

total turnover.

Nippon Signal has global export experience to over 20 countries including Turkey, Argentina,

Brazil and Taiwan, but none in Europe so far.

Figure 56: © Product Line Up, Nippon Signal Website88

Market Players: Daido Signal

Daido Signal focuses on manufacturing railway signalling systems, including electronic

interlocking systems, automatic train control systems, traffic control systems, monitoring devices

for railway equipment, train detectors, automatic train stop systems (ATS), level crossing

protection equipment and signal lights.

88 www.signal.co.jp/english/

http://www.signal.co.jp/english/


Railway signalization represents 90% of its consolidated JPY 24.8 billion (EUR 206 million)

turnover, with JR East being their biggest customer at 50% value share. Private railway operators

account for an additional 30% and other JR companies make up the remaining 20%. Daido Signal

has almost no export experience.

Figure 57: © Product Line Up, Daido Signal Website89


Opportunities exist for European railway industry companies with top quality and innovative

products and control systems featuring accident prevention and specific focus areas like

derailments for both low and excessive speed and railway crossing derailments.

All major Japanese railway companies consider this to be a key safety factor in their future long-term

safety investments and would consider overseas procurement if the competitive advantage is clear

when compared to domestic systems. Additional areas of opportunity are in the following areas.

■ High-performance wheel mounted and friction brakes for Shinkansen and High Speed Train

(HST) lines that enhance safe operations at speeds exceeding 300km/h;

89 www.daido-signal.co.jp

http://www.daido-signal.co.jp/


■ Back-up brake systems and brake systems to assist trains in immediate stopping (emergency

train-stop systems);

■ Earthquake emergency brake systems and earthquake early notification technologies;

■ Remote and external control systems that can monitor brakes, endurance and status

(temperature, wear levels of brake pads and disks);

■ Reduced braking distance systems (newest Shinkansen cars now need 20% less distance to

come to a full stop compared to earlier models);

■ Electric power management systems to ensure optimal operations during natural disasters;

■ Products, systems and technologies allowing safe operations exceeding 300km/h for newest

Shinkansen cars;

■ Advanced cruise control systems to further reduce human errors;

■ Prevention of structural damage by strengthening bridges and viaducts with seismic

reinforcement measures;

■ Systems to avoid derailments and secondary accidents;

■ Enhanced telecommunications systems during disasters;

■ Rail rollover prevention devices and equipment.


Case Study: JR West and MerMec Track Inspection Technology

Eiji Tsubone, General Manager of JR West, announced during the 3rd EU Japan Railway Industrial

Dialogue, Brussels, in May 2015 that MerMec from Italy was awarded the implementation of a track

surface inspection, measurement system and a head-check inspection system in one platform.

After a long tendering and evaluation process for machine-vision technology suppliers, MerMec

was selected, becoming the first overseas supplier to deliver and install machine-vision inspection

technology in Japanese railways.


The contract includes supplying 3 V-Cube sets with 3 track inspection and 3 fishplate inspection

systems installed on selected JR West vehicles. Over 5,000 km of JR West tracks at 1,067mm

gauge, including almost 650 km at 1,435 mm gauge of the Sanyo Shinkansen line, will be

inspected by MerMec’s products.

Figure 58: © Mermec V-Cube Technology, Railway Gazette

MerMec’s V-Cube technology automatically identifies and evaluates various types of defects such

as sleeper cracks, fastener conditions, missing bolts, corrosion and welding during the visual track

inspection.

Partial deliveries were done in 2016, with the remaining balance that was refilled at the beginning

of 2017. The total order value is estimated at 6.65 million euro and includes trading powerhouse

Mitsui & Co as contractual partner.

MerMec is presently also in commercial talks with several other Japanese railway operators and

hopes that this first JR West project triggers additional new orders.


4. Regulations

4.1 Technical Railway Standards

The last major revision to the Japanese Technical Railway Standards was done in March 2002,

when the Railway Bureau of the Ministry of Land, Infrastructure, Transport and Tourism (MLIT)

Railway Bureau decided to add new 3rd layer, being governmental guidelines based upon

suggestions from the railway industry. The previously mentioned Operation Safety Clause (OSC)

belongs in this category and is often referred to as one of the major non-tariff barriers for overseas

suppliers.

Even after this revision, the top principle remains passenger safety. Railway operators can now

adapt easier new technologies that enhance safety, without prior governmental approval, but bear

complete responsibility for the actual implementation.

Figure 59: © Railway Operations Law, Naoto YANASE90

90 UIC Senior Advisor High Speed, JR East Paris Office, 2011


The Railway Operations Law and the Technical Regulatory Standards on Japanese Railways are

mandatory, and each Japanese railway company is required to comply.

Figure 60: © Technical Standards System in Japan, Railway Bureau, MLIT

The main clauses of the mandatory technical standards consist of safety, policies, convenience

and environmentally friendly operations.


Figure 61: © Framework of the compulsory railway technical standards in Japan91

Railway operators must avoid accidents by continuously improving facilities, executing

appropriate maintenance of rolling stock and facilities, and providing adequate education to

railway staff. Since the 2002 revision, technical regulations for high-speed (Shinkansen) and

conventional lines are basically the same.

An English translation of the Ordinance of the Ministry for Technical Standards for Railway is

available in pdf format (424 pages) at the MLIT website.

www.mlit.go.jp/english/2006/h_railway_bureau/Laws_concerning/14.pdf

91 www.jica.go.jp

http://www.mlit.go.jp/english/2006/h_railway_bureau/Laws_concerning/14.pdf

http://www.jica.go.jp/


Figure 62: © Table of Content Ordinance of the Ministry for Technical Standards for Railway

The Railway International Standards Centre promotes standardisation activities such as the

development and revision of international standards for railway applications for inclusion of

advanced Japanese railway technologies in IEC and ISO international standards.

Within the Japanese Industrial Standards (JIS), railway-related identification begins at the

alphabetic letter E (JIS E 1101).


5. Annexes

Business Development to the Railway Industry in Japan

Japan Overseas Railway Association

For European railway industry companies wishing to access the Japanese market, the Japan

Overseas Railway System Association (JORSA) could be a good start. It provides direct

introductions to its members most suitable for specific business segments. JORSA’s website in

English can be found here: http://www.jorsa.or.jp/en/

Its corporate members are internationally business minded. They all have in-house English-

speaking staff and are looking actively to increase their business volume in overseas markets.

Further they are open to any future business tie-up that could be beneficial for them in the

competitive Japanese domestic market to differentiate them from their competitors.

Some visual examples of railway equipment manufactured by JORSA members.

http://www.jorsa.or.jp/en/


Figure 63: © Examples of Domestic Railway Equipment, JORSA website


Railway Industry Organisations

Contacting professional railway organisations in Japan will help establish faster business relations

as finding the exact division and person in charge within large companies like the JR Group or

the Big 16 private railway operators can be very time consuming and expensive.

■ Japan Association of Rolling Stock Industries (JARI): www.tetsushako.or.jp/english/

■ Japan Overseas Railway System Association (JORSA): www.jorsa.or.jp/en/

■ Association of Japanese Private Railways (Mintetsu): www.mintetsu.or.jp/en/

■ Japan Subway Association (JSA): www.jametro.or.jp/en/

■ Japan Railway Civil Engineering Association (JRCEA): www.jrcea.or.jp

■ Association of Railway Architects (ARAN): www.aran.or.jp/english

■ Japan Railway Technical Service (JARTS): www.jarts.or.jp/index_en.html

■ Railway Technical Research Institute (RTRI): www.rtri.or.jp/eng/rtri /

Railway Industry Trade Fairs

Visiting or participating in railway-specialised trade fairs in Japan will help build a deeper

understanding of the Japanese railway market while putting you in direct contact with potential

customers at both the major and smaller railway equipment manufacturers.

When visiting trade fairs in Japan, distributing your business cards and product brochures

prepared in Japanese to potential customers and business contacts are ideal business

development tools.

■ Mass Trans Innovation Japan: www.mtij.jp/english/

■ Station and Airport Terminal Expo: www.jma.or.jp/tf/en/sat/en/

■ Logis-Tech Tokyo: http://logis-tech-tokyo.com/

http://www.tetsushako.or.jp/english/

http://www.jorsa.or.jp/en/

http://www.mintetsu.or.jp/en/

http://www.jametro.or.jp/en/

http://www.jrcea.or.jp/

http://www.aran.or.jp/english

http://www.jarts.or.jp/index_en.html

http://www.rtri.or.jp/eng/rtri

http://www.mtij.jp/english/

http://www.jma.or.jp/tf/en/sat/en/

http://logis-tech-tokyo.com/


Railway Industry Specialised Press

Marketing and communications through Japanese press releases on global project references,

via specialised railway press and their websites might help in acquiring sufficient brand

recognition and trustworthiness as a potential business partner for overseas procurement.

■ JR Gazette: www.kotsu.co.jp/magazine/gazette/

■ SUBWAY: www.jametro.or.jp/publication

■ Mintetsu: www.mintetsu.or.jp/association/mintetsu/

EU-Japan Railway Industrial Dialogues

Participation in the above-mentioned and regularly held EU-Japan Railway Industrial Dialogues

could be the fastest way to meet decision makers and executives of major Japanese railway

companies as all stakeholders are present at these conferences.

European Business Council, Railway Committee

The European Business Council (EBC) is an umbrella organisation composed of 16 European

National Chambers of Commerce representing around 2,500 European corporations in Japan.

The EBC has 26 industry committees, including one for railways.

www.ebc-jp.com/index.php/about-the-ebc/734

The EBC Report on the Japanese Business Environment, a white paper aimed at improving

business conditions for European companies in Japan, is published annually and contains useful

recommendations for all stakeholders, including the railway industry.

http://www.kotsu.co.jp/magazine/gazette/

http://www.jametro.or.jp/publication

http://www.mintetsu.or.jp/association/mintetsu/

http://www.ebc-jp.com/index.php/about-the-ebc/734


Foreign Railway Industry Companies in Japan

Knorr-Bremse Railway Systems Japan

As the world's leading manufacturer of braking systems for rail and commercial vehicles, Knorr-

Bremse has been pioneering development, production and marketing of modern braking systems

for a variety of applications for over 100 years. The group has manufacturing plants in over 25

countries, more than 24,000 employees, and consolidated global sales exceeding 5.8 billion euro

in 2015.

Besides brakes, Knorr-Bremse also manufacturers door systems, air-conditioning systems,

control components and wipers for railway operators. The railway business segment has over

14,000 employees with a sales turnover of 3.34 billion euro in 2015.

Knorr-Bremse Railway Systems KK was established as a joint venture named Koshin Knorr KK

in 1992. Their core business was focused on compressors but was later merged into the Knorr-

Bremse Railway System Japan KK, a 100% subsidiary, which also acts as their Asia Pacific

headquarters.

www.knorr-bremse.jp/ja/

Siemens Mobility Japan

Siemens KK was established in Japan in 1981, including the Mobility Business Division that

oversees their railway business in Japan. It provides mainly motors and electrical railway-related

products and services.

■ Cars for both short and long distance, subway cars, trams and light rail, unmanned cars, steam

locomotives

■ Signal and signal control technology for passenger and freight railways

■ Electrical solutions for railway and public transport

■ Maintenance service for cars and infrastructure

http://www.knorr-bremse.jp/ja/


■ Payment systems for public transport

■ Management, construction, financial procurement, planning and consulting for turnkey mobility

systems

http://www.siemens.com/jp/ja/home.html

Harting KK

In 1985, Harting KK was established in Japan with headquarters Yokohama and three regional

sales offices in Nagoya, Osaka and Fukuoka to ensure delivery of perfect after-service and quality

assurance. Harting KK, part of the German Harting Group, supplies connectors for railway

applications in both rolling stock and railway equipment.

The high-quality reputation of its products in Japan is thanks to its automated production. Another

important reason for its business success has been a flexible production approach to customized

products.

www.harting.com

Mersen Japan

Mersen from France is a global expert in electrical power and advanced materials, and designs

innovative solutions to address specific client needs. This enables Mersen to optimise its

manufacturing processes in various industrial sectors. It is famous for industrial fuses used in

subways, trams, trolley busses, electric and diesel locomotives which are also applicable for

almost all railway systems.

Mersen Japan was established in Japan with 4 sales offices in 1981. They are well known for

high quality electrical products that have superior technology and high safety levels.

www.mersen.com/en/

http://www.siemens.com/jp/ja/home.html

http://www.harting.com/

http://www.mersen.com/en/


Souriau Japan

A 100% owned subsidiary company of Souriau SA from France, Souriau has been present in

Japan since 1963. Souriau Japan was incorporated in 2003 and currently employs 25 people.

Souriau supplies full interconnection systems to Japanese railway operators for the interior of

cars and equipment within cars, in addition to signalization purposes like beacons, speed control

devices and traffic control systems.

www.souriau.com

Nihon Weidmueller Co., Ltd.

A subsidiary of the German Weidmueller Group, present in over 80 countries globally. In Japan

since 1980, its is headquartered in Tokyo with sales offices in Nagoya, Osaka and Fukuoka.

Its core business involves importing and selling electrical components to railway operators of

HST, trams, subways and locomotives.

www.weidmuller.co.jp

Thales Japan

Thales from France is one of leading suppliers of advanced solutions for railway transport. A wide

product line-up includes automated signalling and train control, operation control centres and

passenger information, contactless ticketing technology systems. All products aim at increasing

performance and line capacity while reducing operating, maintenance and infrastructure costs.

Since 1970, Thales has been active in the Japanese market for over 45 years, and currently

employs about 55 staff at offices in Tokyo, Haneda and Osaka. In Japan, it mainly supplies

signalization systems, communication systems and automatic gates to public transport operators.

JR East recently did a pilot test with Thales to design their new generation CBTC systems for the

Joban line but stopped the test in favour of domestic technology.

http://www.souriau.com/

http://www.weidmuller.co.jp/


In 2015, Thales Japan became a member of a Japanese consortium of four companies, including

Mitsubishi Heavy Industries, Mitsubishi Trading, Hitachi and Kinki Sharyo, to collaborate on new

projects in global markets. Together, it won the Dubai metro tender, which is one of the largest

global subway projects ever. Completion of this project is scheduled for end of 2019.

www.thalesgroup.com/en/global/activities/ground-transportation

Consolis Rail International Japan

Consolis Rail International Japan is recent newcomers in the Japanese market. It was established

in November 2014 and is a 100% subsidiary of the France-based Consolis Rail International,

which specializes in the design and manufacture of sleepers for railway operators.

Consolis Rail does business in 14 countries and manufacturers over 3.5 million sleepers per year.

Strong R&D capacities assure a continuous flow of innovative products for applications on HST,

express lines, public transport and heavy freight lines.

www.consolis.com/rail/

Goldschmidt-Thermit Japan

Elektro-Thermit, a member of Goldschmidt-Thermit-Group from Germany, incorporated

Goldschmidt-Thermit Japan in February 2010, which was previously its representative office for

Japan.

Since 1979, together with its long-term Japanese business partner, Mi-ne Seisakusho, they

supply rail welding solutions using the latest technology. Goldschmidt-Thermit Japan also imports

and distributes track equipment and measuring devices.

www.goldschmidt-thermit.co.jp

http://www.thalesgroup.com/en/global/activities/ground-transportation

http://www.consolis.com/rail/

http://www.goldschmidt-thermit.co.jp/


Schunk Carbon Technology Japan

Schunk Carbon Technology from Austria is the leading global manufacturer of carbon sliding

strips and carbon brushes for railway applications, including high speed railways, electric freight

locomotives and subways. Its Japanese subsidiary is located in Yokohama.

www.schunk-group.com

Nihon Getzner

Since 1969, Austria-based Getzner has specialized in vibration isolation that minimizes the need

for maintenance and repairs on tracks and vehicles. The Tokyo office of Nihon Getzner was

launched in 2002.

www.getzner.com

Saft Japan

The newest kid on the block in Japan, is Saft from France, who incorporated its Japan subsidiary

in February of 2016. Saft is a leading manufacturer of advanced technology for the railway

industry, amongst others.

For almost 30 years, Saft was represented in Japan by Sumitomo Corporation, one of the biggest

Japanese trading houses.

In December 2016, Saft was awarded a contract by Kawasaki Rolling Stock to provide batteries

for the 91 Singapore unmanned Mass Rapid Transit (MRT) cars, valued at several million USD,

their biggest Asia contract till date. Deliveries will start in August 2017 and last till January 2021.

www.saftbatteries.com

TUV Rheinland Japan

Since 1978, TUV Rheinland has been present in Japan as a 100% subsidiary of the global TUV

Rheinland Group from Germany. TUV Rheinland Japan has seven office locations nationwide.

http://www.schunk-group.com/

http://www.getzner.com/

http://www.saftbatteries.com/


TUV Rheinland Japan specializes in providing product safety services for the railway industry,

including evaluation and certification of railway systems, rolling stock and components for

deployment in the Japanese market.

www.tuv.com/en/japan/home.jsp

TUV SUD Japan

TUV SUD Japan was established in 1993 and provides a wide range of consulting, engineering,

testing, certification and training services for conventional, high-speed, metro and light rail but its

expertise is not limited at all to the railway business segment only.

Globally, TUV SUD possesses 50 years of experience in delivering safe and reliable railway

systems and processes for rolling stock, infrastructure, electrical and mechanical systems as well

as for generic safety components.

www.tuv-sud.jp

http://www.tuv.com/en/japan/home.jsp

http://www.tuv-sud.jp/


Japanese Railway Business Overseas

Case Study: Hitachi Rail Europe (UK)

As the global railway market is expected to see an average annual growth of 2.5% over the next

few years, and revenues expected to reach JPY 22 trillion (EUR 183 billion) by 2020, it is easy to

understand why Japanese railway companies are looking for opportunities beyond their domestic

borders.

This will be key for future sustainable growth and the Hitachi Railway business unit has been one

of the first to grab business opportunities via a long-term growth strategy in the UK market,

combined with a proactive global M&A strategy in Italy in recent years.

The Hitachi Railway Business unit product line is very wide and includes rolling stock, on-board

components, power supplies, depot systems, signalling systems, traffic management and station

equipment.

Figure 64: © Total Railway Systems Supplier, Hitachi Railway Systems Website

Its complete global business employs 12,400 people (including the 4,200 employees of Ansaldo

STS) with manufacturing plants in Japan, UK, Italy and the US in FY2017.

Global sales turnover capped JPY 563 billion (EUR 4.69 billion) in FY2017. The breakdown

mainly includes 53% cars, 26% transport systems and 12% turnkey solutions. Considering its


total sales was JPY 168 billion (EUR 1.4 billion) in 2014, this growth is quite remarkable and

sustainable as the order book balance stands at JPY 2.85 trillion (EUR 23.75 billion), its highest

ever. 92 According to CEO Alistair Dormer, Future sales targets stand at JPY 640 billion

(EUR 5.33 billion) for 2018, with 80% of all sales coming from overseas projects, while targeting

25% of all sales as turnkey projects. Hitachi’s CEO Higashibara is targeting JPY 1 trillion

(EUR 83 billion) in sales by 2020 via continuous global M&A efforts. Hitachi is deeply committed

to become a real global player that shows clearly in the fact that the CEO of the Hitachi railway

business unit is Alistair Dormer, who joins three other non-Japanese on their eight-member board.

This ambitious Hitachi global growth plan is making the Big 3 worried as its present turnover is in

the JPY 800 billion to JPY 900 billion (EUR 6.66 ~ 7.5 billion) range. Once on that level, Hitachi’s

competition will not be limited only to the Big 3 as the Chinese competition with CRCC, boasting

JPY 3.5 trillion (EUR 29 billion) turnover, will also be watching their moves.

Hitachi entered the UK market in 1999, and their new manufacturing plant in Newton Aycliffe,

County, Durham, went into production at the end of 2014. The total investment value of the plant

stands at almost 100 million euros and has a monthly production capacity of 35 cars. Its railway

service and maintenance depot in North Pole opened in September 2015. Presently, Hitachi

Railway Europe employs over 1,000 people but is also targeting 2,000 jobs spread over 14

locations in the UK by 2019.

In June 2014, Hitachi Rail received an IEP (UK Intercity HST) order valued at JPY 550 billion

(EUR 4.58 billion), the biggest railway order ever awarded in the UK. This was also the moment

when the Big 3 clearly witnessed the high evaluation of Japanese railway technology in an

overseas market. In December 2016, the first UK-built Intercity Express Train rolled out of the

Newton Aycliffe plant.

92 https://www.hitachi.co.jp/New/cnews/month/2018/06/0608/20180608_05_rs_presentation_ja.pdf


Figure 65: © Intercity Express Train, Hitachi Railway Systems Europe Website93

End of 2015, Hitachi acquired Ansaldo Breda-Newco three manufacturing plants: One each in

Pistoia, Naples and Reggio Calabria (both Italy), and one in Pittsburgh (US). As a result, Hitachi

Railway Systems, doubled its global sales from JPY 167.4 billion (EUR 1.395 billion) in 2014 to

JPY 352.6 billion (EUR 2.938 billion) in 2015.

Recent orders in the UK include the First Group (2016, 70 million Euros value, five AT300 trains

with five cars), TransPennine Express, First Great Western, Scotland Glasgow Subway and

Schedule Management Projects.

On a global scale, deals were recently closed in Russia, India, Thailand, Italy (2015,

EUR 190 million, additional 136 rail vehicles consisting of 112 intermediate double-decker

93 www.hitachirail-eu.com

http://www.hitachirail-eu.com/


coaches and 24 driving cars out of total contract of 706 carriages, consisting of 575 intermediate

double-decker cars and 131 driving cars to Trenitalia), a monorail project in Korea, the Ho Chi

Minh City Metro project in Vietnam, a large inverter project for the Sint Petersburg subway,

signalization projects in China, car deliveries to Taiwan, Singapore, Myanmar and the US. These

are in addition to sales in the home Japan market where it had new Shinkansen cars and battery-

powered cars. Hitachi Rail also opened a sales office in Singapore.

Finally, in March 2016, Hitachi Rail US opened a new Miami manufacturing facility, creating 100

new jobs. The plant will start manufacturing 136 cars and 272 motor bogies for delivery to the

County's Metrorail fleet starting from early 2017. The total production run will continue through

the first half of 2019.

Case Study: Mitsui Trading (UK)

Inspired by the successful footsteps of Hitachi into the UK market, Mitsui Trading is the newest

Japanese entry into the global railway business, In January 2017, Mitsui acquired 40% of shares

from Abellio UK, a subsidiary company of Dutch Rail and investor East Anglia since February

2012, a local UK railway operator. East Anglia is active mainly in the Eastern part of England,

operates 1,300 trains daily, and employs almost 3,000 people. This is also the first project where

a Japanese company has gotten directly involved in railway operations in the UK.

The total investment value has not been disclosed but is estimated at several billions JPY. The

HST line between London and Cambridge/Norwich (areas acting as bed towns to London) was

selected due to increased population along the line and brisk overseas railway business in

general. Total length of the line exceeds 1600 kms of East Anglia rail network and Dutch Rail and

Mitsui aims to replace the 1240 older cars with 1000 new ones, in addition to improving the time

schedules to enhance passenger comfort and convenience. The contract period runs through

October 2025. Increases are targeted to double present ridership of 350,000 daily. On an annual

basis, 140 million passengers are currently served.


Figure 66: © East Anglia Cars, BBC website94

This recent move into the UK market follows railway business experience that Mitsui built in the

Brazilian market since 2007 and was not only related to passenger and freight but also to delivery

of cars and infrastructure work.

Mitsui is also teaming up with Abellio and JR East for increasing business beyond the UK in

Europe overall through participation in public tenders like the West Midlands, with the

announcement expected in June 2017.

Case Study: Kawasaki Rolling Stock Company (US)

In 1906, Kawasaki started with rolling stock manufacturing and was the first to develop steam

locomotives and aluminium cars in Japan. Presently, Kawasaki has a large car, bogie and

equipment division supplying all major railway and subway operators in Japan. Its two

manufacturing plants are located in Hyogo prefecture, near Kobe.

94 www.bbc.co.uk

http://www.bbc.co.uk/


To date, Kawasaki has produced over 90,000 cars. The production range varies from passenger

trains (high speed, intercity, rapid transit and monorail), locomotives, freight EMU and cars and

finally bogies. In recent years, their business of safety doors on platforms has been performing

well due to brisk demand by the major railway operators.

Monthly production capacity in Japan is about 80 passenger cars and 8 locomotives.

Figure 67: © Product Range, Kawasaki Heavy Industries Global Website

The Kawasaki Railway division realized a turnover of JPY 135 billion (EUR 1.125 billion) in FY

2016, JPY 146 billion (EUR 1.21 billion) in FY 2015 and JPY 147 billion in 2014. Kawasaki rolling

stock manufacturing is a 100% wholly owned company of the Kawasaki Heavy Industries Group

which employs almost 35,000 people worldwide and boasts global turnover of JPY 1.54 trillion

(EUR 12.83 billion).

The company has two had US overseas manufacturing plants in Yonkers (New York) and in

Lincoln (Nebraska) since 2002. It has sold over 1,000 cars to the New York Transport board since

1985. Cities like Washington, Philadelphia and Boston are also using Kawasaki rolling stock


equipment. At the beginning of 2017, Kawasaki announced their USA plant produced a

cumulative quantity of 2,000 cars.

In 2011, Kawasaki Rolling Stock signed a contract with Alstom Transport S.A. of France and CTCI

Corporation of Taiwan to provide the Department of Rapid Transit Systems, Taipei City

Government (DORTS) with a railway system for the Taichung City Government. Singapore's Land

Transport Authority Ordered 364 MRT Cars for a New Line in 2014 and an extra 12 MRT trains

with 72 cars in 2015.

In 2015, Kawasaki received a 400 million USD order from the Washington Metropolitan Area

Transit Authority (WMATA) for an additional 220 subway cars. All 220 of the Series 7000 subway

cars will be manufactured at Kawasaki's Lincoln plant and are scheduled for delivery between

2018 and 2019. This optional order completes a contract of 748 cars, signed in 2010, with a total

value of 1.47 billion USD. Once completed, over 50% of all WMATA cars will be Kawasaki-made.

In the past, Kawasaki has also delivered its products and services in the UK, China, Africa and

Central and South America.

Case Study: China Railway Construction Corporation (China)

China Railway Construction Corporation Limited (CRCC) is a Chinese publicly traded rolling stock

manufacturer, formed on 1 June 2015 with the merger of China CNR Corporation and CSR

Corporation Limited. CRCC had a consolidated turnover of JPY 3.8 trillion (EUR 31 billion) in

2015 and 175,000 employees on its payroll.

CRCC has quickly become new major global competitor for not only Japanese manufacturing

companies overseas but also for the traditional global Big 3, Bombardier (Canada JPY 900 billion

[EUR 7.5 billion] in FY2014), Siemens (Germany JPY 860 billion [EUR 7.16 billion] in 2014) and

Alstom (France JPY 800 billion [EUR 6.66 billion] in 2014).

In 2014, a shockwave went through the global railway market when China delivered, for the first

time, Made in China rolling stock cars to Australia. The total delivery consisted of 624 cars valued


at US$ 3.8 billion and delivered to Sydney for HST services. The order consisted of 78 pairs of

eight cars, each with two floors.

However, quality and durability levels are and will remain major issues following deployment. The

first major recall of Chinese rolling stock was announced by Singapore. The tragic HST Wenzhou

accident, in which 30 people died in 2011, is well remembered by the global railway community.

This accident happened only three years after the launch of HST services in China in 2008.


List of Japanese Railway Equipment Manufacturers

Manufacturers of Rolling Stock

■ Hitachi Rail: www.hitachirail-eu.com

■ Kawasaki Heavy Industries: www.khi.co.jp/english/index.html

■ Niigata Transys: http://www.niigata-transys.com/en/index.html

■ Nippon Sharyo: www.n-sharyo.co.jp/index_e.html

■ Kinki Sharyo: www.kinkisharyo.co.jp/e_index.htm

■ Japan Transport Engineering Company: www.j-trec.co.jp/eng/index.html

■ Alna Sharyo: http://alna-sharyo.co.jp/jigyoseihin.html

Manufacturers of Electric Equipment and Parts

■ Fuji Electric: www.fujielectric.com/index.html

■ Koito Electric Industries: www.koito-ind.co.jp/english/

■ Kyosan Electric Manufacturing: www.kyosan.co.jp/english/index.html

■ Mitsubishi Electric Corporation: http://www.mitsubishielectric.com/bu/transportation/

■ Morio Denki: www.morio.co.jp/english/130kaishi-eg.html

■ Sinfonia Technology: www.sinfo-t.jp/eng/index_a.htm

■ Suzuki Gokin: www.suzuki-gokin.co.jp/eng/index.php

■ Nippon Signal: www.signal.co.jp/english/index.html

■ Toshiba Corporation Social Infrastructure Systems: www.toshiba.co.jp/sis/en/index.htm

■ Toyo Denki Seizo: www.toyodenki.co.jp/en/

■ Yawata Electric Industrial: www.yawatadenki.co.jp/en/index.html

■ Yutaka Manufacturing: http://www.yutaka-ss.co.jp/en/index.html

http://www.hitachirail-eu.com/

http://www.khi.co.jp/english/index.html

http://www.niigata-transys.com/en/index.html

http://www.n-sharyo.co.jp/index_e.html

http://www.kinkisharyo.co.jp/e_index.htm

http://www.j-trec.co.jp/eng/index.html

http://alna-sharyo.co.jp/jigyoseihin.html

http://www.fujielectric.com/index.html

http://www.koito-ind.co.jp/english/

http://www.kyosan.co.jp/english/index.html

http://www.mitsubishielectric.com/bu/transportation/

http://www.morio.co.jp/english/130kaishi-eg.html

http://www.sinfo-t.jp/eng/index_a.htm

http://www.suzuki-gokin.co.jp/eng/index.php

http://www.signal.co.jp/english/index.html

http://www.toshiba.co.jp/sis/en/index.htm

http://www.toyodenki.co.jp/en/

http://www.yawatadenki.co.jp/en/index.html

http://www.yutaka-ss.co.jp/en/index.html


Manufacturers of Non-Electric Equipment and Parts

■ Akebono Brake Industry: www.akebono-brake.com/english/index.html

■ Goko Seisakusho: www.go-ko.co.jp/eng/index.html

■ Hitachi Nico Transmission: www.hitachi-nico.jp/en/index.html

■ KYB: www.kyb.co.jp/english/index.html

■ Kyoei Jitsugyo: www.kyoto-kyoei.com/en/index.html

■ Komatsu: www.komatsu.com/generator/

■ Koshin Seikosho: www.koshin-s.co.jp/english/index.html

■ JTEKT Corporation: www.jtekt.co.jp/e/index.html

■ Mitsubishi Heavy Industries: www.mhi-global.com/index.html

■ Nabtesco Corporation: www.nabtesco.com/en/index.html

■ Nachi-Fujikoshi Corporation: www.nachi-fujikoshi.co.jp/eng/index.html

■ Nakamura Jico: www.najico.co.jp/en/

■ Narita Manufacturing: www.narita.co.jp/en/index.html

■ NSK: www.nsk.com/index.html

■ NTN Corporation: https://www.ntnglobal.com/en/index.html

■ Nishiyama Corporation: www.nishiyama.co.jp/en/index.html

■ Nippon Steel & Sumitomo Metal Corporation: www.nssmc.com/en/index.html

■ Sumitomo Precision Products: www.spp.co.jp/English/index2-e.html

■ Japan Steel Works: www.jsw.co.jp/en/index.html

http://www.akebono-brake.com/english/index.html

http://www.go-ko.co.jp/eng/index.html

http://www.hitachi-nico.jp/en/index.html

http://www.kyb.co.jp/english/index.html

http://www.kyoto-kyoei.com/en/index.html

http://www.komatsu.com/generator/

http://www.koshin-s.co.jp/english/index.html

http://www.jtekt.co.jp/e/index.html

http://www.mhi-global.com/index.html

http://www.nabtesco.com/en/index.html

http://www.nachi-fujikoshi.co.jp/eng/index.html

http://www.najico.co.jp/en/

http://www.narita.co.jp/en/index.html

http://www.nsk.com/index.html

https://www.ntnglobal.com/en/index.html

http://www.nishiyama.co.jp/en/index.html

http://www.nssmc.com/en/index.html

http://www.spp.co.jp/English/index2-e.html

http://www.jsw.co.jp/en/index.html


Manufacturers of Railway Related Products and Services

■ Asayama Corporation: www.kk-asayama.jp

■ Amada Holdings: www.amadaholdings.co.jp/en/

■ Amphenol Japan: www.amphenol.co.jp

■ Captain Industries: www.capind.co.jp

■ Dai Nippon Toryo: www.dnt.co.jp/english/index.html

■ Daido Signal: www.daido-signal.co.jp/english/index.html

■ Daiko Electric: www.daikou-denki.co.jp

■ Denka Company: www.denka.co.jp/eng/index.html

■ e-OHTAMA: www.e-ohtama.jp/english/

■ Fine Sinter: www.fine-sinter.com/english/index.html

■ Fuji Electric Industry: www.fujidk.co.jp/english/

■ Fukoku: www.fukoku-rubber.co.jp/english/index.html

■ Harting: www.harting.com/en/

■ Hayakawa Electric Manufacturing: www.tetsushako.or.jp/pdf/catalog-hayakawa.pdf

■ Hitachi Metals: www.hitachi-metals.co.jp/e/index.html

■ Hitachi Automotive Systems: www.hitachi-automotive.co.jp/en/

■ The Institution for Transport Policy Studies: www.jterc.or.jp/english/Henglish.htm

■ Housetec: www.housetec.co.jp

■ Japan Aviation Electronics Industry: www.jae.com/en/index.html

■ Japan Railway Rolling Stock & Machinery Association: www.rma.or.jp

■ Jupitor Corporation: www.jupitor.co.jp/english/

■ JR East Rail Car Technology & Maintenance: www.ttech.co.jp

■ Keeper: www.keeper.co.jp/index-en.html

■ Kitz Corporation: www.kitz.co.jp/english/index.html

■ Knorr-Bremse Rail Systems Japan: https://www.knorr-bremse.jp/en/index.jsp

■ Kokusai: www.kokusaikk.co.jp/english/index.html

■ Kobe Steel: www.kobelco.co.jp/english/index.html

■ Kotsu Dengyosha: www.parasign.co.jp

http://www.kk-asayama.jp/

http://www.amadaholdings.co.jp/en/

http://www.amphenol.co.jp/

http://www.capind.co.jp/

http://www.dnt.co.jp/english/index.html

http://www.daido-signal.co.jp/english/index.html

http://www.daikou-denki.co.jp/

http://www.denka.co.jp/eng/index.html

http://www.e-ohtama.jp/english/

http://www.fine-sinter.com/english/index.html

http://www.fujidk.co.jp/english/

http://www.fukoku-rubber.co.jp/english/index.html

http://www.harting.com/en/

http://www.tetsushako.or.jp/pdf/catalog-hayakawa.pdf

http://www.hitachi-metals.co.jp/e/index.html

http://www.hitachi-automotive.co.jp/en/

http://www.jterc.or.jp/english/Henglish.htm

http://www.housetec.co.jp/

http://www.jae.com/en/index.html

http://www.rma.or.jp/

http://www.jupitor.co.jp/english/

http://www.ttech.co.jp/

http://www.keeper.co.jp/index-en.html

http://www.kitz.co.jp/english/index.html

https://www.knorr-bremse.jp/en/index.jsp

http://www.kokusaikk.co.jp/english/index.html

http://www.kobelco.co.jp/english/index.html

http://www.parasign.co.jp/


■ Kyosan Kogyo: www.kyosankogyo.co.jp

■ Lecip Corporation: www.lecip.com/index.htm

■ Lonseal Corporation: www.lonseal.co.jp/english/

■ Mersen Japan: www.mersen.com/en/group.html

■ Mitsui & Co: https://www.mitsui.com/jp/en/index.html

■ Metro Sharyo Corporation: www.metosha.co.jp

■ Moog Japan: www.moog.com

■ Murabayashi Industry: www.live-rubber.co.jp

■ Nabtesco Service: www.nabtesco-service.co.jp

■ Nikkeikin Aluminium Core Technology: www2.nikkeikin.co.jp/act/

■ Nihon Weidemüller: www.weidmueller.com

■ Nikko Electric Manufacturing: www.nikko-el.co.jp

■ NOK Corporation: www.nok.co.jp/en/index.html

■ Ongakukan: www.ongakukan.co.jp

■ Panasonic System Solutions Service: https://panasonic.co.jp/cns/psss/

■ Railway Freight Association: www.rfa.or.jp

■ Sankosha: www.sankosha-s.co.jp

■ Siemens: www.siemens.com/entry/cc/en/#/startscreen

■ Souriau-Sunbank: www.souriau.com

■ Starlite: www.2nd.starlite.co.jp/english/index_e.html

■ Suminoe Textile: www.suminoe.jp/english/index.html

■ Sumitomo Bakelite: www.sumibe.co.jp/english/

■ Sumitomo Riko: www.sumitomoriko.co.jp/english/

■ Thales Japan: https://www.thalesgroup.com/en/asia-pacific/japan

■ Taiyo: www.taiyo-ltd.co.jp/eg/index.html

■ Takara Kenzai Seisakusho: www.takarakenzai.co.jp

■ Tatsuta Electric Wire & Cable: www.tatsuta.co.jp/en/

■ Tenryu Composite: www.tenryu-cmp.co.jp

■ Toa Engineering Corporation: www.toae.co.jp

http://www.kyosankogyo.co.jp/

http://www.lecip.com/index.htm

http://www.lonseal.co.jp/english/

http://www.mersen.com/en/group.html

https://www.mitsui.com/jp/en/index.html

http://www.metosha.co.jp/

http://www.moog.com/

http://www.live-rubber.co.jp/

http://www.nabtesco-service.co.jp/

http://www2.nikkeikin.co.jp/act/

http://www.weidmueller.com/

http://www.nikko-el.co.jp/

http://www.nok.co.jp/en/index.html

http://www.ongakukan.co.jp/

http://www.rfa.or.jp/

http://www.sankosha-s.co.jp/

http://www.siemens.com/entry/cc/en/#/startscreen

http://www.souriau.com/

http://www.2nd.starlite.co.jp/english/index_e.html

http://www.suminoe.jp/english/index.html

http://www.sumibe.co.jp/english/

http://www.sumitomoriko.co.jp/english/

https://www.thalesgroup.com/en/asia-pacific/japan

http://www.taiyo-ltd.co.jp/eg/index.html

http://www.takarakenzai.co.jp/

http://www.tatsuta.co.jp/en/

http://www.tenryu-cmp.co.jp/

http://www.toae.co.jp/


■ Toack Corporation: http://www.toack.co.jp/eng/

■ Toho Denki Industry: www.toho-elc.co.jp

■ Tokai Material: www.tokai-material.co.jp

■ Tokai Rolling Stock & Machinery: www.t-ckk.co.jp/index.html

■ Tokyu Techno System: www.tokyu-techno.co.jp

■ Toshiba Transport Engineering: www.toshiba-tre.co.jp

■ Toyo Chemical Industrial: http://www.toyochemical.jp/en/aisatsu/index.html

■ Tsuha Sharyo Industry: www.tsuha.co.jp

■ Tuv Sud Japan: www.tuv-sud.jp/jp-en/about-tuev-sued-1/tuev-sued-in-japan/tuev-sued-

zacta_1

■ TE Connectivity Japan: www.te.com/en/home.html

■ Ueda Brake: www.uedabrake.co.jp

■ Wabtec Corporation Japan: www.wabtec.com

■ Washion Kyoritsu Keiki: www.washion.co.jp/en/

■ West Japan Railway Technos Corporation: www.wjrtechnos.co.jp

■ Yashima: https://www.yashima-co.co.jp/ja/index.html

■ Yashiro Composites Corporation: http://www.ycp.co.jp/eng/

■ Yaskawa Controls: https://www.yaskawa-control.co.jp/

■ Yokohama Seiki: www.yokosei.co.jp/index_e.html

■ YTT International: www.yttinc.co.jp/

http://www.toack.co.jp/eng/

http://www.toho-elc.co.jp/

http://www.tokai-material.co.jp/

http://www.t-ckk.co.jp/index.html

http://www.tokyu-techno.co.jp/

http://www.toshiba-tre.co.jp/

http://www.toyochemical.jp/en/aisatsu/index.html

http://www.tsuha.co.jp/

http://www.tuv-sud.jp/jp-en/about-tuev-sued-1/tuev-sued-in-japan/tuev-sued-zacta_1

http://www.tuv-sud.jp/jp-en/about-tuev-sued-1/tuev-sued-in-japan/tuev-sued-zacta_1

http://www.te.com/en/home.html

http://www.uedabrake.co.jp/

http://www.wabtec.com/

http://www.washion.co.jp/en/

http://www.wjrtechnos.co.jp/

https://www.yashima-co.co.jp/ja/index.html

http://www.ycp.co.jp/eng/

https://www.yaskawa-control.co.jp/

http://www.yokosei.co.jp/index_e.html

http://www.yttinc.co.jp/


Railway Operators and Government Owned Companies

■ Central Japan Railway Company: english.jr-central.co.jp/index.html

■ East Japan Railway Company: www.jreast.co.jp/e/

■ Fukuoka City Transportation Bureau: https://subway.city.fukuoka.lg.jp/eng/index.php

■ Hankyu Corporation: http://www.hankyu.co.jp/global/en/

■ Hanshin Electric Railway: www.hanshin.co.jp/global/en/index.html

■ Hokkaido Railway Company: www2.jrhokkaido.co.jp/global/index.html

■ Japan Freight Railway Company: https://www.jrfreight.co.jp/en/

■ Keihan Electric Railway: www.keihan.co.jp/en/

■ Keikyu Corporation: www.haneda-tokyo-access.com/en/

■ Keio Corporation: www.keio.co.jp/english/index.html

■ Keisei Electric Railway: www.keisei.co.jp/keisei/tetudou/skyliner/us/index.html

■ Kintetsu Railway: www.kintetsu.co.jp/foreign/english/index.html

■ Kobe Electric Railway: www.shintetsu.co.jp

■ Kyoto Municipal Transportation Bureau: www.city.kyoto.jp/koho/eng/index.html

■ Kyushu Railway Company: www.jrkyushu.co.jp/english/index.html

■ Nagoya Railroad: www.meitetsu.co.jp/english/

■ Nankai Electric Railway: https://www.howto-osaka.com/en/top.html

■ Nishi-Nippon Railroad: http://www.nishitetsu.co.jp/en/

■ Odakyu Electric Railway: www.odakyu.jp/english/

■ Sagami Railway: www.sotetsu.co.jp/en/

■ Sanyo Electric Railway: http://www.sanyo-railway.co.jp/global/en/index.html

■ Sapporo City Transportation Bureau: www.city.sapporo.jp/st/english/english.html

■ Seibu Railway: https://www.seiburailway.jp/railways/tourist/english/

■ Semboku Rapid Railway: www.semboku.jp

■ Shikoku Railway Company: www.jr-shikoku.co.jp/global/en/

■ Shinkeisei Electric Railway: https://en.shinkeisei.co.jp/

■ Tokyo Metro: www.tokyometro.jp/en/index.html

■ Tobu Railway: www.tobu.co.jp/foreign/index.html

http://english.jr-central.co.jp/index.html

http://www.jreast.co.jp/e/

https://subway.city.fukuoka.lg.jp/eng/index.php

http://www.hankyu.co.jp/global/en/

http://www.hanshin.co.jp/global/en/index.html

http://www2.jrhokkaido.co.jp/global/index.html

https://www.jrfreight.co.jp/en/

http://www.keihan.co.jp/en/

http://www.haneda-tokyo-access.com/en/

http://www.keio.co.jp/english/index.html

http://www.keisei.co.jp/keisei/tetudou/skyliner/us/index.html

http://www.kintetsu.co.jp/foreign/english/index.html

http://www.shintetsu.co.jp/

http://www.city.kyoto.jp/koho/eng/index.html

http://www.jrkyushu.co.jp/english/index.html

http://www.meitetsu.co.jp/english/

https://www.howto-osaka.com/en/top.html

http://www.nishitetsu.co.jp/en/

http://www.odakyu.jp/english/

http://www.sotetsu.co.jp/en/

http://www.sanyo-railway.co.jp/global/en/index.html

http://www.city.sapporo.jp/st/english/english.html

https://www.seiburailway.jp/railways/tourist/english/

http://www.semboku.jp/

http://www.jr-shikoku.co.jp/global/en/

https://en.shinkeisei.co.jp/

http://www.tokyometro.jp/en/index.html

http://www.tobu.co.jp/foreign/index.html


■ Tokyo Monorail: www.tokyo-monorail.co.jp/english/

■ Tokyu Corporation: www.tokyu.co.jp/global/index.html

■ Tokyo Metropolitan Government, Bureau of Transportation: www.kotsu.metro.tokyo.jp/eng

■ West Japan Railway Company: www.westjr.co.jp/global/en/

■ Yokohama City, Transportation Bureau:

https://www.city.yokohama.lg.jp/lang/residents/en/living/bus_subway/

http://www.tokyo-monorail.co.jp/english/

http://www.tokyu.co.jp/global/index.html

http://www.kotsu.metro.tokyo.jp/eng

http://www.westjr.co.jp/global/en/


Important Bibliography

■ Abenomics, Government of Japan, 2019, 16p, English

■ Procurement Outlook FY2020 JR East, JR East, 2019, 7p, English

■ Trade in Goods with Japan, European Commission Directorate-General for Trade, 2019,

10p, English

■ EPA, Ministry of Foreign Affairs, 2019, 3p, Japanese

■ Holmatro Rerailing System, JR East, 2019, 1p, Japanese

■ Invest Japan Report 2018, JETRO, 2018, 52p, English

■ Annual Report 2018, East Japan Railway Company, 2018, 84p, English

■ IT-Suica Business, East Japan Railway Company, 2018, 6p, Japanese

■ LRT Tender Utsunomiya City, City of Utsunomiya, 2018. 7p, Japanese

■ EU-Japan Trade Relationship-Facts and Figures, European Commission, 2018, 1p, English

■ Closure USA Plant, Nippon Sharyo, 2018, 1p, Japanese

■ JR East stopping Thales’ CBTC Pilot Project, Nikkan Kogyo Newspaper, 2017, 4p,

Japanese

■ 16 Big Private Railway Databook 2015, Mintetsu, 2015, 70p, Japanese

■ Hitachi trains to push into Europe to challenge Siemens, Alstom, The Japan Times, 2015,

4p, English

■ Railway Technical Standard, 2015, 14p, English

■ Technical Standards in Japan, Railway Bureau, 2013, 13p, English

■ Japanese Technical Standards, Naoto Yanase, 2011, 17p, English

■ Japan Railway Construction, Transport and Technology Agency Leaflet, 2015, 34p, English

■ Central Japan Railway Company Fact Sheet, 2016, 20p, Japanese


■ Central Japan Railway Company Annual Report, 2016, 45p, Japanese

■ East Japan Railway Company Fact Sheets, 2016, 11p, Japanese

■ Financial Data of the 6 JR Companies, Tokyo Shoko Research, 2016, 3p, Japanese

■ JR West Fact Sheets, 2016, 24p, Japanese

■ Tokyo Metro Corporate Profile, 2016, 39p, Japanese

■ EBC Railway Committee Members Profile, EBC, 2015, 5p, English

■ JR East Corporate Data, 2016, 5p, English

■ About the Japanese Rolling Stock Industry, JARi, 2014, 14p, Japanese

■ Analysis of the Big 3 Rolling Stock Manufacturers, 2014, 14p, Japanese

■ Report of the 16th EU-Japan FTA/EPA negotiating round in Tokyo 11-20 April 2016,

European Commission, 2016, 8p, English

■ EU-Japan Railway Industrial Dialogue, MLIT, Yasunari Oka, 2015, 5p, Japanese

■ The Joban Line Project, CBTC for Japan, Thales EU Affairs, Yves Lagoude, 2014, 10p,

English

■ Introduction to International Standards in the Railway Segment, Railway Technical Research

Institute, 2016, 53p, Japanese

■ Worldwide Rolling Stock Manufacturers, Market Insights and Factsheets for top 50

manufacturers and Overview of 180 Companies and 330 Production Sites, SCI Multiclient

Studies, 2016, 22p, English

■ Railway Technology in Japan, Challenges and Strategies, Hiroumi Soejima, 2003, 10p,

English

■ The 2 Reasons Why Overseas Railway Equipment Does Not Increase in Japan, Toyo Keizai

Net, 2015, 2p, Japanese

■ UNIFE Annual Report 2016, UNIFE, 2016, 128p, English


■ Government Procurement in Japan, Obstacles and Opportunities for European SMEs,

EU-Japan Centre for Industrial Cooperation, Lyckle Griek, 2014, 98p, English

■ Growth Strategy for Japan’s Airline and Rail Industries: Tokyo Olympics to Trigger a Leap,

Nomura Research Institute, Keisuku SANO et al., 2015, 17 pages, English

■ Railroad, Daiwa Securities, 2015, 16p, Japanese

■ Domestic Railroad Statistics, Japan Rail Industries, 2016, 6p, Japanese

■ Railway System’s Business Strategy, Hitachim Alistair Dormer, 2015, 38p, Japanese

■ Japan’s Railway Technology and Overseas Expansion, Ministry of Land, Infrastructure and

Transport, Shunya Shiozaki, 2016, 41p, Japanese

■ Taking away market share from the big 3 railway manufacturers in a 20 trillion global market,

Nikkei Newspaper Online, 2014, 3p, Japanese

■ Within Reach, the EBC Report on the Japanese Business Environment, 2016, 98p, English

■ UNIFE World Rail Market Study 2016, Roland Berger, 21p, 2016, English

■ Railway in Sweden and Japan - a comparative study, Transport analysis, 2014, 80p, English

■ Railways market and procurement trends (railway policy), Ministry of Land, Infrastructure

and Transport, Yasaburo HIKASA, 2014, 27p, English

■ Railways: Issues and Recommendations, European Business Council, 2016, 14p, English

■ The Rolling Stock Manufacturing Industry in Japan, JARi, Masahito Mizoguchi, 2016, 19p,

English

■ The Databook of the Major Private Railways, Mintetsu, 2015, 70p, Japanese

■ Why Japan? 5 reasons to invest in Japan, JETRO, 2014, 12p, English

■ Invest Japan Report, JETRO, 2016, 56p, English

■ About the Japanese Railway Car Industry, JARi, Masahito MIZOGUCHI, 14p, Japanese

■ Railways: Open season on Tendering, Japan Today, Geoff Botting, 3p, 2015, English


■ Prospective EU-Japan Free Trade Agreement, European Parliament, 11p, 2016, English

■ Trade Sustainability Impact Assessment of the Free Trade Agreement between the

European Union and Japan, Final Report, European Commission, 314p, 2016, English

Useful Contacts in Japan

■ European Business Council (EBC) in Japan: www.ebc-jp.com

■ EU Japan Centre for Industrial Cooperation (EUJCIC) in Japan: www.eu-japan.eu

■ EUJCIC-Ministry of Economy, Trade and Industry (METI): Government Procurement

Information Portal Website: http://information1.gov-procurement.go.jp/en/

■ Japan External Trade Organization (JETRO) www.jetro.go.jp/en

http://www.ebc-jp.com/

http://www.eu-japan.eu/

http://information1.gov-procurement.go.jp/en/

https://www.jetro.go.jp/en


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Railway Technologies & Services Japan Market Study

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