Sony Group Corp. President Kenichiro Yoshida, center, explains the "VISION-S" prototype EV at a news conference. (Photo Courtesy of Sony Group Corp.)

       TOKYO -- The Sony Group Corp.'s recent announcement that it is considering entering the electric vehicle (EV) market in earnest is likely to heat up competition in the industry even further.

       Global giants such as Germany's Volkswagen (VW), General Motors (GM) in the U.S., and Toyota Motor Corp. are chasing Tesla, the leading U.S. EV maker in terms of sales volume. Chinese EV manufacturers are also on the rise, and the entry into the market of U.S. IT giants such as Apple Inc. and Google LLC is also being talked about. An "era of conflict over EVs" is accordingly emerging.

       "This is a bold step into the future," said Sony Group President Kenichiro Yoshida at an event held in conjunction with the Consumer Electronics Show (CES) in Las Vegas on Jan. 5 (Japan time), emphasizing the significance of entering the EV market.

       After the unveiling of Sony's VISION-S prototype EV at CES two years ago, many users called for its commercialization, but Sony has consistently maintained a cautious stance, saying that at that time it had no plans for commercialization.

       It is believed that the EV prototype was intended to boost the business for parts essential for automated driving, such as image sensors, of which Sony boasts the world's largest market share, and semiconductors. Sony's move was also thought to be a strategy to aim for synergy with the company's own content business, including movies and music, which can be enjoyed inside the vehicles.

       The global trend toward EVs appears to have played a part in the firm's announcement that it is considering entering the EV business, which is heating up with the involvement of various players.

       According to the International Energy Agency, the number of EVs sold worldwide in 2020 reached approximately 2,008,000, a 30% increase over the previous year. Tesla is the driving force behind this. SAIC-GM-Wuling Automobile, a joint venture between GM and Chinese manufacturers, is catching up with Tesla with its low-cost EVs priced at less than 500,000 yen (about $4,310), followed by VW, China's BYD Co. and others.

       Toyota Motor Corp. President Akio Toyoda is seen during a news conference in Tokyo's Koto Ward on Dec. 14, 2021. (Mainichi/Yohei Koide)

       During these years, the United States, Europe, and China, which are promoting climate change countermeasures and industrial policies in relation to each other, have accelerated their efforts to regulate combustion engine vehicles and create rules that favor EVs.

       A concept car using self-driving technology from Baidu Inc., a major Chinese internet search engine, is seen in Shanghai, China, on April 19, 2021. (Mainichi/Yoshinori Ogura)

       Major automakers have raised their EV sales targets simultaneously, and Mercedes-Benz of Germany and Volvo Car Corp. of Sweden aim to exclusively make EV vehicles by 2030. In December 2021, Toyota announced that it will switch its luxury car brand, Lexus, to all EV models by 2035.

       The EV market is one that automakers around the world are focusing on, but because EVs, which run on batteries and motors, have fewer parts than conventional engine-based cars, the hurdle to entry are relatively low, and many companies from other industries are coming forward to join the market.

       In China, internet search giant Baidu Inc. announced in January 2021 that it will start manufacturing and selling EVs, while smartphone giant Xiaomi Inc. said in March that year that it plans to invest $10 billion in the EV sector over the next 10 years. In October 2021, Taiwan's Hon Hai Precision Industry Co. in Taipei unveiled EV prototypes being developed by a joint venture with a local automaker, with plans to begin supplying EVs in 2024 on consignment from manufacturers worldwide looking to enter the market.

       Although it has not made any official announcement, Apple is also believed to be developing a self-driving EV called the Apple Car. The largest company to which Apple outsources the production of iPhones is Hon Hai. There is significant speculation in the automobile and electronics industries that Apple and Hon Hai are exploring a business model with horizontal division of labor, in which development and manufacturing are separated, as is the case with smartphones.

       Against this backdrop, Sony President Yoshida is confident that the company can become a creative entertainment company that redefines mobility by leveraging its strengths in image sensors and content.

       The automobile giants that are facing Sony's challenge will be forced to make further changes. Honda Motor Co. President Toshihiro Mibe told reporters in Tokyo on Jan. 5, "Many things have happened globally since last year, and they will continue to happen." As for Sony's move, he said, "It is within our expectations, and we will decide how to fight (in the future)."

       (Japanese original by Kenji Wada and Yuhi Sugiyama, Business News Department)

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