Japanese oil refiner switches on to electric vehicle project

Idemitsu and Tajima aim to unveil their first ultra-compact vehicle in October and start selling the product next year, with a price of up to $14,250 (1.5m yen)

Japanese oil refiner switches on to electric vehicle project
An Idemitsu tanker is seen at a petrol station near Osaka. The refiner's automotive production materials unit has been increasingly important, as its oil business has suffered in recent years, according to analysts. File photo by Reuters.

(ATF) Japanese oil refiner Idemitsu Kosan plans to launch an electric vehicle next year through a joint venture with unlisted carmaker Tajima Motor, signalling a further shift out of internal combustion engines.

Idemitsu has stepped up its transformation into a supplier of low-carbon energy and materials as local oil demand drops, although in Japan that is largely due to a shrinking and ageing population rather than progressive ideas about conservation and sustainability.

Idemitsu and Tajima aim to unveil their first ultra-compact vehicle in October and start selling the product next year, with a price tag of between 1 million and 1.5 million yen ($9,500 and $14,250). The vehicle will be available for rental at Idemitsu petrol stations.

The refiner began its move into EV production last year, when it installed solid electrolyte production equipment for the manufacture of batteries at its plant in Chiba prefecture and aims to start operating next year. 

Idemitsu’s automotive production materials unit has been increasingly important, Thanh Ha Pham, an equity analyst at Jefferies in Tokyo, said. Idemitsu’s oil business has suffered in recent years, although its styrene monomer margins have been high, Thanh said.

SHORT DISTANCES

The companies hope the new model, a 4-seater EV with a driving range of up to 120 km and a maximum speed of 60 km per hour, will draw demand from individuals and businesses using cars for short distances for shopping and deliveries.

The venture is an ambitious move for Tajima, best known as a maker of parts, ranging from oil pans to door handle covers. Started by former race-car driver Nobuhiro "Monster" Tajima, the company said its entry into EV manufacture reflected the founder's desire for a "sustainable earth environment, to save lives and protect what is valuable".

The Idemitsu-Tajima JV debut car is 2.5 metres long and 1.3 metres wide, smaller than conventional mini-vehicles in Japan.

"We believe there is about 1 million potential demand for ultra-compact EVs as it is safer than bicycle or small motorbike and easier to drive than a conventional mini-vehicle," Idemitsu president Shunichi Kito told a news conference.

"We plan to offer various services including sharing and subscription of the EV at our 6,400 petrol stations," he said.

With reporting by Reuters

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japan EV Idemitsu Tajima