Feb 28th - Japan To Use Russia's Glonass Satellite System

The government plans to start using Russia's Glonass satellite system in fiscal 2011, in addition to the U.S. Global Positioning System, for land surveys, to expand coverage and improve accuracy, it has been learned.

The former Soviet Union began developing Glonass in the 1980s to compete with GPS. Although the system was initially set up for military use, Russia is now promoting Glonass for civilian purposes.

It is unusual for Japan to use Russia's satellite technology, although more than 20 years have passed since the end of the Cold War.

Signals from Glonass can be used free of charge, just like those from GPS.

Over the 10 years or so from fiscal 2011, the Japanese government will upgrade satellite signal receivers in about 1,200 locations nationwide for land surveys, enabling them to receive Glonass signals as well.

The government hopes using Glonass will allow satellite signals to reach more places, including behind tall buildings and in valleys. It also aims to get faster and more accurate data on movements in the earth's crust near volcanoes.

Feb 28th - Docomo to launch tablet computer in late March to counter iPad

The Optimus Pad L-06C

TOKYO —

NTT Docomo Inc said Thursday it will offer a multifunction tablet computer in Japan next month to compete with Apple Inc’s iPad.

The Optimus Pad, made by South Korea’s LG Electronics Inc, will use the latest operating system that Internet search giant Google Inc has developed for tablet computers.

The tablet with an 8.9-inch display weighs 620 grams. It cannot be used as a phone. Its retail price is estimated at between 30,000 and 35,000 yen.

NTT Docomo, the largest Japanese mobile phone service provider, also said it will put on sale two new smartphones selling for between 25,000 and 30,000 yen in Japan in March.

One of them is the 7.7-millimeter Medias made by NEC Casio Mobile Communications Ltd, which NTT Docomo said is the world’s thinnest smartphone. The other is the Xperia arc by Sony Ericsson Mobile Communications.

Feb 27th - Taxi Firms Offer New Mobile Services For Customers

Major taxi companies in Tokyo are ramping up efforts to attract more repeat customers by providing new services that offer greater convenience to mobile phone users.

Tokyomusen, a taxi association in Shinjuku Ward that has a fleet of roughly 4,500 taxis, will launch a new service as early as June that helps customers quickly find cabs by dialing a phone number on their handsets. Customers will not need to tell the dispatcher where they are, as drivers will be able to pinpoint their locations with the global positioning systems in mobile phones.

Nihon Kotsu Co., meanwhile, will launch a service Tuesday that allows customers to make reservations with an application on smartphones equipped with U.S.-based Google Inc.'s Android operating system. This service is already available through U.S.-based Apple Inc.'s iPhone.

Nihon Kotsu, the largest taxi company in Tokyo, also plans to expand its lineup of taxi stands at hospitals and large buildings to about 20 locations in fiscal 2013, up from 15 at present.

Taxi sales reached about 1.8 trillion yen in Japan in fiscal 2009, down more than 60% from the fiscal 1991 peak.

Feb 25th - In U.S., Toyota Hit By Recalls, and Resurgent Local Rivals

Toyota Motor Corp. suffered its first drop in U.S. market share in 11 years in 2010, as massive vehicle recalls and reinvigorated local rivals created markedly tougher competition for the Japanese company.

Toyota's U.S. market share fell 1.8 percentage points to 15.2% last year. Ford Motor Co., regaining strength in its home market, relegated Toyota to third place in the U.S.

Over the past year, Toyota has been beefing up its quality control system.

Last year saw a remarkable revival of the U.S. Big Three carmakers. As their restructuring efforts started paying off, and consumer confidence in Toyota took a hit due to a series of highly publicized recalls, the Big Three increased their aggregate U.S. market share for the first time in 15 years.

Looking ahead, Toyota's uphill battle will likely continue, as rivals are stepping up their challenges, releasing models in the midsize and compact categories that have underpinned Japanese automakers' global success.

"It's as if I were looking at the Japanese market," an executive of a Japanese automaker said at the North American International Auto Show, which was held in January in Detroit.

The event was full of new subcompacts, including General Motors Co.'s Chevrolet Sonic and Ford's Focus. Korean and German rivals, such as Hyundai Motor Co. and Volkswagen AG, also plan to launch new models in the medium-compact vehicle category, in which Japanese automakers now control a roughly 50% share.

Fresh Recalls

On Thursday, Toyota announced it would recall a total of 2.39 million vehicles, including 2.17 million in the U.S., for problems involving possible floor mat interference with the accelerator pedal. Similar problems led to millions of Toyota recalls last year.

Over the past year, Toyota has been beefing up its quality control system, creating the position of chief quality officer for each major region, including North America, Europe and China, in an effort to ensure a thorough grasp of information on vehicle problems. And right after announcing massive recalls, Toyota gave 1,000 or so of its engineers an additional task of finding ways to improve vehicle quality.

One reason that Toyota's recalls tend to be increasing is that the company has learned a lesson from its bitter experience in the U.S.: Toyota has made it a rule to swiftly disclose problems as soon as their causes are uncovered, even if the problems are minor.

Toyota's efforts to achieve a turnaround in the U.S. will rest largely on the success of new models. This year, the company plans to launch an all-new Camry, its mainstay sedan. Other new U.S. offerings will include the fuel-efficient Yaris subcompact and the wagon version of the Prius hybrid.

Feb 25th - Mitsubishi Corp To Join In 200 Megawatt Solar Power Project In Spain

Japanese trading house Mitsubishi Corp. said Friday it will take part in a 200-megawatt solar power generation project in Spain, making it the first Japanese company to own concentrated solar power plants under commercial operation.

The Tokyo-based company said it has acquired a 15% stake in Acciona Termosolar from Acciona Energia, a group company of Acciona S.A. of Spain.

The project's total cost is around EUR1 billion and is expected to generate about 450 million kWh.

The Spanish company is world largest independent non-utility renewable energy developer and owner. It operates four CSP plants in southern Spain, three of which are already operating commercially. The remaining plant is slated to go onstream this autumn.

Feb 24th - NEC Develops Combo Fingerprint-Finger Vein Reader

NEC Corp. has developed the industry's first contactless-type biometric authentication system that reads both fingerprints and finger veins.

When the hand is held in front of the reader, a camera captures fingerprint and finger vein images to compare with a database of registered individuals. By simultaneously checking two biometric markers, people can be authenticated with nearly 100% accuracy. The system operates connected to a PC and features robust access restrictions.

NEC plans to market the system to financial institutions and public organizations in Japan, North America and Asia.

For domestic marketing it will collaborate with the U.S. software company Novell Inc. The two partners are forming a team of 20 salespeople for the task.

The system will retail for around 25,000 yen to 30,000 yen and NEC hopes to sell 400,000 units in three years.

Feb 22nd - FDK Devises Ultrathin Lithium Battery

Electronic parts supplier FDK Corp. has developed one of the industry's thinnest disposable lithium batteries.

The square-shaped battery measures 0.42mm thick and 25mm on a side. It boasts a life of five years -- much longer than the two to three years of existing models. It will be marketed for use in such products as security cards.

The Fujitsu Ltd. affiliate will invest about 300 million yen to set up production lines at a Tottori Prefecture factory bought from Sanyo Electric Co. Mass production is slated to begin in September, with sales expected to reach 500 million yen by March 2012.

Slimming down existing button-shaped batteries is difficult. The new product solves the problem by using thin-film materials, opening the way for the development of bank security cards that issue different passcodes with each use.

Feb 22nd - Japanese M&A Deals In Asia Jump 83% In 2010

Japanese companies are ramping up mergers and acquisitions in the rest of Asia, eager to tap the region's dynamic growth.

Japanese acquisitions of Asian businesses surged 83% on the year to a record 274 deals in 2010, according to Thomson Reuters. These deals accounted for 52% of all overseas M&As, including investments, by Japanese companies -- the highest level in seven years.

On a value basis, Japanese M&As in Asia increased 3% to roughly 890 billion yen.

Faced with a shrinking domestic market as the population ages, Japanese firms hope to tap into Asia's brisk consumer spending. Kirin Holdings Co. obtained a stake in a Singaporean soft drink company, while Nippon Paper Group Inc. invested in a Chinese paperboard company. Toyo Tire & Rubber Co. has acquired a Malaysian tire manufacturer.

Rengo Co is scheduled to acquire a trio of Vietnamese companies in the paperboard field.

This year so far, Japanese companies have conducted 32 M&A deals in Asia.

At the same time, a growing number of cash-flush Asian companies are buying Japanese businesses. Such M&As in 2010 increased 24% on the year to a record 73, while the value of these deals surged 87% to 117.9 billion yen.

Many of these companies are targeting Japanese firms' technologies and brand recognition to further their business growth.

Real estate purchases in Japan by Southeast Asian investors were conspicuous, including the acquisition of a Hokkaido resort by a Malaysian firm. Just this month, Panasonic Corp. said it will sell its nickel-metal-hydride battery business to a Chinese battery maker.

Feb 21st - Toyota Shifts Domestic Talent To Emerging-Market Sales

Stepping up efforts to boost sales in emerging countries, Toyota Motor Corp. has reassigned 10% of its roughly 1,000 domestic sales personnel.

The 100 or so affected staffers join the 200 or so domestic employees already in charge of emerging markets. They will be tasked with developing sales networks as well as drawing up plans for new products and sales promotion.

Those reassigned will work out of Japan for the time being, making trips to local markets as needed. The move will be included in a long-term management policy Toyota is to announce March 9.

Toyota enjoys a nearly 50% market share in Japan but has lagged behind foreign rivals in emerging countries. In Brazil, which overtook Germany to become the world's fourth-largest auto market in 2010, its share amounts to just 3%. And in China, now the world's biggest auto market, it has a share of 7%.

Moving to increase sales, Toyota launched the Etios low-priced sedan in India late last year. This locally manufactured passenger car is priced at the local equivalent of 920,000 yen to 1.28 million yen.

In China and Brazil, the automaker is working toward kicking off production at new plants next year.

And in Indonesia, group firm Daihatsu Motor Co. is to build a new plant in 2013. Toyota plans to procure compact cars priced at 800,000 yen to 900,000 yen from this plant, hoping to tap demand among the Asian middle classes.

The firm is accelerating efforts to increase sales in emerging countries at a time when the Japanese market's growth potential remains poor.

Domestic new-car sales grew 14% on the year to 1.56 million units in 2010, thanks to government subsidies for environmentally friendly vehicles. But this still fell 10% short of the peak hit in 2004.

Feb 19th - KDDI To Unveil WiMAX-Compatible Smartphone

KDDI Corp. in April will release Japan's first smartphone compatible with WiMAX high-speed wireless communications.

Japanese enjoy an ever-broadening array of smartphones to choose from.

The cell phone service provider will sell EVO, a WiMAX-compatible phone made by Taiwan's HTC Corp. KDDI affiliate UQ Communications Inc. has set up WiMAX base stations. With around 600,000 current subscribers, the system has ample room for more.

WiMAX enables data to be sent and received at five times the speed of regular cell phone service. This could make smartphones more convenient, since many are used to access the Internet. The growing popularity of smartphones is squeezing cell phone companies' service capacity, and WiMAX compatibility could ease the burden on the mobile communication networks.

Apple Inc.'s iPhone enjoys popularity in the smartphone market, but KDDI aims to fight back by offering models equipped with unique functionality. KDDI also seeks to set itself apart by the enhanced convenience of being able to send and receive large volumes of data at high speed.

Feb 12th - Toyota To Slash Board Size For Faster Decision-Making

Toyota Motor Corp. will reduce its director levels from 27 to 10-15 in a bid to speed decision-making amid intensifying global competition.

The leading carmaker's board today consists of a chairman, two vice chairmen, a president, six vice presidents, 15 managing directors and two directors.

The company also has 50 managing officers, which are the equivalent of corporate officers at many other companies. By also shedding managing officers, Toyota will likely shrink the size of its upper echelon to around 60 people from 77 currently.

The auto giant has expanded its executive roster in lock step with sales growth. But with the business environment changing rapidly and as the race over next-generation green vehicles becomes heated, slimming down its management team has become a top priority.

Toyota normally makes changes to its management lineup in June, when it holds its annual general shareholders meeting. But some of the top-executive culls may be announced in April, when the automaker is due to unveil its long-term business plan.

Feb 10th - Fit Compact Holds Lesson For Honda Management

Honda Motor Co. is much talked about by auto industry analysts, who marvel at the Fit compact's brisk sales and the automaker's rapid earnings recovery.

The Fit HV has the same power system as the Insight to cut costs.

A look behind the scenes at the development of the Fit Hybrid, which was launched last October, helps explain the mystery.

In June 2008, 25 people overseeing the rollout of the new model gathered at a hotel in the resort town of Nasu, Tochigi Prefecture. People in the marketing department had asked that car's design not be changed, citing the existing model's solid sales. The development team disagreed, saying it wanted the car to evolve.

Honda has a tradition of hosting "camps" during the launch of a new model to let people from various departments mull things over. Although there were many different views about what kind of car the Fit Hybrid should be, there was one point on which all agreed: the need to cut production costs.

Click to enlarge

Honda has lagged behind rival Toyota Motor Corp. in hybrid vehicles. Auto sales have been slow and consumers are reluctant to splash out on expensive cars. But simply slashing the price would make the new model unprofitable and the management would not likely approve the project in that case.

The key to resolving the problem lay in borrowing from Honda's Insight hybrid, said Kohei Hitomi, head of the Fit Hybrid project. The cost of hybrid power systems is a major factor in the price of the cars. Thus, turning out affordable cars depends on holding that cost down. Using the power system from the Insight would let Honda save on development and production costs and boost profits through economies of scale.

But there was a big obstacle: mounting the Insight's 40-liter gasoline tank on the much smaller Fit.

Break from tradition

Honda had been here before. Five years earlier, when the Insight was being developed, engineers working on the two models worked closely together even before they knew whether the Fit Hybrid would go into production. They created designs to that would allow the same power system to be used on both.

Honda used to design auto bodies from scratch for each new model just for the challenge. Joint development of the two hybrid vehicles was thus a break from tradition.

Honda rolled out another hybrid, the CR-Z, last February. The CR-Z has a sporty look but it shares about 20% of its components with the Insight and around 10% with the Fit. The popular Freed minivan is based on the Fit's chassis. Honda is now using common parts in as many models as possible.

The carmaker is also taking a second look at sales over the past couple of years to eliminate waste and focus on its most popular models to maximize economies of scale. Even the hallowed Civic was not immune from scrutiny. Honda pulled the Civic from the Japanese market at the end of last year.

This "selection and concentration" strategy is paying off. The Fit made up 54% of Honda's domestic sales in January.

Honda President Takanobu Ito said Honda cannot survive as a big company, so he wants to turn it into a great mid-sized firm that can quickly adapt to new circumstances. As a company, Honda is adopting what could be called "Fit management" -- trying to become small, nimble organization that brings in big profits.

Honda plans to launch its first hybrid wagon, the Fit Shuttle, next month. This year marks the 10th anniversary of the model and it seems destined to play an increasingly important role in the company's future.

Feb 10th - Elpida, TDK Making Strides In Energy-Saving Memory

Elpida Memory Inc. has developed a new type of DRAM offering superior energy efficiency, while TDK Corp.  has come up with a prototype of a next-generation power-saving semiconductor.

Elpida aims to commercialize its 3-D DRAM in 2013 or 2014. The R&D laboratory of Taiwanese unit Rexchip Electronics Corp. has built a 1-gigabit prototype.

With the new technology, wiring and charge-storing components are produced on a silicon wafer and then stacked atop one another. This makes more effective use of chip real estate and can shrink memory cell area by 30%.

The new technology could slash microchip power consumption to a thousandth that of current offerings.

The technology can be used to make smartphones, tablet computers and other such devices even smaller. Semiconductor production efficiency will also get a significant boost because it will be possible to cut more chips from a single wafer.

DRAMs store their data as electrical charges -- and if the flow of electric current is interrupted, the information is lost. But the new DRAM's structure reduces current leakage, so less power is needed to store data. This will prolong the life of batteries in portable devices.

Meanwhile, TDK and others have succeeded in creating a basic prototype chip that can retrieve and store data without sending an electric current, avoiding loss of heat energy. If commercialized, it could slash semiconductor power consumption to around a thousandth that of current offerings.

The device exploits spin, a fundamental property of electrons, to transmit signals. TDK, the Akita Research and Development Center, and Osaka University have confirmed that spin currents can be used to send information using silicon, the main material used by chips. This marks the first time that this has been achieved at room temperature.

In five years, TDK aims to first commercialize the technology in hard-disk drives. The technology will not only cut power use, but also increase memory capacity at least 10-fold by minimizing head size, the company says. The firm will consider applying it to devices like memory chips in the future.

Chips using electric currents to transmit data generate heat from circuit resistance and consume energy. But with spin currents, there is almost no loss, according to TDK.

Feb 9th - Foreign Investment In Japan Shows 1st Net Outflow In 4 Yrs

Overseas investors pulled out more direct investments from Japan than they put in for the first time in four years in 2010.

Direct investment in Japan by overseas companies and others grew 41% on the year to 4.9 trillion yen, according to preliminary data released Tuesday by the Ministry of Finance. But the amount leaving Japan surged 110% to 5.05 trillion yen, resulting in a net outflow of 144.7 billion yen.

French tiremaker Michelin ended production in Japan as profitability worsened.

Notable investments in Japanese companies last year included Chinese textile maker Shandong Ruyi Science & Technology Group's move to bring Japanese apparel firm Renown Inc. under its umbrella. And Volkswagen AG took a capital stake in Suzuki Motor Corp.

At the same time, foreign firms feeling the effects of the 2008 global financial crisis shuttered or streamlined operations here. French tiremaker Michelin ended production in Japan as profitability worsened after the crisis, while U.S. media company Liberty Global Inc. exited the Japanese market by selling its stake in Jupiter Telecommunications Co.

European and U.S. drugmakers and retailers were also quick to consolidate or close Japanese bases. And a portion of Citigroup Inc.'s sale of Nikko Cordial Securities Inc. is believed to have been included in the 2010 data, boosting the outflow figure.

"Direct investment in Japan is shrinking because of stalled structural reforms in domestic industry," warns Hiromichi Shirakawa, chief economist at Credit Suisse Securities (Japan) Ltd.

Meanwhile, investors whose hopes of Japanese growth are fading on a rapidly graying population and other factors have headed to such greener pastures as emerging countries. Foreign direct investment in China topped 100 billion dollars for the first time in 2010, growing 70% from five years earlier.

Feb 9th - Toyota Cleared In Probe, will sales accelerate now?

Now that a federal investigation has found that engine electronics played no role in sudden, unintended acceleration of Toyota Motor Corp. vehicles, the focus has shifted to whether the outcome will provide a tailwind for the firm's flagging U.S. sales.

Japan's leading automaker recalled nearly 8 million cars through the end of January last year over the acceleration issue. Consumer concerns over the quality of Toyota cars have largely receded since then, but much damage has been done. Although total U.S. auto demand grew 11% on the year in 2010, the firm's sales there slipped 0.4%.

One reason for the poor performance is that many potential buyers were waiting for updated models to be rolled out, including a revamped Camry compact. But weighing even more heavily on sales was that a significant number of consumers chose to put off purchases until the Department of Transportation came to a definitive conclusion about the causes of sudden acceleration in Toyota vehicles.

For the investigation, the National Aeronautics and Space Administration (NASA), which headed the probe, mobilized its engineers with expertise in such areas as electronic engineering, electromagnetic interference and ergonomics.

That Toyota's electronics control system has been cleared by an organization as respected as NASA is expected to go a long way toward easing consumer concerns about the quality of its cars.

Also, the findings will likely have a major impact on the product-liability suits against Toyota at a California federal district court, because the safety of Toyota's electronics control system is one of the central issues.

Feb 8th - FT: Panasonic's Smart Fridges Light The Way

Panasonic's latest refrigerators, in addition to keeping food cool and making ice, use a light sensor to scan their owners' kitchens.

If these determine that it is night-time and no one is likely to open the doors for a few hours, they power down a bit to save on electricity.

Smart fridges are just one way that the Japanese electronics group is "greening" its business. In a corner of the same huge white-goods factory in which it makes its intelligent refrigerators, workers install circuitry into hydrogen fuel cells destined for Japanese homes.

The boxy machines will heat water and generate electricity with minimal emissions of carbon dioxide. At Y2.5m ($30,000) before government subsidies, they are far from cheap but Panasonic says that buyers can cut Y50,000-Y60,000 from annual utility bills as they help prevent global warming.

Toshiki Shimizu, the executive in charge, has big ambitions for what is still an experimental business. Panasonic has sold about 5,000 residential fuel cell systems since 2009 through local natural-gas utilities. But in a few years, he says, the company aims to expand the business to a scale "equal to refrigerators, air conditioners and other home appliances".

The fuel cells and smart-fridges illustrate a strategic shift among Japanese technology companies towards "green innovation".

It is a change driven in part by necessity, as lower-cost South Korean, Taiwanese and Chinese groups lure customers away from Japanese televisions and video players.

But companies also sense an opportunity, with rising energy prices and tougher pollution laws likely to increase demand for clean technology.

Japan's government has designated the sector as one of five strategic growth areas that it hopes will create 2.6m jobs and add Y149,000bn to manufacturing output by 2020.

Panasonic is aiming to more than triple revenues from clean technology to Y3,000bn by 2018.

Many other companies are also going green. Nissan and Mitsubishi Motors have begun selling battery-driven electric vehicles, building on a market for low-emission cars pioneered by Toyota's Prius petrol-electric hybrid.

Sharp and Kyocera are sharply expanding solar-panel production, while Sanyo, almost bankrupt a few years ago, has re-emerged as the world's largest maker of rechargeable batteries.

In all, three in 10 Japanese manufacturing companies are looking to enter the market for clean technology or increase their presence there, according to a survey by the industry ministry.

The bet on green technology is not a sure thing. Some analysts question whether returns will ever match those that are being lost in consumer electronics.

Much of the green sector depends on subsidies - a big risk, as rising government debt loads draw budget planners' attention from climate change to the risk of a bond market revolt.

And Japan is not the only country targeting the green market. China's solar-panel makers have soared past Japan's in production volumes since Beijing designated the technology a priority half a decade ago.

China is also investing heavily in wind power and encouraging its carmakers to develop their own electric vehicles.

Even so, Japanese executives are betting that, because many green technologies are still in their infancy, their companies have an advantage: there is plenty of scope for the kind of painstaking improvement in materials, design and manufacturing at which Japanese groups traditionally excel.

"If you look at solar panels, for example, energy conversion rates are still low," says Toshihiko Omote, deputy chief technology officer at Nitto Denko, a maker of filters, adhesives and optical films.

"It's important to look for 'no-limit' areas where it still matters when you set a world record for performance."

Feb 8th - Toyota Lifts FY View, But Oct-Dec Net Profit Drops 39%

A little more than a year after a massive recall threatened to run it off the road, Toyota Motor Corp. predicted its net profit would jump in the current fiscal year ending in March thanks to strong sales overseas and extensive cost-cutting.

But Toyota also revealed in its results for the latest reporting period that it, like its Japanese rivals, is still being dogged by a stronger yen and a slump in domestic auto sales.

The world's biggest auto maker by sales Tuesday boosted its net profit projection to Y490 billion ($5.97 billion), up 40% from its previous estimate in November and more than double the Y209 billion it earned last year.

"The fact that we were able to raise our forecast indicates that our cost-cutting efforts have exceeded our own expectations," Toyota senior managing director Takahiko Ijichi said at a press conference following the earning release. "We think that shows we're back on the road to recovery."

However, the company also said that in the October-December quarter its net profit slid 39% to Y93.63 billion from Y153.22 billion in the same period a year earlier on the back of lower sales volumes in several key markets and persistent strength in the Japanese currency.

Toyota has raised its full-year profit outlook for three straight quarters, up from an initial estimate of Y310 billion back in May. The revised number for the year ending in March is still far below that of Honda Motor Co., which expects a Y530 billion profit for this fiscal year, but above that of Nissan Motor Co.'s Y270 billion estimate. Nissan reports its latest earnings on Wednesday.

Despite its steadily improving profit outlook, Toyota's income is still only at levels it reported more than a decade ago. Its targeted net profit of Y490 billion represents about 30% of a record Y1.718 trillion Toyota posted in the fiscal year ended in March 2008. Before the global slowdown that year, which forced Toyota into the red in March 2009, it hadn't posted net profit below Y500 billion since March 2000.

For Toyota, home is where it hurts most. Whereas the auto maker expects to boost overseas production by 7% on the year to 4.36 million vehicles by March 31, it sees domestic production falling 1.4% to 3.16 million vehicles. The company's exposure to Japan, where it dominates nearly half the market, has become a major drag on profitability amid shrinking Japanese demand for cars and Toyota's commitment to maintaining a domestic production base of at least 3 million vehicles a year.

A surge in the yen over the past year has made it difficult for Toyota to export more cars, which would lessen the slack in domestic production capacity. Akio Toyoda, the company's president and grandson of Toyota's founder, has indicated that the auto maker cannot profitably export compact cars when the yen is worth less than Y90 to the dollar.

While sales volume fell in three of its largest markets--Europe, Japan and North America--during the three months from October, profits rose in all markets except Japan. For the full year, Toyota expects sales to be flat or higher in all markets including Japan, where the rebates had helped boost sales until their cut off in September. In particular, the company pointed to high demand for its cars in emerging markets as far afield as South Africa and Thailand--which Ijichi called a pillar of the company's future growth strategy.

To cope with the strong yen and weak domestic sales, Toyota is trying to extract more profits where it's most competitive. "We are trying to raise prices selectively, sell more higher profit margin vehicles and produce more in the markets where our sales are growing fastest," Ijichi explained.

In the quarter ended December, Toyota's revenue declined 12% to Y4.673 trillion from Y5.293 trillion and operating profit sagged 48% to Y99.07 from Y189.11 billion.

For the full fiscal year, the Japanese auto giant expects to see an operating profit of Y550 billion and sales of Y19.200 trillion. These projections are better than its previous forecast for an operating profit of Y380 billion and sales of Y19.000 trillion.

Toyota's earnings estimates for this fiscal year are based on its company's expected average yen rate for the year of Y86 to the dollar and Y112 to the euro.

Ijichi also said Tuesday that his company "welcomes" the planned merger between steel giants Nippon Steel Corp. and Sumitomo Metal Industries Ltd., which was announced last week. He said the proposed deal represents the birth of a global major that could be an effective partner as Toyota expands its operations around the world.

Feb 8th - Asahi Breweries To Double M&A Spending

Asahi Breweries Ltd. plans to spend up to 400 billion yen on mergers and acquisitions in the two years through 2012, double the amount spent in the previous two years.

The major beer maker is stepping up M&As to gain sales momentum ahead of its transition to a holding company structure in July. Asahi has been conducting huge buyouts in recent years, including the acquisition of an Australian soft drink maker for 77 billion yen in 2009.

Asahi Group Holdings, to be set up on July 1, will oversee Asahi's liquor, soft drink and food companies, as well as a firm managing all of the current foreign units.

Asahi aims to boost group sales to 2-2.5 trillion yen by fiscal 2015 from about 1.48 trillion yen in fiscal 2010, in the hope of becoming a global top 10 food maker.

Feb 7th - Itochu Forms Holding Firm To Promote Solar Power Business In USA

Itochu Corp. on Tuesday created a holding company in California, which it claims to be the largest marketer of solar power generation systems in the United States, through management integration of its two local subsidiaries, the major trading house said.

The new firm, SolarNet Holdings LLC, aims to better compete against Chinese solar panel makers to tap rapidly growing U.S. demand for solar energy.

The holding company now owns all shares in Itochu's two subsidiaries -- SolarNet LLC and Solar Depot LLC, both based in California.

SolarNet operates DC Power Systems, a wholesale distributor of renewable energy products, and solar energy systems integrator Stellar Energy GP Inc.

Solar Depot is a wholesale distributor and systems integrator of solar electric and thermal systems.

Feb 4th - Sapporo To Buy Pokka In Soft-Drink Push

Sapporo Holdings Ltd. plans to spend about 30 billion yen to turn soft-drink producer Pokka Corp. into a subsidiary, adding to its 20% stake.

The move comes at a time when the Japanese brewer is scrambling to strengthen its soft-drink segment, which is smaller than its beer and real estate operations, in an effort to diversify its earnings. The firm also aims to accelerate its overseas expansion by tapping Pokka's sales channels in Asia outside Japan.

Sapporo will take a majority stake in the canned-coffee purveyor by acquiring shares from investment fund Advantage Partners LLP, which is Pokka's largest shareholder, and major confectioner and dairy firm Meiji Holdings Co., which owns roughly 20% of Pokka.

Sapporo's soft-drink business generates roughly 30 billion yen in annual sales, while Pokka logs about 97 billion yen in sales. Their combined sales would rank about eighth in the domestic soft-drink market.

Pokka has strength in lemon juice and is perhaps best known for its canned-coffee products. It owns some 90,000 vending machines mainly in greater Tokyo and Nagoya. Vending machines, which sell products at listed prices, have been bringing in stable profits amid intensifying price competition.

Pokka produces and sells beverages in Singapore, and it plans to construct a plant in Malaysia. Sapporo has cooperated with Pokka in production and distribution since taking a stake in 2009.

For Pokka, becoming a subsidiary of Sapporo means that it will have access to the brewer's strong finances and can boost sales of its products at home and abroad.

Domestic soft-drink manufacturers are increasingly consolidating to stay alive as the domestic market becomes saturated. Asahi Breweries Ltd. last year announced acquisitions of House Foods Corp.'s (2810) water business and Kagome Co.'s barley tea operations.

Feb 3rd - Sony 3Q Net Profit Slips 8.6% As Yen, Thin TV Margins Weigh

Sony Corp. said Thursday its net profit in the October to December period fell 8.6% from a year earlier, weighed by the strong yen and thin margins in its television business.

The Japanese electronics conglomerate reported a net profit of Y72.3 billion for the fiscal third quarter ended Dec. 31, compared with a profit of Y79.2 billion in the same period a year earlier. The figure was above the mean estimate of Y66.96 billion based on six analysts polled by Thomson Reuters.

Revenue slipped 1.7% from a year earlier to Y1.98 trillion, while operating profit dropped 5.9% to Y137.5 billion.

Sony generates about 70% of its sales outside of Japan, leaving the company vulnerable to the yen's appreciation. A strong yen hurts Japanese exporters because it makes their products more expensive abroad, while eating into overseas profit when brought back to Japan.

Echoing similar remarks by rival TV makers Panasonic Corp., LG Electronics Inc. and Samsung Electronics Co., Sony said conditions in its flat-screen television segment remain tough as falling prices squeeze its margins.

One bright spot was in the domestic market, where Sony's sales got a boost in the period from a government stimulus program that provided incentives for consumers to trade in old TVs for more energy-efficient models.

For the full fiscal year to March 31, Sony maintained its forecast for a net profit of Y70 billion and an operating profit of Y200 billion, though it trimmed its revenue forecast to Y7.2 trillion from Y7.4 trillion previously.

Sony's outlook is based on the assumption that the dollar will average Y82 and the euro will average Y110 for the January to March quarter.

Sony reports its earnings under U.S. accounting standards.

Feb 3rd - Japanese Government To Set Rules For 'Supercompacts' In FY12

The government will in fiscal 2012 introduce standards for "supercompacts," two-seat passenger cars in a smaller class than minivehicles.

The move comes amid rising demand among people who drive only in the city and from older Japanese seeking an easy way to run neighborhood errands.

Nissan unveiled its Land Glider, a two-seater electric vehicle, at the Tokyo Motor Show in 2009.

The Transport Ministry plans to set crash-safety standards in fiscal 2011 and submit a bill to revise the current legislation at a Diet session in fiscal 2012. Given that supercompacts are not allowed on highways, the ministry will likely relax safety standards for such autos, a move that could reduce their production costs.

The road transport vehicle law and other regulations define the standards for passenger cars with four or more seats and minivehicles that can carry up to four passengers. These cars are allowed to drive on highways and must meet certain safety standards, such as the ability to protect passengers from serious injury in head-on collisions at speeds of 50kph.

The current regulations also cover one-seat minicars, which are mostly used for delivery services. But because these vehicles are prohibited by law from carrying cargo heavier than 30kg, they can be impractical for shopping and other activities.

Domestic carmakers believe there is excellent potential demand for two-seaters. Not only do they appeal to elderly people looking for a convenient tool for running errands, but they also offer the benefit of lower carbon-dioxide emissions and can help ease traffic congestion in cities.

Nissan Motor Co. presented a two-seat electric concept car designed specifically for city driving at the Tokyo Motor Show in 2009, and continues to fine-tune it.

Feb 2nd - Honda Climbs To No. 2 In Market Capitalisation

Honda Motor Co. had the second-highest market capitalization of publicly traded companies in Japan on Tuesday, passing such firms as Mitsubishi UFJ Financial Group Inc and NTT DoCoMo Inc. on its way up from fifth place a year earlier.

While Toyota Motor Corp. remains well ahead of the pack, automakers now occupy the top two spots.

Honda shares gained 2% to close at 3,545 yen on Tuesday, a day after the firm upgraded its earnings forecast for the fiscal year through March 31. Its market cap swelled to 6.42 trillion yen, beating the previous day's No. 2 firm, DoCoMo, by about 28 billion yen.

The stock market has welcomed Honda's ability to weather a strong yen, underscored by its October-December results. In addition to cutting costs, the automaker has expanded operations in emerging markets, mainly through local production.

"I give high marks to Honda for essentially logging 140 billion yen in operating profit when the dollar was at about 83 yen," Goldman Sachs Japan Co. analyst Kota Yuzawa said.

The top 10 firms included others faring well in emerging markets, among them Mitsubishi Corp. at No. 8 and Nissan Motor Co. at No. 9. Automakers also got a boost from a North American recovery.

After hovering around No. 15 at the turn of the century, Honda regularly showed up in fifth or sixth place by 2009. Tuesday marked its first time at No. 2 dating back to the late-1980s economic bubble.