Talk with Mr. Kawai, the President of NGK Spark Plugs __Channel JAPAN ＃22/2021

Car-related products remain our core business and generate about 80% of sales. What's more, the products themselves are for internal combustion engines, and that's despite the attention that EVs are getting in the media. Considering environmental issues, the world is shifting in that direction. We believe the time has come for us to begin shifting our core business, our portfolio.

We carried out a major reorganization. Until now, NGK Spark Plug was comprised of vertically integrated divisions. This time we've established a pseudo-company structure, stripping away the company system. Each division has its own assets and manages its business according to its own capital. The purpose of this change was to encourage quick and responsible decision-making within divisions. We just started the new fiscal year under this structure and are hoping that it produces good results going forward.

It's something that society itself is demanding, and as a company we undoubtedly have to respond and do all we can. The government has said it aims for carbon neutrality by 2050, but it's not possible simply within the scope of the technologies we've accumulated until now. Unless we pursue change that goes beyond existing notions, I don't believe it will be achievable. We may need to reuse CO2 emissions as fuel, for instance. We need to come up with new technologies, new ideas, and a new sense of motivation. Otherwise we can't achieve that target.

It's possible to generally forecast the near future, what will happen 10 years from now. Our current trajectory indicates that internal combustion engines may or may not peak out. They may start gradually declining and shifting to EVs. The challenges for EVs such as infrastructure are becoming clearer now. Another point is that looking 10 years ahead, I believe we'll probably see all kinds of technological innovations and advances beyond our imagination.

For example, 5G or 6G offering much faster data rates, which could give full remote control of production lines. I jokingly refer to this as Gundam. Gundam is an anime of a giant robot controlled from a cockpit. We may be able to see video of production lines from such a cockpit and pick up and assemble components. I believe we may really see that kind of world soon.

People will be able to simultaneously carry out multiple tasks from a remote location. I believe that age is approaching.

As I mentioned earlier, we believe we need to restructure our business portfolio. Within that, what is crucial for us is to supply our technologies, our core competence, to deliver products to businesses pursuing social sustainability. We have advantages in products for internal combustion engines now. Our main products are those which neutralize exhaust gas emissions. Despite what's being talked about now, internal combustion engines will continue running on roads in the foreseeable future. I agree we can't immediately switch to electric cars. We will continue supplying our products in this field and invest from that into new businesses, businesses that contribute to the world into the future. That's the big vision of our midterm management plan.

By continually delivering new technologies based on our existing ceramics technologies to fields where innovation is already underway, we believe we can contribute to society. It's a challenge we've already started taking on.

I believe fuel cells and batteries will become extremely important in the age of electric vehicles. The core stack section is made of ceramic. Electricity can be produced from hydrogen, and hydrogen from electricity, though in small amounts. It has that sort of function, and we want to leverage that. We can generate energy from solar, and the manufactured hydrogen or fuel can be used by factories, for example. If we can realize a circulatory system, we'll be able to contribute to factories becoming carbon neutral. Our four group companies set up Morimura SOFC Technology. The joint venture is focused on SOFC stacks, and we'll collaborate with various other companies to build up the business.

Conventions are rapidly changing. Given that, I believe we as people and individuals need to constantly ask ourselves what we can contribute to the world. Otherwise our goals will keep changing, and frankly we won't be able to live our lives with a sense of satisfaction. After all, I believe people need to contribute to and live as members of society. That's why I want to contribute something during my life. It doesn't matter if it's for society or for your family. I think it will actually lead to your sense of self-worth, and that gives you, or is equal to, a sense of fulfillment. I myself am always mindful of endeavoring to pursue work and interests that give me fulfillment.

In this age of rapid change, what kind of fulfilling society should we strive to build in the future? And what will you do there? The point is that it's not just a vision for society, but what you yourself can do.