Although Japan’s international presence is declining, there’s no denying that its national wealth remains largely driven by its industry. This is evident in the disruption of global supply chains in the event of a major disaster in Japan.
Japan’s manufacturing and industry activities are centered around a belt-like area known as the Pacific Belt. And, like other countries, there are “industrial zones” and “industrial regions” where manufacturing and industry are concentrated.
Japanese children first learn about these industrial zones and regions in fifth grade, the year they turn 11. We’d like to begin a series of articles focusing on each industrial zone and region, focusing on what’s covered in elementary school textbooks. We hope this series will help readers decide where to establish a base in Japan and form partnerships with companies located there.
In this first installment, we’ll look at the Keihin Industrial Zone, which straddles Tokyo and Kanagawa.
The Keihin Industrial Zone: The Smallest of the Three Major Industrial Zones
Readers who have flown through Haneda Airport, officially known as Tokyo International Airport, have likely seen the sight of numerous large factories nearby. This is the Keihin Industrial Zone.
From Haneda Airport, you can see the factories primarily in Kawasaki City, Kanagawa Prefecture, which is the central area of the Keihin Industrial Zone, centered around the JFE Steel steelworks.
However, the production value of the Keihin Industrial Zone is not necessarily large.
In the graph shown, the Keihin Industrial Zone is fifth from the top. Its production value is ¥23 trillion, less than half that of the Chukyo Industrial Zone (¥55 trillion). In fact, it is the smallest of the “three major industrial zones”—Chukyo, Hanshin, and Keihin.
This is due to the Keihin Industrial Zone’s location in large cities such as Tokyo, Kawasaki, and Yokohama. While the area once boasted a presence comparable to other industrial zones, pollution and high land prices made expansion difficult, causing it to fall behind other industrial zones and regions.
Production volume will continue to shrink, but it will not disappear
In terms of production volume, the Keihin Industrial Zone is likely to remain in the same state for the foreseeable future.
As mentioned above, the JFE steelworks is located in the heart of the Keihin Industrial Zone. However, the steelworks’ blast furnaces have already ceased operation in response to carbon neutrality efforts.
Also, please take another look at the graph above. You can see that the green portion, or the chemical industry, accounts for a relatively large portion.
Frankly, the future of Japan’s chemical industry is quite bleak. I recently had the opportunity to interview a veteran Japanese chemical analyst at a global think tank. After explaining the aging of facilities in Japan’s chemical industry and the rise of Chinese companies, he stated that Japanese companies will likely be forced to consolidate their operations across borders, forcing some aging Japanese factories to close.
In addition to the decline of steel and chemicals, there’s also the negative reality that Nissan Motor’s Oppama Plant has decided to scale back production of key models. The Oppama Plant is located in Yokosuka, Kanagawa Prefecture, and is also part of the Keihin Industrial Zone.
However, this does not mean that the Keihin Industrial Zone will disappear. Even now, taking advantage of its proximity to Tokyo, the Keihin Industrial Zone serves as a base for prototyping and high-value-added products. It is also home to numerous research laboratories.
From another perspective, given its proximity to the Keihin Ports (Tokyo, Kawasaki, and Yokohama), Haneda Airport, and Narita International Airport, the Keihin Industrial Zone is likely to continue to function as a logistics hub for manufacturing.
The “geographical advantage” of proximity to Tokyo and other cities
At the beginning, I wrote that this article can be used as a reference when choosing a base or partner in Japan. In this regard, one feature of the Keihin Industrial Zone is that it is close to major cities such as Tokyo and Yokohama, cities where major companies have their bases.
Therefore, in terms of the speed of communication and information transmission, the Keihin Industrial Zone has a geographical advantage that sets it apart from other industrial zones and regions.
