SocialNew York
Baltimore
Washington D.C.

Creating“Social Value” －Social－Overseas Deployment ofHigh-Speed Railway Systems

Dallas
HoustonNortheast Corridor Project(Washington D.C. – New York)

Texas Project(Dallas – Houston)Socialperpetuity. Candidates for overseas expansion are countries andregions where we can expect to introduce complete systems on
new high-speed passenger rail lines, where our superior highspeed rail systems can be used to their full potential. We also
take into consideration that the candidate country/region haslegal systems for intellectual property, etc., political stability, andeconomic power to make huge infrastructure investments. Given
these conditions, we are currently targeting the United States.

system that includes civil engineering structures, signaling
equipment, rolling stock, operation management systems, andmaintenance and repair, as well as provide consulting services
necessary to ensure the safe and reliable operation of high-speed
railways, including the preparation of technical specifications andoperation and maintenance manuals, and the coordination ofrelevant Japanese companies.

Efforts in high-speed rail projects in the U.S.
We are continuing our efforts in the Texas Project, whichaims to introduce the Tokaido Shinkansen system in Texas,
and the Northeast Corridor Project, which aims to introduce
SCMAGLEV (Superconducting MAGLEV) in the NortheastCorridor of the United States.
The Texas Project aims to connect two major cities inthe state of Texas, Dallas and Houston, with the Tokaido
Shinkansen high-speed rail system. The development entities,
Texas Central Partners and its subsidiaries (hereinaftercollectively referred to as“TC”), are working to develop thebusiness, such as formulating technical specifications, preparing
operation and maintenance plans, and raising construction
funds. We provide technological consulting to TC through our
local subsidiary, High-Speed-Railway Technology Consulting
Corporation (HTeC). We are also working with JapaneseTechnical consulting for Taiwan High Speed RailIn response to a request for technical assistance from theTaiwan High Speed Rail Corporation, which operates Taiwan’s
high-speed rail system based on the Japanese system, webegan providing technical consulting in FY2014 and havecompleted nine individual projects to date. Going forward, inaddition to the construction work we have been supporting

manufacturers to prepare for core system order contracts.
For the Northeast Corridor Project, we aim to introduce
SCMAGLEV in the Northeast Corridor connecting Washington
D.C. and New York and are carrying out promotional
activities so that the Washington DC. – Baltimore section canproceed first under the cooperation of the Japanese andU.S. governments. Currently in the U.S., the Federal Railroad
Administration and other organizations are conducting
environmental impact assessments with U.S. federal grants.
The Japanese government is also
engaged in a research project tointroduce SCMAGLEV in the U.S.
We intend to provide technicalsupport when the project makes
concrete progress.
Shinkansen inspection tour by U.S.
Secretary of Transportation Pete Buttigieg

since the planning stage, we will continue to respond torequests from the Taiwan High Speed Rail Corporation, suchas providing technical support for the procurement of newcars based on the N700S, which the Corporation has decided
to procure in 2023, and contribute to the Corporation’s safeand reliable transportation services.

Efforts to promote the Japanese high-speed railsystem as a global standard
We are continuing to work to establish the Japanese highspeed rail system, which is based on the principle of“CrashAvoidance,”as a global standard through the International
High-Speed Rail Association (IHRA).
61

CENTRAL JAPAN RAILWAY COMPANY Integrated Report 2023

Generating "Economic Value"

Creating "Social Value"

Corporate Data

SocialBuilding Relationships with Material Suppliers

Policy on material procurement

Consulting & coordination business
Based on the belief that infrastructure that is fundamental to
the local community and government, such as high-speed rail,
should be owned and operated by the government or a companyof the country or region, our policy for the overseas expansionof high-speed rail systems is to contribute to the project throughconsulting and other businesses, rather than becoming thebusiness entity. Specifically, we propose to provide a complete

Highlight

Creating“Social Value” －Social－Significance of overseas expansion
The expansion of high-speed rail systems overseas is expected
to expand the market for related Japanese manufacturers
and contribute to the maintenance and strengthening oftechnological capabilities, which in turn will flow back to
JR Central in the form of a stable supply of materials andequipment, technological innovation, and cost reduction. Itis an important initiative for JR Central to fulfill its mission ofmaintaining and developing Japan’s main transportation artery inBusiness Strategy

In order to procure higher-quality and reliable materials atreasonable prices to support safe and reliable transportation,
JR Central procures quality materials in Japan and fromabroad based on its Basic Philosophy of Material Procurement.
In particular, recognizing that quality is the most importantfactor, we conduct on-site quality audits at the plants ofour suppliers, as well as investigate the technical level andmanufacturing capabilities of suppliers and their businessconditions, to check that the quality required for the products
is ensured. We also strive to reduce costs by encouraging theentry of new suppliers, placing orders based on economies ofscale, and rigorously assessing manufacturing costs, among
other measures. In the railway business, which requires us tocontinue to fulfill our social mission in a stable and sufficientmanner over a long period of time, it is also necessary tomaintain the quality of the materials used in the businessover the long term. Amid the recent drastic changes in theenvironment surrounding materials, such as the shortageof parts and materials and long delivery times, we arecommunicating closely with our suppliers and asking them
Basic Philosophy of Material Procurement1

Procurement of high quality materials

3Procurement of materials at reasonable prices

567

Conducting a quality audit of rolling stock components

Actual procurement amount of main materials (FY2022)

Procurement prioritizes the maintenance of safe and reliable transportation

24to provide a stable supply and after-sale care. In particular,
we strive to place orders with multiple suppliers for materials
that are essential to the daily operation of our trains sothat we can avoid the risk of supply disruptions caused byearthquakes or other disasters. We also ask our suppliers
to comply with relevant laws and regulations and to respecthuman rights. We review their efforts in these areas whenstarting business and periodically thereafter.
Suppliers are“partners”with whom we work to reduce
costs while maintaining and improving product quality.
Establishing continuing and stable business relationships
with them enables us
to procure high-quality
products at reasonable
prices, thereby contributingto the strengthening anddevelopment of the entire
railway-related business inJapan, including our suppliers.

Pursuit of suppliers possessing a supply system capable of strictly
adhering to contractual delivery deadlines
Pursuit of suppliers capable of building a continuing and stablebusiness relationship
Pursuit of suppliers capable of supplying satisfactory after-sale care regardlessof whether such service is needed during normal or emergency times
Pursuit of suppliers capable of adapting to diverse usage
environments

8

Establishment of a satisfactory communication framework

9

Appropriate handling of information

10

Fair and equitable transactions

11

Pursuit of suppliers who give consideration to reducing theenvironmental burden

12Compliance with relevant laws and regulations

13

Providing and updating website information on procurements

Machinery andwork tools

7%

Rails and sleepers

Fuel and chemical
products

1%

Miscellaneous materials

1%

Rollingstockmaterials

Rails and othertrack materials

8%

Relays and switch supplies

Signals andcommunications
materials

8%59%

Purchase amount JPY

203.9billion

PowerApprox.
transmission
materials

400 suppliers

16%Power source equipment
and insulators

Rolling stock and bogies

Declaration of Partnership Building

IHRA Forum (left: main conference, right: technical visit)

In support of the “Declaration of Partnership Building” promoted by thegovernment and business organizations, JR Central declares that it will focus its
efforts on coexistence and co-prosperity throughout the supply chain, new businessalliances that transcend company size and affiliation, and compliance with desirable
trade practices between parent and subcontractors.

CENTRAL JAPAN RAILWAY COMPANY Integrated Report 202362