Boston, MA -- (SBWire) -- 07/23/2013 --The expected contraction in Japanese auto sales has continued into March, as sales for the month fell 11.3% year-on-year (y-o-y), taking the total for the first three months of the year, to 1,528,009 units, down 9.4% yo- y. We forecast an 11% decline for 2013, to 4.8mn units, based on the incentivised growth of 2012, which we believe will be difficult to repeat.
For 2013, we expect this trend of weak sales to continue as we do not expect the government to reinstate any subsidies for consumers. With the subsidies bolstering sales for much of 2012, it is reasonable to assume that sales in 2013 will contract without the subsidies. Given that the subsidies benefitted the small car segment, we forecast small car sales to contract 15% in 2013.
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One segment which could see a boost in sales is the electric vehicle (EV) segment due to the rollout of the ultra compact car. There should be interest in this mini car from the elderly target market given that it addresses an unmet need. Furthermore, the government's promise to provide subsidies of up to half the new vehicle's cost would provide a catalyst to ultra compact sales.
While the yen has weakened substantially to about JPY99/US$ currently, production decisions are made on a long-term basis and we do not expect Japanese automakers to reverse their overseas expansion strategy anytime soon. Indeed, Toyota announced plans in April, to base its Lexus car production in Kentucky in the US. That said, carmakers will take advantage of the weaker yen by ramping up their spare domestic production capacity should demand in overseas markets for their exports rise in the coming months.
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Japan Autos Report Q3 2013: New Research Report Available at Fast Market Research
Recently published research from Business Monitor International, "Japan Autos Report Q3 2013", is now available at Fast Market Research