Boston, MA -- (SBWIRE) -- 02/08/2013 -- With Japan's eco-vehicle subsidy programme ending earlier than the official deadline of January 2013 due to the strong take-up rate of the allocated funds, new vehicle sales for September 2012 came in at 446,686 units, down 3.4% y-o-y. This was the first decline in the last 12 months. However, this is in line with BMI's view that the earlier growth rate of new vehicle sales was unsustainable and H212 was likely to see more subdued growth.

We do not expect new vehicle sales to surprise to the upside and stage a strong rebound for the remainder of the year. With 9M12 vehicle sales at 4.3mn units, we are maintaining our forecasts of 5.8mn units for 2012, a 36.9% increase y-o-y. Japan's economy is still sluggish and our country risk team forecasts 2012 GDP growth of 1.5%. With such pessimistic outlook, it will be harder for Japanese consumers to purchase new cars without the subsidies.

View Full Report Details and Table of Contents

Outside of the domestic market, in response to growing violence towards Japanese automakers due to the Senkaku/Diaoyu islands dispute, Toyota Motor announced in late September that it would completely halt production in China and instead choose to run down inventory for some of its models. We had previously warned that the company would face a temporary, but potentially, nasty shock to sales in China, as local consumers turned on Japanese brands. Even then, the violent reaction towards Japanese firms has been remarkable, begging the question of whether a return to normal operations will be possible over the medium term.

We also continue to see Japanese brands stepping up overseas production to offset the strong yen. Premium car manufacturer Infiniti has announced it will produce cars in Mexico for export to Latin America and North America. Infiniti is keen to increase its global presence. On the back of strong growth in Europe and Latin America, the brand aims to triple global sales to 500,000 units by 2016 from 146,000 in 2011. Similarly, Toyota announced in June 2012 that it plans to produce some 25,000 Yaris subcompact models at a French plant for export to North American markets from 2013. The move will require an additional investment of EUR8mn (US$10mn) in order for the facility to meet the specific requirements of the North American market.

About Fast Market Research
Fast Market Research is an online aggregator and distributor of market research and business information. Representing the world's top research publishers and analysts, we provide quick and easy access to the best competitive intelligence available. Our unbiased, expert staff will help you find the right research to fit your requirements and your budget. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.

Browse all Transportation research reports at Fast Market Research

You may also be interested in these related reports:

- Malaysia Autos Report Q1 2013
- Vietnam Autos Report Q1 2013
- Mexico Autos Report Q1 2013
- China Autos Report Q1 2013
- Brazil Autos Report Q1 2013
- Hungary Autos Report Q1 2013
- Pakistan Autos Report Q1 2013
- Argentina Autos Report Q1 2013
- Canada Autos Report Q1 2013
- Germany Autos Report Q1 2013