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January new auto sales plunge 27.9% in Japan

February 4, 2009
By Ken Worsley


According to data released Monday by the Japan Automobile Dealers Association, sales of new cars, trucks and buses in Japan fell 27.9% in January, to 174,281 units. That figure, which does not include the sales of mini-cars, is the lowest seen in 37 years and is about half of the all-time highest monthly sales figure of 325,468 from January 1990.

Amongst the major automakers, Toyota saw a 23.4% fall in sales with the Lexus brand included. With Lexus stripped out, Toyota moved 81,985 units, for a 22.5% decline. Lexus sales fell 57.7% to 1,270 units. Nissan saw a 31.1% slide to 30,786 units, while Honda’s sales dropped 30.7% to 22,087. Mazda saw a 34.5% fall to 10,701 units, and Mitsubishi sales dropped 53.9% to 2,988. Subaru saw a 28.2% slide to 4,088, while Suzuki saw the lowest percentage drop, at 17.1%, having sold 4,557 vehicles.

In a separate report, the Japan Mini Vehicles Association announced that sales of mini-cars fell 5.6% in January to 127,426 units. Sales of mini-cars have now fallen for three consecutive months.

The consequences of the global downturn in demand for new vehicles look dire. Mitsubishi, Mazda and Subaru all announced on Wednesday that they will fall into the red for fiscal 2008. Mitsubishi has pulled out of the Dakar rally, and Mazda is set to cut 500 more jobs.

Bloomberg points out that Mitsubishi and Mazda had both forecasted profits for the current fiscal year, and that both firms will “cut capital expenditures and jobs as they try to limit the damage from the worst U.S. car market in 27 years.”

Back in November, BusinessWeek speculated that Japanese auto firms might soon be seeking bailouts from the government, especially if they began to show red ink. According to the Nikkei, Mitsubishi President Osamu Masuko told reporters on Wednesday that the firm doesn’t “need to boost capital, so we’re not considering [seeking bailout funds].” At the same time, Mazda’s Nobuyoshi Tochio, the general manager of financial services at the firm, told reporters that Mazda “is not considering receiving public funds.”

Mitsubishi, however, is planning to secure about 50 billion yen in low interest loans from the Development Bank of Japan. Such loans are a part of a set of emergency measures established by the government intended to support firms during the financial crisis. It’s coming down to semantics.

Filed Under Automotive, Economic Reports 

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One Response to “January new auto sales plunge 27.9% in Japan”

  1. Japan - Engine Failure | Bear Market Investments on March 31st, 2009 12:45 am

    […] from where the much awaited boost in domestic demand is going to come from; note for example here that autosales dropped a healthy 27.9% in January. Add to this that retail sales dropped 5.8% on an annual basis with the […]

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