• Home
• About/Contact
• Economic Reports
• Research
• Advertising

• Business
• Economics
• Reports
• Finance
• Marketing
• Politics
• Real Estate
• Services
• Retail
• Tech

Subscribe

News roundup, Thursday October 1: Wages, Tankan, Nikkei, Disney, auto sales and more

According to a report released yesterday by the Ministry of Health, Labour and Welfare, average wages at Japanese firms with five or more workers fell 3.1% in August, to 273,360 yen. August was the fifteenth straight month of decline in wages, and overtime pay dropped 13.4% to 16,259 yen. The industry with the highest average pay was “electricity, gas, heat supply and water,” at 452,968 yen, while workers in the food services industry came in lowest, with an average of 129,169 yen.

In a separate report released by the Ministry of Economy, Trade and Industry, it was announced that retail sales fell 1.8% in August, showing a decline for the twelfth month in a row. Read more

January new auto sales plunge 27.9% in Japan

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.

Toyota shut down (almost?) all domestic production facilities yesterday

Several reports on Toyota hit the media today, and we’ll just take a quick look at two of them. First, the Nikkei is reporting that Toyota shut down all twelve of its domestic production facilities yesterday, and intends to close them again twice more in January. This will be followed by 11 days of closure over February and March.

The Japan Times published a Kyodo report stating that Toyota had closed 11 of 12 production facilities yesterday, in an attempt to bring new vehicle production down to about half of last year’s level. According to Kyodo, production cuts will reduce Toyota’s output to 11,000 units per day, which is the effective borderline for profitability.

In addition, Toyota has announced plans to suspend production at all seven of its North American factories for up to 30 days from January to March.

New auto sales plunge 23.3% in December, 6.5% for 2008

According to data released this week by the Japan Automobile Dealers Association, domestic auto sales in December fell by a whopping 52,593 units, or 23.3%. For the entire year of 2008, new auto sales fell by 221,487 units, which translates to a 6.5% drop. This is the lowest number of cars sold in Japan since 1974.

Meanwhile, new auto sales in the US fell 36% in December, while overall 2008 sales were down about 18%. This is all bad for Japan’s automakers, who continue to report a string a bad news. Toyota, which is faced with its first operating loss in 71 years, announced earlier this week that it would close all 12 of its domestic production facilities for six days in February and five days in March. Now, Toyota has announced that it is asking workers not to use personal holidays on these days, but instead to forgo wages. Union representatives are hoping that some form of kaizen sessions can be planned for these days off, so that workers may continue to earn partial wages. Read more

Merry Christmas! Isuzu cut your salary!

With Toyota cutting 750 billion yen from its fiscal 2008 profit projections, and seeing its output drop for the fourth straight month in November, it’s no longer any surprise that Japanese automakers are cutting back on just about any and all expense.

But Isuzu takes the cake, leaking to the Nikkei on Christmas Eve that it plans to cut salaries for all employees by about 8,000 yen. Of course, this is better than staging mass layoffs - if they can be held off, and we do find some solace in the fact that executive compensation will be cut by about 30%. Still, the average unionized Isuzu employee makes only about 300,000 yen per month, and previous pay cuts in 2002 only generated greater profits for the firm, which makes one wonder about the competence of union leaders - Isuzu’s operating profit hit an all-time high in FY2007, after increasing for five consecutive years.

In November, Isuzu decided to eliminate every contract worker - all 1,400 of them. Pressure from workers, however, has led the firm to not terminate work contracts for contract workers before they expire.

October new auto sales in Japan down 13.1%, to 1968 levels; Toyota cuts FY2008 profit projections by 74%

According data released Tuesday by the Japan Automobile Dealers Association, domestic auto sales in October decreased to 233,922 vehicles, down a whopping 13.1% from October 2007. October’s figures followed a 5.3% decline in September and a 14.9% slide in August. October was not only the third straight month that sales showed a decline, but sales fell to their lowest level since 1968.

While Toyota and Nissan saw respective 14% and 20% falls in sales, Honda’s sales jumped 10% in October. In September, all three firms saw large drops in sales in the US market, with Toyota dropping 23%, Nissan falling 33% and Honda slid 25%.

The Japan Mini Vehicles Association also announced that sales of mini cars (vehicles with engines of 660cc or smaller) rose 6.2% in October, to 145,444 units. Read more

Convenience store sales up, Mos Burger in Indonesia, lower sales at Toyota and trouble with the iPhone

According to the Japan Chain Stores Association, sales at Japan’s convenience stores increased 6.6% in September from a year earlier. Total sales hit 624.0 billion yen, showing a rise for the fifth consecutive month, as customers continue to flock to convenience stores for their tobacco products. September’s figures follow a 7.5% rise in August.

Keeping watch of Japanese service brands moving overseas, Mos Burger has announced plans to move into the Indonesian market. According to the Nikkei, the firm intends to set up a joint venture capitalized at 2 million dollars. Masuya Holdings will contribute 70% of the funds, while Orix’s Indonesian subsidiary will chip in 20%. This leaves Mos with a 10% stake in the firm. Mos Burger intends to open 15 shops in Indonesia by 2011, with 50 or so being open ten years from now.

According to Attractors Lab, 62.2% of those folks in the market for a new condo in Japan believe that current prices are too high. This figure is up by 6.4% from July.

In the bad news category, Japanese steelmakers are set to cut production for the first time in three years, as demand from automakers has slowed. At the same time, Toyota’s sales are expected to slide for the first time in ten years, by 2%, in 2008.

Finally, the Nikkei is reporting that quality control problems with Apple’s iPhone are apparently “tarnishing” the firm’s image in Japan. Nikkei lists trouble with the “MobileMe” service, as well as faulty chargers, software glitches and the “freezing of the iPhone while in use” - I used to call that a “blue screen of death.” Any iPhone users out there to report?

Japan auto sales up 6.9% in April, Exports and Production up in March

According data released last Thursday by the Japan Automobile Dealers Association, domestic auto sales in April increased to 232,993 vehicles, up from 217,911 in April 2007. Major auto makers did well: Toyota saw an increase of 8.8%, Nissan saw a rise of 11.5% and Honda sales increased 4.7%.

By category, passenger car sales were up 9.4% at 201,155 units, while truck sales were down 6.7% to 60,662 units and bus sales slid 2.6% to 1,176 units. At the same time, the Japan Mini Vehicles Association said that sales of new mini-vehicles in April fell 2.8% to 135,837 units, showing a decline for the 13th straight month.

Auto exports increased by 12.3% in March, showing an increase for the 32nd straight month, hitting 638,384 units. In FY2007, Japan shipped 6.77 million vehicles overseas, up 10.4% over FY2006 and up for the sixth consecutive year.

Also in March, production of cars, trucks and buses in Japan rose 2.3%, up for the 8th straight month. In FY2007, the production of vehicles in Japan increased 2.5% to 11.79 million units, showing a rise for the sixth consecutive year.

New auto sales, minicar sales, import sales down in March

A year ago, we heard that a lack of new models was hurting domestic auto sales as they continued to slump throughout the year. Now, despite the fact that Japan’s automakers have been on a binge of releasing new models, new auto sales are still not picking up. In March, new auto sales fell 3.3% to 471,755 units, according to the Japan Automobile Dealers Association.

This year, it looks as though high gasoline prices are going to be the thorn in the side of automakers. Toyota has released twelve new models over the past year, Nissan has put out its revamped Skyline, and Honda has tinkered with its Fit, which has been the best selling model in Japan so far this year.

By category, car sales fell 1.4%, truck sales were down 15.1%, and bus sales slid 10.6%.

Breakdown by maker: Read more

New auto sales down 7.1% in December, 7.6% in 2007

High gasoline prices, a lack of exciting new products, increasing urbanization and an aging population are a dangerous combination of factors when one talks about new automobile sales. How dangerous? In 2007, new car, truck and bus sales in Japan dipped to their lowest level since 1972, sinking by 7.6 percent to 3,433,829 units (not including mini-vehicles).

Sales of trucks fell 17.6 percent and sales of buses declined 11.3 percent.

After the rises seen in October and November, overall vehicle sales slipped 7.1 percent to 236,142 vehicles in December.

Japan’s market for new cars peaked in - you guessed it - 1990 at 5,975,000 units. Since then it has been on the decline, though some years have been better than others. What must be troubling to those who seek to sell more cars in Japan is that 2007 was the fourth consecutive year of decline. Read more

Next Page »

Copyright © 2006-2010 Japan Economy News

Privacy Policy | Disclaimer