Tue, Jun 03, 2008 page11

• Nissan sales suffer on gas prices

  DOWNSHIFT The Japanese automaker is introducing new models in an attempt to capture a bigger share of the domestic market after sales dropped 6.1 percent

  • BLOOMBERG
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  Nissan Motor Co, Japan's third-largest carmaker, led a drop in domestic auto sales last month, as higher taxes and fuel costs cut demand for new vehicles.

  Sales of cars, trucks and buses fell 6.1 percent to 221,377 from a year earlier, the Japan Automobile Dealers Association said in a statement yesterday. The total excludes minicars.

  Japan’s consumer spending has slumped because of inflation driven by higher food costs and a record price for gasoline. Car sales also dropped on one less selling day and after the tax rate on automobiles rose to 5 percent last month from 3 percent in April.

  “With gasoline prices so high, consumer sentiment is taking a big hit,” said Takashi Aoki, who helps manage about ¥130 billion (US$1.2 billion) at Mizuho Asset Management Co in Tokyo. “People aren’t spending money at shopping malls and they certainly aren’t driving there either.”

  Gasoline in Japan surged to a record ¥160.3 a liter last week. The tax rate fell for one month in April after the government failed to agree on a revenue bill.

  The high gasoline prices also deterred transport companies from buying new trucks. Truck sales fell 16 percent last month to 29,659 units.

  Japan’s carmakers are reducing their reliance on mature markets such as Japan and the US, where sales are slowing, and expanding in emerging markets. Japan’s stagnant wages and a shrinking population dragged vehicle sales, excluding minicars, to the lowest in 35 years last year.

  China surpassed Japan as the world’s second-biggest auto market after the US in 2006. Emerging market sales will outstrip those of Japan, the US and Europe combined by 2010, consulting company Global Insight Inc said.

  Sales at Nissan dropped 11.4 percent to 33,681 vehicles. Last month, the company’s sales surged 11.5 percent, the most of any carmaker, as consumers rushed to buy vehicles at the lower tax rate.

  Toyota Motor Corp’s sales fell 2.8 percent to 105,519 vehicles last month. Sales for Honda Motor Co, Japan’s second-largest carmaker, increased to 26,900 vehicles, or 5.1 percent, helped by its revamped Fit compact.

  Japanese automakers have been introducing new models in the country to capture a bigger share of the shrinking Japanese auto market. Japan vehicle sales, including minicars, will likely fall to about 5.32 million units this year — a fourth straight annual decline, the Japan Automobile Manufacturers Association said.

  Toyota, which plans to raise domestic sales 0.6 percent to 1.6 million vehicles this year, has introduced three new models in Japan this year. Honda released its new Freed minivan in Japan on Thursday, as it aims to raise the company’s domestic market share to at least 15 percent from 12 percent now.

  Toyota rose 1.9 percent to close at ¥5,470 on the Tokyo Stock Exchange. Honda gained 2.3 percent to ¥3,610 and Nissan rose 0.9 percent to ¥945.

  Sales of minicars, powered by engines no larger than 0.66 liters, fell 2.8 percent to 139,147 units last month, the Japan Mini Vehicles Association said. Minicar sales peaked in 2006 at 2.02 million units.

  Daihatsu Motor Co, Japan’s largest minicar maker, boosted sales 3.9 percent to 49,168 units. Suzuki Motor Corp, the country’s second-largest, sold 45,018 minicars, little changed from last year. The two automakers were helped by the introduction of new models in December and January respectively.
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