Toyota In Domestic Sales Slump

Frank Williams
by Frank Williams

Toyota's enjoying record financial prosperity; year-on-year, the world's largest automobile manufucturer's Q2 operating profits rose 31.8 percent (675.43 billion yen vs. 512.42 billion yen). The lion's share of Toyota's success stems from strong U.S. sales of high margin models (Tundra and Lexus LS), bolstered by a weak yen. Meanwhile, back at home, bleh. ToMoCo's domestic sales slumped 10 percent, dropping 43k vehicles compared to last year. Speaking to the Japan Times, Yoshihiro Okumura, from Tokyo's Chiba-gin Asset Management Co. says the downturn reflects a shrinking domestic pie. "It's becoming more difficult to make a large profit in Japan, as the market is shrinking and people aren't buying cars." In an attempt to spur sales, Toyota has unleashed 11 new or redesigned cars in the past 16 months.

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  • 210delray 210delray on Aug 03, 2007

    I would assume the problem is as borderinsane describes it, with an aging population, near-zero immigration, and fewer newborns. So am I correct that the population is already heading downward?

  • Johnson Johnson on Aug 03, 2007

    Let’s tell the whole story regarding the Japanese market. The market *as a whole* is in decline. Nissan and Honda are seeing dropping sales as well. The key is that Toyota is maintaining it’s marketshare in Japan, which means in other terms Toyota is not really losing sales to the competition, but simply losing sales due to a shrinking market. Minicars are the only growing market in Japan, and Toyota’s Daihatsu brand has the #2 top selling minicar (and overall #2 selling car) on the market. In fact, in the top 20 best selling cars in Japan, the list is still dominated by Toyota. Why is this headline “Toyota in domestic sales slmup” Wouldn’t it be more *truthful* to put the headline as “Japanese automakers in domestic sales slump”?

  • Frank Williams Frank Williams on Aug 03, 2007
    Johnson: Why is this headline “Toyota in domestic sales slmup” Wouldn’t it be more *truthful* to put the headline as “Japanese automakers in domestic sales slump”? Because the article being blogged is about Toyota, not an analysis of the entire Japanese auto industry.
  • 97escort 97escort on Aug 04, 2007

    In addition to the above described demographic situation, Japan is experiencing the results of no domestic oil production. Japan imports all its oil. With oil prices rising due to Peak Oil, Japan is feeling the effects more than any other advanced country. It had tried hard, but it's very difficult to have a growing auto market with rising oil prices and declining world oil production. Japan is a forecast for what the U.S. will experience as Peak Oil hits the U.S. auto market. The outlook is not good.