Japanese New Car Market Worst In Decades
The Japanese car market is in the midst of the worst crisis since 1978. The Japan Automobile Manufacturers Association expects auto sales in Japan to fall to a 34-year low in the current fiscal year that ends in March 2012. This as a result of the severe production drop, triggered by the March 11 earthquake and tsunami.
JAMA said it expects Japan’s domestic auto sales to fall 3.3 percent from a year earlier to 4.450 million vehicles. That would be the lowest level since March 1978, says The Nikkei [sub].
As companies are solving supply problems and are ramping up production, JAMA expects sales to pick up over the second half of the fiscal year when JAMA forecasts a 17.4 percent rise in sales for the seven months to March. This compares with and cannot quit make up for the 28.6 percent drop in sales in the first five months through August.
All in all, JAMA expects “overall levels of demand to be sluggish,” as JAMA president and Nissan COO Toshiyuki Shiga said at a press conference today.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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So, is this a supply problem or demand problem? You'd think that with so many cars lost in the tsunami, demand would be up.
If there was ever an opportunity for the American manufacturers to gain a toehold in the Japanese market, then it's now. Start shipping over as many Focuses, Fiestas, and Cruzes as possible and see the market share increase.
Not the least bit shocking given the year runs April to March. The market seems to be recovering as expected. Obviously nobody was expecting second half demand to *fully* recoup the lost demand from the first half.