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Japan's new-vehicle sales jump 13.8% y/y in March, with YTD volumes up 12.3% y/y




Japanese new-vehicle sales were positive year on year in March as domestic demand picked up owing to new models launches.

IHS Markit Perspective:

  • Significance: Japanese sales of new vehicles, excluding minivehicles, totalled 460,654 units during March, marking a 13.8% year-on-year (y/y) increase. Minivehicle sales slipped 0.2% y/y to 230,721 units.
  • Implications: Japanese sales of mainstream registered vehicles grew for an eighth straight month in March, whereas minivehicle sales slipped in the negative territory for a third consecutive month, after briefly posting growth in December 2016.
  • Outlook: IHS Markit currently forecasts that light-vehicle sales in Japan will total more than 4.91 million units during 2017, up 1.4% y/y, helped by a gradual recovery in minivehicle sales and the continuation of "eco-car" tax benefits for another two years.

Japanese sales of new vehicles, excluding minivehicles, totalled 460,654 units during March, marking a 13.8% year-on-year (y/y) increase, according to data released today (3 April) by the Japan Automobile Dealers' Association (JADA). Of this total, sales of passenger and compact cars grew 14.8% y/y to 398,048 units, truck sales edged up 8% y/y to 59,792 units, while bus sales were up 5% y/y to 2,814 units. Sales in the year to date (YTD) stand at over 1.030 million units, reflecting an increase of 12.3% y/y.

Within the mainstream vehicle market, Toyota reported a sales increase of 11.1% y/y in March, to 196,794 units. It was followed by Nissan, which sold 67,992 units, up 32.8% y/y. Honda took third spot with a slight 0.3% y/y increase in sales to 49,880 units, followed by Mazda and Subaru, which sold 28,587 units (up 34.8% y/y) and 18,496 units (up 27.7% y/y), respectively. Suzuki came sixth with sales of 13,550 units, a 9.7% y/y gain. Seventh and eighth positions were occupied by Isuzu and Hino with sales of 13,160 units (up 17.6% y/y) and 11,443 units (up 30.8% y/y), respectively. These were followed by Mitsubishi and Lexus with sales of 6,134 units (down 4.4% y/y) and 5,626 units (up 24.4% y/y), respectively. Meanwhile, 46,584 vehicles were imported into Japan in March, up 6.5% y/y.

Sales of minivehicles, categorised as vehicles with an engine capacity of up to 660 cc, edged down 0.2% y/y in March to 230,721 units, according to the Japan Mini Vehicles Association. During the month, Suzuki became the leading player in the segment by posting sales of 71,215 units, up 9.4% y/y. Suzuki was closely followed by Daihatsu, which posted sales of 70,857 units, down 2.7% y/y. In third place, Honda's sales reached 42,896 units, down 5.4% y/y. Nissan occupied fourth position, its sales slumping 7.1% y/y to 23,549 units, followed by Mitsubishi with 9,050 units (down 6.8% y/y). Mazda and Subaru were next with 5,208 units (up 1.3% y/y) and 4,777 units (up 9.2% y/y), respectively. The last on the list was Toyota, which sold 3,165 units during the month, declining 2.8% y/y.

Outlook and implications

March marked as the eight consecutive month of increase for the new-vehicle sales in Japan. Sales surged 13.4% y/y during February and 8.6% y/y during January. Growth during the month can be largely attributed to positive demand for new models such as the Toyota C-HR and Roomy, Nissan Serena and Note, and Suzuki Swift.

During March, the minivehicle segment slipped in the negative territory for a third month in a row, after briefly posting a 1.7% y/y rise in December 2016. Nevertheless, the rate of decline has slowed considerably from the previous year as the long downward trend bottoms out. Sales during the month were partly helped by new model launches such as Toyota's Roomy and Tank, according to Yoshiaki Kawano, a Tokyo-based senior analyst from IHS Markit. The segment is already under pressure because of the negative effect from a 50% increase in minivehicle-ownership tax introduced in April 2015, which faced additional challenges in 2016 in the form of a mileage scandal involving Mitsubishi. The automaker suspended production and sales of four of its minivehicles, sold only in Japan, after the models were found to have inflated mileage ratings. In August 2016, the automaker was found to have overstated fuel-consumption data for eight more models including the Pajero, Outlander, and RVR. Sales of models affected by the first mileage-data scandal resumed on 1 July 2016, while sales of models involved in the second revelation restarted on 1 October 2016 with corrected mileage data. As a result, Mitsubishi's sales witnessed double-digit percentage declines during most of 2016 and recorded a 6.8% y/y decrease last month.

IHS Markit currently forecasts that light-vehicle sales in Japan will total more than 4.91 million units during 2017, up 1.4% y/y. Of this total, passenger-car sales, which account for nearly 85% of the overall market, are expected to grow by 2.5% y/y to 4.21 million units. Sales of light commercial vehicles (LCVs) are expected to fall 5% y/y to 704,097 units. Overall, we expect the growth this year to be partly fuelled by the continuation of "eco-car" tax benefits. In a bid to promote and support eco-car sales, the government extended the current eco-car tax breaks for another two years from April 2017 to April 2019, accompanied by more stringent fuel-economy standards.

About this article

The above article is from IHS Automotive Same-Day Analysis of automotive news, events and trends, and is a deliverable of the World Markets Automotive Service. The service averages thirty stories per day and also provides competitor and country intelligence. Get a free trial.