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New report shows 35% decline in Japan's total vehicle sales in March 201

By / 7 years ago / Latest News / No Comments

The report by companiesandmarkets says that a drop in sales was inevitable given the extent of the damage to some vehicle plants, but mostly to the facilities of suppliers based in the north where the disaster struck, which has significantly disrupted the supply chain.

However it adds that the slowdown is not entirely a result of the disaster. March was the seventh consecutive month of lower sales year on year and continues the trend started when government incentives on car purchases were withdrawn.

Looking to the full year, the firm says it had initially expected sales to exceed 5mn in 2011, but this will now depend on how quickly carmakers can return to normal operation schedules. The company comments: 'We have leaned on the side of caution in lowering our forecast markedly to show a decline in sales of 46% in 2011. While we would expect slower sales for the following months after the disaster, we believe replacement sales will begin to feed in by Q411 and into 2012.'

It adds that: 'While we had initially expected growth in import sales to be lower in 2011 in line with lower overall demand, we do now see some opportunities for imported brands if domestic carmakers cannot fulfil demand when consumers are in a position to buy again. The downside risk to this scenario is that foreign carmakers are also feeling the effects of the disrupted supply chain. However, one of the big stories in Q1 11 is a fourfold increase in imports of Japanese brands from overseas plants, led by a fourfold increase in March 2011. Total imports for Q111 were up by 30% y-o-y, which suggests the flexible globalised production of some domestic brands will come into play in fulfilling demand.'

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