Sales of new imported vehicles in Japan, including those assembled overseas by Japanese automakers, increased 0.4% in fiscal 2005 from the previous year to 269,796 units, an industry body told Kyodo News on Thursday.

The figure marks the first increase in two years. Sales in the year ended 31 March comprised 251,559 units made by foreign firms, up 2.9% and the first increase in three years, and 18,237 units made by Japanese automakers, down 25.0%, said the Japan Automobile Importers Association.

The total does not include minivehicles.

The association said foreign carmakers launched a number of new models, including some from Mercedes-Benz and BMW, to try to counter competition from Toyota's upscale Lexus, which debuted in Japan last year.

Meanwhile, few new Japanese models hit the market during the year, the association said.

In March alone, new imported vehicle sales fell 0.3% from a year before to 36,149 units, consisting of 34,187 foreign-brand vehicles, up 1.3%, and 1,962 units of Japan-brand vehicles, down 22.1%.

In fiscal 2005, Volkswagen, Mercedes-Benz and BMW remained the three top-selling brands.

Volkswagen was the best-selling brand for the sixth straight year. It sold 53,851 units, down 3.8% from the previous year, capturing 19.96% of Japan's imported vehicle market.

Mercedes-Benz boosted sales 13.8% to 48,423 units, accounting for 17.95% of the market. BMW also expanded sales 19.1% to 46,632 units, taking a 17.28% market share, Kyodo News added.