Passenger car sales in Japan were 6.8%
ahead of last year as at the end of February, rising to 634,162 from 593,880. That makes
it four months out of the last five that car sales have risen against year ago levels, and
under most circumstances that would be regarded as good news for the sector. However,
despite the upturn, which came after 18 consecutive falls in the market, there is still an
absence of the feel good factor. The problem for the Japanese is that the recovery has
come about through rather artificial means rather than a natural return to the growth

The Japanese car market has been worth
close to 4.4 million units a year for the past decade, but the market fell to under 4.1
million in 1998 and doesn’t look likely to get much higher than 4.2 million in 1999,
despite the current boost. The problem is that all of the growth in the past few months
has been the result in the change in legislation concerning micro cars. As of last October
these now have to be longer and wider and include enhanced safety features. That meant
that all of the players in that particular sector had a plethora of new models ready for
the launch date, and it is those and those alone that have driven the sector over the past
few months.

Although the market is up by some
40,282 units, which is a figure greater than the sales of seven of Europe’s countries for
the first two months, it is clearly bringing little relief to most of the players in the
scene. Imports from indigenous manufacturers such as Toyota, Nissan and Mitsubishi have
been whittled away and in the case of Nissan have been almost halted. Most other importers
are also under the cosh with the likes of Audi, GM Opel and Ford sharing the pain being
felt by Volvo and Chrysler.

The big wins in the market to date have
come from those who can offer a good choice of micro cars, and they are being led by
Suzuki (+10,646 units) who brought out four new models to meet the new legislation.
Daihatsu brought out three new models and that is reflected in their 6,324 unit gain.
Mitsubishi also had three models and benefited from that with a 3,027 unit gain, whilst
Honda sparkled with a 9,256 unit uplift courtesy of their two new models. Subaru only had
the new Pleo to meet the required changes, but that resulted in a 7,641 unit gain, whilst
Mazda picked up 1,165 extra sales after also launching three new micro models. The one
exception to all of this has been Toyota who have boosted sales by 7,962 units despite
being absent in the micro car sector.


Nissan’s lack of a micro car is highlighted
by the fact that they were the only Japanese marque to stay in the red during the opening
period. Nissan sales fell by 7.9% to 100,033 from 108,642 and Renault will quickly realise
just how big a problem they have decided to tackle. Toyota may not have an own-brand micro
car, but they do have Daihatsu as part of their family.

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The performance of the Japanese makers
apart, the only remarkable feat to date has been the 40.4% gain by Mercedes-Benz, lifting
sales by 2,336 units to 8,112 from 5,776. Mercedes does not have a micro car in the
Japanese market, but it does now have the A Class, and that seems to be doing the trick
for now.