The Japan Automobile Manufacturers Association has forecast 3.635m new passenger cars will be sold in Japan next year, down 2.4% from an estimated 3.726m cars this year, according to a report.

The Associated Press (AP) said the forecast comes amid weak consumer spending in Japan - earlier this month, the government announced that domestic demand contracted 0.2% in the July-September period from the previous quarter.

In contrast, sales of Japanese cars overseas are booming with Toyota on track to pass General Motors in coming years to become the world's top automaker, with plans to boost global sales to 9.8m vehicles in 2008, the AP report added.

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