Japan Sees Domestic Car Sales Rise Ahead of Tax Hike

02/05/97

Reuters reports that Japan's domestic car sales rose 14.9 percent in January 1997, year-on-year (excluding 660cc minivehicles). The rise was aided by demand from consumers who want to buy cars before the nation's consumption tax rises from 3% to 5% in April. The Japan Automobile Dealers' Association said that Japanese vehicle sales hit 336,642 units in January, for the fifth consecutive monthly rise on a year-on-year basis. January sales surpassed a record high of 325,468, set in January 1990.

All Japanese automakers realized year-on-year gains for January, except Isuzu. Isuzu attributed its sales drop to a shift in consumer buying trends from heavy sports-utility vehicles to lighter models. Kankaku Research's senior analyst Nobuaki Yanachi said, "the results of the January sales were as expected." Carmakers expect domestic sales to continue to climb until April when the higher tax rate takes affect.

Paul Dever -- The Auto Channel