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Japan's Economy Challenges Domestic and Import Manufacturers' 1998 New Car Sales

13 February 1998

Japan's Economy Challenges Domestic and Import Manufacturers' 1998 New Car Sales

    WASHINGTON, Feb. 13 -- Selling cars to Japanese consumers is
becoming a greater challenge among the approximately thirty automobile
manufacturers now competing in a declining Japan vehicle market according to
Japan Auto Trends, newsletter of the Japan Automobile Manufacturers
Association (JAMA), released today.
    "The bottom line is that persistent attention to quality, service and
consumer taste becomes more crucial to gaining market share," William C.
Duncan, General Director, JAMA USA said.
    Car sales in 1997 in Japan fell 3.8 percent.  Imports, excluding reverse
imports (those built in Japanese plants overseas) fell 3.9 percent.  Big Three
Detroit cars fell 18 percent primarily due to poor consumer acceptance.
However, other importers fared better, including Mercedes (+2.3%), VW/Audi
(-0.3%), Rover (+0.9%), Citroen/Peugeot (+5.6%) and Fiat (+16.5%).
    "The largest importers in Japan's market, with the exception of Mercedes,
have a significant position in Japan's highly competitive small/mini car
market, which makes up 80% of total car sales.  The Big Three have only 1.1%
of their sales in this huge market segment, while VW/Audi has 72%," Duncan
added.
    In a recent J.D. Power study of Japanese vehicle consumers, particularly
high marks were given to Mercedes, BMW and VW for luxury and status.  Japanese
brands rank high for meeting customer needs and service.  The study, in
reporting top-ranking vehicles, did not indicate where the Big Three cars fell
within overall rankings.
    This issue of Japan Auto Trends also reports on the Japanese automakers'
response to the global environmental challenge as well as highlighting details
of the new JAMA brochure, The Need for More Environment-Friendly Automotive
Technologies.
    The newsletter features an article on how the impact of Japan's land
scarcity and expensive fuel shapes the demand for automobiles.  Japan, with a
total landmass of 145,850 square miles, is the size of California, with a
population of more than 125 million or half that of the U.S. The need for
small, fuel-efficient cars isn't a matter of personal taste but rather one of
personal necessity in a country this crowded.
    In addition, Japan Auto Trends contains 1997 data for vehicle sales by
manufacturers as well as by market segments -- small/mini and large.
    Japan Auto Trends is a quarterly publication examining developments in
Japan's auto markets.  The publication is also available on the JAMA Web site
-- http://www.japanauto.com.
    JAMA, headquartered in Tokyo, has offices in Brussels, Singapore and
Washington, DC.

SOURCE  Japan Automobile Manufacturers Association, Inc.