Japan’s Automotive Industry Is Undergoing Major Changes – International Pages – Brief Article – Statistical Data Included
Japan’s automobile production for 1999 fell 1.5 percent from the previous year to 9.89 million cars, falling short of 10 million for the first time in 20 years, according to the Japan Automobile Manufacturers Association.
The decline was attributed to a fall in domestic sales, reflecting the nation’s economic slump. Exports also remained sluggish due to the stronger yen.
Production of subcompact passenger cars for 1999 dropped 9.0 percent, while that of minicars rose by 32.6 percent. Minicar sales have been brisk since October 1998, when the vehicle standard was revised to permit manufacturers to increase the length and width of models with engine displacements of up to 660cc.
Production of trucks for 1999 declined 9.8 percent, and output of buses fell 15.0 percent.
Meanwhile, the world’s automobile industry has been seeing a wave of cross-border tie-ups, partly spurred by the merger between Daimler-Benz AG and Chrysler Corp. in September 1998.
The global consolidation of the auto industry has also involved major Japanese car makers. General Motors Corp. has three Japanese automakers under its wing: Suzuki Motor Corp., Isuzu Motors Ltd and Fuji Heavy Industries Ltd., Ford Motor Co. owns a third of Mazda Motor Corp. Nissan Motor Co. and Renault SA concluded a capital tie-up in early 1999 in which the French car maker became the largest shareholder in the ailing Japanese firm. Nissan is carrying out a major restructuring program under the lead of Carlos Ghosn, chief operating officer from Renault. Mitsu-bishi Motors Corp., which has a capital tie-up with Sweden’s Volvo AB and DaimlerChrysler are negotiating a comprehensive alli-ance that will give DaimlerChrysler about a 34 percent stake in Mitsubishi.
Toyota Motor Corp. acquired more than 50 percent of Daihatsu Motor Co. in 1998, and plans to increase its stake in Hino Motors Ltd. to over 50 percent. Toyota also plans to buy about 5 percent of Yamaha Motor Co. to join hands in developing and producing car engines. Toyota hopes to strengthen group ties to compete with GM, Ford and other major overseas car makers.
Honda Motor Co and GM agreed in late 1999 to supply engines to each other and cooperate in developing environment-friendly cars. Honda, however, has no plans to conclude capital tie-ups with other companies. Japanese car makers are reducing their domestic production capacities and increasing overseas output. Nissan plans to close five domestic production sites and reduce domestic output by about 30 percent to 1.65 million cars. Toyota plans to cut domestic annual production capacity to between three million and 3.5 million cars from the current 3.8 million, while Mazda plans to reduce domestic output by about 20 percent from the current annual figure of 1.1 million cars.
KEY INDICATORS:
Domestic car production (vehicles)
1995 10,195,536
1996 10,346,699
1997 10,975,087
1998 10,049,792
1999 9,895,476
Source: Japan Automobile Manufacturers Association
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