Related to the declining demand for cars in the U.S. market, the Japanese auto industry is feeling the pinch of it all as it has experienced a severe decline in the local production of their cars for export. All 12 Japan-based vehicle makers suffered a 41% decline from May output.
And as far as sales, companies are already lagging behind the auto group’s forecast for the fiscal year, expected to be the worst in three decades, due to falling wages and growing unemployment. It predicts Japan industry-wide sales will drop 8.5 percent to 4.3 million in the year ending March.
Japan has implemented tax cuts and subsidies on some fuel- efficient cars to spur auto sales. Consumers can apply for a 250,000 yen ($2,600) subsidy if they scrap a car more than 13 years old to buy a new one and 100,000 yen for a new car purchase without scrapping an old one.
The government expects the incentive to lead to the sale of an additional 690,000 vehicles this fiscal year. Electric, hybrid, natural gas, and some diesel vehicles also qualify for an exemption from the country’s weight and purchase taxes.
(Source) Bloomberg
Tags: auto industry, auto sales, diesel vehicles, feeling the pinch, fuel efficient cars, japan car, japan industry, japanese auto, purchase taxes, three decades