By Mike Caggeso
Sales of cars, minicars, trucks and buses hit a 28-year low, falling 5%, or 5.08 million, from the 5.35 million sold in 2007, according to figures released by the Japan Automobile Dealers Association (JADA) and Japan Mini Vehicles Association, Bloomberg reported.
Worse, domestic auto sales in December totaled 183,549 vehicles – a 22% decline and the biggest drop on record – showing the sales crunch is a growing problem.
"We never imagined sales would fall this badly," JADA Director Takeshi Fushimi said, Reuters reported. "This is a bleak situation."
Widespread job losses plagued the industry, sapping consumer demand and chopping hundreds of thousands of vehicles from sales tallies.
"The industry is going through a blizzard," said Ichiro Takamatsu, chief investment officer at Alphex Investments Co., a Tokyo-based hedge fund, told Bloomberg. "In Japan, people don't see cars as their status symbol anymore with this economic slowdown."
According to JADA figures, Toyota sold 1.47 million vehicles in Japan last year, a 7.4% fall. Nissan's sales came in at 537,553 units, down 5.8%.
Honda Motor Co. (ADR: HMC), however, sold 423,628 units – a 6.4% gain – partially because of higher demand for new and moderately priced models of the Fit compact and Freed compact minivan. The latter only sold domestically in its first year.
Last month, the Japan Automobile Manufacturers Association projected annual sales would fall again in 2009. It estimates that new automobile sales will fall to 4.86 million vehicles, which would be the first drop below 5 million in 31 years.
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