Consumer uncertainty sends new vehicle sales to 33-year low

Domestic sales of new vehicles fell to a 33-year low of 1.59 million units in the April-September half, down 8.8 percent for the second consecutive year-on-year fall.

The drop in sales, which excluded minivehicles with engine displacements of up to 600cc, was led by a 15.4 percent fall in small passenger cars to 746,297 units sold, the Japan Automobile Dealers Association said Monday.

Behind the fall are several factors discouraging purchases of new vehicles, an association official said, pointing to high gasoline prices stemming from crude oil rises, uncertainty over the future course of interest rates, and the fact that disposable household income has not increased in line with corporate earnings.

"Vehicles come behind such things as food and homes in terms of priority," he said. "As long as their vehicles work properly and do not look too bad, people refrain from spending on vehicles."

For September alone, sales of new autos declined for the 27th month in a row on a year-to-year basis to 328,363 units, down 9.5 percent from a year earlier.

New car sales declined in all categories. Passenger cars suffered a 4.9 percent fall to 285,633 units sold, while trucks dropped 31.4 percent to 41,699 sales and buses plunged 38.2 percent to 1,031.

By automaker, Toyota Motor Corp. sold 135,994 new vehicles through its Toyota-brand dealership network, down 4.3 percent, while sales of its upscale automobiles through separate Lexus showrooms remained level at 3,023, down 0.1 percent.

Nissan Motor Co. sold 60,104 vehicles, down 9.5 percent, while Honda Motor Co. booked an 18.4 percent fall in sales to 37,261 units.

Among other automakers, Mazda Motor Corp. saw its new vehicle sales decrease 5.4 percent to 20,919 units.

The Japan Mini Vehicles Association said sales of new minivehicles in the April-September period totaled 896,334 units, down 6.8 percent from a year earlier, with September sales falling for the sixth straight month to 171,435 units, down 6.9 percent from the same month in 2006.

Sales of passenger cars in the minivehicle segment dropped during the six-month period for the first time in four years to 670,450 units, down 6.0 percent, as minivehicle makers released almost no new models.