Japan New Car Sales:

 https://mainichi.jp/english/articles/20211101/p2g/00m/0bu/060000c

Article:

TOKYO (Kyodo) -- New car sales in Japan dropped 31.3 percent in October from a year earlier to 279,341 vehicles, a record low for the month, weighed down by supply chain disruptions due to the coronavirus pandemic, industry data showed Monday.

It was the fourth straight month of decline and followed a 32.2 percent fall in September, also affected by a global semiconductor shortage. The outlook remains bleak as carmakers have cut production and postponed deliveries, leaving dealers unable to negotiate with customers.

Sales of cars other than minivehicles tumbled 30.2 percent to 176,743 units, also the lowest for the month of October since the survey began in 1968, said the Japan Automobile Dealers Association.

Ideas:

Sources in Japan say that it could take up to six months to get a new car as dealers are unable to provide cars for new buyers.

As manufacturing and especially the car industry is very important to the Japanese economy this could be a major constraint that is going to keep the Japanese economy from reaching the pre-pandemic level for a while.

The car industry in Japan and anywhere globally has connections not just the those who work at the car factories but probably thousands of suppliers who also might be effected by the chip shortage.

If the eight Japanese car companies cut production meaning stopping work, that could easily effect all of the suppliers and contractors involved in the car industry. So it could have a domino effect in the Japanese economy.

For example, back in 2008 when GM in the US was on the brink of bankruptcy the US government felt GM was too big to fail. Not just because of GM but because all of the suppliers in the US and globally that was connected to GM.

Article:

Sales of minivehicles, which have an engine displacement of up to 660 cc, dropped 33.2 percent to 102,598 units for the fifth straight month of decline. It was the first time in 40 years that minicar sales had dropped below 110,000 in October, according to the Japan Mini Vehicles Association.

The pandemic has disrupted the supply of components and has been exacerbated by factory shutdowns in Southeast Asia due to a resurgence of the virus.

By brand, Toyota Motor Corp. logged a 42.2 percent decline in sales, excluding minicars, to 79,458 units.

Ideas:

Japan seems to be a very unique situation or something like a symbiotic relationship among the eight car companies. While in the US there are only three car companies left if you don't count Tesla.

While in Japan there are eight. And yes, some now are like subsidiaries of Toyota and Nissan but the competition doesn't seem like the US. As maybe each have somewhat of a niche in what they do, which helps them survive among the stiff competition in Japan.

But again this is much bigger now than just the car companies. As any small or medium sized company that is connected or related the car industry might now have sales and production problems too.

The only good thing might be, and they probably do, if the car companies are sitting huge sums or cash in the banks to ride out the chip shortage period.

And the next situation, is like ANA and JAL, are the car companies in the future going to reduce the number of employees they have if this continues on and on.

JAL and ANA don't see their profits or sales returning this year and not even in 2022.

Article:

Mazda Motor Corp.'s fell 25.8 percent to 8,015 units while Nissan Motor Co. recorded a 13.9 percent decrease to 17,061 units.

As for minivehicles sales, Honda Motor Co., which produces a popular N-Box minicar, logged a 49.9 percent decline to 13,474 units. Those of Daihatsu Motor Co. dropped 45.2 percent to 30,062 units, with Suzuki Motor Corp. marking a loss of 23.5 percent to 34,829 cars.

Ideas:

During the pandemic the decrease in sales could have easily been attributed to decreased consumer demand and many consumers were worried about their jobs or waiting to buy or subscribe to get a new car.

But now as consumer demand in Japan is/was beginning to increase consumers now will have no choice but to postpone getting new car, either buying or subscribing as the car supply is not there.

And those who do try, it has been reported, might have to wait six months for a new car.

So the Japanese economy, which might have been in a position to get out of the pandemic situation with the improved manufacturing and maybe improved consumer spending is now maybe not in such as good place yet.

And then add in the increase in energy prices and food prices and consumers maybe are thinking twice about how much they want or need to spend at this time.

Have a nice day and be safe!