Japanese new car market closes the year on an up note. Keis surprise

Japan-December

The Japanese new car market closed the year on an up note. The year 2014 ended up 3.5 percent to 5,562,887 units registered in Japan January through December. December sales across all segments were up 2.1 percent. This according to consolidated data reported by Japanese industry associations.

Executive summary: The big JDM implosion did not happen.

Industry observers at home and abroad predicted a crash of the Japanese new car market following the consumption tax rise in April. Their fears were misplaced. Despite massively pulled-forward sales in the last part of 2013 and the first quarter of 2014, the Japanese new car market registered a small gain of 3.5 percent.

What saved the market from negative growth were astonishingly high sales of mini vehicles. Sales of “kei” cars were up 7.6 percent in 2014, whereas sales of regular cars registered a small loss of 0.8 percent. Quite astonishing it is, because mini vehicles were stripped of most of their tax advantages, which was said to trigger an extinction of the small cars. Just the opposite happened. After strong gains throughout the year, sales of kei cars jumped 18.5 percent in December, leading to a record market share of 46.3 percent.

Imports, down 2.9 percent for the year, and up 2.2 percent in December, held their own, despite the fact that the cheaper yen makes imports more expensive in the local currency. In December, imports held an astonishing 15.7 percent share of regular vehicles, which should prompt proponents of the “closed market“ theory to look for other conspiracies.

Among the Big Three. Toyota held its own as planned, even if it did cost nearly a point of market share. Nissan lost 1.3 percent. The big winner was Honda, up 11.2 percent for the year, and gaining more than a point of market share.

A full table of December and 2014 Japanese new car sales can be found here.

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