Japan’s Domestic Auto Market Is Polarizing
20 January 2008
Nikkei. Japan’s domestic auto market is growing increasingly polarized, with drivers opting for either minicars or luxury cars.
Minicars—cars with engines 660cc and smaller—accounted for 35.9% of all cars sold in 2007, marking a new high for the fourth straight year. The minicar’s share of the total market has grown by 5 percentage points over the past five years.
Minicars made up more than 20% of total unit sales for every Japanese automaker in 2007, with the exception of Toyota Motor Corp. Even Nissan Motor Co., which does not make these models itself but has them supplied by another automaker, saw minicar sales account for 20.8% of its unit sales in 2007.
Meanwhile, wealthy urbanites are choosing to purchase luxury cars. In the imported-car market, sales of models priced at or above 6.01 million yen [US$56,244] reached roughly 47,000 units last year, up 70% from 2000. During the same period, sales of imported cars priced at or below 3 million yen [US$28,075] dropped 20%.
Almost twice as many minicars and luxury cars over 2000.
Does this mean that the Japanese middle class is disappearing by moving up or down or that more Japanese are trying to reduce fuel consumption and pollution?
Will this trend travel all the way to North America?
Vehicle electrification could reduce the demand for minicars while achieving the same whorthy goals. That's probably the road that North Americans will follow. With PHEVs and BEVs, it will be possible to use larger cars while reducing liquid fuel consumption and pollution to the same levels or below those obtained from current minicars.
Posted by: Harvey D | 20 January 2008 at 08:12 AM
Is that such a bad thing?
The rich pay more,
The less rich pay less.
They both get nearly the same utility out of it.
_
It's a progressive pricing structure.
How's that bad?
Posted by: GreyFlcn | 20 January 2008 at 08:54 AM
It may be a bad economic sign if the change is caused by movement of the middle class downwards. But that may not be the explanation.
Posted by: marcus | 20 January 2008 at 09:06 AM
Minicars are practical for Japan's dense urban areas with limited parking, narrow streets. It's not just about fuel economy.
Posted by: Nick | 20 January 2008 at 09:24 AM
@ Harvey D,
Your observation is very cogent. The conversion to cleaner and more efficient fuel increases other choices. With that liberation and the selection of one(s) that have fewer side effects, the size of vehicles may and probably will become somewhat irrelevant.
Even though I personally have never owned a vehicle larger than a mid size sedan, and usually vehicles smaller than that, it is a personal choice on how one chooses to allocate your funds. I personally have no need for a larger vehicle, but it is not a social deviation to need or acquire one.
In this rather temporary era, where there are physical, economic, and political limitations in fuel supply, some who who have not recognized that it is very temporary condition, have taken on the attitude and mystique that only heretics drive SUVs. And that such people who should be burned at the stake.
The reality is that only transport has a been a slave to an heretofore un-substitutable fuel choice of liquid hydrocarbons. Albeit, that short time period has consisted of several decades. That era is now very close to ending.
Mankind's ascent has invariably involved making more and more energy available to every man. The era of this particular limit is certainly finished. Although all the events necessary to make it visible to all, particularly knot headed politicians, have still to occur.
But the future is just as certain as it is for the man who jumped from atop a skyscraper, but has not hit the ground yet. Its inevitable.
I just hope that the return to this primitive religious Nature worship, proves to be a temporary phenomenon too. A proper respect for Nature is healthy; religious Nature worship is not.
Posted by: Stan Peterson | 20 January 2008 at 10:15 AM
Maybe many families have two cars, one big car for image and occasional use, and one small car for daily use. In that case, the total amount of fuel consumption by the big car will be relatively small.
On the other hand, the expensive cars will be the first to become full-electric. (since that will soon be very chique and popular). The small cars will be electrified later, but already consume less.
Although the trend may be not that dramatic, every big car produced now will drive around for many years to come.
Posted by: Alain | 20 January 2008 at 11:49 AM
@Stan:
Are you really really high or just high?
Posted by: drivin98 | 20 January 2008 at 02:28 PM
Modern cars for modern lifestyles. Why do some people instantly assume that owning a small vehicle reflects poverty? Small is beautiful is about butterflies, not religion. Religious (and interracial) wars and differences are not prequisitte to nature apreciation .
I personally dont assume that the person with the bigest rock hanging from thier earlug is doing it better than the au natuturale.
A person who feels the need to drive an expensive to build, maintain and fuel, expensive also in terms of ecological footprint, that person does not appear to me better off - rather displays a poverty of the imaginaton and lack of understanding of the nature we are all born into. This mentality misses the whole point.
To promote or offer hope as would justify or promote this mismatch with reality is misguided and delusional at best, dangerous and selfish to fellow inhabitants .
note article GCG 20-1-08 re Mercades 60mpg twin cid 'for 2'and stablemates promotional drive down (the old) route 66.
Smart 'withit' city and urban consumers (and presumably no less a luxury car maker than Mercades) see the benifit in parking spaces aplenty just waiting for the savvy minivehicle client.
The biggest problem with this vehicle class is the unequal outcomes in an accident against heavier vehicles.
Of course the sense that heavier vehicles are safer originates from the same flawed thinking that larger vehicles are "safer.
Many of these city tanks are then fitted with 'bull bars to reinforce the occupants luxury experince.
The population as a whole experiences an inrease in hospital bed days.
Good for some , but who really pays?
Posted by: arnold | 20 January 2008 at 05:57 PM
in most places of japan u need to probe that you own a piece of land large enough to fit your car in order to be able to buy it, that is one reason for small cars to be popular, also the taxation on engines smaller than 660cc is very different than diferent engines, thats probably the main reason. Finally here the size of the car doesnt have a important social meaning as it has in other parts of the world.
Posted by: juan | 20 January 2008 at 07:31 PM