Domestic sales of cars, trucks and buses in fiscal 2010, beginning in April, are expected to drop 4.9 percent from the previous year to a 33-year low of 4,649,600 units, the Japan Automobile Manufacturers Association said Thursday.
It would be the lowest level since around 4.23 million units were sold in fiscal 1977, with demand expected to taper off after government subsidies for fuel-efficient vehicles expire in September.
"While the subsidies will expire in the first half (of the financial year), we hope auto sales will be supported as economic conditions recover fully through various measures," JAMA Chairman Satoshi Aoki said, citing the Bank of Japan's decision Wednesday to further ease its monetary policy.
Aoki, who doubles as chairman of Honda Motor Co., also called for government steps to stabilize the currency market. A stronger yen erodes the profits Japanese carmakers make abroad when repatriated.
The industry body also said domestic vehicle sales for the current business year ending this month are likely to rise 4.1 percent from fiscal 2008 to 4,891,600 units.
Despite sluggish economic conditions, JAMA said demand was boosted by government tax breaks and subsidies for the purchase of energy-saving cars.
Sales of about 900,000 units in fiscal 2009 and about 700,000 units in fiscal 2010 are anticipated thanks to the government measures, according to the association.
JAMA also officially named Nissan Motor Co. Chief Operating Officer Toshiyuki Shiga as its next chairman. He will succeed Aoki when his term expires in May.
Officials from Toyota Motor Corp., Honda and Nissan take turns to head the association every two years.