US sales critical for Japan automakers

US sales critical for Japan automakers
Nissan Motor Co.’s Kyushu plant in Kanda, Fukuoka Prefecture
PHOTO: Japan News/ANN

Japanese automakers are strongly dependent on sales in the United States at present, as the US economy is showing steady growth while the future of the Chinese market, the largest in the world, appears uncertain.

More and more Japanese automakers have boosted productive capacity in response to growing demand for new cars.

Nissan Motor Co., for example, announced on early this month that it will start full-fledged production of Rogue sport-utility vehicles targeting the North American market at its production subsidiary in Kyushu in spring 2016.

Nissan's Rogue, known as X-Trail in Japan, is produced in the United States and exported to that country from Nissan's South Korean plant as well. The Kyushu plant will be Nissan's third Rogue production site for export.

Nissan's sales volume in North America accounts for 30 per cent of its global total.

Rogue is well regarded in the United States for its powerful driving and excellent environmental performance. Sales of the vehicle there increased by nearly 40 per cent in the first half of 2015 from the same period last year.

Nissan Vice Chairman Hiroto Saikawa presented the Rogue's production process to the media on July 9. "Following the correction of the appreciation of the yen, the production of Rouge represents the revival of Japan's manufacturing," Saikawa said.

Fuji Heavy Industries Ltd. plans to double the production capacity of Subaru cars at its Indiana plant in 2016. Subaru is enjoying good sales and a strong reputation for its design and driving performance.

"We have too many orders to keep up with production," said Fuji Heavy President Yasuyuki Yoshinaga.

Some automakers are also putting new models onto the market. Honda Motor Co. will start selling three new models including a Civic sedan by the end of this year, and Mitsubishi Motors Corp. has upgraded its Outlander SUV.

US vehicle sales were about 8.52 million units in the first half of 2015, the highest level for the same period since 2005.

However, the air bag problem involving Takata Corp., which sparked a massive recall and repairs in the United States, is a major concern of Japanese automakers. The US sales volume of Honda Motor, which was hit the hardest by the air bag issue, was sluggish for the January-June period, posting 1.8 per cent growth from the same period the previous year.

Research firm IHS Automotive predicts the market size for new vehicles in 2020 will be about 30 million units in China, and about 17 million units in the United States.

"It's going to be important [for Japanese automakers] to further increase their market share in emerging nations while heightening their competitiveness in the North American market," said SC-Abeam Automotive Consulting Executive Vice President Shoji Shimizu.

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