JAMA - December 24, 2009

1. Total Demand for Motorcycles

   Although motorcycle demand in Japan this year has benefited from the introduction of new models, market conditions remain harsh. This is the result not only of the economic downturn triggered by the global financial crisis, but also of higher vehicle prices reflecting mandatory compliance with emissions regulations and, in addition, the shortage of motorcycle parking availability in urban areas, among other factors. Against this backdrop, total current and upcoming demand for motorcycles in Japan is projected as follows.

   1. Total motorcycle demand in Japan in calendar 2009 should finish at 432,000 units, down 23.7% from 2008, with declining sales having been recorded in all motorcycle displacement categories.
   2. No recovery in demand is foreseen in 2010 for Class-1 motor-driven cycles, the category comprising the lion’s share of motorcycle demand in Japan. As a result, total domestic motorcycle demand next year is expected to drop to 404,000 units, down 6.5% from 2009.
2. Class-1 Motor-Driven Cycles (50cc & under)
   1. Sales of Class-1 motor-driven cycles in 2009 are projected at 255,000 units, down 13.8% from 2008. The primary factors behind this decline are the economic downturn and its impact on consumer confidence as well as a longer vehicle replacement cycle.
   2. In 2010, notwithstanding an anticipated gradual recovery of the economy, a further decline in demand is projected as a result of a continued slump in consumer confidence and other negative trends. Consequently, sales in this category are forecast at 230,000 units, a drop of 9.8% from 2009.
3. Class-2 Motor-Driven Cycles (51cc-125cc)
   1. Demand for Class-2 motor-driven cycles in 2009 should finish at 66,000 units, a plunge of 45.5% from 2008, when sales in this category surged owing to expanding consumer appreciation of these vehicles’ economy in the light of soaring fuel prices (and, as a result, their wider use in daily commuting), as well as a rush of last-minute purchases prior to scheduled vehicle price hikes stemming from mandatory compliance with emissions regulations. That surge largely set the stage for a reactionary downturn in 2009, which in fact occurred.
   2. In 2010, favorable factors including the impact of new model launches and users’ downsizing to this category (primarily from mini-sized motorcycles) should result in sales of 73,000 units—a gain of 10.6% over 2009.
4. Mini-Sized Motorcycles (126cc-250cc)
   1. Mini-sized motorcycle sales in 2009 should total 48,000 units, down 32.6% from 2008. Demand in this category has suffered considerably as a result of the economic downturn and a notable decline in consumer confidence among younger age groups, as well as a continuing reluctance to purchase and use these vehicles in urban areas, where there is a discouragingly severe shortage of parking bays.
   2. In 2010, continued harsh conditions in the employment and income environments and users’ downsizing to motorcycles with smaller engine displacement should result in total annual sales in this category of 42,000 units, a 12.5% decline from 2009.
5. Small-Sized Motorcycles (over 250cc)
1. Sales of small-sized motorcycles in 2009 are estimated at 63,000 units, a drop of 19.3% from 2008. Despite expectations that demand for these larger models for recreational purposes would remain firm (especially among middle-aged and elderly riders), the negative impact of declining wages on sales in this category has been significant.
2. In 2010, despite the anticipated gradual economic recovery, factors contributing to a further decline in sales in this category include the postponement of replacement purchases on the part of users amid the uncertain status of employment and incomes and, in addition, a reduced model line-up as a result of emissions regulations compliance. Overall demand for these motorcycles in 2010 is therefore projected at 59,000 units, down 6.3% from 2009.