Japan market July update

posted Aug 12, 2011, 6:20 AM by Loose Tube   [ updated Dec 28, 2011, 9:39 PM ]

Sales to dealers by domestic makers (JAMA)

2011 has already been an incredible year in Japan and when it's over most people will be happy to forget it.

The 2-wheeler market has been in decline for some years, the situation made more acute by the 2006 parking ban, followed by the 2008 economic crisis. So it’s encouraging to see some sort of “recovery” appearing in 2011.

The following table illustrates the % change in sales by JAMA members Year on Year by category for each of the first 7 months of 2011.


 Comments

  • The 50cc category saw 2011 sales higher than 2010 in 6 of the first 7 months and an overall gain of 11%.
  • 125cc gains were more patchy but an excellent July saw an overall 7% increase.
  • For 250cc the year started slowly but was followed by 5 consecutive months of gains over 2010, for an overall increase of 16%. This category suffered markedly after the introduction of parking restrictions in 2006. For now at least it appears to have bottomed out.
  • The >250cc category started very strongly with large gains in January and February. Since then sales fell dramatically, either caused by consumer and dealer confidence or the disruption to manufacturing.

Vehicle Registrations

The motor vehicle industry Tankan results in June showed industry confidence in a short term recovery in the market. July’s consumer confidence index also shows a positive trend, though it has not yet reached pre-disaster levels.

The following is a summary of the results so far in 2011 vs 2010: 

 

YTD July

 

JMVA

2010

2011

 

250 domestic

20105

19605

98%

250 foreign

3031

2778

92%

>250 domestic

23712

21043

89%

>250 foreign

11779

11207

95%

 250cc

Both Honda and Yamaha performed well with a 5% and 2% gain respectively over 2010. This may confirm that the 250 category has bottomed out. As a whole domestic brand registrations fell 2% over 2010. Foreign brands fell 8%.

The new Honda CBR250R brought strong sales due partially to its attractive retail price positioned JPY100,000 lower than the Kawasaki Ninja 250.

Over 250cc

The first 7 months saw Honda -28%, Suzuki -22% and Yamaha -25%. Only Kawasaki saved the show with a 46% gain, resulting in -11% for domestic brands. The performance in the 1st quarter before the disaster was very similar to the 2nd quarter compared to 2010, implying that the disaster itself did not cause the downward trend, even if sales to dealers started strongly and then weakened.

Foreign big bike sales started poorly but recovered in the 2nd quarter for an overall -5%.

Disaster effected area

The 1995 Kobe disaster caused extensive infrastructure damage which actually prompted a surge in small displacement 2-wheeler sales. Buyers were people seeking a flexible and inexpensive form of transport to fill the gap until transport system repairs were complete. Kobe is a city of 1.5 million and the principal city in Hyogo prefecture which houses 4.4% of the nations’ population.

This year’s earthquake and tsunami have caused extensive damage not to mention casualties in 3 main prefectures, Iwate, Miyagi and Fukushima (hereafter the disaster area). The destruction was spread over a much wider area compared to Kobe. The population in this area represents about 4.5% of the population.

Here we focus on the disaster area in order to understand any implications for 2-wheelers. 

250cc

For the 250 category the disaster area represented 2.2% of 1st quarter registrations in 2009 and 2010, but in 2011 this fell to 1.6%. The area was down 43% on 2010 whereas the whole market was down only 17%. This maybe explained by the disaster areas northerly climate. The buying season is triggered by a change in the weather, which may vary year to year.

In the 2Q the disaster area represented 3.2% of the whole market’s registrations in 2009 and 3.0% in 2010, whereas in 2011 this increased to 3.8%. The market as a whole was up 2% over 2010 and the disaster area increased by 32%. Both Yamaha and Honda performed well, but foreign brands performed poorly.

This indicates that for small displacement vehicles consumers are replacing destroyed vehicles or looking for alternative transport solutions. However, the numbers involved are as yet not enough to significantly affect the overall market.

Over 250cc

For the over 250 category the disaster area represented 2.2% of 1st quarter registrations in 2009 and 2.5% in 2010, but in 2011 this fell to 1.8%. The area was down 25% on 2010 whereas the whole market was down only 9%. This maybe explained by the disaster areas northerly climate as mentioned above.

In the 2Q the disaster area represented 3.6% of the whole market’s registrations in 2009 and 2010, whereas in 2011 this decreased to 3.2%. The market as a whole was down 10% over 2010 and the disaster area fell by 20%. Of domestic brands, only Kawasaki performed well. The situation in the disaster area reflected that of the nation as a whole albeit with slightly worse results.

Conclusion

Domestic brand vehicles of 250cc and under are recovering well, with a small contribution from the disaster affected area. 

Domestic big bikes (apart from Kawasaki) are still in decline, whereas foreign big bikes are holding firm.

The outlook is positive for all but domestic big bikes.

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