Japan car sales bounce back

A lead organisation in Japan’s car industry reports sales of vehicles in its domestic market have recovered in September, but warns the pandemic will continue to dampen consumer spending.

The world’s third-largest economy suffered its worst post-Second World War contraction in the second quarter of this fiscal year. While it has shown some signs of life, consumer and businesses remain cautious.

Seiichi Nagatsuka, vice-chairman of the Japan Automobile Manufacturers’ Association (JAMA), says this month’s new-vehicle registrations have recovered to almost the same level as September 2019.

“I hear that sales have recovered to close to 90 per cent, but a rebound in consumer spending is slowing so the severe situation is unchanged,” Nagatsuka told a press conference on September 24.

Japan’s car sales fell by more than 40 per cent year-on-year in May after the country’s government urged people to stay home in April in a bid to halt the spread of coronavirus.

JAMA wants the government to extend tax breaks given on car purchases earlier this year to offset the fallout of Covid-19 and to offer other incentives to boost domestic sales and support an industry that employs more than five million people.