Toyota, Nissan Lead Japan Sales Drop as Growth Slows

Japan’s new auto sales fell for a third straight month, led by Toyota Motor Corp. and Nissan Motor Co., as a slowing economy kept buyers out of showrooms.

Sales of cars, trucks and buses, excluding minicars, fell 13 percent to 233,922 vehicles in October, the Tokyo-based Japan Automobile Dealers Association said in a statement today. Toyota Motor Corp., Japan’s largest automaker, sold 117,642 vehicles excluding the Lexus brand, down 14 percent. Sales at Nissan Motor Co., the country’s third-biggest, fell 20 percent to 31,708.

Falling domestic and U.S. demand have prompted Honda Motor Co. and Nissan, Japan’s second- and third-largest automakers, to cut their earnings forecasts for this fiscal year as rising unemployment and tight credit curb consumer spending. Japan’s economy is slowing as export growth cools and the surge in the yen against the dollar cuts the value of overseas sales.

“It’ll be more difficult for auto demand in Japan to recover than in overseas markets, as the economy is in a severe situation,” said Hirofumi Yokoi, a Tokyo-based analyst at auto- consulting company CSM Worldwide. “Demand is also falling, because the population is shrinking and consumers are losing interest in buying autos.”

Toyota gained 4.6 percent to 3,900 yen as of 2:22 p.m. in Tokyo. Nissan slumped as much as 9.9 percent. Honda Motor Co. was unchanged at 2,400 yen.

Interest Rates

In an attempt to spur growth, the Bank of Japan cut interest rates to 0.3 percent from 0.5 percent, and the government said it would pump 5 trillion yen into the economy in its second stimulus package since August.

Honda raised sales 10 percent to 33,423 vehicles last month helped by its revamped Odyssey minivan. Mazda Motor Corp.’s fell 21 percent to 11,416 vehicles. Mitsubishi Motors Corp. had a 39 percent drop, the dealers group said.

Minicar sales rose 6.2 percent to 145,444 units, the Japan Mini Vehicles Association said in a separate statement. Daihatsu Motor Co., the country’s largest minicar maker, had a 15 percent gain. Sales at Suzuki Motor Corp., the nation’s second, rose 4.6 percent.

The drop in domestic demand echoes a sales slump in the U.S., the most profitable market for Japan’s carmakers. Last month, Toyota’s sales in the world’s largest car market dropped 23 percent. Nissan’s plunged 33 percent and Honda has a 25 percent drop.

The decline in the U.S. prompted Toyota to extend a no- interest loan offer it began early last month.