Japan Still Battles Weak Production

Automakers in Japan saw weak production and sales in July on the back of strong yen, unstable global economy and parts-supply problem due to the earthquake and tsunami in Japan on March 11.

Global production at Toyota Motor Corp. (TM) dipped 6.1% on a year-over-year basis to 594,614 vehicles during the month while its domestic sales of passenger cars, trucks and buses slashed 35% and exports slid 5% due to lower shipments to North America.

However, Toyota plans to ramp up production in the coming months to make up for the lost production due to the disaster. Consequently, the automaker plans to manufacture additional 350,000 vehicles between October and March 2012.

Honda Motor Co. (HMC) saw the worst. Its global vehicle production plunged 34% to 206,727 units in July for the sixth straight month, while its domestic sales tumbled 31.5% and exports declined more than 19%.

Nissan Motor Co. (NSANY) fared well compared to both the automakers. Its worldwide production appreciated 18% to 388,680 vehicles. Its production in the U.S. was boosted by strong demand for the Altima sedan. Despite a 17% fall in domestic sales, the company’s global sales improved 8% due to a 23% rise in exports during the month.

Meanwhile, global vehicle production at Suzuki Motor Corp. slipped 3.6% to 228,147 units, Mazda Motor Corp. declined 13% to 103,384 units, and at Mitsubishi Motors Corp., decreased 5% to 97,862 units.

Toyota revealed a profit of ¥1.16 billion ($14.21 million) or 37 yen cents per share for the first quarter of its fiscal year ended March 31, 2012, which plummeted from ¥190.47 billion ($2.33 billion) or ¥60.74 per share a year ago.

The sharp fall in profit was attributable to substantial decline in vehicle sales all over the world, especially North America and Europe due to disruptions in supply of parts caused by the twin disaster in Japan.

On the other hand, Honda posted a sharp 88.3% fall in profit to ¥31.8 billion ($394 million) or ¥17.64 per share (22 cents per share) in the first quarter of its fiscal year from ¥272.49 billion or ¥150.27 per share in the same quarter of prior fiscal. The decline in profit was attributable to adverse impact from the Japan disaster and unfavorable currency translation effects.

However, Nissan reported a 1.6% increase in revenues to ¥2.08 trillion ($25.48 billion), while its profit totaled ¥85 billion ($1.04 billion). Nissan sold 1056.000 units globally during the quarter, an increase of 10.6% from the same period last year.

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