You are here
Japanese car sales accelerate in Q1
THE first quarter of 2014 saw a shake-up in the car market as the once-anaemic Japanese brands accelerated up the sales charts, boosted partly by cyclical trends and partly by the re-classification of COE Category A in February.
However, Mercedes-Benz, the top brand in 2013, remained the No 1 make with 1,225 cars registered between January and March, according to the Land Transport Authority (see table). But the Q1 runner-up is now Toyota (including Lexus) with 1,003 units, up one spot as it swopped places with BMW, which is now No 3 with 909 units.
Volkswagen is unchanged from the end-2013 rankings in fourth position with 508 cars but, interestingly, Nissan has risen to fifth on the sales chart with 390 units. Japan's second largest carmaker had finished 2013 in eighth place.
Mazda retains its seventh place with 239 cars sold in the first three months of the year. Hyundai and Honda, which were in 10th and 11th position respectively as at end-2013, moved up one notch each to ninth and 10th respectively. This means Honda re-enters the Top 10 after an absence of two years.
A total of 5,962 new cars were registered in the first quarter of 2014, a 10.7 per cent increase from a year ago. For the whole of last year, 22,472 new cars were registered.
In percentage terms, the best-selling Mercedes-Benz brand actually increased its market share in the past three months. The brand with the three-pointed star had ended 2013 with 17.2 per cent of the total market, but this has now gone up to 20.5 per cent. That means a star adorned the front end of one out of every five cars registered between January and March.
But it was the popularity of the Japanese makes that was striking. The general manager of a Japanese dealership said that this was due mainly to owners of older cars. He pointed out that this group of replacement buyers had been waiting for COE premiums to soften but could no longer hold back as their cars approached scrap age.
"These are usually the more practical buyers who are careful with their money and prefer to buy another mass market car," he explained. "Even though they can well afford a luxury model."
As a result, mainstream brands like Toyota, Nissan, Mazda, Hyundai and Honda are benefiting from this cyclical trend.
Another reason, according to the general manager, is that February's re-categorisation of Cat A had encouraged more people to consider a mass market brand of car. "They had probably entered the market assuming that the Cat A COE premium would fall even though it did not."
While the continuing strength of the Cat A premium may cause prospective buyers of small cars to think twice about entering the market, Japanese makes should be able to sustain their newfound sales strength.
"With the growing trend in vehicle deregistrations, I believe the mass market brands will be supported by a growing number of replacement buyers," he said.