Japan’s Car Sales Post Slight Increase

Car sales in Japan rose in May for the first time in 14 months, suggesting that the market may have bottomed out after last year’s sales tax increase slammed the brakes on consumer buying. Although overall vehicle sales continued a steady decline in May, falling 8% from year-ago levels to 294,211 units, passenger cars eked out a 0.1% gain to 210,813, according to the Japan Automobile Dealers’ Assn. Among the signs of a belated spring thaw in Japan’s car market was growth at Nissan Motor Co. and Mazda Motor Corp., which both saw brisk demand in May for their multipurpose compact wagons. For the industry as a whole, however, the modest turnaround in the car segment was more than offset by a continued slide in truck sales, down 24% from a year ago. Imports also continued to suffer, falling 15.6% from May 1997 to 19,336 vehicles. Japanese vehicle sales have fallen steadily since the government boosted the sales tax to 5% in April 1997 and the economy slid into a protracted slump.