Japan automakers reeling from global economic downturn+

TOKYO, Dec. 17 Kyodo - The Japanese automotive industry has been sent reeling by the global financial crisis, which has dealt a major blow to consumer spending both at home and abroad.

Carmakers have been a growth engine for the nation's economy recovering from
the more than decade-long slump following the burst of Japan's bubble economy
around 1990, but it appears to be on the verge of stalling, analysts say.
Honda Motor Co. said Wednesday it is likely to see a group operating loss of
190 billion yen for the second half of the 2008 business year ending next
March.
For its full 2008 business year, the company lowered its consolidated operating
profit estimate to 180 billion yen from 550 billion yen projected as of
October. Sales are seen falling to 10.4 trillion yen compared with the previous
forecast of 11.6 trillion yen.
The new projection for fiscal 2008 global auto sales is 3,650,000 vehicles
compared with the earlier projected 4,015,000 vehicles.
Nissan Motor Co. said it will cut its domestic auto production target for
fiscal 2008 by an additional 78,000 units and gradually reduce the number of
its temporary employees to zero by the end of March to combat shrinking global
auto sales.
The likelihood of market leader Toyota Motor Corp. falling into the red in the
October-March second half of the current business year is increasingly
possible, analysts said.
In response to the earnings deterioration, Honda will map out a new business
plan centering on capital spending curbs including postponement of new plant
openings, company officials said.
The opening of a new car plant under construction in Saitama Prefecture will be
put off for a year or longer, although it had been expected to begin operations
in 2010, they said.
A planned factory in Mie Prefecture by Yachiyo Industry Co., a car parts-making
subsidiary, will begin full operations a little more than a year later than the
originally scheduled date, the officials said.
==Kyodo
2008-12-17 23:18:12