Economic Outlook n° 1188 | Special Report | Transport: a two-speedworld


Euler Hermes


 Japan


Profitability of automobilemanufacturers Japan


Change in sales Operatingmargin


2007 12.2% 8.0%


03/2010 -11.1% 2.0%


Sources : aggregate data Toyota,Nissan,Honda,Mazda,Mitsubishi, consensus *Operatingmargin=operating income / sales


▶ InJapan, a technical reboundinsales Therobustgrowththatexceeded30%in2012wasdue toa2011comparisonbasismarkedby thecollapsein productionandsales–morethan1millionvehicles– asaresultof theearthquakeandtsunami.Over the longterm, theJapanesemarket is trendingdownward, givenanageingpopulation,urbanovercrowdingand therequirement that vehiclepurchasers inJapan’s mega-regionsownaparkingspace. In2013, the Japanesemarket isexpectedtocontractby approximately5%. Inadditiontovolatility initsowndomesticmarket, Japanesemanufacturersmust contendwiththe significant concentrationof theirautomobile productionwithinthecountry,whichexposes themto yenparity trendsagainst thedollarandeuro.These trendsworkedtoJapan’sadvantageinthefirsthalfof the2000decade,whentheyendepreciatedby40% against theeurofrom2001to2008,givingJapanese manufacturersaclear competitiveadvantage.


Duringthatperiod, theaverageoperatingmarginfor Japanesemanufacturers fluctuatedbetween7%and 8%.Asofmid-2008,however, theyen/europarity returnedtoitsearly2000level (100yenpereuro), thereby reducingtheJapanesemanufacturers’ competitiveadvantageandoperatingmargin,whichis nowaround4%andmoreinlinewiththatofa generalistautomobilemanufacturer.


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▶ Japanesemanufacturers’ production inmillions of units


Production Japan


Foreign Japanese share 2007


9,944.637 11,856.942 46%


2011


7,158.525 13,382.390 35%


03/2011 5.7% 3.9%


03/2012e -2.6% 3.0%


03/2013f 19.0% 4.5%


Source: Jama (Japan AutomobileManufacturers Association)


PV registrations in Japan and yen/euro parity PVregistrations


6.0 5.5 5.0 4.5 4.0 3.5 year-on year in millions of units forecasts Gain competitiveness 1.06 0.92 0.78 Loss of competitiveness 0.64 0.50 05 06 07 08 09 10 11 12 13 Sources : Jama (Japan AutomobileManufacturers Association), EulerHermes forecasts 9


Yen/europarity 1.20 100 JPY=1 EUR


0 0 0 0 0 0 0 0 0 0 1 1 12109876543210


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