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Monday, Oct. 20, 1997

Carmakers hope drivers rally to environment-friendly push


Staff writerAutomakers have long tried to impress customers with design and driving performance, but now they are paying homage to the latest in added values: environmentally friendly technology.Stranded by lackluster domestic demand, automakers are hoping to stimulate sales by displaying a number of environmentally friendly vehicles at this year's Tokyo Motor Show from Oct. 18 to Nov. 5 at Makuhari Messe, in Chiba Prefecture. Some analysts predict that vehicles with improved fuel efficiency and reduced emissions will not immediately impact sales, but say such technologies will, in the long run, fuel competition.Since the government raised the consumption tax from 3 percent to 5 percent in April, domestic auto sales have declined for six consecutive months. "We hope that the effects of the Tokyo Motor Show will raise October sales, but we are still uncertain about it," said Yoshifumi Tsuji, chairman of the Japan Automobile Manufacturers Association.Tsuji's group has revised its sales estimate for the current business year downward from 7 million units to 6.65 million. According to JAMA officials, domestic auto sales in the first half of the 1997 business year, which ended in September, came up 300,000 units less than initial estimates earlier this year. Sales in the latter half of the year will also probably be tough, they said.To cover this year's sluggish sales, Japanese carmakers have turned to overseas markets, especially the United States and Europe, to maintain domestic vehicle production with increased exports. Japan's exports surged 41.6 percent in August from a year earlier, marking their 15th straight month of growth.The depreciation of the yen against the dollar also encouraged the tactic, and the major carmakers will probably stick with it until their overseas plants start operations in the second half of next year, according to analysts. "Despite expectations in the auto industry, no one seriously believes the motor show will lead to an increase in sales," said Tadao Takei, executive vice president of Nissan Motor Co. Past shows have not necessarily resulted in a rise in auto sales, he said."People will buy cars if they really like them. So, if we can present them with unique and different models, they will sell well," Takei said. Analysts say customers are longing for cars different from previous models and from those of their rivals.Multipurpose vehicles have been enjoying brisk sales for the past few years and have expanded their share to almost 50 percent of the domestic market. But with the market approaching saturation, sales weren't as strong as they were last year and finally dropped 5.2 percent in August from the previous year to mark the first year-on-year drop since December 1993.Though automakers continue to look for clues to the next consumer trend, they all seem to agree that environmentally friendly technology will be the next must-have feature as consumer awareness of harmful exhaust gases and the Earth's limited resources climbs. "Whether we like it or not, the world will have to face the reality of environmental issues. We hope that our new technology will be accepted by consumers," said Satoru Toyama, managing director of Mitsubishi Motor Corp., who is in charge of passenger car development.Toyota Motor Corp. recently introduced the Prius, the world's first mass-produced hybrid car. Prius employs both an electric motor and a gasoline engine, and also reduces carbon dioxide emissions by half compared with vehicles with regular gasoline engines.Mitsubishi has also announced it will equip its new models with the newly developed gasoline direct injection engine, which improves power and fuel efficiency while cutting carbon dioxide emissions by 30 percent. The company aims to equip all of its models with GDI engines by 2010.Nissan Motor will introduce vehicles with a new direct fuel-injection engine called NEO Di this year, and Honda Motor Co. has announced a new system called integrated motor assist, whereby its new direct fuel-injection engine is assisted by an electric motor.Noriyuki Matsushima, senior analyst at Nikko Research Center, said individual consciousness about environmental issues is still weak, but environmentally friendly technology has the potential to become a major consideration for consumers in purchasing new cars. "Automakers had long considered that safety and environment would not lead to profits, but as far as safety is concerned, such a belief has now changed," he said.



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