Japanese Motorcycles Market in the 2019 hit a new record low while losing only 1.7%. The industry actually stands at 10% of the all time record established near 30 years ago and is declining year after year. Since October, when tax on sales of goods were increased from 8% to 10% the demand for consumers good in Japan sharply declined.
Japanese economy grew faster than initially estimated in the third quarter, according to a second GDP release. The improvement was due to upgraded estimates for the domestic economy, notably fixed investment. The external sector, however, continued to flag, likely weighed on by trade tensions with Korea and between the U.S. and China. Turning to the fourth quarter, economic activity appears to be waning given the PMI measuring private sector activity fell into contractionary territory in October and remained stuck there through December.
Activity is likely being subdued by the sales tax increase from 8% to 10% that took effect in October; Typhoon Hagibis, which hit Japan in October; and continued trade tensions. To boost the economy, the government recently announced a USD 120 billion spending package, around 20% of which will be spent from December to March, and the rest from April 2020 to March 2021.
In 2020, economic growth is likely to slow notably, largely as the sales tax hike will constrain private consumption. Moreover, continuing trade tensions will weigh on the external sector. That said, the economy should benefit from ultra-low interest rates, spillovers from the 2020 Olympics and low unemployment.
Following the progressive decline reported in the most recent years, with the 2018 hitting the lowest sales level out of the last 50 years, in the 2019 the Japanese domestic market hit a new record low, with only 382.913 vehicles sold, down 1.7% from the previous year and falling down in the 15th place in the Global 2019 ranking (not yet final).
Sales reported for the market leader, Honda, have been 174.679, down 1.5% with 45.6% of market share.
In second place Yamaha with 79.920 units (-3.6%) followed by Suzuki with 61.592 (-3.0%) and Kawasaki with 21.035 (-1.1%). The four Japanese brands hold 88% of market share while imported brands take 12%.
Among importers the leader is Harley–Davidson, despite losing 1.6% of sales. The fastest growing brand is Husqvarna, recently landed in the market, growing 99.6% from the previous year.
Reason behind the decline
Before explaining the factors behind the inability to sell motorcycles in the country, it is necessary to first organize what type of motorcycle has ceased to sell. Speaking of motorcycles in one word, Japanese classification split models on moped, with below 50 cc or between 51-125cc. The motorcycles segments are three, the “mini bike” for engine between 125-250cc, the “small bike” for displacement between 250-400 cc, and the “big bike” with over 400 cc engines.
As said, the current number of domestic sales felt to nearly 10% of the heyday, but the most of the fall is concentrated in the moped segment. In the early 80’s, when motorcycles were in its heyday, scooters that can be driven with feet have become popular as a substitute for commuting, attending school, and shopping. At the time, mopeds boosted sales at over 2,8 million units in a single year, along with Honda’s Super Cub 50, which was widely used as a commercial motorcycle for newspaper delivery and home delivery.
In the following decades the small two wheels, with speed limit of up to 30 km / h, sales have gradually fallen due to the following reasons:
- 3 Not exercise To prohibit the license acquisition · purchase · driving by high school students, the exercise that was developed until the 1990s under the slogan “do not take a license · do not let · do not drive”
- The exhaust emission control adopted since the 1998 forced the producers to change from a two-stroke engine that can be manufactured at low cost to a four-stroke engine that increases weight and mechanism and increases manufacturing costs
- Reinforcement of parking violation enforcement moped that does not take much space than the car, but despite the delay in the development of parking infrastructure has raised voices of doubt that it is the subject of parking violation.
The 50cc was an icon in Japanese motorcycle manufacturing. Honda was founded in 1948 on the success of the two-stroke, 50cc A-Type auxiliary bicycle engine, nicknamed the “Bata-Bata” for the sound it made.
That was followed a decade later by what would become the most-produced motor vehicle in history: the Super Cub. Set to surpass the 100 million-unit milestone this year, it originally sold with a four-stroke, 50cc engine, but now is available with a variety of engine sizes in more than 160 countries. The 50cc version remains only in Japan.
According to the Japan Automobile Manufacturers Association, moped sold in the 2018 have been only 143.129. Honda takes 60% and the rest in slit between Yamaha and Suzuki.
Emission Standards are killing the cube
The final nudge toward extinction coincides with the imposition of tougher environmental regulations. Japan, like other nations around the globe, has adopted European Union vehicle-emissions standards as the basis of its own. Those regulations started solely as limits on pollutants in exhaust, but the fourth version — coming into full force this fall — requires on-board, self-diagnostic systems to make sure engines run cleanly for at least 20,000 kilometers (12,427 miles). That contributed to the purge of models such as Honda’s Z-Series and Little Cub.
The fifth iteration, effective in 2020, extends that requirement to the life of the vehicle. That should halve emissions within 20 years yet add as much as 111 euros ($130) to the cost of each vehicle, according to a 2016 study for the European Commission. That’s about 10 percent of the sticker price for some Japanese models.
“Toward 2020, product development is going to be extremely tough,” Yamaha Chief Executive Officer Hiroyuki Yanagi said. “Instrument controls will become more complex, and costs will go up.”
Japan’s Environment Ministry said it discussed the new emissions standards with car and motorcycle manufacturers, and concluded it didn’t make sense to adopt different local standards because of the global nature of the industry.
Bicycle related services catch up with bikes
The bicycle market is showing vibrancy year after year in light of the slumping motorcycle industry. Electric bicycles, whose performance has been dramatically improved and prices have become reasonable, are now commonly found in the city. In addition, the government regards the bicycle as safe, secure and environmentally friendly mobility, and decides on the “Bicycle Utilization Promotion Plan” to promote the spread of the share cycle and connections with public transportation, and the installation of cycle ports in June 2018 And we are still pushing forward. Companies that responded quickly to government policies have developed share cycle services one after another, and in Tokyo, which is waiting for the Olympics, there has already been a fierce share dispute.