TOKYO -- Japan's domestic sales of new autos in 2017 climbed 5.3% from the previous year to 5.23 million units, led by revamped models of miniature vehicles known here as kei cars.
New-car sales topped 5 million for the first time in two years and exceeded the prior-year volume for the first time in three years. The figures were released by the Japan Automobile Dealers Association and the Japan Light Motor Vehicle and Motorcycle Association on Friday.
At Nissan Motor and Subaru, sales have suffered since October due to the discovery of inspection improprieties, but both managed better full-year results. Nissan's sales fell 18.9% year on year in December but were up 10.6% for the full year. Subaru similarly retreated 9.9% in December but gained 13.5% overall in 2017.
Sales of miniature cars, vehicles with a 660cc or smaller engine displacement, gained 6.8% to 1.84 million, recovering from a slump after a tax increase on such vehicles in the spring of 2015. Daihatsu Motor, a Toyota subsidiary, sold the most minivehicles for the third straight year with 3.9% sales growth.
Sales of vehicles with a larger engine rose 4.5% from 2016 to 3.39 million units.
Japan's domestic new-car sales are expected to remain firm in 2018. But eco-car tax breaks, which have underpinned sales, will continue to be gradually rolled back as early as the spring. This could create a headwind for automakers.
Discussions about automobile-related taxes are expected to heat up toward the end of 2018 as Japan prepares to raise its consumption tax in October 2019. The industry is calling for lower auto taxes to offset the increased burden on car buyers.