TOKYO - If you believe the forecasts of Japan's Big 5 car companies, 1998 will look very different from 1997.
Exports will be down. And sales in Japan will be up.
Auto analysts are not convinced.
Japan's carmakers put out 'bullish domestic sales plans in an attempt to cheer up their discouraged dealers,' said Noriyuki Matsushima, an auto analyst at Nikko Research Center. 'However, there are absolutely no prospects for recovery in Japan upon the start of the new year.'
Overestimating home-market demand and underestimating exports is almost traditional for Japan's auto industry. At the end of 1996, for example, Japan's 11 carmakers predicted their exports would fall about 7 percent going into 1997. Instead, exports surged about 20 percent.
The companies also predicted sales in Japan would rise a little over 7 percent in 1996 and then 6 percent in 1997. Actual sales in Japan rose about 3 percent in 1996, and fell 4 percent in 1997.
Of the five, only Mazda predicted its exports will rise this year, by about 6 percent. Toyota, Nissan, Honda and Mitsubishi all said their exports will slip by between 5 and 9 percent.
The companies say that the fall in exports will be offset by a rise in Japanese sales, starting from about the second half of the year. Toyota, Nissan and Mazda all said their home-market sales will jump by approximately 7 percent. Mitsubishi predicts a more modest 5 percent gain, while Honda, which was one of the few Japanese carmakers to achieve higher sales in Japan in 1997, forecast only a 1 percent rise this year.
JAMA, Japan's auto manufacturers' association, forecast that 1998 sales will rise by only 3 percent to 6.88 million units.
That makes company claims of a 7 percent gain look extremely ambitious.
The JAMA forecast assumed that the Japanese economy would recover some time in the second half. That now looks unlikely.
The leaders of Japan's four largest business and industry groups, speaking at a joint New Year's press conference on 6 January, were more pessimistic. Kosaka Inaba, chairman of the Japan Chamber of Commerce and Industry, said Japan's economy could contract in 1998.
JAMA predicted that overall exports would be flat, at around 4.08 million units.
Koji Endo, deputy head of research at Schroders Japan Ltd., said he expects exports will go up 'a little more than their targets, mostly because their domestic sales will be lower than the targets.'
Exports will not rise much in absolute terms, he said, and would depend on market demand in the three key areas of North America, Europe and Asia. In Asia, said Endo, 'the situation is getting worse month by month.'
Exports to North America and Europe will be held down by increases in Japanese companies' own capacity in those regions. Japanese manufacturers will add 100,000 units in Europe and about 150,000-180,000 units in North America.
Endo said that the projections were compiled in November, and already 'the situation in November and in January is different.' The yen's continued fall has made Japanese cars even more competitive in export markets.