Sales of medium- and heavy-duty trucks have been accelerating thanks to increasing demand in the disaster-stricken areas of the Great East Japan Earthquake and a government subsidy for environmentally friendly vehicles.
Transport companies are speeding to buy trucks for their fleets, fearing the end of the government subsidy program aimed at putting more fuel-efficient vehicles on the road.
Total sales of medium- and heavy-duty trucks with load capacities of three tons or more at four major manufacturers in March increased 45 percent to 11,409 units over the same period a year ago, according to the Japan Automobile Dealers Association.
On a single-month basis, it marked the first time that sales have exceeded the 10,000-unit mark since March 2008, which was before the financial crisis brought on that fall by the collapse of U.S. investment bank Lehman Brothers.
Sales of trucks temporarily dropped sharply last year due to the suspension of production after the earthquake and tsunami on March 11. The total sales of the four companies was 1,721 units in May.
However, sales rebounded after the summer, thanks to reconstruction and development needs in the disaster-stricken areas.
“There has been a stable demand for dump trucks aimed for construction companies,” said an official at Mitsubishi Fuso Truck and Bus Corp. “As fishing ports were reconstructed, demands for refrigeration and other vehicles for distribution increased.”
Hino Motors Ltd. also saw a 70 percent increase in sales of its trucks in six prefectures in the Tohoku region in fiscal 2011 over a year earlier.
“We expect demand for about 8,000 to 10,000 vehicles a year, which will likely last at least several years,” said Akimasa Yamamoto, senior managing director at Hino.
Subsidies for purchases of environmentally friendly vehicles, for which applications began to be accepted April 2, also pushed up sales.
Owners of trucks registered as new vehicles on Dec. 20, 2011, or after are eligible to apply for the subsidy program.
Under the program, 900,000 yen ($11,176) is provided for the purchase of a heavy-duty truck, as well as 400,000 yen for a medium-duty truck and 200,000 yen for a smaller truck, that meet government fuel-efficiency targets.
Combined with the benefits of tax credits for environmentally friendly vehicle, a heavy-duty truck priced 10 million or more could be 1 million yen cheaper at the maximum.
Transport companies, which renew their fleet of trucks regularly, are also doing that ahead of schedule.
In response, truck manufacturers are taking measures to cope with an increasing demand as competition for orders is intensifying.
Mitsubishi Fuso speeded up the time it takes to assemble vehicles on the production line to the fastest on record.
Hino has increased the number of employees working on holidays and overtime, while Isuzu Motors Ltd. restarted recruiting short-term workers in June, a process that had been suspended since the earthquake.
The budget for the government subsidy program for commercial vehicles, such as trucks, is 21.8 billion yen out of a total 300 billion yen under the 2011 extra budget.
Truck sellers are worried about the brakes being put on the program.
“Subsidies could be axed as early as in May when the budget possibly could run out,” a salesperson said.
The government began publishing the state of acceptance of applications for subsidies on April 24 at the website of the Next Generation Vehicle Promotion Center.
As of April 20, applications for subsidies worth 11.6 billion yen in total, more than half the budget, had been accepted.
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