Japan Automobile Output to Hit 11.3 million units in F2006, Nippon Steel

Nippon Steel revised the estimate of domestic automobile output to 11.3 million units in fiscal 2006 ending March 2007, which are around 100,000 units higher than that in the summer, when the automobile export increases for North America and Middle East while the domestic demand is slow. With the higher output, domestic supply of galvannealed steel sheet is expected to get tighter. Domestic automobile output increased by 3.3% to 5.53 million units in the half year to September from same period of 2005, which increased for 3 years in a row, according to Japan Automobile Manufacturers Association. The export demand increased by 17.6% while the domestic demand decreased by 3.4% to 2.7 million units. Domestic automakers plan to make total 11.6 million units for fiscal 2006 when they launch new models in the second half year. Nippon Steel expected the automobile output would decrease by 1-2% to 10.7-10.8 million units for fiscal 2006 from 10.89 million units in fiscal 2005 with lower output in first half and flat in second half due to lower domestic sales. However, the firm revised the estimate upward by 400,000-500,000 units to 11.2 million units in the summer under higher export than expected. Nippon Steel said the estimate is more precise than before when automakers make plan mainly for export with less impact by domestic sales.