Japan Automobile Steel Demand to Drop by 5% in Oct-Dec

Japanese automobile output is estimated to decrease by 7% to around 2.3 million units for finished car in October-December from July-September. The knockdown set production would increase by 6% to around 2.21 million units. The estimation is based on the production plan of Japanese automobile makers in late August. Japanese automotive steel demand is estimated to decrease only by around 5% while automobile output is concerned to decrease due to the end of subsidy for eco-friendly car purchase by the end of September.

The automobile maker expected the domestic output would decrease by 20-30% in October-December from the first half of fiscal 2010 started April. However, the makers revised up the production due to strong demand in overseas market. Japanese car export showed year-on-year increase for 7 months in a row through July, according to Japan Automobile Manufacturers Association.

Domestic finished car production is estimated to be around 9.6 million units in fiscal 2010, which around 400,000 units higher than the initial estimation by integrated steel makers. However, the steel makers are concerned about decrease in finished car export due to higher yen exchange rate.