add swedish brand volvo to the ever-growing list of automakers that say they won’t make an appearance at the tokyo motor show this coming october. Volvo joins parent company ford, as well as general motors and chrysler, in skipping the biggest new car show in japan.

“we have evaluated our participation at motor shows for 2009 to see how we can make the most out of our resources, and this year we decided not to participate at tokyo,” volvo spokeswoman maria bohlin said today in an email to automotive news.

The show’s future - at least for 2009 - is in doubt thanks to the massive wave of cancellations. The japanese automobile manufacturers association says it will make a decision by early february on whether canceling the show all together is the best idea.

It seems that the recent downturn in sales is the excuse some automakers have been seeking to pull out of certain shows. The cost of attending a show is high for the automakers, especially in smaller markets.

Oct 13, 2009

Chang-Ran Kim
Reuters news Agency

TOKYO–The list of participants at the Tokyo Motor Show says it all: the Japanese car market is sinking into irrelevance.

At least that's the mood ahead of the biennial event opening next week as one carmaker after another cancelled their attendance, leaving just two boutique brands from overseas – Lotus and Alpina.

It's a sea change from two years ago, when top guns from Volkswagen, Daimler and BMW all flew in to jazz up their booths despite their cars' limited presence in the world's third-largest auto market.

The rare, razor-thin turnout at the Tokyo Motor Show – traditionally considered one of the industry's five big international shows – underscores the waning fortunes of Japan's once-buoyant market.

Demographically, Japan is suffering the double blow of a shrinking population and a rapid exodus from the countryside to cities, where owning a car can be a hassle due to expensive parking lots and congested roads. Auto executives also blame a fading interest in cars among young Japanese.

In Tokyo, home to a tenth of Japan's population and counting, car ownership is under 0.5 per household, or less than half the national average.

Add to that the financial crisis that has many automakers losing money and it is little surprise that some members of the Japan Automobile Manufacturers Association (JAMA) had initially proposed doing away with the Tokyo Motor Show all together this year. The four domestic truck makers all pulled out early on.

For the financial year to March, JAMA, the industry's lobby group, is forecasting a 32-year low in sales of new cars and trucks of about 4.3 million units, down 8 per cent from last year.

The government has helped stem some of the sales slide with reduced taxes since April on less-polluting cars, especially hybrids, and a separate scheme to reward new purchases to replace cars older than 13 years.

But unlike in the United States or Europe, the response has been far from dramatic, with sales finally breaking a 13-month decline in September with a modest 0.2 per cent rise. Questions also hang over whether the tax incentives will remain in place for three years as planned with a new government in place.

"The government's stimulus should help this year, but beyond that we expect the downward trend to resume," said JPMorgan auto analyst Kohei Takahashi.

"There's no question that the importance of the Japanese market is diminishing."

SIDELINED BY CHINA?

The Japanese market's woes have invited the inevitable comparison with China, where booming demand meant that no global brand dared miss the Shanghai auto show in April. China this year unseated the United States as the world's biggest auto market.

At the Tokyo Motor Show, opening to media on Oct. 21, automakers will showcase 19 world premiere cars, down from 37 in 2007. Floor space will be less than half of the previous show.

Still, Japanese executives insist their market – and their local auto show – still play an important role.

"Japanese car and motorcycle makers lead the industry in environmental and other technology," said JAMA chief Satoshi Aoki, also chairman of Honda Motor Co.

"The Tokyo Motor Show plays a crucial role as the forum from which such technology and messages originate," he said.

To step up to that plate, Honda will premiere three cars including a futuristic, six-seater hybrid minivan that takes lightweight technology to an extreme with basket-like, floating seats, an all-glass roof and carbon-weight wheels.

In an even more sci-fi-esque concept, Nissan Motor Co will display the Land Glider, a two-seater all-electric city commuter that tilts when turning corners, like a motorcycle.

Market leader Toyota Motor Corp is covering wide ground with showcase items including the second version of its electric car concept, the FT-EV II, as well as the first physical model of a planned rear-wheel-drive sports car that will borrow affiliate Subaru's signature boxer-engine technology.

Chief engineer Tetsuya Tada said the compact sports car, to go on sale by the end of 2011, would be "affordable" at much less than 3 million yen ($33,600 U.S.).

At the Lexus stand, Toyota will have a two-seater sports car that is widely rumoured to be a close-to-production version of the LF-A sports car concept, which Toyota president Akio Toyoda has personally raced on the famed Nurburgring track in Germany.

The sports car theme gels with the new chief's stated mission of turning Toyota into a maker of "fun" cars to breathe some life back into Japan's lustreless car market.

"I have a feeling it's us carmakers – not the customers – that have distanced ourselves from cars," Toyoda said this month.

"We ought to be making better and more exciting cars."

A dramatic rise in COVID-19 cases in Japan has prompted the Tokyo motor show organizers to cancel the show for the first time since the show began in 1954. Automotive News Europe quoted Toyota CEO Akio Toyoda, also chairman of event organizer the Japan Automobile Manufacturers Association, saying the organizers concluded it would be difficult to offer the show’s main programs where visitors get to experience “attractive features of mobility in a safe environment.”

The Tokyo show has never previously been canceled. Japanese Prime Minister Yoshihide Suga is reported to be considering declaring a state of emergency in some Japanese cities, including Tokyo. The show’s cancellation comes three months before Japan is scheduled to host the Olympics. Last year they were postponed to this year.

The show was scheduled for Oct. 20-31. Toyoda said that when it returns in 2022 or 2023, the motor show will be rebranded a “mobility show” to reflect the Japanese automakers’ increasingly diverse transportation choices. He also said a virtual event was not considered because the show prioritizes visitors’ hands-on experiences. “We would rather hold the event in the real world, not virtually,” he said, “so we’ve decided to cancel the event.”