Auto sales hit by Asian currency instability

Auto sales hit by Asian currency instability

TOKYO (AFP): Japan's Toyota Motor Corp. president, Hiroshi
Okuda, said yesterday a decline in Asian auto sales was
inevitable following currency instability that has lashed
Southeast Asian economies.

"Naturally, we are expecting a decline in auto demand because
of the psychological worries caused by unstable currencies in
Asia," Okuda told news conference.

"For the time being, our stance is to monitor the market, but
we are not considering production cuts," he said.

Toyota is a leading auto maker in the region, with
manufacturing plants in Indonesia, Malaysia, the Philippines and
Thailand, all of which have been hit hard by currency speculation
in foreign exchange markets.

Okuda said it was "still unclear" whether Japanese domestic
auto sales would recover in July to levels of the previous year.

But he said that auto sales "are currently trending in such a
way that there is the possibility of a recovery being delayed
until August or September."

Okuda cited the adverse impact of the April 1 consumption tax
increase on new car sales, as well as steps by auto makers to
boost sales of used cars.

He said Toyota would continue to aim for 40 percent share of
the domestic market for car sales in the year to March 1998 by
focusing on "launching two to three new models after August."

Toyota is also planning to establish a representative office
in Russia by the end of the year, but production there was
unlikely to start soon, he said.

"Although we are currently exporting assembled cars to Russia
through trading houses, we are currently considering the
possibility of semi-knock down production in the next year or
two," Okuda said.