Japan is the world's third largest auto producing country, producing 8.4 million cars last year, behind China's 18.4 million and USA's 8.7 million.
The automotive industry is very important to Japan. Contributing 15 percent of Japan's manufacturing exports value, the auto sector contributes more to Japan's economy than its well established electronics sector, which has since been overtaken by the Taiwan and the likes of Apple have overtaken Sony.
Japan's 127.5 million population buys about 5 million new vehicles each year (excluding trucks and buses). 78 percent of Japan's households own a car but only 42 percent own more than one car.
Japan has one of the highest car ownership cost in the world. Compared to Malaysia, it may be cheaper to buy a car in Japan but maintaining one and keeping it road legal is very expensive. Vehicles are required to undergo a mandatory 'shaken' inspection every two years. Inspection cost varies depending on the vehicle's weight. It may cost between 50,000 Yen (RM 2,000) to 200,000 Yen (RM 8,000). This is excluding the cost of repair before your vehicle can pass its 'Shaken' test.
Because of the very strict safety standards imposed, most mechanics don't do mechanical repairs on individual parts. Instead, faulty parts are usually replaced. Which explains the high number of reconditioned parts being imported by parts dealers in Malaysia.
Rust spots, however minor, will not be tolerated by 'Shaken' inspectors. On cars over five years old, it is not uncommon for to require entire brake system replaced. You are looking at easily over RM2,000 in preparing your vehicle for its 'Shaken.'
As such, the average lifespan of a car in Japan is only around five to seven years. After which, it is no longer economical to maintain them anymore. These cars are often reconditioned and imported by grey importers from other countries, like Malaysia.
The maximum loan tenure period is at five years. But financing is not necessary required by car buyers. The average annual income of a university graduate in Japan is about 3.2 million Yen. A Toyota Aqua (Prius c) for example, starts at 1.69 million Yen, slightly over half a year's worth of salary. But the most popular young graduate's car is a Suzuki Wagon R, starting at about 1.1 million Yen, just a a third of a year's worth of salary.
I estimate the average annual salary of a Malaysian graduate at around RM 35,000. The most popular graduate's car, a Perodua Myvi, starts at RM 44,000.
However, the young people of Japan no longer see cars as a necessity, or even a status symbol anymore. Rather, a car is viewed as merely transportation tool, a necessary inconvenience to those living in areas where public transport is not easily available.
The young people of Japan are indifferent about the types of cars they own, with cheaper, basic variants often favoured over higher range models. Indeed, there is a now a clear shift towards smaller cars with basic features.
With the high cost of car ownership and a network ultra reliable public transport, it is not difficult to understand where they are coming from.
In such a saturated car market, one of the last frontiers for automakers to squeeze additional sales are dog lovers and women. The pet industry is huge in Japan. In a society where European-like family friendly work place policy for women is still a rarity, most women delay or even put off entirely child rearing and marriage. Instead, many Japanese women spend a lot on pet grooming.
As dogs, other than guide dogs for the blind are not allowed in trains, many car makers are designing cars to be dog friendly.
For security reasons, more women find a stronger reason to pay for a car than men, who is likely to be satisfied commuting via public transport. Indeed, the funny trend about Japan is that there are more women interested in the joy of driving than men.
Forget about what you saw in Fast and Furious and Initial D anime. In reality, driving and cars are not a big thing in Japan anymore. Instead of street racers and drifters glorified by movies, Youtube and manga comics, it is women who dominate Japan's automotive scene because they spend more on cars, especially cute little kei car compacts, than men.
Kei cars are very popular. Exempted from weight tax, parking space purchase from the local municipal (a one time fee when purchasing a new car) and registration cost, they are the cheapest to run.
The origin of kei cars, a tax regulaton bracket, originated from Japan's post war years where fuel had to be rationed. Kei cars are limited to only 660cc engine capacity, 3,400 mm long, 1,480 mm wide and 2,000 mm high.
Japan has now entered what is called a demotorization phase. Car sales peaked in 1990, with 7.7 million vehicles sold. Although Japan is the key focus on all discussions about demotorization, the phenomenon is not unique to Japan. The same trend is noted in major cities of Western Europe, and to a certain extent, even in metropolitian cities in USA, which saw application of driving licenses peaking in 2004.
Up until recently, kei cars is the largest car segment in Japan. But this trend changed in 2010, as a result of government incentives for green cars, especially hybrids. Immediately this saw the Toyota Prius shoot to the top of the sales chart.
Sales of kei cars are not tabulated by JAMA, the source of Japan's vehicle sales data, as kei cars do not go through the same registration process as regular cars so it is difficult to track them. Sales of kei cars are tracked by Japan Mini Vehicles Association, which does not release monthly registration data.
The best selling kei car is Suzuki Wagon R. The Daihatsu Mira, Honda NBox and Daihatsu Tanto are other popular kei cars.
Both the Toyota Prius and Aqua hybrid now outsell any kei car model.
Toyota is the top selling car brand, controlling 36 percent of Japan's car market as of April 2012.
Below is a table of the top-30 best selling car models in Japan, as compiled by JAMA (Japan Auto Manufacturers Association) for the month of January to April 2012.
The list below is just a guide and is not a complete reflection of what's actually happening on the ground. Mitsubishi is the seventh largest brand in Japan but you won't see any Mitsubishi models on the top-30 list. For reasons I don't know, Mitsubishi does not provide a breakdown of their vehicle sales by model.
Also, kei cars are not included in this list, for reasons mentioned earlier.
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