Japan April 2016: Mitsubishi scandal reshapes local auto industry

The Mitsubishi fuel economy scandal is already reshaping the Japanese and worldwide auto industry. 

* See the Top 30 best-selling cars, Top 30 kei car & Top 55 brands by clicking on the title *

This post was created in collaboration with Stephen Bloom.

The Japanese market begins to show some signs of recovery just in time for the start of a new fiscal year. April’s monthly sales are up 1.6% from last year to 324.717 units, meaning the year-to-date total is now down 5.5% to 1.794.851 deliveries. Regular vehicles are up 7.2% to 212.683 registrations and imports improve 6% to 16.071. The kei car segment that was hit this time last year with a tax increase was anticipated to contribute significantly to this month’s growth, but just the opposite was true on account of a scandal that is reshaping the Japanese auto industry. In the wake of last year’s scandal at Volkswagen, Mitsubishi admitted last month to manipulating fuel economy test data for 25 years which led to a massive devaluation of the company and a $2 billion buyout by Nissan.

Ironically, it was Nissan that discovered the discrepancies earlier this year between Mitsubishi’s and actual fuel consumption data of four kei models produced by the two company’s joint venture, NMKV. The scandal resulted in a stop-sale of the affected models and quickly escalated as news broke of the company submitting manipulated data since 1991 and culminated with Nissan acquiring a controlling stake of Mitsubishi. This new control by Renault-Nissan will have implications not only in Japan, but on the global automotive market also.

The Nissan Dayz and its twin the Mitsubishi eK are under a stop-sale order in Japan 

As a result of the halt to sales of the popular Nissan Dayz and Mitsubishi eK, it is only fitting to start with the kei car market this month. Overall sales in the segment fall by 7.5% to 112.034 units with Nissan and Mitsubishi’s kei car sales dropping by 51% and 45% respectively. The top four models all post double-digit gains over last April when the tax increase for kei car taxes dampened sales. At the top of the chart the Honda N-BOX adds another 11.691 units to extend its lead over the Daihatsu Tanto which places again at #2. Suzuki takes the next four spots on the chart starting with the Alto at #3, followed by the Spacia climbing 7 places to #4, Hustler, and WagonR. Sales of the Mitsubishi-made Nissan Dayz decreased 67% following a stop-sale causing it to fall eight places to #11 in the wake of the fuel economy scandal. Its cousin, the Mitsubishi eK, drops by 64% to #19. Sales of both models, including the Dayz Roox and eK Space wagon versions, have not yet resumed.

The new Toyota Prius remains the champ of the regular car chart with sales up 137% to 20.770. The Toyota Aqua stays in second place while the new Sienta reclaims the #3 spot from the Honda Fit and even leads in year to date totals aided by the new model’s sales up 953% over last year. Also boosted by a new generation is the Toyota Passo which is up 33%, climbing eleven spots to #10. And finally making its debut on the chart this month, the new Suzuki Ignis comes in at #21 having sold 7.633 units since its February launch, including 2.778 in April alone.

Previous month: Japan March 2016: Kei cars pull market down 9%, Toyota Prius reigns

One year ago: Japan April 2015: Toyota Esquire and Honda StepWGN shine

Full April 2016 Top 30 cars, Top 30 kei cars and Top 55 All-brands below.