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Eco-Friendly Cars Boosted Japanís Auto Sales in June
Aug 06, 2009

Eco-friendly cars comprised over 50% of new domestic cars sold in Japan in June 2009 as the government introduced quite attractive green tax breaks and subsidies.

As per the statement released by the Japan Automobile Manufacturers Association (JAMA) on July 16, 2009, more than half of the sales of new domestic cars in June 2009 were accounted by the fuel efficient cars that are eligible for the government's tax incentives, reported istockanalyst.

According to the association, 55% of June's new car sales, i.e. 194,000 Units, was accounted by eco-friendly cars (including mini cars and passenger vehicles), which is a 43% up from April's 114,000 Units. Prius hybrid of Toyota Motor Corp. was the best-selling car in Japan in June while its competitor, Insight from Honda Motor Co. ranked fourth.
 
The rising sales of hybrids as well as other energy-saving cars in the past few months are attributed to the green tax breaks and subsidies announced in April and June by the Japanese government.

A gasoline-electric model, for the third successive month in June, acquired the No. 1 position in the category of non-mini vehicle sales.
  
In the trade-in incentive program, people can get a subsidy of 250,000 yen on purchasing eco-friendly models to replace the cars which have been registered for over 13 years. The subsidy is 125,000 yen in case of a mini-vehicle with engine of upto 600 cc.

Further, the rate of decline in new vehicle sales, excluding 660cc mini-vehicles, was also recorded easing from the earlier months. This was all due to the tax incentives and subsidies introduced on eco-friendly cars. It is noted that similar incentives have made the journey somewhat smooth for the automobile markets in several countries like China.

According to a Research Analyst at RNCOS, "Japan's automobile industry is appearing to steadily reflect the impacts of tax incentives introduced by the government. Now, what the auto industry requires is to capitalize on these government benefits and make efforts to revive the market. Although, still a long way is to be traversed before the nation's economy makes a convincing come back."

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