New-vehicle sales of Daihatsu in Europe will stop at the end of January 2013. A subsidiary of Toyota Motor Corp., Daihatsu explained that because of the strong yen, exporting vehicles to Europe from Japan has become too unprofitable.
Another factor that had a role in this decision is the rising cost of developing models that comply with tighter CO2 emission regulations in Europe. However, Daihatsu clarified that it will continue to supply parts and after sales services in Europe after 2013.
From 11.9% of oversees sales in 2005, European deliveries of Daihatsu cars dropped to only 5.3% in 2010. The carmaker said that in 2010, it sold 19,300 vehicles in 10 European countries. In 2009, it sold about 36,300 units.
In a company statement, Daihatsu said that it chose to halt sales “because it could not make a business out of exporting completed units produced in Japan.” Since late in 2008 and even more so in mid-2010, the yen has appreciated sharply against the euro.
Presently, the euro fetches around 110 yen, close to its lowest level in nine years, compared to about 135 yen in mid-2010 and 170 yen in 2008.
Daihatsu also said that it cannot anymore consider exporting from Japan a “viable business” when costs to meet CO2 standards in Europe are growing and as profitability drops because of a stronger yen against euro. [via autonews - sub. required]