Toyota expects a drop in Prius sales as government support ends

Article by Christian A., on September 2, 2010

For over a year, the Prius hybrid has led sales growth for Toyota Motor Corp. in Japan due largely to government subsidies. But as these subsidies are ending, the demand for the model is expected to fall.

Hiromi Inoue, the new-car sales chief for Tokyo Toyopet Motor Sales Co., said that a sales plunge is “unavoidable” and that they should prepare for the “coming crisis.”

Inoue said that the number of customers who signed up to purchase a Prius at Tokyo Toyopet's 66 showrooms has decreased, from 20 in June to about 8 customers a day.

The Japan Automobile Dealers Association expects sales of Japan’s car industry to drop by 23% in the six months starting in October from a year earlier.

When the third-generation Prius model started selling in May 2009, demand for the model had risen quickly. One month later, the government launched the incentive program.

With this plan, consumers can ask for a 250,000 yen ($2,963) subsidy if they scrap their car that’s older than 13 years old and get a more fuel- efficient one. Consumers can get 100,000 yen for a new car purchased without scrapping the old one. [via autonews - sub. required]

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