Three Japanese carmakers' sales decline.

But Toyota posts first-quarter business increase

Struggling against a still-rising yen, three of the four Japanese automakers with Southland-based U.S. sales operations finished the fast quarter with sales lagging behind a year ago.

While Toyota remains ahead of its first-quarter 1994 pace and Nissan, Honda and Isuzu lag behind, their numbers continue to shift.

Sales for Torrance-based Toyota Motor Sales U.S.A Inc. were 226,374 for the quarter, up 2.1 percent from a year before. But that eroded from a 13.3 percent lead just one month ago, with most of that lump accounted for by a 21 percent gain in sales for January. In contrast, Toyota's March sales were off 12.8 percent from March 1994; sales for its Lexus luxury division were down 17.7 percent.

"March 1994 was the greatest March in the history of Toyota, so it's not really fair to try and make a comparison," said Toyota spokesman Jeremy Barnes, who added that buying patterns differ from month to month.

Gardena-based Nissan North America is still behind the first quarter of 1994, with sales of 161,485 cars and trucks, down 2.2 percent. But Nissan is on a rebound; March sales were up 7.8 percent. Nissan's Infiniti luxury division, buoyed by strong lease programs and incentives, has fared even better, with sales up 25.1 percent for the month and 46.4 percent for the quarter.

Infiniti scores

"A lot of the Infiniti dealers feel they've been playing second fiddle to Lexus, and they decided to turn this around," said Doug Dohring, chairman and CEO of Dohring Co., a Glendale-based automotive research and marketing firm. "They've been very aggressive on their sales and promotions," he said. And that, in part, accounts for the dip in Lexus sales, Dohring added: "The increase in Infiniti sales has to come from somewhere."

A Nissan spokesman did not return phone calls seeking comment.

Torrance-based American Honda Motor Co.'s sales were down 2.3 percent for the quarter, with 144,231 cars and trucks sold, March sales were up 2.2 percent from a year before, a rebound from February, when sales dipped 7.8 percent. Sales for its Acura luxury division were down 19.1 percent for the quarter, and may also be a victim of Infiniti's success, Dohring noted.

American Isuzu Motors Inc. of the City of Industry continues to fare the worst of the four automakers. Sales were off 19.9 percent for the quarter, with 22,232 vehicles sold. March sales were down 25.3 percent.

Yen's rise hurts sales

All four automakers have had to deal with the rising strength of the yen, which dipped below 80 yen to the dollar last week. A stronger yen makes imported cars more expensive to sell in the United States.

In response to the yen's gathering strength, Toyota has raised retail prices twice since the beginning of the year, Nissan increased prices in March and Honda hiked prices earlier this month. Isuzu has shifted some of its U.S. manufacturing capacity toward more popular models and is importing more pickup trucks from Japan.

Some 54 percent of Japanese vehicles sold in the U.S. are manufactured in this country, said Jesse Snyder, an analyst with Autofacts Inc., a Pennsylvania-based industry consultant, and he expects that number to rise to combat the yen's strength.

"You're going to see more vehicle (production) moved to the U.S., and an increased number of components being sourced from North America," he said.

Dohring agreed, and noted that Toyota has plans to increase production of its Camry sedan at its Kentucky plant next year. But he believes changing the parts sourcing will take a while longer. "That's not a short-term fix. That's something that can take two or three years to accomplish," he said.

Altogether, sales of U.S. vehicle makes are down 4.2 percent for the year so far, while Japanese makes are down 5.1 percent - figures most industry analysts attribute to the slowing of the U.S. economy. Sales of U.S. makes were down 5.2 percent in March while Japanese makes slid 8.2 percent.

As for the disparity between Japanese and U.S. vehicle sales, Dohring noted a recent study his company conducted indicated car buyers believe American automakers are producing better-quality vehicles and people are more willing to purchase them.