Global News: Mazda Seeks Government Help; Toyota To Slash Prius Price; China Incentivizes Rural Car Sales; Kia Cuts Russia Sales Targets
By Michelle Krebs March 18, 2009In global news Tuesday, Mazda said it was seeking financial help from the Japanese government, China is giving incentives to rural dwellers to buy cars, and Kia slashed its forecast for Russia.
In Japan, Mazda confirmed it is seeking financial help from the Japanese government. Mazda has the second-worst credit rating among Japanese automakers, making it impossible to sell bonds. "We can't sell bonds right now," said Nobuyoshi Tochio, general manager of Mazda's financial services division. "The market isn't functioning. Conditions are really bad."
Meantime, Japan's Nikkei
newspaper is reporting Toyota plans to cut the price of its upcoming redesigned 2010 Toyota Prius hybrid to match the price of the 2010 Honda Insight. In the U.S., the new Insight, which went on sale in Japan last month and officially goes on sale in the U.S. March 24, is priced about $2,200 less than the least expensive 2009 Toyota Prius.
In Russia, Kia has reduced its forecast for sales due to the nation's deteriorating economy and after seeing its own January and February combined sales fall 37 percent from a year ago. Kia had 12 percent rise in sales from 2007 to 2008 in Russia. In January this year, Kia forecasted nearly 15 percent growth for 2009, but has since revised it to 13 percent. Helping Kia, the automaker said, is the fact that it is introducing new models this month and has taken control of its own distribution in Russia. Kia still intends to be among the top five sellers in terms of sales volume by 2010.
Ford and some analysts expect vehicle sales in Russia to fall by as much as 50 percent in 2009 compared with 2008. Russia increased its tax on auto imports by 35 percent in January.
In China, the government is providing subsidies to people in rural areas to buy cars and motorcycles. The $732-million Farmer Auto Stimulus package includes a 10 percent subsidies for rural residents who buy new cars and a 13 percent subsidy for those who buy motorcycles. In addition, automakers and local governments have launched or are talking about launching additional subsidies for rural dwellers to buy vehicles. The incentives are expected to spur sales of Chinese minivans. General Motors may well be one of the beneficiaries of the incentives with its low-cost Wuling-brand van and trucks, like the Wuling Sunshine, popular with rural residents.
Photos by manufacturers
1 - Toyota Prius
2 - Wuling Sunshine
AutoObserver's Global News report is compiled by Edmunds' Senior Manager David Greene.
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