Japan's Carmakers Expand Home Factories

Despite sluggish domestic sales, Japanese automakers are boosting production to meet rising demand for their high-quality exports

Japan's dwindling car market is a major concern for the country's automakers. Having touched a 20-year low in 2006, this year sales fell every month until October. But when it comes to Japanese auto production, the picture is quite different. Despite Japan's high costs and sluggish domestic market, 2007 is set to mark a fifth consecutive increase in vehicle production. Spurred by rising demand overseas, Japan Inc.'s high-quality, flexible plants will produce a total of 10.7 million vehicles this year, projects automotive consulting firm CSM Worldwide. That compares with a total of 10.5 million cars and trucks in the U.S., which fell behind Japan as the world's biggest vehicle maker last year.

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