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Car sales in the United States have slowed dramatically for Toyota and Nissan, Japan’s two largest automakers, according to a new report—and both brands think their share of the U.S. auto market has gone as high as it will go.
For the first time this year, Toyota said it is projecting a drop in sales for the year as American car buyers continue to favor larger cars like SUVs and trucks over more efficient vehicles, Automotive News reported. That’s a problem for the Japanese automaker because the company has spent nearly two decades building its reputation off of clean emissions cars like the ones in its Prius lineup.
“The market turned out to be somewhat weaker,” said Toyota executive vice president Takahiko Ijichi Tuesday after the company announced a 43 percent drop in quarterly profit, according to Automotive News. The U.S. automotive market “really requires very careful managing going forward.”
Toyota is expecting its operating profit to drop 40 percent for 2016 ending in March, reports said.
Similarly, Nissan believes there is no more room for growth in America. The company shared that it has experienced a fall in profits, even while attempting to serve up better incentives for buyers. While continuing these efforts, the company’s operating profit dropped 19 percent in the last quarter. Yokohama projects that numbers for its entire sales year—which ends in March, like it does for Toyota—operating income will likely fall by 10 percent, AN reported.
“Incentives are rapidly growing in the [American car] industry, and we are paying close attention to it,” Nissan co-chief executive officer Hiroto Saikawa.
The North American car market was the largest export area for Japanese automakers, with more than 1.3 million passenger vehicles delivered to the States over the first nine months of 2016. For reference, that number trumps what those carmakers see at ports onEarth’s other six continents.
