TOKYO (Kyodo News) – Japan’s industrial production fell 0.9% from the previous month in November due to the impact of automobiles and electronics, the first decline in three months, government statistics showed on Thursday.
According to preliminary figures released by the Ministry of Economy, Trade and Industry, the production index for factories and mines (seasonally adjusted) was 104.0, when 2020 is set as 100. This followed a 1.3% increase in October.
The ministry has left its basic assessment of industrial production unchanged since July, stating that the situation has been “unclear and fluctuating.”
Out of the 15 sectors surveyed, 11 sectors reported a decline in production, while four sectors recorded an increase, with automobile industry production falling by 2.5%.
“The decline in the reporting month was mainly due to a decline in the automobile sector, especially small passenger cars, reversing the recent upward trend,” a ministry official said.
Production of electronic components and devices also contributed to the overall decline, with a 3.5% decline led by integrated circuit memory chips, the ministry said.
On the other hand, production machinery production increased by 1.6%, led by semiconductor manufacturing equipment, which increased by 2.6%, supported by strong domestic and overseas demand.
Looking ahead, ministry officials cited the potential impact of Daihatsu Motor Corporation’s production suspension, calling it a “risk factor for future downturns” in the auto sector and industrial production as a whole.
Toyota Motor Corp.’s small car division halted all domestic production this week amid uncertainty over when factories will resume operations in the wake of a safety testing scandal affecting most models.
The industrial shipment index decreased by 1.3% to 102.5, the first decline in three months, while the inventory index rose by 0.1% to 104.3.
Based on a poll of manufacturers, the ministry expects production to increase by 6.0% in December and fall by 7.2% in January.
Ministry officials said the government will closely monitor the potential impact on capital investment from rising overseas interest rates and a slowing Chinese economy.