New Generation of Japanese Cars on the Way

A new generation of fuel-efficient cars is on its way, perhaps dealing another blow to Detroit, reports the Los Angeles Times (February 14).

Japan's big automakers stand to profit from galloping gas prices as they prepare to roll out a batch of fuel-efficient small vehicles. The subcompacts from Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co. will deliver fuel economy in high-30-miles-per-gallon territory at prices starting at about $12,000.

In March, Toyota will launch the Yaris sedan and three-door hatchback, followed by Honda's Fit, a five-door hatchback in April, and Nissan's Versa hatchback in May and a sedan in the fall.

Toyota and its two rivals are taking aim at a group of younger buyers who otherwise shop for used cars. The new Japanese subcompacts, which max out at about $15,600 for a top-of-the-line Toyota Yaris, come with long lists of standard and optional equipment.

The extra sales would continue the growth of the big Japanese companies, while American carmakers keep losing market share to foreign brands, Brown said. Last year, Japan's automakers captured a record 32.2% of the U.S. market, up from 22.8% a decade ago, while the American companies' share fell to a record low of 56.9%, down from 73.5% in 1995.