Goldman cuts Japan auto industry rating

Japan's automobile industry was lowered to "neutral" from "attractive" at Goldman Sachs Group Inc., which cited slowing US economic growth and prolonged strength of the yen. Toyota Motor Corp. had its share-price target cut ten per cent because of a possible slowdown in demand, according to a report by Tokyo-based Goldman Sachs analysts. They also reduced their estimates for Nissan Motor Co., Honda Motor Co., Mazda Motor Corp., Suzuki Motor Corp., Fuji Heavy Industries Ltd. and Yamaha Motor Co. "We now expect all Japanese automakers will return to normal production this autumn," the analysts wrote in the report, in reference to a slowdown after Japan's March 11 earthquake and tsunami."Yet while automakers are planning to ramp up production sharply in the second-half, concerns about the demand side are emerging," the analysts said. Analysts are reducing estimates for US automobile sales for 2011 and 2012, as consumer confidence in the US economic outlook slumped this month to the lowest level since the recession, raising the risk that spending will dry up.US sales at Toyota fell 23 per cent in July, while Honda deliveries dropped 28 per cent. From / Gulf News