September 16 2008.

Yamaha plans to reduce its soaring motorcycle inventory in Europe, adjusting output and cutting shipments by around 9%.

Amid sluggish sales in the key markets of Italy and Spain, Yamaha's inventory in the region has soared to 50% above normal. To correct the overstock before it releases new models next spring, the firm will boost sales promotion spending as well.

European demand started weakening after February, prompting Yamaha to cut its 2008 sales forecast for the market by 14% to 374,000 units. With sales softer, inventories have risen rapidly, so the firm will adjust output at sites such as its plant in Shizuoka Prefecture, its main location for production of overseas-bound motorbikes, as well as at a production subsidiary in Italy, to cut wholesale shipments by around 9% on the year.

The product lineup to be rolled out next year will include a flagship sport-type motorcycle and an entry-level model.

In North America, Yamaha was able to slash its inventory quickly after lowering output and amid solid sales of models with high fuel economy.

Source: The Nikkei Business Daily