Gasoline prices, after surging, have fallen back, but even so automobile sales have been plunging around the world as a result of the downturn in economic conditions and the contraction of credit following the collapse of Lehman Brothers. The drop has been especially sharp in the United States, where the situation has been exacerbated by the decline in home prices and questions about the future of the Big Three, but the pace of the fall has also picked up in Japan and Europe. And even the emerging economies have been experiencing rapid deceleration since the Lehman shock.

According to input-output table analysis, a decline of 10%, or ¥6.7 trillion, in sales of vehicles by Japanese automakers will produce a negative impact of ¥18.4 trillion on an all-industry basis. Industries feeling major effects include steel, commerce, business services, industrial machinery, and transportation.

The Japanese auto industry was dealing with new developments even before the financial crisis, such as demands for "greener" cars, growth of countries like the BRICs (Brazil, Russia, India, and China), rising fuel prices, and higher costs of materials. The financial crisis set off a worldwide contraction of credit, and the picture is expected to become even bleaker in 2009, with manufacturers short of funds for investment and consumers holding back from new car purchases. Amid the global downturn, Japan's automakers are in a relatively good position, since they lead in production of small, fuel-efficient vehicles and have healthy balance sheets. They are also ahead in development of battery and other new technology, and they may in the end emerge as the locomotives of the global auto industry.