Japan’s Eco-Car Subsidies Could Run Out in July

The Japanese government's 248 billion ($3.2 billion) incentive program for the purchase of fuel-efficient vehicles is likely to use up the last of its funding next month, The Nikkei reports.

The plan, which began in December, was intended to run through January 2013 or until the money was exhausted. Buyers of eligible vehicles receive rebates of 70,000-100,000 yen ($895-$1,280).

The government had received applications for subsidies for 1.5 million vehicles through the end of May or for 60% of all passenger vehicles sold since the program began, The Nikkei estimates.

Total vehicle sales in Japan, including trucks and buses, surged 56% to 2.4 million units the January-May period. Analysts credit eco-car incentives and a rebound from lower year-earlier volume in the aftermath of the country's March 11 earthquake and tsunami.

Automakers had expected the incentives to continue into September. The Japan Automobile Dealers Assn. predicted last month that sales would fall 23% year-over-year to 2.1 million cars in the six months starting Oct. 1.