More Japanese ordered air conditioners last month as the nation felt the impact of a record heat wave. The heat was unprecedented in a country that rarely experiences such intense temperatures, especially for a prolonged period of time. The volume of air conditioning units that were ‘moved,’ which essentially means sold, jumped 10.9 percent from 2017.
On July 23, the nation recorded the highest temperature since they began keeping track, hitting 41.1 degrees in Kumagaya, Saitama Prefecture. As a result of this incredible temperature, the Meteorological Agency labeled the heat wave a natural disaster.
The general public was warned to take precautions and necessary steps to remain cool and avoid heat exhaustion and heat stroke. All-in-all, according to government records, more than 70,000 people visited hospitals due to heat-related illnesses throughout the country over the course of three months. 140 people died due to this intense heat wave.
Record Numbers of Air Conditioners Sold
1,763,000 units were sold last month, which represents the 10.9 percent increase from the same month the previous year. The entire monetary value of the air conditioners represented 137.9 billion Yen, or approximately $1.2 billion US.
Yet, it wasn’t only air conditioners that were the hot ticket items during July; refrigerators, washing machines, and vacuums all saw a growth in demand.
Home appliance shipments valued at 281.1 billion Yen for the reporting month, which represented a total of 7.2 percentage increase from the previous year.
The Impact on Other Industries
While incredibly good news for appliance manufacturers and sales representatives, the long-term impact of this prolonged heat wave could endure for months. As consumers spend more on appliances to keep cool (even to the point of them being life-saving devices), they generally tap into their disposable income.
This could affect other industries in the months ahead as there may be less disposable income for other intended purchases. Also, the cost of running these air conditioners may not immediately be felt until the electric bills are sent out.
Overall, This Remains a Positive Sign for the Economy
While the heat wave that struck Japan this past July was record-setting, Japanese and immigrants alike understand how to weather difficult climate conditions. Turning to air conditioning units and even spending more on other appliances highlights the turnaround in the economy from the start of this year.
Home appliance shipments valued at 281.1 billion Yen for the reporting month, which represented a total of 7.2 percentage increase from the previous year. This clearly highlights that the economy is on the move and consumers have more confidence in it. This should be welcome news to a wide range of businesses throughout Japan that the general consumer public is beginning to relax their purse strings and focus on a few luxury items.
The news bodes well as these higher ticket items are rarely ever considered impulse items, and if consumers are more confident in their spending and the economy, it should ripple throughout most other sectors of the economy in the coming months.
Economists anticipate the Japanese economy to grow stronger as we head toward the final months of 2018.