TOKYO - Doing business online is beginning to catch on in Japan, where a new study predicts the automotive industry will become more dot-com dependent than any other business except personal computers.

The numbers still are small. Internet sales here in 1998 were $614 million (Yen64.5 billion) and the automotive share of that e-commerce was 3.1%, including parts and components as well as new and used cars. By 2004, however, e-commerce business is expected to balloon nearly 100-fold to $57 billion (Yen6 trillion) with the automotive share 14.5%.

The study by Andersen Consulting, commissioned by Japan's Ministry of International Trade & Industry's Electronic Commerce Promotion Council, was conducted in 1998 and 1999 via questionnaires sent to 937 Japanese companies. These were followed by interviews with the 339 executives that responded.

"Japan is three to four years behind the U.S. in electronic commerce. It will be 10 years or more before we catch up," says Hiroyuki Nishimura, an Andersen Consulting partner in Tokyo.

Business-to-business (B2B) e-commerce, he says, currently is two to three times larger in the U.S. than in Japan. Business-to-consumer (B2C) is about 20 times larger.

While about 30% of Japanese homes - roughly 13 million - currently have computers, the country's Internet population is estimated at 22 million people. Consumers are considered the key to e-commerce expansion, and more and more Japanese are logging on from homes, offices and Internet-compatible cell phones, and game consoles are fast becoming another gateway.

For most automakers and their dealers, the Web so far has served primarily as a conduit of product information available from sites such as Toyota Motor Corp.'s Gazoo, Nissan Motor Co. Ltd.'s Clicar and Honda Motor Co. Ltd.'s HEAT. Now the role is expanding to order-taking and processing.

Mazda Motor Corp. in January became the first Japanese automaker to try online sales with the offer of a limited edition of 200 "Web-tuned" versions of the latest model Demio wagon. The price, $350 (Yen37,000) higher than the standard, is fixed and includes several sporty extras. Other details, including trade-in allowance and credit checks, can be settled online. After a purchase reservation is made, Mazda steers customers to their nearest dealer to sign the sales contract. By Jan. 31, more than 35,300 inquiries had been made and 10 Demios sold.

No one yet seems sure who should do what in this brave new automotive world of e-commerce. For example, Toyota reportedly planned to sell its innovative new WiLL Vi subcompact directly over the Internet after its Jan. 17 introduction. Dealers, however, were so alarmed about this step - possibly marking the beginning of the end of dealer territories - that the plan reportedly was scuttled.

"The Net is useful for exchanging information between customers, dealers and companies, but not for making final sales," a Toyota spokesman says. Yet, tectonic shifts already are underway.

Since most dealers only have room to display three or four models, automakers may establish showrooms in each of Japan's 47 prefectures large enough to display all of their models to help customers, especially those dealing online, make a choice.

Says Kunihiko Shiohara, a vice president of Goldman Sachs (Japan): "E-commerce probably won't change the structure of dealerships much, but their function will change dramatically." Dealers will remain the delivery point for new cars, however purchased. But with the gross margin on new-car sales only 1.6% and more than half of Japan's dealers losing money, the focus will be on new profit centers.

Mr. Shiohara says the ultimate goal of automotive e-commerce is to reduce inventory costs for both makers and dealers, with a make-to-order routine involving completely flexible manufacturing systems.

"Ideally, automakers want to skip dealers as go-betweens in order placement," he says, "so as to narrow the gap between projected production and actual output."

Mr. Shiohara expects Honda, which pioneered the mix-and-match production of different models on the same line, to lead the way at its Suzuka plant with the introduction this fall of an even more flexible production system featuring eight different models coming off one line - up from five.

But for something as new and different as e-commerce, some perspective is needed. In 1998, 0.02% of all consumer purchases in Japan were made on the Internet. If the total reaches the $55 billion (Yen6 trillion) projected for 2004, that still will only be an estimated 2.2% of total consumer sales. The 14.5% automotive share of e-commerce estimated for that year will be worth $8.2 billion, a small fraction of total transactions in that sector.

All the same, it's a beginning. No one in Japan, or anywhere else for that matter, can be sure how far and how fast online car purchasing will grow.