Japanese car sales plunge in China due to row of islands


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Sales of Japanese-made cars fell in China in September, with Toyota reporting a 48.9% drop and Honda a 40.5% drop in demand after a dispute over ownership of an island chain led protests and a boycott of Japanese products in China.

Japanese automakers reported a slump in China sales in September – with Toyota’s almost halving – confirming the impact of a territorial dispute between the two countries and raising concerns about their future on the market. largest car market in the world.

Violent protests and calls for a boycott of Japanese products erupted across China in mid-September after Japan nationalized two of the East China Sea islands, known as Diaoyu in Chinese and Senkaku in Chinese. Japanese, buying them from their private owners.

Toyota Motor Corp said on Tuesday that sales in China fell 48.9% in September from a year earlier, while Honda Motor Co reported a 40.5% drop in sales there.

Nissan Motor Co’s auto sales in China, including imports, fell 35.3% in September from a year earlier, according to its Chinese venture capital partner Dongfeng Motor Group Co. Suzuki Motor Corp said shipments to dealers in China fell 42.5% last month from a year earlier.

“Inventories are going up, factories are running less, and retail is not doing well at all,” said Koji Endo, senior analyst at Advanced Research Japan.

“It will be the German and South Korean manufacturers who will take over from the Japanese brands when the Japanese cars sell less. I don’t see a single positive factor (for Japanese brands). »

As street protests have died down, China has sent its patrol boats into what Japan considers its territorial waters near the islands in recent weeks, prompting protests from Tokyo against Beijing.

Analysts say sales by Japanese automakers, which together held just over a fifth of the Chinese auto market before the protests, could continue to weaken as diplomatic tension persists.

“We had cut our Japanese car sales forecast for 2012 by 100,000, but that seems far too conservative now,” said John Zeng, Asia-Pacific director at industry consultancy LMC Automotive. “We previously expected them to sell 3.04 million, but it would be great if they could move 3 million.”

Toyota and its two local Chinese partners sold a total of about 44,100 vehicles in September, Beijing-based company spokesman Takanori Yokoi said.

For the first nine months of this year, sales of Toyota and its partners totaled about 640,200 vehicles, up 4.6 percent from the year-ago period, Yokoi said.

Small rival Mazda Motor Corp said last week that its sales in China fell 35% in September from a year earlier.


According to Toyota sales officials in Beijing and dealerships selling Toyota and Lexus cars, sales began to rebound towards the end of the month, raising hopes for a quick comeback.

“The biggest question now is how permanent the damage to Toyota and other Japanese brands is,” said a key Toyota and Lexus dealer. “It’s too early to say one way or the other, but we’re a bit worried.”

A Japan-based Toyota executive told Reuters that Toyota’s production cuts in China are expected to last until November, showing the company’s pessimism about prospects for a quick recovery.

At least two Beijing-based Toyota executives have told Reuters the Japanese automaker and its Chinese partners are unlikely to be able to meet their goal of selling 1 million cars in China this year. They sold less than 900,000 cars in 2011.

Among Japanese automakers, Nissan has the most exposure to the Chinese market, followed by Honda and Mazda.

In 2011, Nissan sold 883,000 vehicles in the world’s largest automotive market, which represents about 27% of the company’s vehicles sold worldwide. For Honda, this ratio was around 20%, while for Mazda it was around 18%.

For Toyota, Japan’s largest automaker, China accounted for around 12% of vehicles sold worldwide in 2011.

The market share of Japanese brands stood at 21.2% at the end of August, compared to 21.6% in 2011, according to official data. German brands grew to 23.3% from 21.3%, while Korean brands’ market share increased to 9.3% from 9% during the period.

The dramatic drop in demand for Japanese vehicles has been an unexpected boon for other foreign brands. In September, sales of BMW in China jumped 55%, Audi 20% and Hyundai Motor 15%.

Anonymous Toyota-Lexus dealership operator reads after visiting its Toyota and Japanese-brand car outlets, mostly in southern China, that 10% of its customers no longer intend to buy Toyota cars and have canceled their orders, while 20% are sticking with them. “The rest – about 70% – is on the fence.”



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