Japanese car sales in China rebound, but outlook remains cloudy

The Asahi Shimbun - Sales of Japanese cars are showing signs of a comeback in China, but they are still a long way from making a full recovery.

The share of Japanese automobiles rebounded in November to 11.7 percent from 7.6 percent a month earlier, although the sales number represented a 36.1 percent drop year on year.

Japanese carmakers have seen their sales in China plummet since September due to anti-Japan demonstrations and a boycott of Japanese products over the Senkaku Islands dispute.

The China Association of Automobile Manufacturers said Dec. 10 that 1,461,300 passenger cars were sold in the country in November, a gain of 12.5 percent from the same month last year.

New vehicle sales, including commercial vehicles, grew 8.2 percent year on year in the month, to 1.791 million units. New vehicle sales in the January-November period rose 4 percent from the same period last year, to 17.49 million units, almost guaranteeing that the annual number will top the 19 million mark.

As for shares in the passenger car market by country, Chinese, German and French carmakers saw declines from the previous month, at 43.7 percent, 18.5 percent and 3 percent, respectively. U.S. and South Korean automobile manufacturers increased their shares to 13.1 percent and 9.8 percent, respectively.

"(South Korean cars) are posting explosive growth as consumers have come to realize that Korean cars offer the same performance as Japanese vehicles at reasonable prices," said a Hyundai Motor Co. official.

Sales at Hyundai in China increased 39.7 percent in November. The total number of sales for the month for the Hyundai Kia Automotive Group came to 143,000, almost double the 79,500 units for Nissan Motor Co., which is the top Japanese carmaker in the Chinese market.

Customer numbers visiting dealerships of Japanese makers are returning almost to last year's levels, indicating that anti-Japan sentiment over the territorial dispute between the two nations is starting to subside.

But few officials at Japanese manufacturers are optimistic about the short term.

A Nissan official said the number of visitors to its dealerships in November was at almost the same level as last year, and sales rebounded to around 85 percent.

"It will likely take more time for sales to return to last year’s level," said Toshiyuki Shiga, Nissan's chief operating officer.

A senior official at Honda Motor Co. said, "The number of people looking is returning to normal, but in many cases, we were unable to close the sale."

Prolonged weak sales could affect Japanese carmakers from making further investments in China.

Toyota Motor Corp. has decided to postpone construction of a fourth plant in Tianjin that had a projected production capacity of 200,000 small cars annually. The decision came after Toyota determined that lower sales numbers will continue for some time in China. The firm is also considering putting off a plan to build a third plant in Guangzhou.

Similar moves could spread to other Japanese makers.