Diaoyu row cuts Toyota sales in China over 40%
Source: Agencies |
October 6, 2012, Saturday
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Print Edition
Print Edition
Toyota Motor Corp's China sales fell just over 40 percent in September from the year before, while those of rivals such as Hyundai and BMW jumped, underscoring how badly Japanese brands have been hit by a row between the two countries over the Diaoyu Islands.
Showroom traffic and sales have plunged at Japanese car makers since anti-Japan protests and calls for boycotts of Japanese products broke out across China in mid-September over the Japanese government's "purchase" of the islands in the East China Sea.
A prolonged sales hit of this scale could threaten profit forecasts at Toyota, Nissan Motor Co and others as China, the world's biggest car market, makes up a bigger portion of their global sales.
Toyota sold about 50,000 cars in China in September, a senior company executive said yesterday.
That would be down from about 86,000 in September 2011 but better than the figure reported earlier by Japan's Yomiuri newspaper, which said sales halved from the 75,000 sold in August.
The dramatic fall-off in demand for Japanese vehicles has been an unexpected boon for other foreign brands, with South Korea's Hyundai Motor Co saying yesterday that its China sales climbed 15 percent to 84,188 vehicles last month.
Toyota declined to confirm the number, saying it would announce its Chinese sales for September next Tuesday.
As demand evaporates, Toyota, Nissan, Honda Motor Co and others have been forced to cut back production in recent weeks in a slowing, but still promising, Chinese market.
A source said late last month that Toyota's production cutbacks could extend through November, a move that would almost certainly put the company's goal of selling 1 million cars in China this year out of reach. "I would say that it's almost impossible now," the executive said, blaming the wave of anti-Japan sentiment that has swept the country.
He added, however, that sales showed signs of recovery toward the end of last month, especially over the final weekend, providing some hope for an early comeback.
Anti-Japan sentiment across China escalated last month amid the row over the Diaoyu Islands.
Demonstrators vandalized properties of some Japanese companies, including a Toyota outlet in the eastern city of Qingdao that was torched.
Japanese carmakers have been the most visible losers, although there have been signs of the tensions affecting other sectors, with All Nippon Airways Co Ltd saying late last month that it had seen a wave of cancellations on Japan-China routes.
Semiconductor maker Rohm Co Ltd forecast a decline in orders for the second half of the budget year ending in March, citing significant weakness from Japanese automakers.
"The second half is not looking very good, it all depends on how much impact the events in China will have," said Hidemi Takasu, managing director of R&D at Rohm.
"We sell quite a lot to automakers so when they decide to cut production we feel the impact."
On Thursday, Mazda Motor Corp said its China sales tumbled by more than a third last month from a year earlier, providing the first concrete numbers to point to Japanese automakers' troubles in China.
Other premium brands benefitted. Volkswagen's Audi had sales boosted by 20 percent in September, BMW by 55 percent and Daimler's Mercedes-Benz by 10 percent.
Showroom traffic and sales have plunged at Japanese car makers since anti-Japan protests and calls for boycotts of Japanese products broke out across China in mid-September over the Japanese government's "purchase" of the islands in the East China Sea.
A prolonged sales hit of this scale could threaten profit forecasts at Toyota, Nissan Motor Co and others as China, the world's biggest car market, makes up a bigger portion of their global sales.
Toyota sold about 50,000 cars in China in September, a senior company executive said yesterday.
That would be down from about 86,000 in September 2011 but better than the figure reported earlier by Japan's Yomiuri newspaper, which said sales halved from the 75,000 sold in August.
The dramatic fall-off in demand for Japanese vehicles has been an unexpected boon for other foreign brands, with South Korea's Hyundai Motor Co saying yesterday that its China sales climbed 15 percent to 84,188 vehicles last month.
Toyota declined to confirm the number, saying it would announce its Chinese sales for September next Tuesday.
As demand evaporates, Toyota, Nissan, Honda Motor Co and others have been forced to cut back production in recent weeks in a slowing, but still promising, Chinese market.
A source said late last month that Toyota's production cutbacks could extend through November, a move that would almost certainly put the company's goal of selling 1 million cars in China this year out of reach. "I would say that it's almost impossible now," the executive said, blaming the wave of anti-Japan sentiment that has swept the country.
He added, however, that sales showed signs of recovery toward the end of last month, especially over the final weekend, providing some hope for an early comeback.
Anti-Japan sentiment across China escalated last month amid the row over the Diaoyu Islands.
Demonstrators vandalized properties of some Japanese companies, including a Toyota outlet in the eastern city of Qingdao that was torched.
Japanese carmakers have been the most visible losers, although there have been signs of the tensions affecting other sectors, with All Nippon Airways Co Ltd saying late last month that it had seen a wave of cancellations on Japan-China routes.
Semiconductor maker Rohm Co Ltd forecast a decline in orders for the second half of the budget year ending in March, citing significant weakness from Japanese automakers.
"The second half is not looking very good, it all depends on how much impact the events in China will have," said Hidemi Takasu, managing director of R&D at Rohm.
"We sell quite a lot to automakers so when they decide to cut production we feel the impact."
On Thursday, Mazda Motor Corp said its China sales tumbled by more than a third last month from a year earlier, providing the first concrete numbers to point to Japanese automakers' troubles in China.
Other premium brands benefitted. Volkswagen's Audi had sales boosted by 20 percent in September, BMW by 55 percent and Daimler's Mercedes-Benz by 10 percent.
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