Toyota Taking On Top China Sales Spot
With mature markets under-performing spectacularly, Toyota continues to invest in supplying China's endless thirst for cars. Shanghai Daily reports that ToMoCo is about to drop some $529m on increased production capacity in the Middle Kingdom. With volume leaders GM and VW in its sights, Toyota hopes to snag ten percent market share (1m vehicles). Sales are already headed for 700k this year. Toyota is scrambling to meet demand with a production capacity of only 640k units annually. And so its joint-venture plants are getting more money for more cars; Guangzhou Auto Group will double production to 400k units, while Sichuan FAW Toyota will hit 30k and Changchun FAW Toyota will build up to 10k Priora and Land Cruisers. Of course tooling-up takes time; ToMoCo won't be finished until 2010. By which time steel and fuel prices may have taken some of the zest from the Chinese market. Still, in its pursuit/maintenance of world domination, Toyota can't afford not to build more cars in China.
Maybe they buy them becuase they are marketed as "Chinese" cars just as they are marketed here as "American" cars because of where they are assembled.
Chinese may hate Japanese, but they still love Japanese products, for their reputation for quality. One of the biggest sources of trade frictions between Japan and China are Chinese manufacturers fraudulently placing "Made in Japan" labels, and using Japanese branding and packaging, to sell products in China.
I have toured the facility in Guangzhou. The product is identical to what you see in the States. As long as the govt keeps the fuel subsidies in place, there is tremendous potential for growth.