Guess Which Cars Sell In Japan? Imports. Now Guess Which Ones
According to U.A.W. talking points, the Japanese car market is closed to foreign imports, and the yen is kept artificially low. Utter insanity on both counts. The customs duty on new cars imported to Japan is exactly zero, and the yen is so obscenely expensive that Japanese carmakers openly threaten to leave and privately are shifting as much production as possible out of the country. Unbeknownst to talking point readers, Japan has had a thriving car import market for decades. For more than a year, imports to Japan showed an uptick. TTAC has been taking about this for quite a while, here, then here and also here.
Today, The Nikkei [sub] did wise up to the fact that imports are getting hotter in Japan despite a tepid new car market. The Nikkei sent a reporter to an Audi showroom, interviewed a BMW customer, and noted a societal change: “My wife prefers foreign cars, so that’s why we bought one,” a bank employee who traded his domestic car for a BMW told The Nikkei. “They have lower fuel efficiency than Japanese cars, but that is not a big problem because we drive only on weekends.”
Now what’s really going on with imports to Japan? Let’s look at it a little closer.
At first glance, we see that Japan has been importing foreign cars for quite a while in decent quantities. The peak was in 1994 with nearly 400,000 units. The low was in 2009, when everything was low. In 2010, unit sales were already above 200,000 with a trend up. Market share gives a better picture than units sales. We show the import share of passenger vehicles, because that’s what’s mostly imported. The 8 percent market share in 2011 is as of September 2011, we don’t show unit sales for that year, because we don’t have them yet. They will be up.
Now let’s look who imports the mostest. To the left, we have the September sales. The market share is the share of all imports, not the share of the total market. We see the September sales 2010, and the growth compared to September 2010. Then, the whole experiment again for the first nine months.
Imports Japan September 2011 January – September 20112011Share2010Growth2011Share2010GrowthVolkswagen Group9,25527.24%6,63039.59%53,66025.97%51,5464.10%VW6,44418.96%4,55741.41%37,29018.05%38,192-2.36%Audi2,7838.19%2,05035.76%16,2147.85%13,20422.80%Bentley160.05%19-15.79%850.04%101-15.84%Lamborghini100.03%4150.00%690.03%4843.75%Bugatti20.01%20.00%1100.00%Nissan6,01517.70%6,605-8.93%41,96120.31%16,913148.10%BMW Group5,94317.49%5,4958.15%34,75816.82%32,3407.48%BMW4,16512.26%4,1300.85%24,00511.62%23,4152.52%BMW MINI1,7585.17%1,32632.58%10,5765.12%8,71421.37%BMW Alpina170.05%21-19.05%1140.06%159-28.30%Rolls Royce30.01%18-83.33%630.03%5221.15%Daimler4,92914.51%4,7833.05%25,64412.41%25,1152.11%Mercedes-Benz4,68813.80%4,701-0.28%24,64511.93%24,2931.45%smart2400.71%82192.68%9900.48%82020.73%Maybach10.00%90.00%2350.00%Fiat-Chrysler1,7435.13%1,51914.75%10,2244.95%8,88315.10%Fiat8172.40%882-7.37%4,4792.17%4,3772.33%Jeep4351.28%27458.76%2,4071.16%1,42269.27%Alfa Romeo1980.58%15626.92%1,5420.75%1,22525.88%Dodge1740.51%68155.88%7830.38%63223.89%Chrysler410.12%75-45.33%4490.22%630-28.73%Maserati360.11%2924.14%2000.10%217-7.83%Ferrari310.09%2810.71%2940.14%332-11.45%Lancia110.03%757.14%700.03%4845.83%Toyota1,4244.19%1,10229.22%10,0314.85%6,97343.85%Volvo1,6054.72%96167.01%8,1723.95%5,64744.71%PSA Group1,0783.17%1,230-12.36%6,7843.28%6,2308.89%Peugeot6982.05%874-20.14%4,5692.21%4,573-0.09%Citroen3801.12%3566.74%2,2151.07%1,65733.68%Suzuki2280.67%402-43.28%2,8951.40%3,517-17.69%Porsche3921.15%21879.82%2,5971.26%2,5103.47%Ford3521.04%31810.69%2,4211.17%2,2955.49%Renault3541.04%24544.49%2,3161.12%2,03613.75%General Motors2930.86%18955.03%2,2131.07%1,77424.75%Chevrolet1560.46%64143.75%8640.42%67627.81%Cadillac1060.31%979.28%1,0370.50%74539.19%Hummer180.05%21-14.29%2180.11%276-21.01%GMC100.03%666.67%840.04%7020.00%Buick20.01%1100.00%80.00%560.00%DAEWOO10.00%20.00%2JLR Group1820.54%199-8.54%1,5070.73%1,3719.92%Jaguar1170.34%127-7.87%7770.38%808-3.84%Land Rover650.19%72-9.72%7300.35%56329.66%Honda1100.32%101000.00%8000.39%72310.65%Lotus310.09%1963.16%2160.10%226-4.42%Mitsubishi30.01%19-84.21%1010.05%148-31.76%Aston Martin80.02%13-38.46%1000.05%8419.05%Hyundai120.04%26-53.85%680.03%182-62.64%Saab70.02%1600.00%490.02%4119.51%Rover30.01%10-70.00%320.02%47-31.91%Morgan30.01%3130.01%1118.18%MG10.00%2-50.00%70.00%616.67%Detomaso10.00%30.00%1200.00%Pontiac180.00%633.33%GMDAT140.00%5-20.00%Unimog40.00%Kia30.00%250.00%Autobianchi20.00%1100.00%Mini10.00%2-50.00%Opel10.00%4-75.00%Saturn10.00%2-50.00%Subaru1-100.00%Others80.023266.7520.034515.56%Total33,980100.0030,004113.3206,648100.00168,687122.5
Source: Japan Automobile Importers Association
What do we see? As long as I can remember, Volkswagen had been the largest importer to Japan. This year, only by cumulating all brands of the Volkswagen Group could we defend that honor. On a single brand basis, Nissan would be the largest importer to Japan. Next in line are the usual suspects BMW and Daimler, followed way back in the field by a motley crew of Fiat-Chrysler brands. And what’s next? Toyota already imports the same amount as all Fiat-Chrysler brands. Ford and GM are way back in the field.
Imagine: Little Porsche sells more cars in Japan than Ford and all of GM. The reason for the low sales of U.S. cars in Japan is simple: People want imported cars alright. People just don’t get excited about American cars. Fiat’s stepchild Alfa Romeo sells better than the bestselling GM brand, the Cadillac.
Now look at the growth rates of cars that sell in appreciable numbers. The Germans are not growing by much. What is really growing are – Japanese imports! Nissan already imported nearly three times as many cars for the year than in the same period of 2010. Toyota is stepping up imports also. In the preceding year, Toyota imported 10,000 units per annum. This year, the 10,000 mark was already reached in September. Already, 27 percent of the cars imported to Japan are Japanese brands.
If the yen remains strong, expect this trend to continue.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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400k cars is not an open market at all
This article is does not tell the entire story of why American or European imports make up such a small percentage of the Japanese and Korean home markets. Just read a few sentence below and then check the other article as see “What the truth about cars” is Steve Biegun, a strategist for Ford, during a lecture in 2007 stated this about Ford’s attempts to break into the Korean car market * Ford was barred from airing advertising commercials except between 2 a.m. and 6 a.m. * Its showrooms’ floor space was restricted by government regulation. * Korean tax officials automatically audited anyone who bought a foreign car The tax audit tactic was copied from the Japanese. The Japanese also adjusted emission requirements, as needed, to block entry of foreign car makers, changing the requirements, while shipments of cars were in transit, so that they would not meet emissions specific ions upon arrival. What cars are allowed in are the more expensive luxury ones, the cars that don’t compete against the cars of the masses. For example the #1 selling car in Korea for 2011 was the Mercedes E300 CDi at just over 7,000 sold in a market of 1,484,082 cars sold or in other words a ratio of 7:1484 and that is the biggest selling imported car, the rest have numbers smaller than that. What about the closed parts industry in Japan, while there maybe a bias against foreign cars, a light bulb is a light bulb, a wiper blade is a wiper blade, show me a foreign parts suppliers not tied to a Japanese car maker that sells in Japan. If you doubt these words, to go this web site and see for yourself http://counterpunch.org/2009/07/03/detroit-s-collapse-the-untold-story/