Germans Outsell Lexus At Home In Japan
The good folks who are still convinced that the Japanese car market is closed, can count themselves lucky. Would they have been with me today, they might have doubted their beliefs and strayed from the faith. Today, Lexus finally rolled out its new GS line in Japan. America had already seen it last Summer, and two TTAC testers actually drove the cars.
Today, two straight-laced Lexus executives told reporters in Tokyo that imported cars are so successful that Lexus would like to have some of that success and that they strive to take some of the imports’ growing market share. Kazuo Ohara, Deputy Chief Officer of Toyota`s luxury arm Lexus said:
“In Japan, there is a strong customer segment that is always interested in buying imported cars, and this is the segment we would like to capture.”
The trouble is, those customers are interested in buying German luxury cars.
Kiyotaka Ise, chief officer of Lexus, identified Germany’s Mercedes, BMW and Audi as the darlings of Japanese customers Lexus would love to lure into its showrooms. Easy call, one look at this table says it all:
Japan`s top selling luxury cars, 2011
Lexus42,365BMW34,195Mercedes33,207Audi21,166Indeed, together the Teutonic Top-of-the-line brands sell more than twice as many cars in Japan than Lexus does in its home market.
This won’t change anytime soon. Ohara conceded that it will be a while until Lexus will pry the German iron out of Japanese hands. In Japan, Ohara thinks that this year’s Lexus sales will be only “somewhat higher than the level of last year.”
The growth is supposed to come from elsewhere. “Last year, we sold 404,000 units, and this year, we would like to achieve 510,000,” Ohara said. That is an ambitious 21 percent growth, the same percentage number Toyota has set itself as a target.
But back to the imported cars Japanese like. It’s not that America does not have Kei cars. Hell freezes over before America produces small cheap boxes with pint-sized motors. (Hold your horses, I know that 0.66 liters are a pint and a gulp .) America does not have the big bore luxury cars a rich Japanese clientele craves.
Cadillacs imported to Japan in 2011? 1,392 .
Meanwhile, car imports to Japan rose 22.5 percent this year to 275,644, while the domestic market (ex Kei cars) was down 16.7 percent.
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I was waiting for someone to mention that all cars in Japan are RHD. How many American cars are exportable with steering wheels on the right? Not many. The Australian market was mentioned but the most popular Ford and GM cars here are made here. (Holden, Falcon, Cruze, Ranger). BMW and MB have a long history of building cars that work both ways. US built RHD cars are mostly limited to Chryslers and Jeeps. We cannot get Corvettes or Camaros (based on the Holden) without paying about $30,000 extra for conversion. By the way, this explains the prevalence of Jaguars and Rovers in Japan mentioned earlier.
Interesting how the LHD/RHD barrier is mentioned in the context that it almost implies that Detroit somehow should be blamed for this, too. Think about the situation after WWII. With the Japanese economy in tatters (and you Americans getting to foot the bill to rebuild it - gee, I don't see that factoring into Nissan or Toyopet's 'bail out') would Ford or GM have bothered retooling factories and building RHD for an economy that had the perceived potential to sell a few hundred thousand vehicles per year? Sure, with the hindsight of 70 years, we can see now that perhaps GM or Ford should have tried a bit harder in the 1950s to sell over there, but the Japanese market was tiny. Combine that with the difficulties in adapting vehicles for RHD (at the time), who would bother? So, rather than seeing this as an oversight on the part of Detroit, perhaps this is one of those subtle barriers that Japan Inc chose to maintain to keep out the foreigners. After all, why didn't China adopt right hand drive?