The Unthinkable Happens: Car Imports To Allegedly Closed Japan Up 22 Percent, Foreign Share Highest In Recorded History

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19 Comments on “The Unthinkable Happens: Car Imports To Allegedly Closed Japan Up 22 Percent, Foreign Share Highest In Recorded History...”

• 	gslippy January 11th, 2012 at 10:50 am
  The leading importers to Japan are all from former Axis nations; how strange. Don’t the Japanese like reliable cars?
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  • 		korvetkeith January 11th, 2012 at 10:57 am
    	The leading importers to the US are all former Axis nations, also strange.
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    • 		VanillaDude January 11th, 2012 at 12:31 pm
      	South Korea was on our side.
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    • 		Acubra January 11th, 2012 at 12:45 pm
      	South Korea did not exist when the Axis union was around, that area having been a Japanese colony.
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• 	mike978 January 11th, 2012 at 11:06 am
  Bertel – the Japanese market may not be as closed as urban legend suggests but you cannot just say because 275,644 foreign-built vehicles were imported (for a 10.3% market share) that the market is open. Especially when over 24% of those foreign built cars are from Japanese companies. Just as some people in the USA still class Toyota et al as an “import” brand even though significant numbers are made in the US. Doesn`t the brand matter as much as the physical location of the factory? I say this because some of those people buying Nissan’s in Japan may not know they are “imported” but buy it because Nissan is a Japanese company. Bottom line the Japanese market still has the smallest penetration of foreign brands of any major developed market (EU, US). This may all be due to Kei cars – is that fair?
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  • 		MR2turbo4evr January 11th, 2012 at 11:13 am
    	Ugh, not this again. Just let it go man. Bertel has been long enough in the industry to know what he’s talking about.
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    • 		Acubra January 11th, 2012 at 12:20 pm
      	Don’t be so gullible. The market may be technically open, but try to explain the price difference between domestics and imports. Stick to the facts and do your own thinking, and do not rely on blind faith.
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  • 		wsn January 11th, 2012 at 11:50 am
    	“the Japanese market may not be as closed as urban legend suggests but you cannot just say because 275,644 foreign-built vehicles were imported (for a 10.3% market share) that the market is open.” Or maybe foreign (i.e. Detroit) cars just suck? VW sold 63k in Japan and roughly 300k in the US. In that perspective, VW’s ease of penetrating both markets are about the same. Really, why would a Japanese buy a Cavaliar/Cobalt/Cruze over a Civic?
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    • 		Acubra January 11th, 2012 at 12:18 pm
      	Small correction – SMALL cars from Big Three are not good enough to justify the price difference between same class domestics and imports (30-40% easily) in the “open” Japanese market.
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    • 		WheelMcCoy January 11th, 2012 at 1:00 pm
      	>>Really, why would a Japanese buy a Cavaliar/Cobalt/Cruze over a Civic? Because the Civic was discontinued in Japan? :) Ok, I know what you really mean, but the Ford Focus is standout among small cars.
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• 	Pch101 January 11th, 2012 at 12:08 pm
  You will not hear a Volkswagen executive complain about a closed Japanese market. They don’t need to. The EU makes the complaints on their behalf: http://trade.ec.europa.eu/doclib/docs/2010/february/tradoc_145772.pdf http://madb.europa.eu/madb_barriers/barriers_details.htm?barrier_id=095265&version=4 Japan has non-tariff barriers that raise the cost of importing cars there, which constrains market share. If Japan lowered its NTBs, the Germans would be selling a lot more cars than they are today. But I doubt that it would help the Americans very much; the Japanese are highly brand conscious, and US car companies don’t exactly have cachet value there.
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  • 		Bertel Schmitt January 11th, 2012 at 12:28 pm
    	Ah, those non-tariff barriers. You really honestly believe im ports to Japan wopuld skyurocket iof only Japan would allow the use of “short-range radar (SRR) technology to implement automated or semi-automated for emergency braking systems?” Gee, what else? You know who has one of the highest non tariff barrier? The U.S.of A. It has standards that are utterly incompatible with the rest of the world, and which basically require a re-engineering and re-testing of the car. No small series import rules (as they exist in the EU and Japan.) Can’t even import a single car without the paperwork, unless it’s 25 years old. A 25 % chicken tax. CAFE rules which are tailor-made for Detroit. And why aren’t these barriers an issue? Because the market is big and juicy enough for importers to spend the money and work. If you want to export to Japan, you need to go by Japanese rules (which are pretty close to EU rules …) All those barriers seem only to affect for American cars only. Even zombie Saab managed to get 60 cars through. Remember: Those NTBs get easier the more you import, one time engineering and paperwork … Instead of complaining here, I would complain with the unions which feed utter lies to the members and public.
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    • 		George B January 11th, 2012 at 12:46 pm
      	Every company I’ve ever worked for has been burned when they try to sell products like wireless base stations into the Japanese market. The major problem is Japan is a small market with unique requirements that are strictly enforced, but it’s just rich enough to make it tempting to bid on a contract. Engineers at the US company then have to do lots of work modifying the product for Japan’s unique requirements, only to loose the bid to some Japanese company. In the worst case, the US company both loses the contract and transfers intellectual property to a Japanese competitor.
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    • 		dtremit January 11th, 2012 at 12:54 pm
      	Bertel, if you’re so adamant that there are no non-tariff barriers unique to Japan, answer this: Why is Japan the only major automotive market in which comparable import models are not comparably priced? To take an example from those Germans who are ostensibly doing so well — the Mazdaspeed 3/MPS and the GTI sell at roughly the same price in the US, in Germany, in Australia. And yet, the GTI sells for 25% more than the Mazda in Japan. Why? This is not an isolated example, by any means.
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    • 		Pch101 January 11th, 2012 at 1:17 pm
      	You really honestly believe im ports to Japan wopuld skyurocket iof only Japan would allow the use of “short-range radar (SRR) technology to implement automated or semi-automated for emergency braking systems?” Don’t take the example out of context. The point is two-fold: (1) outside of TTAC, it is absolutely no secret that Japan has relatively formidable non-tariff barriers and (b) they often take the form of technical regulations (which are not limited to the one example that I provided) that require that products be tailor-made to comply with unique regulations that don’t serve any other purpose but to make things difficult. These kinds of rules wouldn’t matter so much if the market potential was high. But combined with all of the other barriers, they act as obstacles. The opportunity to penetrate the local market isn’t great enough to jump through so many hoops. Because the market is big and juicy enough for importers to spend the money and work. Your chart says otherwise. For example, BMW sells about as many cars in the US in under two months as it sells all year in Japan. That would help to explain one reason why BMW’s are sold at such a high premium in Japan when compared to the US and in comparison to rival cars built in Japan — they have to generate margins from their Japanese sales that can make up for the lack of volume. You think that these numbers establish that Japan has some sort of raging import market. But they say just the opposite; the market for imports there is small. And since the NTBs bar them from getting much bigger, there isn’t much volume potential at all, which causes high prices, which necessarily constrains share. You know who has one of the highest non tariff barrier? The U.S.of A. Everyone has NTBs, but the US emissions and safety standards are not a barrier to large players that are willing to go all-in into the US market. They probably help to keep the likes of Peugeot out of the US, but they are clearly no barrier to any company that aspires to sell in volume. And unlike Japan, the US doesn’t demand that individual cars be inspected for compliance once the feds have blessed the design. As for the chicken tax, it’s a non-issue. It is easily avoided. Toyota got around it for years just by shipping the trucks without the beds installed, and then bolting them on after they made it ashore. It’s a silly (and now archaic) tariff, but a meaningful barrier to trade it is not.
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  • 		Acubra January 11th, 2012 at 12:29 pm
    	No they do – but among a tiny group of afficionados. And it is mainly old Yank tanks, anything with 2 doors and a V8, trucks and custom vans that are popular. As for the generic passenger cars – size (ODs and engine capacity) is the killer. The cheaper ones are not on par with Crown/Mark II & Cedric/Cima crowd, while costing similar money to buy and run (maintainance and taxes, and the expensive ones – Ze Germans and the Japanese have this segment for themselves already.
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  • 		wsn January 11th, 2012 at 6:29 pm
    	“Japan has non-tariff barriers that raise the cost of importing cars there” Like injecting $50B cash to bail out Toyota, and forcing a recall of 10,000,000 GM’s for a single accident due to improper installation of floor mats by the dealership (i.e. not employee of manufacture)?
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• 	dodgeowner January 28th, 2012 at 10:56 am
  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. Example Korea: 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 largest selling imported car, the rest have numbers even smaller than that. What about a total of 275,000 imported vehicles into Japan in a market of over 4,210,0000 vehicles? 275,000 vehicles divided up between 52 importers of which a few are Japanese nameplates. 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. Publish this list and the % sales in Japan. If you doubt these words, to go this web site http://counterpunch.org/2009/07/03/detroit-s-collapse-the-untold-story/
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• 	Analyst April 30th, 2012 at 4:35 pm
  Bertel, I like how you conveniently forgot to take into account sales of kei cars. Counting kei cars, you would get about 6% market share for imports. Not to mention a good chunk of these imports are from Japanese brands.
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