Japanese Make Up For China In America

Bertel Schmitt
by Bertel Schmitt

A few weeks ago, Toyota’s CFO Satoshi Ozawa told an astounded press corps (and I paraphrase for brevity): “Sure, the riots in China have an effect, but we’ll make it up elsewhere in the world.” Today, we have the data that prove Ozawa-san right. What’s more, he could have spoken for all his Japanese peers. Yes, the boycott of Japanese cars in China caused drastic cutbacks at large Japanese automakers. However, all are doing so gulpingly well elsewhere that a buyer strike in the world’s largest car market turns into nothing more than a hiccup.

Japan Big Three Global ProductionOct’12YoYJan-Oct’12YoYToyota787,476-0.3%8,469,36632.9%Nissan410,961-4.8%4,151,2579.5%Honda346,1299.4%3,505,55245.7%Company data

Today, Japan’s automakers presented their global sales and production numbers for October, and despite China, they are good. As always, I focus on production instead of sales. In this context, “sales” prove as too vague, they can be (and often are) sales to the in-house sales company, or sales to wholesale. That’s also why OICA ranks manufacturers by production, and not by sales.


Toyota’s global output remained flat in October after rising by 33 percent for the year. Honda’s output climbed 9.4 percent. Nissan’s output decreased a sedate 4.8 percent. Does that mean the losses in China weren’t as dramatic as thought? Far from it. It was a bloodbath.

China ProductionOct’12Oct’11YoYToyota30,60078,700-61.1%Nissan61,360109,546-44.0%Honda26,30257,382-54.2%Company data

In October, Toyota scaled back its China production a whopping 61.1 percent. Honda cut production by 54.2 percent, Nissan by 44 percent. In October alone, the riots did cost the Chinese economy more than 125,000 units that would otherwise have been made at Chinese joint ventures of Toyota, Nissan, and Honda. Nissan has the highest China exposure of the three, but interestingly, Nissan and Toyota cut back by the same 48,000 units.

Where did they make up for it? A lot was gained in America. Honda’s U.S. production jumped 29.1 percent in October. Nissan’s U.S. production is up 21.3 percent. Increasingly that mysterious continent called “Others” is turning into a hot market. “Others” is where carmakers stuff countries like Thailand, Indonesia, Brazil, India and Egypt. Even after China normalizes, Japanese automakers will most likely intensify their efforts in South-East-Asia, where they have been strong anyway.

The European contagion can’t affect the Japanese much. They traditionally are underrepresented in the Old Country, and where you don’t have much, you can’t lose a lot. Europe is a much bigger drag on GM, Ford and (via Fiat) Chrysler.

October Production and Full Year Forecast10M ’1210M ’11YoYProj ’12Toyota8,469,3666,372,79932.9%10,163,000GM7,837,7787,720,0001.5%9,405,000Volkswagen7,500,0006,800,00010.3%9,000,000Black: Company data. Blue: Projection, based on last availableToyota, GM: Production. VW: Deliveries. Forecast by TTAC

Let’s finish this orgy for number fetishists with a check on the World’s Largest Automakers. The standings have been updated with the proper data from Toyota and Volkswagen. GM appears to be unable to provide monthly global data, we will have to wait for the Q4 results … ETA some time in February next year. Until then, we have to extrapolate.

Looking at the table, the race appears to be decided. Especially Toyota and GM are too far apart. Toyota’s end-of-year number very probably will drop below 10 million. Or with a little more of Toyota’s good luck, maybe they won’t.

Bertel Schmitt
Bertel Schmitt

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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  • Blowfish Blowfish on Nov 29, 2012

    well is a bit of convoluted or blasphemic logic, GM , big 1.5 et al and all the le blancs automakers all swarm to middle kingdom to try to get a piece of the constant shifting auto pie, whilst the nipponese are trying to justify that they had not missed much of the MK market? and they're doing just as fine eh. is it like when your son told U I am not going to law or med school, i got accepted to our local barber school , look some day soon enuf I'll be as rich & famous as Vidal sassoon, and what if billy gates had went to LS , by now we would still be writing on pen and note pads now! or a buyer's remorse trying to justify his or her remon/lemon deal went south.

  • Kyree Kyree on Nov 29, 2012

    I mean, this is just ridiculous. What the hell is wrong with these people?! Dealerships and livelihoods were ruined by this ridiculous outburst of immaturity. How deplorable of a person do you have to be that you would actively destroy others' property just because it originates from a feuding country?!

  • Jpolicke In a communist dictatorship, there isn't much export activity that the government isn't aware of. That being the case, if the PRC wanted to, they could cut the flow of fentanyl down to a trickle. Since that isn't happening, I therefore assume Xi Jinping doesn't want it cut. China needs to feel the consequences for knowingly poisoning other countries' citizens.
  • El scotto Oh, ye nattering nabobs of negativism! Think of countries like restaurants. Our neighbors to the north and south are almost as good and the service is fantastic. They're awfully close to being as good as the US. Oh the Europeans are interesting and quaint but you really only go there a few times a year. Gents, the US is simply the hottest restaurant in town. Have to stand in line to get in? Of course. Can you hand out bribes to get in quicker? Of course. Suppliers and employees? Only the best on a constant basis.Did I mention there is a dress code? We strictly enforce it. Don't like it? Suck it.
  • 1995 SC At least you can still get one. There isn't much for Ford folks to be happy about nowadays, but the existence of the Mustang and the fact that the lessons from back in the 90s when Ford tried to kill it and replace it with the then flavor of the day seem to have been learned (the only lessons they seem to remember) are a win not only for Ford folks but for car people in general. One day my Super Coupe will pop its headgaskets (I know it will...I read it on the Internet). I hope I will still be physically up to dropping the supercharged Terminator Cobra motor into it. in all seriousness, The Mustang is a.win for car guys.
  • Lorenzo Heh. The major powers, military or economic, set up these regulators for the smaller countries - the big guys do what they want, and always have. Are the Chinese that unaware?
  • Lorenzo The original 4-Runner, by its very name, promised something different in the future. What happened?
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