#Japan

As predicted by TTAC after Chinese demonstrations against Japan’s control of the Senkaku/Diaoyu islands turned into violence against Japanese cars and car dealerships in China, the matter turned into a severe sales setback for Japanese car companies in China, more severe than initially thought, or hoped . Also as predicted by TTAC, the islands did affect the sales of Japan’s carmakers more than the tsunami. Last Saturday in Shanghai, Toyota’s China chief confirmed that the pain would be felt at least through August. This was before he heard the really bad news.

The Avalon has been something of a caricature since it wafted on stage in 1994. The stretched Camry was low on soul, devoid of style and soft of spring. In short, it was the Buick that wouldn’t leave you stranded. Since then Toyota has struggled to divine a mission for their full size sedan, a problem complicated by the re-invigoration of the large sedan market by the American brands. In hopes of resurrecting sales numbers, which have slid to 25% of their 2000 year shipments, Toyota has injected something hitherto unseen in an Avalon: style. Is it enough?

In the past, Toyota had tried to resist the urges of the Chinese government to establish new joint-venture brands. The company also had been highly skeptical of the viability of the electric vehicle. All doubts have been tossed over board. Toyota launched two new brands and two new EVs in China.

The booths of Japanese automakers were mobbed today just like those of any other automaker at the Shanghai Motor Show. The action at the showrooms are a different matter. Sales of Japanese cars in China remain problematic more than half a year after rowdy crowds took to the streets last September to torch Japanese cars and showrooms. Sales of Japanese cars in China were down 14.3 percent in March while sales of U.S. carmakers were up 31.1 percent. Sales of German brands rose 24.6 percent.

Toyota does not expect to reach positive territory until August this year, Hiroji Onishi, head of Toyota’s China operations, told a small circle of reporters this morning at the Shanghai show. Asked why August, another Toyota executive quipped: “After previous riots in 2005 and 2010, it took half a year to recover. We figure, this time it might take twice as long.”

Now that the U.S. and Japan have agreed on a watered-down version of the Trans-Pacific Partnership trade negotiations (America will keep its beloved chicken tax for at least another decade, Japan will protect its rice farmers from the evils of cheap American rice,) negotiations between the EU and Japan about a trade pact are getting underway, with considerably less drama.

Honmoku street is a wide, tree lined avenue that bends through the southern “Naka” district of the city of Yokohama. Close by sits the massive port, the gateway through which so much of Japan’s industrial output is sent to the world, its tall cranes working ceaselessly and with no regard for human concerns like the time of day. Above it all the Yokohama Bay Bridge soars like a vision, lifting cars and trucks across the entrance to the harbor as effortlessly as it straddles the line between art and infrastructure. Although the massive bridge and its double decked feeder highways encircle the entire district, the sense one has on the ground is of open space and nature, rarities in the second largest city in Japan. In the midst of it all sits the classic American Hot-Rod shop, Mooneyes.

Ferrari abandons its trademark red for a limited-edition version of the California 30 convertible targeted at the Japanese market.

For anyone like myself – that is, a car fan who grew up in the 1990s and watched Japan’s sports cars disappear from the American market in one sudden swoop, news that Japan’s once mighty auto industry is being “hollowed out” might come as a shock. The cars that defined my youth – the RX-7s, Supras even the VTEC Honda compacts, are a distant memory. Most of what Japan offers on our shores are aimed at the mainstream, while at home, kei-cars and hybrids dominate the market.

A lot of the criticism leveled at Japan is that their focus on the mainstream market and alternative powertrains is what sparked their auto industry’s current malaise. But this is a superficial and fallacious assumption that supposes that the glut of superb Japanese cars in the 1990s is a baseline for our expectations of what a Japanese auto maker should be building and selling. In fact, it is an aberration that will never occur again.

Somebody Say I look like an old woman?

Yesterday I shared with you dear, reader, one of my favorite games, the $5000 Craigslist Fantasy Challenge and you responded with a lot of great cars. Today I thought I would step it up just one more notch and introduce you to that game’s Japanese cousin – the “Goo Game.” Won’t you come and pray with me?

Hydrogen does not seem on top of President Obama’s agenda, neither does it rank very high on Martin Winterkorn’s list of priorities, but it sure is popular in Japan. Japanese carmakers, led by Toyota, are targeting a 2015 launch of hydrogen cars.

Toyota also says they are the most energy-efficient.

They may not have western-style unions in China, but workers sure do strike. Workers at Honda’s transmission plant in Foshan, Guangdong Province, walked off the job on Monday after their pay increases weren’t as large as they had hoped.

It’s not just the UAW that is upset about free trade agreements. The Koreans are likewise. The offices of the Korea Automobile Importers and Distributors Association were raided by investigators of the country’s Fair Trade Commission, the Financial Times reports. The agency alleges that BMW, Mercedes-Benz, Volkswagen and Toyota Motor were involved in price collusion.

Typical Japanese Highway scene

Total silence is not the kind of thing you expect in Japan. Given the fact that there are almost 130 million people crammed into a country roughly the size of the State of California, only 20% of which is actually habitable, the din of human activity follows you wherever you go. It is an incredibly urban environment, filled with people, heat and activity. Yet when I turned off the engine and stepped out onto the empty road and into the cool stillness of the summer night, I felt like I was the only person in the world.

Attentive readers of TTAC have known it since the Beijing Auto Show last year that Toyota will launch a separate brand for its “new energy” (read plug-in hybrid and EV) that are produced in China. A not quite officially announced, but de facto policy wants it that way. Now we have the brand. It’s called Ranz.

My TDI in Japan

The engine quit with a sudden un-dramatic snap, and the little Golf TDI began to slough off speed. Reflexively, I bumped the gearshift lever into neutral, flicked on my signal and began moving towards the left edge of the expressway. My exit was less than a mile away and, rather than stop alongside the highway, I used my momentum to coast up the off-ramp and over the small knoll that stood between the expressway and the toll plaza. I stopped there, on the back side of the hill where the road widened on the approach to the toll booths, to avoid blocking traffic and dug out my cell phone to call for a tow truck. I didn’t know it then, but it was the last time that I would ever sit behind the wheel of the little car, never mind the fact that it would follow me again around half of the globe.