Tuesday January 8, 2013

Japanese car sales slump in China on territorial row

TOKYO: Japan's top three carmakers say annual sales in China last year slumped as a consumer boycott sparked by a nasty Tokyo-Beijing territorial row took a heavy toll.

Nissan which has the most exposure to China of the three said sales in the world's biggest vehicle market last year fell 5.3% to 1.18 million units.

“The Sino-Japanese territorial disputes that began in September have seriously affected Nissan's sales and marketing activities in China,” it said in a statement.

Toyota, Japan's largest carmaker, said its China sales in 2012 fell 4.9% to 840,000 vehicles, although it forecast a recovery this year, announcing an annual sales target above 900,000 units.

Honda, meanwhile, said sales in China declined 3.1% last year to 598,576 vehicles, its second straight annual decline, after the 2011 quake-tsunami disaster battered Japanese manufacturers' results.

A long-standing diplomatic dispute flared badly in mid-September after Tokyo nationalised East China Sea islands also claimed by Beijing, sparking huge protests across China and boycotts of Japanese products.

The row over the Tokyo-controlled islands, known as Diaoyu in China and Senkaku in Japan, hurt Japanese carmakers with operations in the country while boosting demand for other foreign brands.

Japan's top three carmakers, which all have manufacturing facilities in China, scaled back production as sales slumped.

Despite predictions of a bounce back this year, there were plenty of uncertainties that might slow a recovery including new governments in China and Japan, said Tatsuya Mizuno, auto analyst at Mizuno Credit Advisory.

“It appears that Japanese auto sales are on course to recover in China, but no one knows when the dispute will flare up again nothing has been resolved,” Mizuno said.

“There is also concern about the future of the Chinese economy. The prospects for a full recovery of Japanese cars in China are still obscure.”

Earlier yesterday, a Japanese industry group said the number of vehicles sold in Japan last year soared 26.1% from 2011, staging a recovery from the twin natural disasters which set off the crisis at Fukushima, the worst nuclear accident in a generation.

Annual sales of cars, trucks and buses, excluding mini-vehicles four-wheel vehicles with engines under 660 cc came in at 3.39 million units in 2012, the Japan Automobile Dealers Association said.

In 2011, Japan's domestic vehicle sales dropped 16.7% after the disaster damaged factories and crippled carmakers' supply chains, forcing companies to shutter plants and halt production.

By category, sales of passenger cars totalled 3.01 million units in 2012, up 26.3% on-year, while truck sales climbed 24.4% to 363,685 units. Bus sales gained 12.1% to 11,938 units, the industry data showed.

However domestic car sales in the last month of 2012 slipped 3.4% to 214,429 units, the data showed, partly due to the expiry of government subsidies aimed at bumping up sales of eco-friendly cars. AFP

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