The Japanese car market is anything but closed, Toshiyuki Shiga, chairman of the Japan Automobile Manufacturers Association said yesterday. Vis-a-vis The Nikkei [sub], Shiga basically repeated what we had said all along, and he used the same line of reasoning that doesn’t seem to register with some blockheaded parties:
“Import duties are zero, and there are no regulations or procedures that block American cars. European vehicle imports are increasing.”
Shiga should know. He is COO of Nissan, which quietly turned into Japan’s largest car importer on a brand basis for the year, only to fall back to number 2 in October on strong imports of the Volkswagen Group. Shiga also asked the same question which I always use, usually without receiving an answer:
“I would like to know exactly what aspects of the Japanese market the U.S. side considers closed.”
The matter bubbled to the top again because the Japanese government is finally making baby steps towards joining the Trans Pacific Partnership free trade framework. Japanese carmakers had been pushing their reluctant government that way for a while in an attempt to offset the surging yen.
Opposition comes from a not unexpected corner: From U.S. automakers. Ford, which also opposed the watered-down free trade agreement with South Korea, wants Japan to stay out. Not being able to answer Shiga’s question of which part of the Japanese market is exactly closed, Ford reverts to a familiar line of reasoning. Ford said in a statement:
“Japan already ships more than 200 cars to the U.S. for every one car we send there.”
In other words: We can’t say which part of the Japanese market is closed, but a look at our pathetic numbers proves that it must be closed somewhere, somehow. It can’t possibly be our own fault. No way.
As the table, provided by the Japan Automobile Importers Association and based on actual registrations, shows, imports are alive and well in Japan. Actually, they are rising with a vengeance. In October, they were up 33.1 percent, and for the year, they are up 23.4 percent.
| Newly Registered Imported Vehicles by Brand | ||||||||
| (Total Passenger Cars, Trucks and Buses) | ||||||||
| Imports Japan October 2011 | January – October 2011 | |||||||
| 2011 | Share | 2010 | Growth | 2011 | Share | 2010 | Growth | |
| Volkswagen Group | 5,452 | 27.7% | 3,435 | 58.7% | 59,112 | 26.1% | 54,981 | 7.5% |
| VW | 3,861 | 19.7% | 2,512 | 53.7% | 41,151 | 18.2% | 40,704 | 1.1% |
| Audi | 1,568 | 8.0% | 906 | 73.1% | 17,782 | 7.9% | 14,110 | 26.0% |
| Bentley | 15 | 0.1% | 9 | 66.7% | 100 | 0.0% | 110 | -9.1% |
| Lamborghini | 8 | 0.0% | 7 | 14.3% | 77 | 0.0% | 55 | 40.0% |
| Bugatti | 0 | 0.0% | 1 | -100.0% | 2 | 0.0% | 2 | 0.0% |
| Nissan | 3,500 | 17.8% | 2,968 | 17.9% | 45,461 | 20.1% | 19,881 | 128.7% |
| BMW Group | 3,371 | 17.2% | 2,788 | 20.9% | 38,129 | 16.8% | 35,128 | 8.5% |
| BMW | 2,215 | 11.3% | 2,040 | 8.6% | 26,220 | 11.6% | 25,455 | 3.0% |
| BMW MINI | 1,146 | 5.8% | 725 | 58.1% | 11,722 | 5.2% | 9,439 | 24.2% |
| BMW Alpina | 7 | 0.0% | 17 | -58.8% | 121 | 0.1% | 176 | -31.3% |
| Rolls Royce | 3 | 0.0% | 6 | -50.0% | 66 | 0.0% | 58 | 13.8% |
| Daimler | 1,820 | 9.3% | 1,510 | 20.5% | 27,464 | 12.1% | 26,625 | 3.2% |
| Mercedes-Benz | 1,771 | 9.0% | 1,496 | 18.4% | 26,416 | 11.7% | 25,789 | 2.4% |
| smart | 49 | 0.2% | 14 | 250.0% | 1,039 | 0.5% | 834 | 24.6% |
| Maybach | 0 | 0.0% | 0 | 9 | 0.0% | 2 | 350.0% | |
| Toyota | 1,831 | 9.3% | 1,023 | 79.0% | 11,862 | 5.2% | 7,996 | 48.3% |
| Fiat-Chrysler | 867 | 4.4% | 737 | 17.6% | 11,091 | 4.9% | 9,620 | 15.3% |
| Fiat | 457 | 2.3% | 227 | 101.3% | 4,936 | 2.2% | 4,604 | 7.2% |
| Jeep | 145 | 0.7% | 154 | -5.8% | 2,552 | 1.1% | 1,576 | 61.9% |
| Alfa Romeo | 67 | 0.3% | 141 | -52.5% | 1,609 | 0.7% | 1,366 | 17.8% |
| Dodge | 94 | 0.5% | 62 | 51.6% | 877 | 0.4% | 694 | 26.4% |
| Chrysler | 49 | 0.2% | 59 | -16.9% | 498 | 0.2% | 689 | -27.7% |
| Maserati | 15 | 0.1% | 24 | -37.5% | 215 | 0.1% | 241 | -10.8% |
| Ferrari | 32 | 0.2% | 65 | -50.8% | 326 | 0.1% | 397 | -17.9% |
| Lancia | 8 | 0.0% | 5 | 60.0% | 78 | 0.0% | 53 | 47.2% |
| Volvo | 656 | 3.3% | 495 | 32.5% | 8,828 | 3.9% | 6,142 | 43.7% |
| PSA Group | 629 | 3.2% | 498 | 26.3% | 7,413 | 3.3% | 6,728 | 10.2% |
| Peugeot | 364 | 1.9% | 330 | 10.3% | 4,933 | 2.2% | 4,903 | 0.6% |
| Citroen | 265 | 1.3% | 168 | 57.7% | 2,480 | 1.1% | 1,825 | 35.9% |
| Suzuki | 113 | 0.6% | 233 | -51.5% | 3,008 | 1.3% | 3,750 | -19.8% |
| Porsche | 268 | 1.4% | 207 | 29.5% | 2,865 | 1.3% | 2,717 | 5.4% |
| Ford | 382 | 1.9% | 164 | 132.9% | 2,803 | 1.2% | 2,459 | 14.0% |
| Renault | 261 | 1.3% | 191 | 36.6% | 2,577 | 1.1% | 2,227 | 15.7% |
| General Motors | 254 | 1.3% | 199 | 27.6% | 2,481 | 1.1% | 1,990 | 24.7% |
| Chevrolet | 118 | 0.6% | 72 | 63.9% | 982 | 0.4% | 748 | 31.3% |
| Cadillac | 96 | 0.5% | 84 | 14.3% | 1,133 | 0.5% | 829 | 36.7% |
| Hummer | 27 | 0.1% | 31 | -12.9% | 245 | 0.1% | 307 | -20.2% |
| GMC | 9 | 0.0% | 9 | 0.0% | 93 | 0.0% | 79 | 17.7% |
| Buick | 1 | 0.0% | 0 | 9 | 0.0% | 5 | 80.0% | |
| Opel | 0 | 0.0% | 0 | 1 | 0.0% | 4 | -75.0% | |
| Saturn | 0 | 0.0% | 0 | 1 | 0.0% | 2 | -50.0% | |
| GMDAT | 1 | 0.0% | 0 | 5 | 0.0% | 5 | 0.0% | |
| Pontiac | 2 | 0.0% | 3 | -33.3% | 10 | 0.0% | 9 | 11.1% |
| DAEWOO | 0 | 0.0% | 0 | 2 | 0.0% | 2 | 0.0% | |
| JLR Group | 127 | 0.6% | 117 | 8.5% | 1,634 | 0.7% | 1,488 | 9.8% |
| Jaguar | 75 | 0.4% | 74 | 1.4% | 852 | 0.4% | 882 | -3.4% |
| Land Rover | 52 | 0.3% | 43 | 20.9% | 782 | 0.3% | 606 | 29.0% |
| Honda | 66 | 0.3% | 116 | -43.1% | 866 | 0.4% | 839 | 3.2% |
| Lotus | 15 | 0.1% | 27 | -44.4% | 231 | 0.1% | 253 | -8.7% |
| Mitsubishi | 1 | 0.0% | 10 | -90.0% | 102 | 0.0% | 158 | -35.4% |
| Aston Martin | 9 | 0.0% | 15 | -40.0% | 109 | 0.0% | 99 | 10.1% |
| Hyundai | 2 | 0.0% | 12 | -83.3% | 70 | 0.0% | 194 | -63.9% |
| Saab | 6 | 0.0% | 1 | 500.0% | 55 | 0.0% | 42 | 31.0% |
| Rover | 5 | 0.0% | 5 | 0.0% | 37 | 0.0% | 52 | -28.8% |
| Morgan | 2 | 0.0% | 0 | 15 | 0.0% | 11 | 36.4% | |
| MG | 2 | 0.0% | 0 | 9 | 0.0% | 6 | 50.0% | |
| Detomaso | 0 | 0.0% | 0 | 3 | 0.0% | 1 | 200.0% | |
| Unimog | 0 | 0.0% | 1 | -100.0% | 4 | 0.0% | 1 | 300.0% |
| Kia | 0 | 0.0% | 1 | -100.0% | 3 | 0.0% | 3 | 0.0% |
| Autobianchi | 0 | 0.0% | 1 | -100.0% | 2 | 0.0% | 2 | 0.0% |
| Mini | 0 | 0.0% | 1 | -100.0% | 1 | 0.0% | 3 | -66.7% |
| Subaru | 0 | 0.0% | 0 | 0 | 0.0% | 1 | -100.0% | |
| Others | 8 | 0.0% | 11 | -27.3% | 60 | 0.0% | 56 | 7.1% |
| Total | 19,647 | 100.0% | 14,766 | 33.1% | 226,295 | 100.0% | 183,453 | 23.4% |
The argument that Japan ships more than 200 cars to U.S. for every car the U.S. sends to Japan only proves one thing: The klutziness of American carmakers when marketing their cars in Japan. Around 70 percent of the cars imported to Japan are from European carmakers, and you won’t hear a European carmaker complain about a closed Japanese market. Even Japanese carmakers out-import U.S. brands ten to one.
Sure, European cars fit the taste of the Japanese consumer better. However, a halfhearted attempt to import truly European Opel cars to Japan ended in disaster. Ford likewise seems to be disinterested in leveraging its strong European presence in Japan. Both have ample RHD models from their sizeable U.K. presence.
It’s much easier to say “those crafty Japanese must have closed their market somewhere, somehow” than simply to admit: ”We NSFWd up.”
In the meantime, American carmakers worried about another Japanese onslaught have Japan’s government as their biggest ally: It seems to be more interested in protecting aging Japanese rice farmers and big Japanese insurance companies from bad American influences than in helping its auto industry.
Free trade would be in the interest of the American farmer who is one of America’s most important exporters. Even if U.S. carmakers would receive an engraved invitation to Japan, it wouldn’t matter.
”We NSFWd up.” Classic. :)
In my opinion (which means nothing in the grand scheme), as a whole, American cars are just not that exciting. Maybe the rest of the world agrees. With some notable exceptions, of course.
“Around 70 percent of the cars imported to Japan are from European carmakers, and you won’t hear a European carmaker complain about a closed Japanese market. Even Japanese carmakers out-import U.S. brands ten to one.”
Is that supposed to say something different?
Don’t think so. Check the table. Chrysler imported 498 cars into Japan during the same period Nissan brought 45,000 American, Brazillian, European, etc… manufactured Nissans into Japan.
US and Japanese requirements for a vehile could not be more different.
Add engine sized-dependant road tax, cost of parts and labor, resale-ability – and you end up with 0 interest for an American import.
Acubra, if that difference is really making it hard for the car makers, it’s both ways.
Wsn,
It is easier to adapt/use/sell a smaller car in a large country with wide roads and low taxes (if any), than a larger car in a small country with very narrow roads, small parkades/garages and high taxes.
Ah, of course, I forgot about the offshore-manufactured cars returning to their intellectual homeland.
Acubra “It is easier to adapt/use/sell a smaller car in a large country with wide roads and low taxes (if any), than a larger car in a small country with very narrow roads, small parkades/garages and high taxes.”
1) Re size: it doesn’t matter. Both GM and Toyota are full line manufactures. Ranging from Aveo/Yaris to Silverado/Tundra. If Silverado doesn’t sell well in Japan, sell Aveo. Or even better, use the much hyped Cruze to prove that GM has indeed made progress.
2) Re taxes: I don’t see this as a problem, since it’s applicable to all auto makers. If anything, it favors larger cars more, as they are more expensive and less tax sensitive. Just look at MB/BMW in Japan.
I love the smell of fresh data in the morning – thanks Bertel for your excellent analysis.
Among US brands, Jeep is an outlier. Japan imported more Jeeps this year than all of the GM brands combined, and increased 62% year-on-year. What changed? Maybe a new model (Grand Cherokee)? Maybe some advertising? Still puny compared to any of the European imports though.
Is the overall increase in imports earthquake-induced?
I’ll bet that most of those Jeeps are Wranglers. The Japanese have liked some American cars – namely, the iconic ones (Jeep, Mustang), or the ones with really distinctive designs (Chevrolet Astro/GMC Safari, which Toyota later recycled as a Scion). If the Japanese are going to spend the money for a Jeep, they probably want one that looks like a JEEP.
Yep, if you take the last couple of years, Wranglers and Cherokees (traditionally a hit over there) rule. Grand Cherokees have been quite popular as well, if you look at numbers sold at Carsensor.net (JDM Autotrader)
I accept Bertel’s assessment that the Japanese market is open. However I don`t think a Japanese company (Nissan) importing cars into Japan is evidence of that. Just like saying Germany has an open market because VW imports cars from Slovakia into Germany (Skoda).
Success or failure of brands in markets are no evidence of import barriers. Neither for Volkswagen, nor for Nissan, nor for Ford.
The only evidence of import barriers are import barriers.
If car makers and politicos can’t show the actual barriers, then they should stop taking their own people for fools.
I agree with you that people should not be fed incorrect information about “barriers”. I just don’t think citing Nissan is the best way to prove it.
Can an overinflated (for whatever reason) sell price be considered as a barrier?
Can the Japanese penchant for (only) glamorous western goods be considered as a barrier…to Detroit?
Leaving aside the Americans for a moment — why do European cars that compete on price with the Japanese everywhere else in the world cost 25-33% more than their Japanese equivalents in Japan?
If that’s not evidence of an import barrier, what is it?
Why hasn’t Hyundai/Kia done well in Japan?
Nobody wanted them.
Really? They seem to do OK everywhere else. The Japanese do seem to like predominately their own makes (for multiple good or bad reasons no doubt). Consumers in other markets seem more “open” to trying other manufacturers. Even in Germany >50% are non German cars.
It’s my understanding that there is a history of cultural emnity between Japan and Korea.
Even in Germany >50% are non German cars.
From which knuckleheaded talking points is that number? I wouldn’t argue German car stats with someone who had to have them in his head for most of his life.
True German brands (and Opel and Ford are counted as such)currently have 64% of the German market. If you count in Skoda and Seat, which any German does, because he knows they are made by Volkswagen, then the number is 71%. The “German” number is for the birds anyway. It is a European common market, and cars of any brands are made anywhere. As the current EU stats show, non-EU brands hold a 15% share of the EU market – again, disregarding where they are made.
In any case, you can’t legislate whether consumers are “open” or “closed” to other brands. They do whatever they like. Europe and Japan are abundantly served by a multitude of indigenous brands, and there just doesn’t seem to be a compelling reason to buy more imports.
As a wise old Japanese car exec told me: “People in Japan buy foreign cars to be different. There aren’t many people who want to be different.”
Bertel – “From which knuckleheaded talking points is that number?” I would not dream of arguing with you about car stats in Gemrnay since you have the experience and knowledge. I just took what I read in your other post to be true : https://www.thetruthaboutcars.com/2011/11/germany-in-october-2011-chugging-along/#more-416859
Which when you look at the link gives German brands 54.7% of the market – VW (21.9), Audi (7.8), Skoda (4.5), Seat (1.9), Porsche (0.6), BMW/Mini (9.2) and Mercedes (8.8). I mistakenly said 50% rather than 55% but the point was the contrast with Japan where the number is what around 90% Japanese. I merely used Germany as an not wholly comparable but illustrative example of another large country with a major home-grown auto-industry and compared it to Japan.
Ford is in no way a German brand or make even if they have some manufacturing and R&D there – if that is the standard then Toyota is British because the have two plants in the UK or American because they have many plants in the US.
Opel is a German brand name, just like Vauxhall is a British brand name. Both are American owned and I would suspect most owners know it is an American owned brand.
I am agreeing with your basic point about Japan being open but not receptive to foreign cars. I also agree you cannot legislate to make people buy a certain car or now. The executive you quote has it correct.
If I have misunderstood the data I apologise, I am just going off what has been posted in TTAC in the past.
Jeez.
Opel built cars in Germany since 1899.
Ford started making cars in Germany in 1925.
Both long before Volkswagen.
Bertel – I don`t want to get into an argument, especially when we agree on the main point of the post.
However to answer your last point Ford started making cars in the UK in 1911 (before quintessential British brands like Land Rover) so by your standard this makes Ford British. Which it isn`t. Nor is it German.
Same reason why Toyotas don’t sell well in South Korea.
Actually, for being a smaller market, the Camry sold a lot better in Korea than the Sonata did in Japan.
Also, for a few years, Honda had the best selling import model, until the Yen started to appreciate (sales of German cars were further helped by the Germans cutting the price on their models in Korea).
Oddly enough, Korea is one of the bigger markets for the Nissan Cube.
“Why hasn’t Hyundai/Kia done well in Japan?”
Very simple: The Japanese hate the Chinese, the Chinese hate the Japanese and the Koreans hate everybody! This coming from a Chinese friend from Cleveland!
Shhh!
Bertel gets touchy with this kind of stuff. I’m surprised I’m still seeing my posting that includes something I hoped was more diplomatic enough for him to swallow.
I stepped in it deep one time with Bertel and I hurt his sensibilities by posting something similar.
And do you blame the Koreans? We don’t blame the Irish for their dislike of the British, it was as bad for the Koreans under the Japanese.
Just accidentially call a Korean a Japanese and watch their head spin!
Baloney.
Trivia question: Which foreign country sells – on aggregate – the most cars in China?
Japan.
January to October 2011 brand market share, China, as per CAAM
Japan 19.11%
Germany 16.60%
U.S. 11.30%
S Korea 8.10%
France 2.77%.
Be careful and don’t let facts get in the way of your prejudices. Or those of the Chinese friend in Cleveland.
Not true on so many accounts.
Btw, according to Pew Research, Korea has had the highest favorable view towards the US (significantly higher than countries like the UK and Canada).
I thought it’s the Germans who hate everybody?
Put a Hermes logo on those Kias and the Japs would surely snap them up.
the Japs would surely snap them up.
It’s bad enough that this guy is a redundant troll. But why is his routine use of a racial slur tolerated around here?
Ah yes, the resident numbers geek who needs to get out more lest he keeps swimming in a septic tank of left-wing political correctness. BTW, I think I saw one of the authors use the term before. And people in Japan are actually indifferent to it.
I will restate my question: Why is TTAC tolerating this poster’s use of this racial slur? The drivel is bad enough, but the bigotry crosses the line.
With regards to the Hyundai’s lack of success in Japan:
– They weren’t priced much lower than the equivalent domestics but with lower refinement and reliability.
– The cars tended to fall under higher tax brackets compared to competitors (too wide), and overall maintenance and repair cost were higher.
– General image of import cars as unreliable and costly, but without the refinement (Germans), brand cachet (Germans), or uniqueness (French) to bring in customers who want something different from the domestics.
– Why would you buy a car that’s perceived to be a lower quality copy of your domestic product, if they’re going to be more costly to own and hassle to use?
After the success of the Toyota Cavalier I don’t understand why the Japanese don’t want to buy American cars. Dodge should export the Caliber, they would really appreciate the craftsmanship.
Um…even Americans themselves don’t want to buy American cars.
You know how the U.S. media exaggerated Toyota’s recall woes and pedal fiasco during the recession? Well, just imagine the Japanese media doing something against perfectly decent foreign cars, except for every single year since Japan began to rebuild its automotive industry after world War 2.
Japanese consumers would never embrace a perfectly fine America car ca, because they have more or less been brained-washed for decades.
In other words, the Japanese car market is closed indirectly through propaganda. The zero tariffs and whatnot is only a facade.
Show me the proof.
In the 80’s, the Japanese government even started a campaign to increase foreign car imports, because they were worried that nonsense like this spreads. That program more than quadrupled imports between 1985 and 1990. Once the Japanese bubble collapsed, flashy imports went out of vogue again.
It seems like brainwashing is alive and well in other parts of the world.
What campaign was this? I know the yen appreciated in the mid-80s, and that helped imports. But I am not aware of any other campaign to increase imports of automobiles.
Known in the trade as “Action Program to Promote Import”
Results:
50,172 vehicles in 1985，68,357 in 1986，97,750 in 1987，133,583 in 1988，180,424 in 1989，and 221,706 in 1990．
It looks like that was a combination of government action (including the value of the yen changing), better manufacturer support (expanding dealer networks, financing deals, etc.), and Japanese companies selling captive imports. Basically, the government helping some and good business practices. It appears to have worked.
The argument that Japan ships more than 200 cars to U.S. for every car the U.S. sends to Japan only proves one thing:
What it proves is that we have a problem. Ignoring it by saying that American auto manufacturers have the problem, doesn’t make it any less of a problem for all of us. We depend upon healthy US production for a healthy US economy. Simply saying that it is GM and Ford’s problem doesn’t change that.
Do you want American automobile companies? A couple of them filed bankruptsy a couple of years ago and cost each of us billions. Do you want American auto suppliers? Do you want American automobile workers? Do you want any technological advances made in the US?
The fact that we have millions of Americans flooding the US economy with imported cars is a problem for all of us. While it may toot your horn to claim you have the best car available, you need to be aware of how this craps on everyone else. Blaming the American car companies for not satisfying your auto cravings to justify helping to sink the US economy is damn selfish. There are great US cars available to satisfy your auto whims if you really give a damn.
Honestly, do you really think your Japanese car is worth the death of the American car industry?
And do we really need to ask why the country that was defeated sixty years ago in war and ending their centuries-long enslavement of Koreans isn’t interested in buying American or Korean cars? There are a lot of Japanese who won’t drive foreign cars built by people they consider inferior to them.
It’s the responsibility of the company to satisfy the customer, not the responsbility of the customer to change buying habits to keep said companies in business, especially when said companies have a history of arrogance and an unfortunate habit of offering too many inferior products.
Right – the Japanese car companies have always offered the finest automotive products without a hint of arrogance. Every car off the dock was an absolute gem and every company a paragon of humility.
VanillaDude: Right – the Japanese car companies have always offered the finest automotive products without a hint of arrogance. Every car off the dock was an absolute gem and every company a paragon of humility.
No automobile company produces a hit every time, just as even the best baseball player doesn’t hit a homerun every time at bat. It’s about the overall record, and the companies with the best overall record of producing solid products – Honda, Toyota and Subaru – have enjoyed the greatest success.
Their overall record is still better than that of GM, Ford and Chrysler. Note that the Japanese companies with a spottier record – Mazda, Mitsubishi and Nissan – have faced a much rockier road in the United States.
You also appear to be a bit behind the times. Many Japanese cars – especially the popular ones – are built here in the United States, unless Alabama, Indiana, Kentucky, Ohio, Mississippi, Tennessee and Texas have all seceded from the union while we weren’t watching.
But if you want to argue that, say, a Cobalt was better than a Civic, or a Malibu was better than a Camry, be my guest. That sould be entertaining (not to mention a good exercise in fiction writing), to say the least.
When an American car company builds a car exactly the way I want it, I’ll buy it. Is it my duty as an American citizen to buy an undesirable $30,000 product, which I know I’ll be unhappy with from day one, solely to support my country?
If I’m not mistaken, you probably had grandparents that sacrificed a lot more to make the US great than what you are complaining about here.
Without the economic engine that is America, you couldn’t afford that car.
And that’s the beauty of America, that I have the ability to make that choice. Given two products that serve the same purpose, I am free to choose the one that will make me smile every time I use it, over the one that will make me pissed at my decision every time I use it.
And what is an “American” car anyway? My Honda was built in Ohio. I fed American workers when I bought my car. The #1 car on my list of choices, the Buick Regal GS (cost too much and I didn’t feel like waiting at the time), was an “American” car built in Germany. Go figger.
An American car is one sold by an American car company. The bulk of the profits derived by each sale and the profits earned by the company should be American.
Buying a domestically made Honda doesn’t make it American. Do you really think Mexicans are thinking that Fords are Mexican because they are assembling some of them?
Americans can’t be so stupid as to think a Honda is American because it is assembled here.
Your agenda, whatever it may be, is wasted breath on me. But if you’re willing to stroke me a check, I’ll happily put a Mustang in my driveway so you can sleep better at night.
VanillaDude: An American car is one sold by an American car company.
Under this convoluted “logic,” a Fusion made in Mexico is an American car, while an Accord isn’t. Most Americans reject that line of thinking.
VanillaDude: The bulk of the profits derived by each sale and the profits earned by the company should be American.
The bulk of the profits go to shareholders, who are located are in many countries, and for reinvestment where the company expects to make money. Which is why many of GM’s profits are invested in facilities in China, and many of Toyota’s and Honda’s profits are invested in upgraded facilities here in the United States.
VanillaDude: Buying a domestically made Honda doesn’t make it American.
You need to tell that to the Americans who are employed by Honda to build Accords here in the United States. Based on your “logic,” their jobs are apparently less important than the job of a GM worker in Michigan, solely because the company headquarters are not based in the United States.
VanillaDude: Do you really think Mexicans are thinking that Fords are Mexican because they are assembling some of them?
There are no large “native” Mexican automobile companies. The Mexican auto industry consists of the Mexican-based operations of foreign companies. Ford is one company that does business by producing vehicles in Mexico – something it has done for decades.
Mexicans undoubtedly consider Fords produced there to be domestic (meaning, Mexican) cars, much as Australians and Great Britons and Germans consider Fords produced in those respective countries to be domestic cars.
I’m also sure that the Mexican Ford workers don’t waste their time obsessing over this sort of nonsense, as they are grateful to have a good-paying job with Ford. But then, they are probably living in the real world.
VanillaDude: Americans can’t be so stupid as to think a Honda is American because it is assembled here.
What is nonsense is viewing the jobs of those who assemble (and engineer and style) Hondas in the United States as somehow less important than the jobs of GM, Ford and Chrysler workers.
“An American car is one sold by an American car company. The bulk of the profits derived by each sale and the profits earned by the company should be American.”
Never mind the profits from the car’s sale, that is a small proportion of the revenue – if any judging by the bankruptcies. A portion of it goes to paying for the engineering & development costs, which may be in multiple locations/nations and of course the actual manufacturing – labor plus parts sourced from a range of suppliers and there have been previous TTAC posts about the “most American” car on that topic.
Honestly, I prefer a Toyota built by friends and relatives a few miles up the road in Kentucky over a Ford built in Mexico. It’s going to take more than jingoism to change a lot of people’s minds on issues like that.
Did buying cotton underwear from France in 1860 help support the slaves that picked that cotton?
Everyone here considers remarkably unimportant reasons to buy a vehicle – so how about considering the nationality of the company benefitting from that purchase and getting the bulk of the profit you gave them? That is a smaller price to pay than the tax increases needed to cover your unemployed neighbors.
So superior reliability, better depreciation and more refinement are now “remarkably unimportant” reasons for buying a car? That’s an interesting take on the situation, although a hopelessly naive one, to say the least.
I won’t argue over reasons because they are too numerous.
I am asking that whatever your reasons, there are priorities among those. Please consider an American car company’s product seriously before sending your money overseas at a time when the US economy needs you.
Huh? Slaves picking cotton? What on earth are you rambling on about now?
The problem is domestic brands have, at least in the past, cut corners in areas like interior plastics to hit a competitive price point and still cover UAW legacy costs. Manufacturers not burdened by UAW benefit costs and work rules have been able to make better cars for the money. Most of the “Japanese” cars sold in the US are assembled by American workers. On top of this, the UAW is actively involved in politics on the opposite side of the Cold Civil War. Why help fund my enemy?
“Do you want American automobile companies? A couple of them filed bankruptsy a couple of years ago and cost each of us billions. ”
1) No.
2) As explained in your second statement. No American auto company, no bailout expense.
(To be precise, I am a Canadian. But the arguement still holds, as Canada paid 20% for the bailout.)
@vanilladude: so if you save $900 buying an import vs a comparable domestic, would you do it?
No.
I don’t even consider foreign brands.
I think it is important to drive an American make.
Especially in this economy.
Driving an American car is not a sacrifice.
I drive a foreign car because there is no way to kill the organized crime parasite without killing the host. When the UAW is gone, I’ll buy cars made by the new companies that will thrive in a free market populated by humans. Driving an American car today is giving money to the enemy.
Look, I support the American worker…this is my country, and I’ve gone places to defend her that most here won’t. That being said…up until fairly recently, with the exception of a few outliers, the Big Three (or what used to be) simply didn’t make cars that competed with the likes of Toyota and Honda. And the market reacted to that. Simply buying American to “Buy American” only served to validate the Big Three’s understanding that if they built it, we would come. Never mind the reliability. So folks flocked to the imports (my parents have owned three Toyotas in thirty years now). I do see a turn around in what GM, Ford and even Chrysler are offering as they start to slowly understand that sticking an American flag on a car simply isn’t enough (and don’t get me started on defining what, exactly, is an “American” car these days). It took Ford, GM and Chrysler decades to ruin the trust and love of the American buyer…possibly with exception to full-size trucks and SUVs, and will take quite a bit of time to fully recover from.
As for the Japanese market…hard for a Crown Vic to compete with what a Japanese car buyer really needs when it comes to size/practicality. If their market is truly open as Bertel outlines, then the new batch of much-improved products should see sales increases in Japan…IF GM/Ford/Chrysler do their jobs right in fully promoting them as vehicles that will completely meet the needs of the intended buying audience. It has been a problem for them…that’s the long and short of it.
You have admirably moved on in your life. Now please recognize that over the past decade the Big Three have also moved on and are making cars that are as good as you are getting with a foreign company. Also please consider how our economy is struggling today, when it wasn’t doing so when you started buying foreign.
Things change. Come home. We need your money here. We need it now. Or things will get worse for all of us. Honestly, any perceivable difference between what you are buying from Japan and what you could be buying in America is slight. And we need Americans to drive American car company products. At least for a decade or so. When we return to economic health, you can chase your whim again.
Detroit can’t plead because pleading looks weak. But I will. Look. We are in economic straights right now and the future isn’t very bright for my kids. You buy band candy to support the schools. You do charity stuff all the time. How about doing something super simple and helpful by driving a US brand for a while? What could be the harm?
The Japanese won’t drive American cars for a myriad of reasons. So, the Japanese car companies don’t need their help to survive. Ford, GM and Chrysler won’t survive unless Americans try American cars again.
Do you want to one day tell your grandkids how America used to be, or how it still is?
Ummm….didn’t I say that? Re-read the post…those “until fairly recently,” and “much-improved products” parts. I at first cringed when I was handed the keys to a new Chrysler 200 a few weeks ago, but I came away genuinely pleased with it after five days on the roads of Michigan…quiet, smooth…handled well, and the interior was vastly better than what it was. I wouldn’t mind seeing my own mother in one. And having a wife that hails from just north of Detroit, I am PAINFULLY cognizant of how badly the economy is suffering…please don’t think that I don’t. The family started buying foreign when the Toyotas they bought went 10+ years each with nary a failure in a time when it was hard to say the same for American iron. And given that they bought cars in 10 year cycles, longevity, reliability and low cost of ownership was very, very important (don’t patronize that people buy for “remarkably unimportant” reasons when it comes to parting with hard-earned money). But before my father passed away in 1997, he bought a brand new 1996 Dodge Ram 4×4 and loved it. And though I am hankering for a Fiat 500 Abarth (maybe I could get a license plate that reads “Lionhrt” I know that for practicality reasons, I most likely need a small truck…so, even though it is outdated compared to the competition, I’ll probably strongly consider a used Ranger (even though my purchase of a five or so year old truck does precious little to provide for the American auto manufacturer at that point).
Bertel is right, of course.
There are few legal barriers to US makes in Japan.
But that doesn’t mean there aren’t real barriers to US makes in Japan. There are.
Worse, we need to open new markets, and Japan is one that has proven repeatedly difficult to open. This isn’t surprising when we know the Japanese culture. Ask Perry how hard it was back in 1850.
We need domestic support for our domestic companies because in 2011 our economy needs us to do so. We have people driving cars because of their concern over our environment, how about because of our country’s economic and technological health? What are we making? Trabants? The idea that American cars are not good enough for Americans sounds like something right our of Marie Antoinette’s silly pouty lips.
And worse, it isn’t true.
I shouldn’t have been so strident in my earlier replies.
Yes, our economy is suffering, but the reasons go much deeper than the woes of GM, Ford and Chrysler. And some of those reasons are a tolerance of too much sloppiness in not only what we make, but government spending and personal financial habits. Papering over the woes of the domestic auto industry with a “Buy American” mantra won’t solve its problems anymore than chanting “USA, USA, USA” will solve the problems faced by our country as a whole.
And while the products of GM, Ford and Chrysler have improved – in the case of the first two, dramatically – that is because foreign competition has forced them to change virtually every aspect of their operations over the past 30 years. They haven’t improved their products because of a new-found concern for the customer or out of the goodness of their corporate hearts. They were getting their heads handed to them on a platter by the competition, and losing billions as a result.
Why the hubbub about Japan? It’s a tiny market compared to China/Brazil/US
Japan has about 127 million people. Of those people about 82 Million are between 15-64 years old. Their popluation is aging, which adds to the limited market.
“Buy American” efforts would more sucessful if people bought more USA made appliances/clothes/electronics/furniture/nails/screws/tool/windows. Even beer.
These items are purchased more frequently than cars.
Not to mention that USA-made tools are typically without equal in this world. Something we still do incredibly well, yet a dying art.
I thought Germany-made tools are typically without equal in this world?
Japan maintains non-tariff barriers, such as inspection processes that delay imports at port for weeks or months at a time. These inspections are slow, arbitrary and targeted against some companies more than others.
Those delays don’t prevent cars from being legally imported. But they do make it costly to import automobiles, which limits the appeal of the market to companies that can’t command a substantial price premium.
Those who cope with it make up for it by charging high prices. Based upon the current exchange rate, a 325i has a pre-tax price of more than 5.2 million yen, or US$67,000. http://www.bmw.co.jp/jp/ja/general/international_sales/intl_sales_pricelist.html A Golf GTI has a pre-tax price of over 3.5 million yen, or more than $45,000. http://www.volkswagen.co.jp/cars/golf/price.html Companies with prices as high as that had better have appealing brands to support their sales.
That being said, it is also disingenuous for Americans to believe that Japan could be flooded with US exports if these restrictions were eliminated. US-market cars don’t exactly wow the world, and in any case, Ford and GM have long operated under regionalized strategies that kept their US operations focused on serving North America, while other markets serviced by other facilities abroad. Exporting cars from the US has never been an important facet of the American automotive industry.
The US is a unique car market, and the automakers know it. The US market is large enough that it is worth it for many companies to target it. In contrast, Japan doesn’t offer that much potential. Between the non-tariff barriers and the aging, declining population, it isn’t worth the effort, and whatever effort is made needs to be rewarded with high prices.
>>Japan maintains non-tariff barriers
>>Those who cope with it make up for it by charging high prices.
Something that I’ve been saying all along whenever that funny “Japan is an open market” thing pops up.
Any foreign car is a “look-at-me” and “I am different” statement (And it is one costly statement at that).
Hence the proliferation of LHD premiums, that are otherwise fully certified for Japanese market.
All aspects of car ownership are more expensive for an import.
What inspection processes?
You mean the manufacturers’ own processes?
When I worked for Volkswagen, they had their own very rigorous Pre Delivery Inspection in Japan. Why? Because the Japanese customer is extremely picky and quality-obsessed – with anything. If it is substandard, it is unsalable.
Again, it is the darned customer who is the barrier to entry.
You mean the manufacturers’ own processes?
The non-tariff barriers have been documented, and it isn’t just the Americans who have noted their existence. Studies conducted in the EU and India conclude that Japan has more non-tariff barriers than other countries.
At least some of those barriers are designed to create delays. Inspecting every car that comes off of the ship in lieu of broad certifications will necessarily create delays, which cost money, which require higher prices and reduces the number of units that can be competitively imported.
Is it those “darned customers” who set up a price 2+ times that of a Japanese domestic equivalent?
As for inspection, I am afraid Pch was refering to grey/personal/used imports that are indeed subject to a procedure similar to shyaken (can be very expensive).
As for inspection, I am afraid Pch was refering to grey/personal/used imports that are indeed subject to a procedure similar to shyaken
No, I wasn’t.
Then what inspections except the manufacturers’ own are there?
These inspections are not there because a law or a bureaucrat wants them. They are there because the market demands a flawless car. You should see Japanese women go over every seam and stitching when they buy a dress or a bag.
The picture that is painted here is one of Japanese government inspectors who go over every car with a magnifying glass and send it back on the boat if there is a scratch in the paint. This is simply another lie.
If you want to play in Japan, you better have your act together with anything, domestic or foreign. Substandard products mean instant death.
As for the prices: Wake up, everything is obscenely expensive in Japan, especially when converted from yen to USD. Japanese cars cost what they cost, and imported cars are priced to market. Any forex gains are not passed on to the Japanese customer. It can get extremely profitable to import to Japan at the current currency situation, and it pays well for added QA steps.
Then what inspections except the manufacturers’ own are there?
The inspections are conducted by the companies themselves, but those are reviewed by the government. Here’s a former Ford exec’s complaints, which note that the inspectors were in-house but had their work audited by government:
The audit process was brutal, he recalls. Inspectors would check off every defect, even if it were well within generally accepted tolerance, (Ford executive Don) Whitehouse said.
“They gun-sighted everything with magnifying glasses and flashlights to see if it had to be repaired,” he said. Then Ford teams would correct them, often at great expense. The expense drove up the price of the cars for Japanese consumers.
Strangely enough, Ford of Japan itself hired the inspectors who put U.S.-made cars through the wringer, turning the local subsidiary into Whitehouse’s chief antagonist. In addition, Japanese government auditors checked the inspectors’ work at regular intervals, Whitehouse said.
http://autos.aol.com/article/japan-bias/
This report by Copenhagen Economics claims that non-tariff barriers raise prices to imports of all kinds in Japan by an average of 60%, while limiting capacity: http://trade.ec.europa.eu/doclib/docs/2010/february/tradoc_145772.pdf
Non-tariff barriers do exist. I don’t see why there is such a strenuous effort here to deny their existence, when they have been documented. The fact that Toyota can offer an IS250 for more than 1.2 million yen less than BMW offers a 325i should tell you something.
to paraphrase MrBostn: Who cares? I know I don’t. I used to, but for years we’ve been told the real action is in the BRIC countries. Most of the USDM are players in those markets already. I still believe that the USDMs most important market is North America, and the US in particular. Even in these recessionary financial times, we’re (collectively) still moving 12 million cars. Maybe down the road China will be the biggest market, but for now, this is it.
Who cares about Japan’s propensity to buy USDM cars? As I understand it, the Kei car is the most commonly sold car. I believe that was part of the reason why the Toyota Cavalier experiment failed. It was too big and powerful (in regards to tax structures), especially if the vast majority of buyers are looking at fueling, parking and paying taxes on something much smaller.
Frankly, I believe this factor alone is one of the major reasons why an average (size, fuel consumption, engine size) car in the US doesn’t sell well anywhere else in the world. Except maybe places where fuel and taxes are lower, similar to the US. Our neighbors in Canada don’t even buy as large a car as we do here in the US…
This may hurt, but American cars are just inferior.
1) Even in the US of A, more people buy Japanese/Korean cars than American cars. Most American vehicle sales are in trucks, not cars. But Japanese simply don’t buy pickups (and that’s assuming American trucks are better, which isn’t necessarily true). Would you say there is a barrier in the States that’s against American cars? How would you explain about the poor market shares in their home games? Other than, maybe, their cars suck?
2) People are saying the new gen of American cars are better. That, I don’t know. I only know that I have heard similar stories for 20 years. I will start looking at an American car seriously, after it has 10~20 years of solid reputation. Not unfair, since Corolla/Civic/Camry/Accord have 30+.
You must be young. I’ve been hearing that American cars are better for over 30 years, and I’ve read reprints of early Vega tests that make enthusiasm about the current domestics look downright measured, hedged, and cautious. It is to laugh.
Driving an American brand is not a sacrifice and it does not make you look inferior to other Americans. And to foreign tourists, they would admire you.
[(226,295/5)*6]/5,000,000)= 5.4%
Sorry Bertel, but sales of imports breaking 5% of the market doesn’t do much to support an argument for an open market. It may well be an open market, as the Japanese make excellent cars and they’re bound to be well suited to their domestic market. Still, imports are a sideshow, and all these numbers show me is how easily distracted most people are by statistics.
How may times do I have to say that lack of sales does not prove that a market is closed?
69 comments, and there still isn’t proof for a single barrier, except for imagined ones.
I’m not suggesting that there is a single barrier, just that lack of sales certainly does nothing to suggest an open market and 5.4% is a lack of sales.
The barriers are based on subjectivity, not objectivity.
If there were no barriers, American brands would be as popular as Japanese brands are both in Japan and the US.
What you are saying is that there are no import barriers, and you are right.
But there are barriers preventing the embrace of American brands with the Japanese.
Very interesting thread, and more interesting replies.
As a Canadian, here is how I read this:
1)Ford and Opel are considered ‘domestic’ by Germans. Really? Most Canadians consider a Honda built in Alliston more ‘Canadian’ than a Cruze built in Michigan, even though McLaughlin Motors has been around since 1876 and was bought by a fledgling GM in 1918. When did Honda finally show up? 1970? 1975? Toyota arrived here in 1965. How’s that for heritage and nation building? Nah, in this ‘me-first’ society, it’s all about what have you done for me lately (thanks Janet Jackson.)
2) Isn’t it funny that North Americans seem to care so little about the history and importance of their own domestic industry, yet the Asians seem to understand just how important manufacturing is to their very survival, and rally around their own like no flag-wrapped American will ever understand? Forget about Canadians, our culture and history vanished 30 years ago. There’s nothing left to rally around, except perhaps a totem pole in Squamish.
3) So when the OECD ranks Japan and Korea as DEAD LAST amongst all its surveyed developed countries for ‘foreign’ penetration of their auto markets, it’s because nobody else builds a decent enough car or truck? Nobody? Or all the rest of the manufacturers are too lazy to go after a piece of the world’s 3rd largest market? They’ll fight over Brazil, though. Even Russia. I wonder what the difference is….
So, a more homogenous, patriotic Asian population will support their own industry, forgoing ‘choice’ for economic security, then North Americans will?
It’s no wonder the West is circling the drain, assaulted on all fronts by peoples who have learned to beat us at our own game: tie everything up in court, raise the banner of choice, the me-me-me crowd will scream about their entitlement to choice and inclusiveness, then watch the silly Westerners fight amongst themselves. Hilarious! Not a shot being fired. Not a single one.
Okay, even though an innocuous company like Toys R Us took years to open their first store, so complex and confounding were the roadblocks, I’ll concede the point: Japanese people don’t like anyone else’s products.
Has it not occurred to anyone out there that perhaps we should figure out WHY they are so patriotic and obedient, yet we are not?
I mean, just as an intellectual exercise before the last manufacturing job controlled by a North American job is off-shored.
Figured you might make an appearance soon enough. But anyhoo, Japan is the world’s largest luxury goods market. How’s that for patriotism?
“So, a more homogenous, patriotic Asian population will support their own industry, forgoing ‘choice’ for economic security, then North Americans will?”
1) You mean “than”?
2) No. North Americans supported big 3 with roughly $100B in bailout. Not to mention GM wouldn’t still have 18% market share without all the “patriotic” purchases.
Japan’s market is indeed closed. Perceptually. You want to sell to them? Make your cars cool or glamorous. But I doubt if Detroit is up to the task. They are, however, experts in selling to hicks, banana republicans and Chinese peasants.
Come to fly-over country and you’ll find most vehicles are domestic. It’s the coastal areas that are so heavily import dominated. We “hicks” drive our vehicles to high miles on bad roads in severe climates, and somehow our domestic vehicles manage to last. I’ve put over 250,000 miles on six Mopar minivans, with minimal repairs needed, just tires, struts and brakes and no expensive timing belts that need replacement.
Lobbyists of every stripe try to game the system to the benefit of ‘their’ team.
http://www.aapc.us/news/Japan-s-auto-barriers-need-to-end-Ford-exec-says
As a result you end up with regulations, franchise laws, tariffs, quotas and even outright propaganda to keep the ‘home’ team in and the ‘away’ team out. Every country makes it a bit easier for the ‘home’ team… consumer rights be damned.
The question isn’t whether Japan, the US or the EU erect barriers to help out ‘their’ companies. That’s brutally obvious… although as Bertel points out, some societies are more guilty of it than others.
But to be blunt about it, they all do and will continue to do so… because companies, trade organizations, political action committees and even the car dealer down the street will always act in their own self-interest.
The greater question is whether any of this behavior is healthy for a global economy. I think there is a balance to it all… that I would simply call reciprocity.
But even that can be a tricky policy to implement.
The greater question is whether any of this behavior is healthy for a global economy.
In this case, I doubt that it makes much of a difference.
The numbers above indicate that import penetration into Japan is minimal. Sales of all imports in Japan this year have been lower than BMW’s total sales in the US over the same period.
Aside from holding the occasional press conference that gripes about it, there isn’t much to be done here. Japan’s market offers limited upside potential, so it isn’t worth the energy. There is far more potential for volume in the BRICs and for margin in the US. Even if Japan’s non-tariff restraints were lifted today, sales would probably still remain low.
I lived in Japan for almost 10 years, have been married to a Japanese girl for 30 years now, and visit Japan for a couple of weeks every year. To cut to the chase, there are no government trade barriers. Yes, there used to be, but they ended 20 years ago. I was there. I saw them, and I saw them go away. Now, the only barriers come from a well-educated Japanese consumer for whom a car is a luxury in most cases – not a necessity.
As a car enthusiast, I have always followed the success of ‘foreign’ cars in Japan. I completely agree with Bertel’s analysis. Japanese are very fussy about quality, and in their highly competitive market, the manufacturers deliver it or go out of business. This applies to everything – not just cars. To get back on topic, they have a ton of domestic automotive choices specifically designed for their market. There is little room in the ‘average’ car market for imports. Imports are for those who want something different. My ‘eyeballing the street’ sees lots of BMW’s Mercedes, VW’s, Audi’s. Some Volvo’s, some Jaguars, almost no Mini’s. Nothing French, ever, once. The occasional Hummer in Tokyo (mostly businesses), some Jeeps (but not in Tokyo). A few years back I saw a sad looking Buick Regal but only one. I have actually seen one (years ago) of the Toyota Cavaliers on the street! They did exist.
My brother-in-law’s impression of American cars is too big (remember, in Tokyo, you have to prove to the Police that you have a parking spot big enough for your car before you can buy it), too hard to drive and park, and not-so-good quality. American cars are for Yakusa who like flashy cars and suits. BMW’s are for rich kids (his son brags that his driving school used 3-Series and dad says that’s why the school cost so damn much). He could maybe see a Benz if you were rich, and a Jeep would be cool if you lived in Hokkaido. Jag’s are trouble, and Caddy’s are gross. He was driving a Toyota Mark X and just got a Prius. He’s owned Toyota’s for almost 30 years. Doesn’t care much for Honda’s and wouldn’t own a Mitsubishi. Thinks Nissan’s are a step down in quality. Subaru-who? In summary, he could buy a foreign car, but why? Toyota makes good cars and he hasn’t had any trouble with them.
Awesome. Thanks for sharing!! “Toyota makes good cars and he hasn’t had any trouble with them.” <- That's exactly why my family and I aren't buying anything else. We've had 11 so far and will hopefully buy 11 more of them over the next many years.
I’m living in Japan right now, and have been for much of the last 4 years. We just bought our first car here, an 8 year old Impreza wagon with a 1.5 liter engine. Do you know why we bought the 1.5? Because the annual road tax for it is less than it would be for the 2.0L boxer. The road tax is probably the biggest thing that makes American cars unattractive here. American cars’ engines offer more displacement, but also require more tax to be paid. Anything over 3.0L ends up in punitive taxation, and if you’re on a budget in a country where everything is more expensive and everywhere is narrower, why would you buy a car designed for a place where the streets are wide and gasoline flows like a river through the heart of every town? You wouldn’t, and that’s not touching the sha-ken (car maintenance inspection).
Where I live, a car is a necessity. Trains only go so many places, and then not very often, so there are lots of people driving 0.6L kei cars. The tourists come from Tokyo in their big German sedans, and there are far more Explorers, Cherokees, and Escalades than you’d believe. A teacher I work with wants one (but not on a teacher’s salary)!
Everyone hates on American cars for a great many reasons, most of which were probably right on through the middle 90s. But it’s not the middle 90s, and the Big Three have changed. It’s just that the Japanese market is not the American market and vice versa. The Accord sold here is not the Accord sold in the US, same with the Camry (which you rarely, if ever see here). I don’t even think Nissan bothers selling Altimas here. So I think a lot of what Lokki has written is pretty right, I just wanted to add a little bit more, and harp on the road tax and family budgetary constraints a little more.
Also, you mentioned the whole proving your parking space thing, that’s true everywhere. I live in a pretty isolated place, and we had to fill out the paperwork, draw the map (twice), and pay the fees. Our (roughly) $2500 Subaru ended up costing $3800 when it was all said and done. Truly lovely service from the dealer, though. I did get teased by my vice principal for buying a car from a “minor” company, although he made fun of himself for the same reason (Suzuki is minor also, apparently).
Everyone, before saying Japanese chose Domestic/European cars over American, please go check following official sites first and see what we are officially offered.
http://www.gmjapan.co.jp/
http://www.ford.co.jp/
http://www.chrysler.co.jp/chrysler/
http://www.jeep-japan.com/
http://www.chrysler.co.jp/dodge/
GM – Cadillac SRX & CTS, Chevrolet – Corvette, Camaro, Aptiva, Sonic
Only 7 cars (including 2 Korean Built, we’ll never buy)
Ford Mustang, Escape (Taiwan), Cuga (Belgium), Explorer, Lincoln Navigator, and MKX coming soon
Chrysler says Thanks we sold out all 300C inventory, Good bye
Jeep – Wrangler, Cherokee, Grand Cherokee, Patriot
Dodge – Nitro only
What are they expecting us to buy in large portion???
I understand GM & Chrysler are under hard time for restructuring, but ford is doing wrong again as the last time they sold tester/mondeo/tauras mixture of cheap anonymous car to lose against Domestic and sub European premium to lose against VW, and rip off American no one buys. Explorer XLT listed price is JPY 4.4 Mil and Limited is JPY 5.3 Mil, just because they can’t sell cheaper than smaller Cuga. We know it is USD 32K / 37K at home, half the price under current currency rate.
I admit there is still negative image to US cars, the general image is like bulky huge brick shape laptop from late 90s made by Compaq.
But still there is a chance. A once kingdom of Sony Walkman is now dominated by iPods.
And yes, many interest in Tokyo to have Tesla.
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, go to this web site http://counterpunch.org/2009/07/03/detroit-s-collapse-the-untold-story/
Editors
Rather than sensor my statements, prove that my data is wrong? By the way, I may make your site famous. I take screen shots of when I post. I have already posted what you do in one US newspaper. Wait until a real reporter starts asking questions.
Am I the only one who sees though the distortions and misrepresentations in this article?
Distortion 1 The writer states 275,644 foreign cars were imported into Japan, only later is it revealed that 74,091 cars were imported by domestic car makers (Nissan, Toyota, Suzuki, Honda and Mitsubishi). The real number of imported cars is around 200,000 in a market of over 4,200,000 vehicles sold.
Distortion 2 200,000/4,200,000 is 4.76% not anywhere near the stated 10.3%. Even if this were a valid number how it is that in 53 years, from 1966 to 2011 the percentage increase from 10% to 10.3%. The writer once mentions the exchange rate and the reduced supply of cars due to the Tsunami, but these are the main reasons Japanese purchased more foreign cars, not an open market as stated.
Distortion 3 What the writer does not tell you is that the car market is tightly controlled to protect the domestic car makers from foreign competition. Of the 200,000 REAL imported cars, 155,299 were from VW-Audi, BMW and MB, premium cars sold at high prices and not compete against the cars of the masses.
Note: The Koreans use the same tactic. The # 1 selling car in Korea, for 2011, was the MB E300 CDi at just over 7,000 cars sold. The BWM series 5’s sold over 12,000. These cars are not what the masses can afford and so are allowed into the country. Interestingly, Hyundai/Kia has increased market share in Europe, America, and South America, yet in 2011 in Japan, Hyundai sold 81 cars, Kia 3. The Japanese are not going to let the Koreans do to them what the Japanese did to the European or American car makers. As proof, in 2008, 1 Japanese Yen was equal to 8 Korean Won, today 1 Yen = 14.58 Won or in other words, if you purchased a $10,000 Korean car in Japan in 2008, in 2012 that same car would cost $5480. Yet in all of 2011, Korea sold a total of 84 cars in Japan.
Mr. Schmitt It would be easier to build cars where you sell rather than import. VW & GM build in China, and Ford, GM and Fiat are making progress to build in Russia, and Ford is working hard at expanding production in India, yet not only do VW, GM, Ford, Fiat not build in Japan neither does Renault, Citroen, Peugeot, MB, Audi and BMW. Why? The answer is and what the writer does not have the honesty to tell you is that the auto parts business is more tightly controlled that the auto industry. A foreign manufacturer would have its parts supply disrupted or find it impossible to obtain parts due to domestic auto threatening termination of parts contracts with that parts maker. While a Japanese buyer may have a bias for a Japanese branded car, a light bulb is a light bulb, a wiper blade is a wiper blade. Why no foreign auto parts makers in Japan of any size? Mr. Schmitt, list the foreign parts makers in Japan and the % of the marker in Japan.
If what I have written has made you question what you have been told, it might be because there is another side of the story you have never heard. Visit this site, you will be stunned.
http://counterpunch.org/2009/07/03/detroit-s-collapse-the-untold-story/
There you will learn that Korea audits the taxes of foreign car buyers, they got this tactic from the Japanese. Prove it for yourself.
This article should read, “Delusions, damn delusions and the truly Closed Japanese Car Market.”
Dodge Owner is 100% on target. Yeah, maybe they import cars from elsewhere but a lot of them have names like Nissan, Toyota, Honda…
How Japan has Maintained The Most Protected
Closed Auto Market In the Industrialized World
1. Japan, the third biggest car market on the planet, after China and the U.S., is
additionally the industrialized world’s most shut and protectionist market.
x It positions 30th out of 30 of the OECD nations in measuring access for imported cars;
x Total auto imports to Japan from the world measure just 3.9% of the business sector. In other
words, Japanese automakers control 96% of their household auto market;
x Although keeping up the most shut car market in the industrialized world,
Japan has reliably sent out more than 40% of its auto and truck generation, trading
about 60% (6 of each 10 autos and trucks fabricated) in 2008, with the greater part going
to North America and Europe.
x Since 2000, US fares to Japan 183,000 versus 16.3 million vehicles traded from
Japan to the United States;
x There are a great many autos and car parts sent out from Japan to the U.S.
70% ($52.1 billion of the aggregate ($72.7 billion) US-Japan car exchange deficiency in 2008.
Conversely, US automakers have been constrained to trading just 183,000 autos and trucks
to Japan from 2000 to 2008. The article may be out of date but it’s still true that their market has not opened any more than it was back then. If anybody knows anything else then please, please tell me I’m wrong.
x By anybody’s judgment skills standard – whether a financial specialist, policymaker, advertising
authority, purchaser or layman, this is not proof of an open business sector, but rather a fixed
market.
2. Japan’s Closed Market isn’t characteristic or a mishap – it was made purposely, by
government approach (MITI) now METI.
x Following the conclusion and expulsion of US auto firms from Japan amid WWII, US
firms were not permitted to come back to build up operations in its outcome.
x Instead, Japan assigned the making of a noteworthy world class car industry its
number one National Industrial Policy procedure and gave each advantage, impetus and
assurance from rivalry that it could.
x In the 1970s, Japan at long last opened its business sector to constrained import investment, and brought down its
restrictive taxes and speculation limitations, however after it had made a huge
and vigorous industry by controlling about 96% of its business sector.
x Japanese automakers then set off on a noteworthy strategy of fare development, and secured a
firm and quickly developing a dependable balance in the open U.S. business sector. Imports from Japan now
speak to more than 15% (2008) of the US auto market.
3. At the point when Japan authoritatively “opened” its business sector, it idealized the specialty of utilizing non-duty
boundaries as gigantic snags to every single outside company attempting to work together in Japan to keep imports to a base.
x U.S. organizations or other remote “transplants” were not permitted to be inherent under Japan’s strict venture laws;
x Each individual imported auto was required to be conveyed to the Ministry of Transport for
two days for examination before endorsement available to be purchased;
x Japan’s selective ‘keiretsu ‘courses of action in the middle of government and Japanese automakers
averted US and other remote auto organizations from working together in Japan;
x Japanese auto conveyance framework was stacked against shippers existing car merchants
were illegal to offer remote cars or to join forces with outside automakers.
x Japan has utilized car specialized regulations as a way to secure nearby markets by
making too much troublesome and excessive administrative and accreditation necessities, with
almost no security or outflows advantages;
x The assessment framework in Japan was intended to advantage local over imported engine vehicle
sorts;
4. In 1995 the US Threatened Tough Retaliation against Japan and Signed a Market
Opening Agreement with the Japanese Government
x All of these weights reached a critical stage in the mid 1990s, when the USTR, at the heading
of President Clinton undermined to force 100% levies on Japan’s extravagance automobiles, if the
government did not consent to completely open its business sector to U.S. auto and vehicle parts.
x This real understanding, called the l995 MOU, was seen as a noteworthy accomplishment at the time in
securing Japanese consent to a free and open business sector. At the point when the 1995 MOU was
marked, complete auto imports to Japan were 5%. Today, after 15 years, it is under 4%.
5. Will US automakers contend in Asia?
For a long time, the Japanese government has contended that US automakers would not
produce vehicles that meet their shopper’s tastes or quality gauges. Yet, adjacent,
in China, now the world’s biggest auto showcase, the main automaker is a US
organization, General Motors, which sold 1.3 million autos and trucks in 2009.
6.Currency Manipulation to pick up an upper hand
x
markets, acquiring gigantic measures of dollars and “jawboning” with a specific end goal to “push
down” the estimation of its own money to give its fares a value advantage.
7. Why the issue of Japan’s prohibition of US autos in its Cash for Clunkers project is
critical. There are two vital reasons:
x Principle: Japan has fixed its business sector to interestingly ensure advantages for its own cars. In particular for
decades now. At the point when the US government made its “Cash for Clunkers” program last
summer, it was precisely built to be transparent to all automakers,
domestic and import. Half of the advantages went to Japanese auto organizations. Be that as it may, when
Japan opened its own comparative system, it intentionally composed it to avoid US and most
other imported automakers from taking an interest and profiting. This isn’t right on a basic level,
wrong in the soul of responsibilities made to the G7 to not erect new protectionist
measures amid this monetary emergency, and wrong on any premise of reasonable play
x Opening Japan’s Market: The way that the endeavors of US auto and car parts suppliers
over decades, and progressive Congress and Administrations have neglected to succeed in
making Japan a really free and open auto advertise, that does not mean we ought to
basically surrender. Japan’s predominance of its home business sector gives it immense unreasonable focal points in
the US and different markets where we contend. Leaving this circumstance unchallenged influences
our own particular assembling aggressiveness here in the US, more emphatically than securing access to their car market. Toshiyuki Shiga is in denial or just blowing smoke but either way he is lying and he damn well knows it. So there!!
As Ogden Nash once described the Japanese mind set back in 1937, “How courteous is the Japanese, he bows and says excuse me please. He climbs into his neighbor’s garden and bows and says ,”I beg your pardon. He bows and grins a friendly grin and calls his hungry family in. He grins and bows and friendly bow and says, “So sorry this my garden now…” It may not be quoted directly since I did it from memory but this close enough is all that matters to make my point. :)