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Japan car sales in China tumble, hit by islands row

Japan car sales in China tumble, hit by islands row

Tuesday, October 09, 2012, 14:51 GMT+7

BEIJING – Japanese car makers reported tumbling sales in China for September, confirming the impact of a territorial row between the two countries and raising concerns that their market share in the world's biggest auto market will continue to shrink.

A Toyota Motor Corp spokesman said on Tuesday that sales in China fell 48.9 percent in September from a year earlier, while Honda Motor Co reported its sales in China fell 40.5 percent.

Nissan Motor Co's China auto sales, excluding imports, fell 34.6 percent in September from a year earlier, according to its China venture partner Dongfeng Motor Group Co , and Suzuki Motor Corp said sales to dealerships in China fell 42.5 percent last month from a year earlier.

Violent protests and calls for boycotts of Japanese products broke out across China in mid-September after Japan bought two of the East China Sea islands, known as the Diaoyu in Chinese and the Senkaku in Japanese, from their private owners.

Analysts say sales could continue to weaken as long as the diplomatic tension remains.

"We had cut our 2012 sales forecast of Japanese cars by 100,000, but it seems to be way too conservative now," said John Zeng, Asia Pacific director for industry consultancy LMC Automotive.

"We had previously expected them to sell 3.04 million, but it will be great if they could move 3 million."

Toyota and its two local Chinese partners sold a total of about 44,100 vehicles in September, the company's Beijing-based spokesman Takanori Yokoi said.

For the first nine months of this year, sales by Toyota and its partners totaled about 640,200 vehicles, up 4.6 percent from the year-ago period, Yokoi said.

Smaller rival Mazda Motor Corp said last week that its China sales tumbled 35 percent in September from a year earlier.

Among the Japanese carmakers, Nissan is the most exposed to the Chinese market, followed by Honda and Mazda.

In 2011, Nissan sold 883,000 vehicles in the world's biggest car market, which accounted for about 27 percent of the vehicles the firm sold globally. For Honda, that ratio was about 20 percent, while for Mazda, it was around 18 percent.

For Toyota, Japan's biggest automaker, China accounted for about 12 percent of the vehicles it sold globally in 2011.

Market share of Japanese brands stood at 21.2 percent at the end of August, down from 21.6 percent in 2011, according to official data. German brands advanced to 23.3 percent from 21.3 percent, while market share of Korean brands rose to 9.3 percent from 9 percent during the period.

The dramatic fall-off in demand for Japanese vehicles has been an unexpected boon for other foreign brands. In September, BMW's China sales surged 55 percent, Audi by 20 percent and Hyundai Motor by 15 percent.

Reuters

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