Contrasting fortunes for Toyota, Hyundai across the Sea of Japan

Posted by: Ian Rowley on November 30, 2009

Last month, I blogged about Toyota opening for business in Korea. A little over a month later, for all Toyota’s woes elsewhere, sales are going well. In October, Toyota beat a (admittedly conservative) target to sell 500 Prius, Camry sedans and RAV4 SUVs each month in Korea, despite sales not starting until Oct. 20. As of today, Toyota said it had received orders for 6,600 vehicles. That means, subject to most of those orders being completed, the Japanese automaker has achieved its annual sales plan for Korea in less than six weeks. (The figures exclude Lexus, Toyota’s luxury marque, which has been on sale in Korea for several years).

Perhaps of more interest, though, is that Toyota’s hot start comes at a time when Hyundai is pulling out of car sales in Japan. The move ends an eight-year experiment which never came close to persuading Japanese car buyers to move out of their locally made cars in significant numbers. “Hyundai Motor has decided to suspend passenger vehicle sales in Japan and will instead allocate its resources to focus on commercial vehicle sales in the country,” the company said in a statement today.

Just as Toyota’s move into Korea makes sense, quitting passenger car sales in Japan looks a sensible move by Hyundai. While Hyundai, fueled by the weak won and impressive vehicles, has outpaced Japanese rivals during the global downturn, this year through October Japanese customers bought just 786 Hyundai cars (and one Kia). That’s better than 2008, but down from an annual peak of over 2,500 five years ago.

While many will blame protectionism, one problem in Japan is that over a third of car sales are 660cc mini-vehicles. That’s a segment in which non-Japanese carmakers, including Hyundai, choose not to compete. Another factor is that the Japanese auto market peaked in the mid-1990s and has been in decline ever since. And if all that isn’t enough, among Japanese car buyers that buy foreign vehicles, most prefer something European. Indeed, Ford is the only non-European carmaker that makes the top ten ranking of import marques. And while Ford ranks 10th with sales through October of 2,700, the top three of Volkswagen, Mercedes and BMW had combined sales of 76,000 during the same period.

Reader Comments

J

November 30, 2009 6:40 AM


just look at the video game market in Japan...Xbox360 is the best of the current game consoles, yet they have only sold a few hundred thousand Xbox360's in Japan compared to over 10 million each in USA and Europe.
Japanese people are still somewhat facist and live a bit like an ancient culture with the same disgust towards foreigner and women as they had during world war II. They are a very secular society.

http://www.businessweek.com/globalbiz/content/oct2009/gb20091021_165496.htm
October 21, 2009
" just 3% of sales in Japan were accounted for by foreign carmakers."


Why you buy Japanese car?? Did you know How Japanese cars have grown up until these days?
Japanese is a best “Selfish protective trade” country in the world. Japan export their goods to foreign. but Japan never want import anythings.
Yes, some people will say, i think the reason is these days foreign cars are not better than Jap car..But the fact is Japan had the selfish trade for the past 50years,and keep continuing,

Such as, GM, Ford, Hyundai ,we can see the in all of the world.
But in Japan there is no Hyundai, GM, Ford and foreign car company,
Even though other foreign car companies branched out in Japan, Japanese government and Japan car companies made unfair situation to foreign cars.

These days Japanese cars’development is because of their Selfish protective trade and fascist and racism mentality. and the money from world who bought Japanese cars.
I Hate Japanese cars, because i have Right reasons. Now it’s time to study about Japanese’ Selfish and fascist mind and their trade and
plz think about this problem before you sucking up the Toyota and Honda.

vicent

November 30, 2009 11:28 AM

Before criticizing Japanese, you better look at how foreign cars were doing in Korea auto market years ago. Korea is still blocking beef export.

john

November 30, 2009 11:50 AM

@ j:

Please, don't post here anymore. At least....not until you learn how to write in a way that somewhat resembles proper english.

d

November 30, 2009 12:11 PM

xbox? 10mils here vs hundred thousand in japan? dude, look at the CIA data for the population gap. dont be silly like the one whoever made the 300 movie an epic. i mean really? 300 guys defending thousands and thousands enemies? either way, it's a simple math, unless we talk about japanese buying 5 xbox each

i have to say, yes, they def dont treat foreigners well, well enough. i had lived there for 7yrs and after all, i still felt like an outsider.

as for cars, quality is the king! why dont we buy cars from gm ford and chrysler, instead watch them going down? coz they are not reliable. so if you dont even support those home-made cars here, why do you expect to see the ppl in japan buying them? on the other hand, performance is another way to look at this. everyone knows the asians are crazy about racing. when i say racing, i dont mean a car w/ 400+hp under the hood running straight line. you aint need skills. all you need is hit the gas as hard as you can. i mean you do have to make turns. and when i say making turns, i dont mean making only left turns like nascar. as far as i know, german made cars are doing well in japan coz they are well made and they very often outperform the japanese ones

ps

November 30, 2009 1:52 PM

J- I lived in Japan for several years. The mentality is the desire to buy local. Nothing wrong with that. Cars are status symbols and the expense of keeping cars (especially in Tokyo) is not a cheap proposition, between fuel, parking spots and shakens. Most of the sales are micro/mini cars that have an engine less than 1000cc's. If a car can be marketed to the masses like what Nissan, Daihatsu, etc do, it has to be a mini car. European success is based on image. Hyundai's compacts can not likely compete with the locals, but they tried.

LOL

November 30, 2009 1:56 PM

Another Korean company, Samsung pulled out of Japan in 2008. Japan is probably the only country that doesn't have Samsung LED TV's on sale. Everywhere in the world, Samsung is good enough, but not in Japan. Japanese are very loyal to their Japan made products, and don't like foreign made products unless they're very high end like BMW or Mercedes.

Tony

November 30, 2009 2:37 PM

As it seems is the case with the Japense in general, personally, I would also only buy Japanese or European cars. Korean/American are getting better, but it will take more time and effort to change their image to the point that it's better than Jap/European cars.

P.S. I'm neither Japanese nor European.

Anon

November 30, 2009 3:31 PM

J, I understand your opinion as an outsider(Probably a jealous Chinese or Korean, lol), but the fact of the matter is in Japan we appreciate the meticulous and rigorous way our cars and products are made, unlike the likes of Kia or Hyundai. No wonder no one buys them.

Also, your post is very weak as an argument, have you read the FT and their opinion on the ps3?

The Xbox 360 is to be honest an outdated console, everybody is talking about the PS3 or Wii and lets be honest, Microsoft only win on price point, nothing else.

At the end of the day, you can comment all you want but the reality is what it is, don't pretend china or korea is this new booming place, you can tell us so, but sooner or later we will find out, much like Dubai Inc LOL.

Ommm

November 30, 2009 4:22 PM


Simple explanation. Japanese have good taste. In my opinon Playstations and Wiis are cool and XBOX 360 a Bill Gates is not.
Toyotas and Lexus Honda is cool Hyundai and Ford is not.
Why would a Japanese person purchase something inferior??? Their friends will laugh at them.
Even a Korean would rather drive a Honda or a Hyundai.

be

November 30, 2009 4:32 PM

J, don't be ridiculous. How long u've lived in Japan to clam such a stupid selfish comment ?
u r too american, isolated all world, naked king and being too fat because don't do anything beside sit down, watch TV (maybe SONY?) and complain all the time.
I am very sad for u, man

Mark

November 30, 2009 4:55 PM

J, totally agree with you. For the same exact reason, Japan will never grow up to be a true global player, not even a truely independent county. Japan will be always taken cared by U.S. for ever.

mike

November 30, 2009 5:25 PM

It's not easy to sell to Japanese consumers, because its mature and sofisticated market.

Ben

December 2, 2009 2:02 AM

Japan is a feudalistic society with the democratic constitution dictated to them by the Americans. Any Japanese who buy foreign products had better be buying far better than what Japan has to offer or they will be shamed to death by family, friends and neighbors. This form of social ostracisation is most extreme in Japan.

Uncle Bobby

December 7, 2009 2:42 AM

Japan is a xenophobic, racist, protectionist country. Foreign companies find it incredibly difficult to sell there, not because of quality or price, but because of import tariffs, non-tariff barriers (regulations), and a culture that looks down on foreigners and foreign products. Korea and Japan aren't as bad in terms of attitude, but their governments have adopted the same protectionist policies to favor local industry. In other words, they don't compete fairly AT ALL. Individuals can be just fine, but their governments and industries collude in ways that really screw the American worker. I will NEVER own a car from any of those countries.

HAHA

December 13, 2009 5:38 AM

@Uncle Bobby: First of all, YOU probably never been to JAPAN so before you criticize JAPAN, why dont you research a little more? I've lived in Japan and the STATES, so I know why Japanese people prefer goods or product in Japan more than the US. Its because the AMERICANS are half ass, lazy, and they really dont care ABOUT their product. On the other hand, Japan has reached the top market due to innovation, monozukuri, team work and their strong DEVOTION towards WORK. As you know Japanese people WORK 24/7 literally (mon-sat) unlike Americans who only work 9-5. SO many Japanese people die or commit suicide because they work so damn much. QUIT talking and get your facts straight mr. BECAUSE you have no idea about JAPAN and what it has offered TO the US and GLOBALLY. Japan contributed so much to the us and abroad. Go to Toyota website and it will show you how much CSR they have. OH and also JAPAN donates money to THAILAND, CAMBODIA and EVEN to U.S. WHEN Bush was in charge, what happend to the economy? Talk about fairness-- in the U.S, they say 'capitalism capitalism' but look at the GAP they created for the rich and POOR. OH and Bobby, If you experienced racism in Japan, its because they view AMERICAN to be too damn COCKY. Have some respect.

Scipio

December 14, 2009 7:36 PM

Haha,

I've lived in Japan 16 years and I would say that a lot of comments about Japanese xenophobia, protectionsim and fuedalism is spot on.

Japanese might be in the office 24/7, but their actual productivity is really low.

Quality products, all of them, really? Even the Japanese have a saying called 'Sony Life' for the 2 years that one of their products will last, before it starts packing in.

However I find it rather ironic, almost laughable, that Koreans scream unfair about Japanese xenophobia and unfair trade pracices

james

December 17, 2009 4:24 PM

I really do not understand why it matters where a car is made? Just go out and drive what you want to drive. If you like a car buy it, if you do not then move on! The internet is full of opinions that mean nothing. I have driven cars from all over the world since 1985 and every one had it's own character. I have never owned a "bad" car but enjoyed the driving experience. Enjoy life and stop worrying what other people think about your wheels and the world will be a happier place!

ps

December 18, 2009 2:08 PM

Scipio, Yes SONY life is alive and well. The Japanese products for the domestic market have never been as bulletproof as their exports. And ditto on the work ethic, where zero defect mentality goes to ridiculous levels (can't write off that 1 yen difference on the 3 billion yen invoice so I'll spend a few days finding it). But, in spite of all the comments, Japan has always been welcoming to Americans. To Uncle Boby, in terms of the market being rigged, that's more the nationalism of the locals and, let's face it, a Chevy Cobalt is not going to knock a local subcompact off its perch. And Hummers might have a little trouble navigating side streets in Setagaya.

Steve

January 19, 2010 10:23 PM

Don't feel bad about Japanese not liking Korean cars or American car. Within 20 years the Japanese will have to start importing people because apparently they don't especially care for having their children either.

Steven

January 25, 2010 10:28 PM

The Japanese auto makers Toyota, Honda and Nissan were highly profitable right before the financial crisis. In my opinion , one of the major reasons is that the Japanese government manipulated Yen so that their big three could enjoy a very nice profit nationally and internationally. Correct me if I am wrong, I think this will come to an end or it has already met its end.

Jim

January 26, 2010 8:58 PM

Unlike most people who have posted here, I have actually lived in Japan. J is correct, they are a racist, xenophobic, dishonorable people. Period. End of story.

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