Shanghai Daily reported that Toyota Motor Corporation's China sales fell just over 40% YoY in September 2012 from the year before, while those of rivals such as Hyundai and BMW jumped, underscoring how badly Japanese brands have been hit by a row between the two countries over the Diaoyu Islands.
Showroom traffic and sales have plunged at Japanese car makers since anti Japan protests and calls for boycotts of Japanese products broke out across China in mid September 2012 over the Japanese government's purchase of the islands in the East China Sea.
A prolonged sales hit of this scale could threaten profit forecasts at Toyota, Nissan Motor Co and others as China, the world's biggest car market, makes up a bigger portion of their global sales. Toyota sold about 50,000 cars in China in September 2012.
That would be down from about 86,000 in September 2011 but better than the figure reported earlier by Japan's Yomiuri newspaper, which said sales halved from the 75,000 sold in August 2012.
The dramatic fall off in demand for Japanese vehicles has been an unexpected boon for other foreign brands, with South Korea's Hyundai Motor Co saying that its China sales climbed 15% to 84,188 vehicles last month.
As demand evaporates, Toyota, Nissan, Honda Motor Co and others have been forced to cut back production in recent weeks in a slowing, but still promising, Chinese market.
A source said late last month that Toyota's production cutbacks could extend through November 2012, a move that would almost certainly put the company's goal of selling 1 million cars in China this year out of reach.
Anti Japan sentiment across China escalated last month amid the row over the Diaoyu Islands. Demonstrators vandalized properties of some Japanese companies, including a Toyota outlet in the eastern city of Qingdao that was torched.
Japanese carmakers have been the most visible losers, although there have been signs of the tensions affecting other sectors, with All Nippon Airways Co Ltd saying late last month that it had seen a wave of cancellations on Japan China routes.
Semiconductor maker Rohm Co Limited forecast a decline in orders for the second half of the budget year ending in March 2013, citing significant weakness from Japanese automakers.
Source - Shanghai Daily