Disputes over some islands in the Pacific between Japan and China have affected sales of Japanese automobiles in China. Rioting, anger, and violence toward the Japanese has prompted some Chinese to react hostilely toward Japanese cars and their owners, in some cases, leaving the owners severely injured. Anti-Japanese sentiment coupled with fear of violence and vandalism has removed some incentive to buy Japanese cars. In August, Japan’s automakers accounted for 15.2% of auto sales in China, a figure that has shrunk from 17.6% in July.
To help assuage Chinese car buyers, Japanese car companies have been making assurances of aid for vehicle repairs to customers injured in violence related to their vehicles and cash compensation for cars damaged by mobs.
But despite this disappointing news for Japan’s automakers, auto sales in China actually rose 11% in August, reflective of targeting more inland Chinese buyers. Looking forward Japanese carmakers may suffer in these largely untapped markets because they may not ingratiate themselves with buyers at this critical juncture.Sources: WSJ