According to Reference News, as of August 6th, the July sales of new cars in China by Japan's three major car companies have all been released, with varying degrees of decline. Toyota Motor sold 143,400 vehicles, a decrease of 6.1% year-on-year. Honda sold 52,567 vehicles, a significant decrease of 41.4%. Nissan sold 47,102 vehicles, a decrease of 20.8%.
So far this year, Japanese car companies have not performed well in the domestic market. From January to June 2024, Toyota's cumulative sales in the Chinese market were approximately 784,600 vehicles, a decrease of 10.8% compared to the same period last year; Honda's cumulative sales of terminal cars in China were approximately 415,900 vehicles, a year-on-year decrease of 21.5%; Nissan's cumulative sales in China, including passenger cars and light commercial vehicles, were approximately 339,300 vehicles, a decrease of 5.4% year-on-year.
Kyodo News reported that Toyota and Honda have seen declining sales for six consecutive months, while Nissan has seen declines for four consecutive months. A spokesperson for Toyota attributed the low sales to increasing price competition centered around Chinese car companies.
According to the People's Daily, this year, electric vehicle companies have started a price war by claiming &#34;electricity is cheaper than gasoline&#34;, targeting the joint venture A-class sedans in the 70,000-100,000 yuan range, especially those from Japanese brands.
However, the dilemma faced by Japanese car manufacturers in the Chinese market cannot be easily solved by stopping price wars. Cui Dongshu, Secretary-General of the China Passenger Car Association, analyzed that on one hand, as the industry rapidly transitions to new energy vehicles such as pure electric vehicles, the market share of fuel vehicles is shrinking significantly; on the other hand, Japanese car companies are still weak in new energy vehicles, with some of their sales being diverted to Chinese domestic new energy vehicles.
Comparing the data of domestic manufacturers can better illustrate the difficulties faced by Japanese car companies.
According to the latest retail sales data from the China Passenger Car Association, in the narrow passenger car market in China, the cumulative sales from January to June this year were 9.839 million vehicles, a year-on-year increase of 3.2%. Among them, the cumulative sales of sedans were 4.482 million vehicles, a decrease of 1.6% year-on-year; the cumulative sales of new energy narrow passenger cars were 4.113 million vehicles, an increase of 33.2% year-on-year.
Facing a survival crisis, Japanese car companies have already taken a series of adjustment actions.
On July 26, 2024, the official WeChat account of Honda China announced that Honda China will optimize production capacity and accelerate electrification transformation. Specific measures include closing the fourth production line of GAC Honda with an annual capacity of 50,000 vehicles, and suspending production at the second production line of Dongfeng Honda with an annual capacity of 240,000 vehicles. Honda China stated that after the adjustment, Honda's total production capacity in China will decrease from 1.49 million vehicles to 1.2 million vehicles
In addition to the closure of some factories, there is also an expansion of electric vehicle production capacity. The new electric vehicle dedicated factory being built by Dongfeng Honda is scheduled to start production in September 2024, while the new energy factory of GAC Honda will start production in November 2024.
Substantial investments are also being made. Honda announced that it will invest ¥1.19 trillion in research and development expenses in the fiscal year 2024, a 23% increase year-on-year, with most of the expenses allocated to investments in electric vehicles.
Similarly, Toyota stated that in order to accelerate transformation towards a mobility company, it will add nearly ¥2 trillion in investments.
Internally, there are business adjustments, while externally, there is a focus on seeking cooperation and forming alliances for survival.
Recently, Japanese automakers Honda, Nissan, and Mitsubishi announced collaboration to enhance competitiveness in international markets such as China. In a joint statement, they expressed that there will be more synergies in the future, leading to the exploration of &#34;new business opportunities.&#34;
Honda and Nissan have already begun preliminary cooperation negotiations, and the recently signed memorandum of understanding marks the latest step in their collaboration process. This partnership will provide both parties with an opportunity to leverage each other's strengths, including various powertrain choices, and will help reduce research and development costs in the broader trends of electrification and automation

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TOYOF

The sales of the three major Japanese car companies in China have all declined, with Toyota, Honda, and Nissan all facing a downturn. Specifically, Toyota's sales dropped by 6.1%, Honda's sales plummeted by 41.4%, and Nissan's sales decreased by 20.8%. The main reason is the increasingly fierce price competition among Chinese car companies, and the sales of new energy vehicles from Japanese car companies are being diverted by Chinese domestic brands. Japanese car companies have already begun adjusting their strategies, with Honda implementing production capacity optimization and accelerating electrification transformation

- Japanese automakers Toyota, Honda, and Nissan experienced varying degrees of sales decline in China in July, with Toyota selling 143,400 units (down 6.1%), Honda 52,567 units (down 41.4%), and Nissan 47,102 units (down 20.8%). The overall performance of Japanese carmakers in the Chinese market has been lackluster this year.
- Factors contributing to the sales slump include intense price competition among Chinese automakers and the rapid shift towards new energy vehicles, where Japanese carmakers are facing challenges. The industry is witnessing a shift towards electric vehicles, impacting the market share of traditional fuel cars.
- In response to the crisis, Honda announced production optimization in China, closing certain production lines and focusing on accelerating electrification. Both Honda and Nissan are seeking collaboration opportunities to enhance competitiveness in international markets, aiming to leverage synergies and explore new business prospects.

China Finance Online

The three major Japanese car companies in China saw a simultaneous decline in sales, prompting industry giants to "band together for self-rescue."