Last year, Japan lost its position as the world’s third largest single car market. As a mature market, its sales are not as dynamic as those coming from big emerging markets such as India, the new number 3. Total passenger car sales dropped by 7% to 3.72 million units. Following the trend in many other markets, the Japanese results for last year were far away from the pre-pandemic levels, which in the case of Japan they were around 4.3 million units per year.
While the world continues to talk about the latest measures taken by the new Trump administration to protect its local market, the case of Japan shows an extreme case of protectionism. In Japan, 94% of the car sales are done by the local makers. Although the market is open to imports, the regulation and taxation make these cars not competitive at all.
Toyota is of course the leader with almost 1.53 million units sold. It lost market share to Honda and Suzuki. All of these Japanese makers make use of the fiscal benefits to the kei-cars. As they are only available in Japan, the foreign companies don’t have access to this peculiar segment and source of sales.
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