Honda’s Accord model has not performed as well as hoped in China with sales of the vehicle there dropping 37% in the first five months of this year, according to Bloomberg News.

The Accord – which until three years ago was the top-selling midsized sedan in China – dropped to ninth place in April with the Volkswagen Passat and Magotan [a Passat derivative for China] taking the top slots.

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In late February, Honda launched a stripped-down Accord that started at about CNY180,000 (US$29,000), some $3,200 cheaper than the previous lead-in model but this still did not kick-start sales.

Bloomberg noted this illustrates the challenges Japanese makers face as German brands’ popularity rises – and the fall-out from a territorial dispute between China and Japan nearly two years ago continues.

As German brands have introduced more affordable models, sales of midsize Japanese sedans have fallen.

Seiji Kuraishi, the managing officer for Honda’s China business, said in April that the company had sought to compete with European and US carmakers.

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He told Bloomberg: “We realised it was a mistake that we didn’t understand customer needs well and didn’t have anything below CNY200,000.”

Five years ago, the Accord, Toyota Camry and Nissan Teana [aka Altima] represented four of every 10 mid-sized sedans sold in China, according to LMC Automotive. By last year this fell to two in 10.

The Accord’s market share fell to 6% last year, from 18% in 2008. Over the same period, the Camry’s share declined to 9% from 16% while the Teana fell to 6% from 10% in 2010 and 2011.

However, Honda’s overall sales in China rose 11% in the first five months, in line with sales growth in the country. China is expected to make up 19% of the Japanese company’s Honda’s global sales this year.