Toyota and Honda both reported sharply lower sales in China in September after anti-Japanese sentiment flared up over a territorial dispute between the two countries. 

Japan last month ‘nationalised’ a group of tiny islands in the East China Sea – known as Senkaku in Japan and Diaoyu in China. The islands for years have been controlled by Tokyo but are also claimed by Beijing.

The move provoked violent anti-Japanese demonstrations across mainland China last month, which resulted in a number of Toyota and Honda dealerships burnt down and Japanese cars on smashed up in the streets.

Toyota said its sales in mainland China fell 49% year on year to 44,100 units in September while Honda reported a 35% drop to 76,100 units. Last week, Mitsubishi said its sales fell 63% while Mazda reported a 36% volume drop.

By contrast, data from the China Association of Automobile Manufacturers (CAAM) showed the overall market declined by just 1.8% to 1.62m units in the same month.

Strong anti-Japanese sentiment is clearly discouraging Chinese buyers from choosing Japanese brands. Japan’s automakers have responded to falling orders by cutting back production. Sales are not expected to improve significantly in the short term while the dispute still unresolved.

JAPAN: Japanese big three halve China production