As tense atmosphere over contested islands continue in China
San Francisco, CA -- (SBWIRE) -- 10/01/2012 -- Sighting the ever-growing uncertainty and tension between China and Japan over disputed islands, Toyota says it is cutting back production of Vehicles to its mainland neighbor.
Many other Japanese companies have made similar claims, and many companies including Toyota closed factories for several days while protests persist. Toyota has since reopened its factories again, but the output has been lower in most areas.
“We are adjusting production on a business-by-business basis, taking into account the present situation with orders and sales,” Toyota said, though it declined to give specific figures.
Toyota and other companies have been sitting ducks as the turmoil and rage bubbles into streets regarding the disputed Senkaku/Daiyou Islands. Attacks on Japanese-made vehicles have been televised.
The Japanese car industry had already been struggling for market shares as U.S. and European rivals ramped up efforts in Asia.
Japanese shares had fallen to 22.8% from 26% in 2009. German makers were able to outsell Japanese makers for the first time ever in August, when the Senkaku Island dispute began gathering momentum.
John Zeng of LMC Automotive in Shanghai stated, “With the introduction of a large number of high-tech Volkswagen vehicles in China, Japanese compact and mid-sized cars are being attacked by German or even Korean cars.”
Nearly 1 million sales had been predicted before the countries decided to have a showdown over the islands. Expectations now are beginning to be cut by as much as 20%.
The troubles could hit companies like Nissan the most. The company relies upon China. The declining sales environment lead to them declining to comment on the current production levels, saying only “The situation from October onward is still fluid,”
Japanese shipping companies have also noticed an effect, as the businesses report unusual delays at Chinese ports. China’s tourism bureau even issued a warning for Japanese planning on traveling to China. Japan airlines have already planned on cutting flights to Beijing and Shanghai.
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