Japanese marques showing signs of comeback

Honda is hoping to achieve a jump in sales by introducing an unprecedented lineup tailor-made for the Chinese market through its two joint ventures at the Shanghai auto show.

Zhu Linjie, spokesman for Honda's Chinese operations, said the new lineup it released in May will help to drive sales.

Responding to demand

Some industry insiders said that the decline of Japanese brands predated the Diaoyu Islands disputes and has more to do with the failure of the brands' portfolios to adequately reflect market demands.

Feng Xingya, executive deputy general manager of Guangqi Toyota, said the joint venture's major products are the mid-sized sedan Camry and the Highlander SUV, whereas compact and small cars only account for some 10 percent of the lineup.

Sales of small and compact cars in the country have doubled in recent five years, making this segment one of the country's most lucrative. German brands have already gained a stable foothold.

To capture this segment, Guangqi Toyota premiered two small cars - the Vios and the new Yaris - at the recently concluded Shanghai auto show.

By 2015, sales of small and compact models will account for 40 percent of the company's total, Feng said. It will continue to introduce new mid-sized cars to the market in the near future.

But Zhu denied that poor sales were related to the lineup and contended that the main reason is the territorial disputes.

Zhu said he is confident that Honda's sales will continue to recover throughout the year's end as tensions over the issues ease. Lin with IHS said that the sales fluctuation will continue in a relatively long period because political elements will continue to affect attitudes toward Japanese vehicles in China.

He also said it is not likely that Japanese brands will regain their market share they held before the dispute.

"Actually, even without the disputes, we have had low expectations for the market share of Japanese brands in China, considering their product portfolios in the country."

He said now the automakers have realized the importance of adjusting the lineup and are bringing more top products to the country.

"So sales volume will continue to increase," he said.

According to local media reports, Toyota's target for this year is to breakthrough the 900,000-unit benchmark by increasing 7 percent of its sales. Nissan aims to reach 900,000 units by growing 16 percent. Honda projects it will increase sales by 25 percent to 750,000 units.

Statistics show that in April, there were no Japanese brands among the top 10 automakers by sales in China.