Commercial Fallout from Japan’s “Purchase” of DiaoyouTai: No One Anticipated China Would React the Way It Did

Some of the commercial fallout from Japan’s ‘purchase’ of the DiaoyouTai.

In total, the lost sales for Japanese firms in China, in the July to September period, would appear to total in the billions of dollars. Most corporate officials and industry analysts say it will be a long time before sales of Japanese goods return to their prior levels.

Auto Manufacturing 

Japanese media reported that Mazda and Mitsubishi had a sales drop of almost 65%, Toyota sales fell by more than 50%. Nissan also had much weaker sales during the periodm but refused to provide specifics.

Overall, Japanese car sales in China dropped by 50%, and all Japanese auto makers suspended marketing campaigns and closed their factories. Even insurance companies have stopped selling insurance on Japanese cars.

Tourism and Travel

Japan Airlines and Nippon Airlines had more than 60,000 cancellations on their Japan-China routes for September to November.

Toyota dealerships in Beijing warned customers not to park their cars in unsecured areas and urged them to affix patriotic slogans to their vehicles

Numerous bilateral Chinese-Japanese cultural events also were cancelled.

More than 70% of bookings from China were cancelled in September, and the figures will be higher for October. the numbers are not going to improve in the near term.

For many Japanese tours and tour companies, more than 90% of Chinese bookings have been cancelled. Hotels and retail shops have experienced the same degree of business losses.

After the earthquake and tsunami, Japan needed 6 months for tourism to begin to recover, but this time it will take longer to return to normal.

Consumer Products

Sharp electronics cancelled a major marketing event, and Sony cancelled a long-planned series of new TV ads.

Sharp’s Chinese market share dropped by 50% and Sony’s by more than 20%. Panasonic dropped to only 0.4%, and Toshiba, Sanyo and other Japanese manufacturers saw their combined market share dropn to less than 1%.

Guangzhou Gome saw its Japanese consumer goods sales drop by more than 50%. Panasonic, Toshiba, Sanyo, Sharp, and Sony have become second-tier brands.

And the declines are not only in China. According to news sources, the Japanese electronics manufacturers have seen their worldwide sales drop by 77%, while China’s sales have increased by about 15%.

Sony, Sharp, and Panasonic have suffered huge financial losses. Some analysts are saying that the Japanese home appliance industry is dead.

Industry analysts have stated that “Now for the Japanese plants, how to appease their Chinese employees’ mood is also a problem.”

And Tokyo’s assessment of the situation? 

“No one anticipated that China would react the way it did. Everyone is now seeing the risk of doing business in China.”

Right. The risk of doing business in China.








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