Japan-China Conflict Brings Profit to US Automakers image

The China-Japan dispute may cause a bigger loss to Japanese automakers than the 2011 tsunami.

Toyota, Honda and Nissan’s operations in China are at risk due to the increasing tensions and the late violent demonstrations between the two markets, caused by a group of islands claimed by Japan and China. After Japan reached an agreement to buy the disputed Sensaku (Diaoyu) islands, situated in East China Sea, the anti-Japan protests sparked.

Demonstrators became really violent burning auto showrooms and breaking into Japanese cars, they also attacked Toyota, Honda and Nissan dealerships in Qingdao. The automakers were forced to idle production in China foe several days to evaluate the situation. Cui Dongshu, deputy secretary general of China’s Passenger Car Association, expects Japanese automakers to lose their lead in China, over the Western brands for the first time since 2005.

“The repercussions for Japanese carmakers are very serious and will last for a long time. There are plenty of choices. Why bother with Japanese brands, if there are concerns of safety due to anti-Japan sentiment?”, he said.