Nov. 23 (Bloomberg) -- Toyota Motor Corp. and Honda Motor Co., recovering from a consumer backlash in China, will continue to expand in the world’s largest auto market as their local venture partner said the worst is over.
Toyota will introduce 20 new models to China in the next three years, Senior Managing Officer Hiroji Onishi said at the Guangzhou auto show yesterday. Honda is guaranteeing buyers against damage due to anti-Japan sentiment, while Nissan Motor Co. said it is targeting to expand in smaller Chinese cities with its Venucia brand.
They are participating in their first major car show in China since large-scale, anti-Japan protests broke out in September over a territorial dispute that led to some cars being smashed and dealerships torched. The most difficult period has passed and people are calmer, said Zeng Qinghong, general manager of Guangzhou Automobile Group Co., which operates joint ventures with both Toyota and Honda.
“In 2013 Japanese brands will go all out to regain any lost ground encountered in the fourth quarter of this year,” Namrita Chow, a Shanghai-based analyst at industry researcher IHS Automotive, said. “This will mean new model launches, discounts and good service packages as well as an increased line up of models on offer to consumers in China.”
Guangzhou Auto’s shares rose 1.2 percent to HK$5.79 as of the midday break in Hong Kong trading, extending yesterday’s 4.6 percent advance that was the biggest gain in a month. The benchmark Hang Seng Index added 0.3 percent today.
Japanese automakers reported a plunge in China deliveries in September and October, as Chinese consumers shunned their cars after tensions escalated over the group of disputed islands known as Senkaku in Japan and Diaoyu in China.
Toyota showed 46 models at this year’s show in Guangzhou, expanding its exhibition space by 12.5 percent from last year. Honda, Japan’s third-biggest carmaker, displayed 23 models at the show, including the Fit hybrid compact, with plans to begin local production of hybrid models in China from 2014, according to the Tokyo-based company.
Showroom traffic at Nissan dealerships have recovered to last year’s levels while orders are at 80 percent, said Hideki Kimata, senior vice president at the carmaker’s Chinese joint venture, Dongfeng Motor Co. Nissan’s commitment to China hasn’t changed and the automaker wants to assure consumers that the brand is “safe and secure,” he said.
“Growth for Japanese brands will depend on how quickly the two countries solve the territorial dispute peacefully,” said Chow of IHS, which estimated that Japanese carmakers may suffer production cuts into 2014 and lose a combined 650,000 units in vehicle production if tensions don’t abate.
In contrast, Volkswagen AG and General Motors Co. said they aim to continue growing faster than the industry in China.
Volkswagen, which also owns the Skoda and Audi brands, is outpacing the industry growth rate as “every business, every brand is selling especially well,” China chief Jochem Heizmann told reporters Nov. 21.
“Next year’s growth won’t be at the past five years’ rate, but China will continue to grow, at a healthy, rational, mild growth rate which is better for the Chinese market’s development,” Jochem said.
GM’s sales in China may be lifted by gains in commercial vehicle deliveries and demand for passenger cars, said Bob Socia, the automaker’s China chief, in an interview at the Guangzhou show.
The company aims to keep its position as the market leader among foreign automakers in China and focus on promoting its Cadillac brand, sport utility vehicles and export business, he said. Volkswagen edged ahead of GM in the third quarter in China sales, the first time in eight years, according to data compiled by Bloomberg.
“We recognize that there’s some formidable competition out there, but next year should be a pretty good year,” Socia said. “What we want to do is continue to outstrip the growth in the industry and try to grab share along the way, as we’ve done this year.”
Marin Burela, president of Ford Motor Co.’s China joint venture, said 2013 will be a “red-letter year” for the automaker in the country as it competes in more vehicle segments.
“We will definitely sell more cars in 2013 than this year,” he said in Guangzhou. “We’ve now started to open up and enter into segments we previously did not compete in. We’re absolutely focused on the SUV market because it is a very fast-growing market.”
To contact the editor responsible for this story: Chua Kong Ho at firstname.lastname@example.org