#Japan

Jac Nasser, the former head of Ford, is warning that Australia’s car industry has passed the point of no return, and expects to see it die within the next few years.

The retreating yen allowed Honda and Mazda to report bigger profits for the last quarter of their April to March fiscal year. Now the two are faced with a new problem, one that will also be shared by its Japanese peers: Higher costs of badly needed foreign investments.

Folks who are not intimately familiar with the peculiarities of the European auto industry often call Renault a similar basket case as its French rival Peugeot. January through March, both are down in Europe, PSA (-15.3 percent) more than Renault (-8.3 percent), but the big difference is that Renault has a much wider international footprint. What’s more, Renault owns 44.3 percent of Nissan. This international footprint helps Renault solve problems in ways Peugeot can’t touch. For instance, by making Nissans.

As predicted by TTAC after Chinese demonstrations against Japan’s control of the Senkaku/Diaoyu islands turned into violence against Japanese cars and car dealerships in China, the matter turned into a severe sales setback for Japanese car companies in China, more severe than initially thought, or hoped . Also as predicted by TTAC, the islands did affect the sales of Japan’s carmakers more than the tsunami. Last Saturday in Shanghai, Toyota’s China chief confirmed that the pain would be felt at least through August. This was before he heard the really bad news.

The Avalon has been something of a caricature since it wafted on stage in 1994. The stretched Camry was low on soul, devoid of style and soft of spring. In short, it was the Buick that wouldn’t leave you stranded. Since then Toyota has struggled to divine a mission for their full size sedan, a problem complicated by the re-invigoration of the large sedan market by the American brands. In hopes of resurrecting sales numbers, which have slid to 25% of their 2000 year shipments, Toyota has injected something hitherto unseen in an Avalon: style. Is it enough?

In the past, Toyota had tried to resist the urges of the Chinese government to establish new joint-venture brands. The company also had been highly skeptical of the viability of the electric vehicle. All doubts have been tossed over board. Toyota launched two new brands and two new EVs in China.

The booths of Japanese automakers were mobbed today just like those of any other automaker at the Shanghai Motor Show. The action at the showrooms are a different matter. Sales of Japanese cars in China remain problematic more than half a year after rowdy crowds took to the streets last September to torch Japanese cars and showrooms. Sales of Japanese cars in China were down 14.3 percent in March while sales of U.S. carmakers were up 31.1 percent. Sales of German brands rose 24.6 percent.

Toyota does not expect to reach positive territory until August this year, Hiroji Onishi, head of Toyota’s China operations, told a small circle of reporters this morning at the Shanghai show. Asked why August, another Toyota executive quipped: “After previous riots in 2005 and 2010, it took half a year to recover. We figure, this time it might take twice as long.”

Now that the U.S. and Japan have agreed on a watered-down version of the Trans-Pacific Partnership trade negotiations (America will keep its beloved chicken tax for at least another decade, Japan will protect its rice farmers from the evils of cheap American rice,) negotiations between the EU and Japan about a trade pact are getting underway, with considerably less drama.

Honmoku street is a wide, tree lined avenue that bends through the southern “Naka” district of the city of Yokohama. Close by sits the massive port, the gateway through which so much of Japan’s industrial output is sent to the world, its tall cranes working ceaselessly and with no regard for human concerns like the time of day. Above it all the Yokohama Bay Bridge soars like a vision, lifting cars and trucks across the entrance to the harbor as effortlessly as it straddles the line between art and infrastructure. Although the massive bridge and its double decked feeder highways encircle the entire district, the sense one has on the ground is of open space and nature, rarities in the second largest city in Japan. In the midst of it all sits the classic American Hot-Rod shop, Mooneyes.

Ferrari abandons its trademark red for a limited-edition version of the California 30 convertible targeted at the Japanese market.

For anyone like myself – that is, a car fan who grew up in the 1990s and watched Japan’s sports cars disappear from the American market in one sudden swoop, news that Japan’s once mighty auto industry is being “hollowed out” might come as a shock. The cars that defined my youth – the RX-7s, Supras even the VTEC Honda compacts, are a distant memory. Most of what Japan offers on our shores are aimed at the mainstream, while at home, kei-cars and hybrids dominate the market.

A lot of the criticism leveled at Japan is that their focus on the mainstream market and alternative powertrains is what sparked their auto industry’s current malaise. But this is a superficial and fallacious assumption that supposes that the glut of superb Japanese cars in the 1990s is a baseline for our expectations of what a Japanese auto maker should be building and selling. In fact, it is an aberration that will never occur again.

Somebody Say I look like an old woman?

Yesterday I shared with you dear, reader, one of my favorite games, the $5000 Craigslist Fantasy Challenge and you responded with a lot of great cars. Today I thought I would step it up just one more notch and introduce you to that game’s Japanese cousin – the “Goo Game.” Won’t you come and pray with me?

Hydrogen does not seem on top of President Obama’s agenda, neither does it rank very high on Martin Winterkorn’s list of priorities, but it sure is popular in Japan. Japanese carmakers, led by Toyota, are targeting a 2015 launch of hydrogen cars.

Toyota also says they are the most energy-efficient.

They may not have western-style unions in China, but workers sure do strike. Workers at Honda’s transmission plant in Foshan, Guangdong Province, walked off the job on Monday after their pay increases weren’t as large as they had hoped.