Why Ford And Other American Cars Don’t Sell In Japan

When it comes to

cars

, Americans seem to love the Japanese. But the Japanese don't seem to like the Americans. Japanese brands

sell

remarkably well in the United States. Several of the best-

sell

ing automakers in the United States are from Japan, and their products seem to dominate entire segments in sales and critical acclaim. Japanese automakers sell so many

cars

in the United States that they actually employ large numbers of American workers in factories across the country. Japanese automakers actually build a third of all vehicles made in America, but the Japanese don't seem to be interested in SUVs, pickup trucks, sports cars, or just about any vehicle made in Detroit.

Ford left Japan entirely in 2017. General Motors maintains a presence there, but it's small: The largest U.S. automaker sold just 700 cars in Japan in 2018. And people are divided over why and what's owed. to do about it, if anything should be done. . President Donald Trump has criticized the imbalance, but so have American automotive trade associations, which blame Japanese protectionism. While there are no Japanese tariffs on American imports, several critics say there are all kinds of technical barriers that make it difficult for American companies to sell in Japan. Here in the United States, when we set regulations for fuel economy or safety or communications standards or whatever, every automaker that sells and produces in the United States is part of that conversation.

In Japan, it is a much more closed process for regulatory compliance. It's "these are the rules and you will follow them." Japanese producers and suppliers are involved in that, but it's pretty closed to any outside companies doing business there. But some industry experts say that's not really the problem. Instead, the reasons American cars are so rare in Japan, which is the world's third-largest car market, have more to do with the tastes of Japanese consumers, the persistent if outdated stereotypes that the Japanese have. about the quality of American cars and the very different ways customers buy vehicles in Japan.

First of all, it is important to note that Japanese brands almost completely dominate local roads. More than 95 percent of all cars sold in the country are Japanese. Imports make up the rest and most of them are high-end European sports and luxury vehicles. This is partly because the Japanese have quite specific needs. For one thing, the space is incredibly tight. Very popular in Japan are the so-called Kei cars, which are small vehicles preferred by drivers who have to make their way through narrow streets and crowded cities. Kei Cars alone account for 40 percent of the Japanese market and are not made by American automakers.

Americans, on the

other

hand, tend to excel at making large vehicles, particularly pickup trucks and large sport utility vehicles. In recent years, American automakers have reduced or even completely eliminated their own lines of compact vehicles, which often remain larger than their Japanese counterparts. In fact, many of the Japanese vehicles sold in the United States (from sedans like the Toyota Camry to pickup trucks) aren't even particularly popular in Japan. The three Detroit automakers have less than 1 percent market share. One of the best sellers, Jeep, sells around 10,000 vehicles a year in Japan. The experience of buying a Japanese car would probably also surprise many Americans, who often view a trip to the dealership as one of life's necessary evils.

Much of Japanese business culture is based on service and hospitality, and car dealerships are no exception. Japanese dealers offer their customers almost white-glove service, and the way buyers choose cars is completely different from the traditional buying experience in the U.S. While American buyers often choose a car from among that are available on a dealer's lot, Japanese buyers can often custom-build them. a car out of a catalog and then order it in a matter of weeks. A strong local supply chain and local factories allow Japanese automakers to do this. Furthermore, the quality of service is usually quite high.

Dealerships often have services such as coffee shops and complimentary car washes. They will also follow up with customers, sometimes even years after the purchase. In general, foreign automakers have had difficulty adapting to this way of selling. Additionally, the Japanese have long had a perception that American cars are inefficient and unreliable. This somewhat dated view originates from the decades between the 1960s and 1980s, when Japanese brands were ascendant and American automakers were plagued by criticism and scandal over vehicles such as the Chevrolet Vega, AMC Gremlin, Ford Pinto and the Chevrolet Corvair. And although U.S. manufacturers have made much more fuel-efficient engines in recent years, the United States has historically made some vehicles that are gas-guzzling compared to cars made elsewhere.

Yes, I think there is a hangover for American vehicles. You know, what does an American car say about you in Japan? That baggage is carried with it. Meanwhile, the Japanese rose to power in the auto industry largely thanks to their reputation for making solid, efficient cars that don't break down. Of course, many observers point out that American cars have done a lot to close the reliability gap over the years, and cars in general are capable of many more miles on the road than they were a decade ago. And American automakers insist they would be better able to compete in Japan if the country removed barriers that make doing business difficult.

The problem for Detroit is that Japan is just one of the international markets where American automakers have struggled. The three Detroit automakers have had challenges in South America and Europe. While China, which is the world's largest auto market, could become a more difficult place to do business due to slowing economic growth, increased competition and trade disputes. If something doesn't change, American automakers could become just that: American companies that sell pickup trucks and SUVs to Americans.