Japan's Auto Makers Focus on China -- WSJ
August 28 2018 - 3:02AM
Dow Jones News
By Sean McLain
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (August 28, 2018).
TOKYO -- Nissan Motor Co. said Monday it has started producing
its first made-for-China electric car, leading a wave of electric
vehicles planned by Japanese makers looking to boost sales in the
country.
China, the world's biggest car market by sales, is becoming a
critical part of Japanese companies' growth plans for both
gasoline-powered and electric vehicles, while uncertainty clouds
their U.S. business because of possible tariffs by the Trump
administration on imported cars and car parts.
Nissan said its joint-venture factory in southern China started
making a battery-powered version of the Sylphy compact, its
best-selling vehicle in the country. (The car is known as the
Sentra in the U.S.) A lower-priced electric model is set to follow
next year, and by 2022 Nissan plans for about a third of its China
sales to be battery-powered vehicles.
Nissan and its Japanese competitors Toyota Motor Corp. and Honda
Motor Co. are collectively introducing more than a dozen
battery-powered vehicles in China in the next few years, and they
are also stepping up production of conventional gasoline-powered
cars.
The U.S. is still the most important market for Japan's big
three, but China is closing the gap. Nissan sold 1.59 million cars
in the U.S. last year, and 1.52 million in China. Toyota sold 1.29
million vehicles in China last year, compared with 2.43 million
vehicles in the U.S. At Honda, China represented 28% of global
sales last year, behind 30% for the U.S.
Car makers need to boost production of plug-in vehicles to keep
growing in China. Next year, Beijing will start mandating that a
certain percentage of vehicles produced in China be electric.
In June, Nissan said it would add an eighth factory in China,
taking over an existing factory owned by Chinese joint-venture
partner Dongfeng Motor Group Co. The plant will produce about
120,000 Nissan vehicles a year.
The production expansion is part of the Yen1 trillion ($9
billion) that Nissan and Dongfeng have said they plan to spend in
China through 2022. Much of that spending will go toward boosting
manufacturing capacity by around one million units, a Nissan
spokesman said.
Toyota has said it plans 10 electric and plug-in hybrid vehicles
in China by 2020. The company has ambitious growth targets in
China, hoping to increase sales there to 1.4 million this year. To
do so, it needs to expand local production. Toyota can produce
about 1.2 million vehicles in China.
A construction tender posted this month on a government website
in Tianjin, where Toyota produces its Corolla sedan and C-HR
compact sport-utility vehicle with a local partner, said the
company was planning to spend around $258 million to expand the
plant to build 120,000 electric vehicles and plug-in hybrids.
Toyota's other Chinese partner, Guangzhou Automobile Group Co.,
said Toyota was planning to spend around $390 million to expand an
existing plant that produces the Camry and a version of the
Corolla.
Honda said in April it would introduce a new electric-vehicle
brand called Everus for Chinese customers. The first Everus model
goes on sale later this year.
Yoko Kubota in Beijing contributed to this article.
Write to Sean McLain at sean.mclain@wsj.com
(END) Dow Jones Newswires
August 28, 2018 02:47 ET (06:47 GMT)
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