{"id":1491107,"date":"2024-09-20T16:05:00","date_gmt":"2024-09-20T20:05:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1491107"},"modified":"2024-09-20T16:05:00","modified_gmt":"2024-09-20T20:05:00","slug":"chinas-collapsing-economy-adds-to-headwinds-for-japanese-automakers","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/chinas-collapsing-economy-adds-to-headwinds-for-japanese-automakers\/1491107\/","title":{"rendered":"China’s Collapsing Economy Adds To Headwinds For Japanese Automakers"},"content":{"rendered":"

China’s Collapsing Economy Adds To Headwinds For Japanese Automakers<\/span><\/p>\n

\n

By Momoka Yokoyama, Bloomberg Markets Live reporter and strategist<\/em><\/p>\n

Shares of Japanese automakers are finding no respite as China\u2019s deepening economic woes damp sentiment already weighed down by concerns over a US slowdown and a rebound in the yen.<\/p>\n

The three biggest in Japan \u2014 Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co. \u2014 slashed production in\u00a0China\u00a0as they lose market share to local manufacturers of electric vehicles and a slumping housing market weighs on domestic consumption<\/strong>. The companies relied on the world\u2019s largest automobile market for more than 16% of their sales in July.<\/p>\n

Automakers\u00a0worldwide\u00a0are seeing sales slump in China amid a sluggish economy and concerns the nation\u2019s producers will pose a competitive threat to incumbent names<\/strong>. A slight\u00a0improvement\u00a0in China\u2019s consumption during a major holiday this week from its pre-pandemic level did little to lift sentiment.<\/p>\n

\u201cChina\u2019s weak domestic demand will have a global impact, and that will be quite a terrible story for Japan too,\u201d <\/em>said\u00a0Tetsuo Seshimo\u00a0a portfolio manager at Saison Asset Management in Tokyo.<\/p>\n

<\/a><\/p>\n

Automakers are trying to adapt to the new landscape. Honda has\u00a0cut\u00a0jobs and paused production at plants in China amid an effort to trim inventories and work on a broader shift in strategy. Nissan\u00a0said\u00a0in June that it ceased production at a plant in Changzhou. That was preceded by Mitsubishi Motors Corp.\u2019s move last year to\u00a0suspend\u00a0local operations as car sales slumped and China shifted to electric vehicles.<\/p>\n

The effort may be too little, too late. Japan\u2019s automobile-related shares are down 17% this quarter, the second-worst performer of the Topix\u2019s 33 industry groups<\/strong>. Their index is headed for a sixth month of declines after Japan\u2019s auto exports to China plunged almost 31% in August from a year earlier.<\/p>\n

But growing optimism that the US will avoid a recession may help stem future losses after the Federal Reserve cut interest rates by 50 basis points in a push to preserve the strength of the world\u2019s largest economy. \u00a0<\/p>\n

An overwhelming majority in a\u00a0survey\u00a0of Bloomberg Terminal subscribers expect a soft landing for the US economy, with 75% forecasting that it will avoid a technical recession by the end of next year.<\/p>\n

Japan\u2019s three largest automaker get at least 39% of their revenue from North America, making it their biggest overseas market, according to data compiled by Bloomberg. \u00a0<\/p>\n

However, an economic slump in China isn\u2019t the only concern for automakers, said Saison Asset\u2019s Seshimo. China\u2019s growing auto industry may gradually take market share away from Japan\u2019s carmakers, causing them to suffer the same fate as the nation\u2019s appliance makers, he said.<\/strong><\/p>\n

Chinese automaker BYD Co. already\u00a0has\u00a040% of total EV volume in Thailand compared with Japanese brands at under 1%, <\/strong>according to Bloomberg Intelligence analysts\u00a0Steve Man\u00a0and\u00a0Joanna Chen.<\/p>\n

\u201cChinese companies are likely to go on offense with a pricing war abroad, potentially intensifying competition with the Japanese names,\u201d <\/em>said\u00a0Mamoru Shimode, chief strategist at Resona Asset Management.<\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nFri, 09\/20\/2024 – 12:05<\/span><\/p>\n

\u200bhttps:\/\/www.zerohedge.com\/markets\/china-collapsing-economy-adds-headwinds-japanese-automakers<\/a>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

China’s Collapsing Economy Adds To Headwinds For Japanese Automakers By Momoka Yokoyama, Bloomberg Markets Live reporter and strategist Shares of Japanese automakers are finding no…<\/p>\n","protected":false},"author":0,"featured_media":1491108,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[1],"tags":[],"class_list":["post-1491107","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","wpcat-1-id"],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pbimBl-6fU7","jetpack_featured_media_url":"https:\/\/bugaluu.com\/news\/wp-content\/uploads\/sites\/3\/2024\/09\/japan20automakers-b292IQ.jpeg","_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1491107","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1491107"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1491107\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media\/1491108"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1491107"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1491107"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1491107"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}