Association, Inc.

Issue No. 2, 2011

European cars in Japan

by Peter Nunn

From time to time, when Europeans talk about Japan, the view comes up that Japan is some kind of special or exclusive market compared to others, especially when it comes to cars.
You don’t have to spend too long in Tokyo however to wonder if that exclusivity tag really stands up.  Along with the many Nissans, Toyotas and Hondas you see plying the roads, you’ll also encounter a fair few Mercedes, BMWs and Audis as well, especially in the more fashionable areas of town, like Aoyama, Ginza and Omotesando.

Indeed, a walk through the parking area of one of the top department stores, like Ginza Mitsukoshi for instance, will reveal one European luxury car after another quietly waiting its owner.  In the Kagurazaka district of Tokyo where I live, we have three BMWs in my road, a couple of Mercedes, a Jaguar, two VWs and even at one stage, a Maserati, to keep the various Prius’ and Accords company. So much then for the claim that the market in Japan is somehow exclusionary.

Japan, it’s true, has long been one of the most sophisticated markets for top luxury goods, a place where “brand” exerts a strong emotional pull.  This in turn carries over to the world of cars where, despite the vast array of offerings on hand from Japanese domestic makers, European cars still have their place and are in demand, thanks to their design, badge and image.

From the charm of a tiny Made-in-Italy Fiat, for instance, to the urban cool of a UK-manufactured Land Rover, to the hi-tech excellence of a German-built Porsche, European cars have their own DNA.  They set you apart and say something different.

As far back as the '80s, in fact, Japan has been a thriving market for cars like the VW Golf (still Japan’s best-selling import), BMW 3-Series and Mercedes S-Class.  Then, as now, the German premium brands dominate the import sector, which might seem small in the grand scheme of things yet which still remains extraordinarily competitive with, new entries arriving from Europe almost by the month. 

Some numbers. In an overall passenger car market worth some 4.2 million units in Japan last year, European sales came to approximately 173,000 units, and of that latter total, 143,000 units were German-branded.  In the over 3.0-litre sector, with registrations totaling 94,000 units, German-sourced models accounted for 15,000 units out of the total 17,000 units share.
The secret of success?  With their long-term commitment to Japan in terms of sales and service, strong quality image and appealing model line-up, the German car makers have found the keys to unlock this supposedly 'difficult’ import market.  For French, Swedish and Italian manufacturers, Japan can also be a happy hunting ground, as Renault, Peugeot, Volvo and Alfa Romeo, among others, will tell you.

Simple, really.  With the right product, commitment and back up, the people will come...