The short answer: as a group, they are hanging in there but are slowly losing ground.
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Issue: Sep 2003


Windecker



The Other Japanese

by Ray Windecker

Subaru, Suzuki and Mitsubishi in the shadow of Toyota and Honda.

The movements of Honda, Toyota and Nissan are well documented in the daily press, yet oddly, the “other Japanese” are seldom mentioned, begging the question: how are these manufacturers doing?

The short answer: as a group, they are hanging in there but are slowly losing ground.

Mitsubishi, a long-time tie-in with first Chrysler and now DaimlerChrysler, is the share leader of the group. Their sales, however, are down 22 percent this year and they are slowly loosing share. Their exuberantly youthcentric ads and bottom-feeding retail credit policies have been abandoned as they move their identity more mainstream. Mitsubishi’s 10 major products are the most wide-spread of the group, quality ratings are well below average and the dealers move about 38 new vehicles per month. (As a reference for the group, Toyota and Honda average 100 plus per month.) Inventory procedures for many of the Japanese brands differ from long-established North American policies as the public data often does not include units in transit and/or units held at shipping lots. Therefore, estimates of Mitsubishis days’ supply run from 95 to 115. This is an outfit that is regrouping while seeking an identity.

Mazda, a semi-independent Ford affiliate, is number two on the volume list. While declining a bit this year, Mazda is holding share. Marketing executives have been in flux and the Zoom-Zoom ad campaign is being adjusted. Quality ratings are near average, ad dollars are spread across eight major product lines. Inventories run in the 85-95 days’ range. Dealers need the recently arrived RX8 and the upcoming Mazda3 plus redirected marketing, to revive consumer interest.

Subaru, with Fuji and General Motors ties, is a different story. Sales and share are growing. Concentrating on AWD and only four major products, Subaru is also pushing for more dealers since they are short of Mitsubishi and Mazda market-area coverage.

Quality ratings are at or a bit above average and monthly new vehicle sales per dealer are in the 25-30 range.

Subaru runs lean on national advertising while spending on concept and image vehicles is limited. Inventories are somewhat less than for Mitsubishi and Mazda.

Subaru, like the others, is in a rebuildingas- leaner mode. This is now a local-effect, concentrated offering, narrow-vision outfit that is making gains.

Suzuki is a limited-offering, low volume, considerably below average quality, limited dealer count, low sales per dealer and short on ad dollars operation, yet they tenaciously hold market share. Suzuki is currently pushing and paying dealers to spruce up and modernize. Daewoo sedans rebadged as Suzukis are on the horizon, courtesy of General Motors. Suzuki is a dealer-based brand that needs bolstering from GM for an effective product lineup.

Isuzu, having given up the car market, has lost half it’s 2001 market share and is still on the downslope. Quality is below average, per dealer new-vehicle sales are in the miniscule sub-10 per-month area and are spread thinly over five light trucks and a variety of cab over engines (COE) and mediums. These bigger-than-light cargo trucks, many assembled in GM plants, are important to the brand as they outsell all lines but the Rodeo SUV. Total inventories, at dealership, in transit and on receiving lots are usually in the 100-plus days territory. Isuzu is struggling to change to and live on a trucks-only diet.

Hino, controlled by Toyota, is an enigma even though roughly 1,000 Hino large tucks will be sold here in 2003. Little information has been released by the company, although one executive provided the following information: Hino currently sells only COE, diesel-engined medium/heavy trucks through 80 U.S. dealerships, with at least one dealership in every state. Currently imported, assembly of an additional conventional long-nose will begin in Long Beach, Calif., in 2004, assembled from imported cab, engine and electronics, with frame and running gear from traditional U.S.-based suppliers. This operation looks like another Toyota stealth market-entry program.

Overall, the “other Japanese” operating in the United States are a numerous, often marginal, thinly spread, often low-quality, mixed bag of cars and trucks, most seeking a market and/or an identity other than simply being Japanese. It is doubtful that even the best of the other Japanese could survive in the U.S. on their U.S. sales and/or production if they were not supported as a slice of one of the Japanese-American-European multinationalistic efforts of past years that were often naively envisioned as entries into the Japanese market for their vehicles as well as their money. To the domestics, now operating in a fierce multinational world, the “other Japanese” are both the competition and themselves.

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