Toyota Motor Corp, the largest automaker in Japan by volume, has dropped to No. 3 amongst automakers from Japan in China, due to not having a presence in one of the key segments – a situation that experts now say will prevail beyond the first six months of 2018.
Through the end of October, Honda Motor and Nissan Motor both outsold fellow Japan automaker Toyota in the world’s largest car market.
Sales of Toyota through 10 months of 2017 were 1.07 million vehicles, in comparison to Honda’s 1.16 million sold during the same span. Nissan sold 1.17 million during that same period.
Experts in the car market in China believe the biggest cause for weakness by Toyota in sales is the lack of a small crossover SUV that others, in particular Honda, have used to help accelerate their growth.
Sales for Honda started growing rapidly and on a more consistent basis dating back to 2015, after two important subcompact crossover SUV reached the market late in 2014.
Though the growth in volume from the two models has decelerated of recent, Honda filled that gap with its redesigned Civic, amongst other models. The Civic started selling in China in April of 2016.
Toyota’s sedans, especially the hybrid version of the Levin and Corolla are selling well, said one auto expert in China, which would result in moderate growth for Toyota in 2017, as well as 2018, but the problem is a lack of presence in China’s hottest segment the crossover SUV.
If Toyota has its own crossover SUV similar to the XR-V and Vezel of Honda, it could generate an additional volume of more than 150,000 vehicles per year minimum, which would be incremental volume for the automaker since they currently do not offer any vehicle in that segment, said the car expert.
Advertising and marketing executives at Toyota said the gap in the product offerings of the automaker would not be addressed until the middle of next year.
Versions in the China market of subcompact CH-R crossover SUV could be in Chinese showrooms during June or July of 2018, said Toyota officials. The CH-R debuted in U.S. showrooms last April.
Toyota did not give a response when ask who was moving up and who was moving down in terms of sales ranking in China. A spokesperson for Toyota based in Beijing said that Toyota’s goal is to continue growing steadily in China’s vehicle market.