It’s Not Tariffs or Protectionism That Sink American Cars in Japan…

Japanese cars gradually overcame the stigma of being low-quality, unreliable trash piles after entering the U.S. market decades ago. Imports became commonplace during the 1970s and Japan’s cars began setting the new benchmark for automotive quality while Ronald Reagan was in office.

The inverse can be said of American cars being sold in Japan, and it’s a well-documented and long-running annoyance for the American automotive industry. In January, a frustrated President Donald Trump complained that Japan does “things to us that make it impossible to sell cars in Japan, and yet, they sell cars [in the United States] and they come in by the hundreds of thousands on the biggest ships I’ve ever seen.”

Though the statement could be taken as contentious, as Japan does not impose any tariffs on U.S. cars, the country also exported 1.6 million vehicles to the States while America sold fewer than 19,000 back in 2015. Something is definitely amiss, and while it might not be as simple a reason as Japan hating our cars, that’s still a large part of it. 

“Of course American cars don’t sell in Japan,” says semi-retired music producer and American automobile enthusiast Yoshihiro Masui.

“American cars have a bad image — they aren’t fuel-efficient, they break down,” he explained to The New York Times. “That’s not really true anymore, but dealers don’t make an effort to convince people. I’ve never seen a TV commercial. You go to a car show, they’re not there.”

Having little to no presence on Japanese roads doesn’t help that image problem, either. Last year, American cars only made up 0.3 percent of the Japanese market. The vehicles that are sold tend to be large, image-enhancing SUVs (Cadillac Escalade, Lincoln Navigator) or brawny American muscle cars. It’s a similar story for German imports, though Mercedes-Benz and BMW are viewed as unique luxury items and typically sell at a substantially higher volume. Many Japanese customers actually prefer left-hand drive cars to further push the idea of owning something unique, especially when they are buying German.

Price is another issue. American imports may not be subject to tariffs but a weaker yen isn’t helping a Dodge Charger that shows up in Tokyo at nearly double its domestic price — an issue former Chrysler Corp. chairman Lee Iacocca was critical of decades ago.

“I wouldn’t mind driving American cars if they didn’t need maintenance for a year,” said former diplomat Kunihiko Miyake to Bloomberg. “Cost-performance-wise, American cars are not good. That’s why I don’t buy them, not because of the nontariff barriers.”

Even with today’s smaller, more reliable, and budget-conscious models, U.S. automakers would still have to spend a fortune on improving public perception and ten times that establishing dealer networks in the Land of the Rising Sun. Even that wouldn’t assure success, though. It has been suggested that the country may not want too many foreign cars there, precisely because they are foreign.

Meanwhile, not quite two thousand miles away from Japan, Chinese consumers are becoming increasingly more interested in American brands. With a billion extra people and a willingness to buy from foreign automakers, China seems like a much more lucrative place to focus North America’s export efforts than the Pacific Islands.

Japanese Prime Minister Shinzo Abe will be meeting with President Trump on Friday to discuss the U.S. withdrawal from the Trans-Pacific Partnership and make a case for Nippon as an automotive trading partner.

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