Chrysler Expands in Japan, but Faces Challenges

Strategic Insights -

Chrysler's sales in Japan have surged, with over 13,000 vehicles sold this year, mostly Jeeps. However, the company still lags behind Japanese brands, with imports accounting for less than one-half of 1 percent of Japan's market. Jerry K. Hsu, Chrysler's new sales and marketing executive in Japan, aims to recruit new dealers and ensure existing ones are selling Chrysler products effectively. Despite a successful new right-hand-drive Jeep model, Chrysler's sales are still minuscule compared to Japanese brands.

Key Takeaways:

  • Chrysler's sales in Japan jumped to 5,700 vehicles in 1993 from 1,600 in 1992, according to the Japan Automobile Importers Association.
  • Sales are expected to more than double to 13,000 vehicles this year and reach 20,000 in 1995.
  • Imports of passenger cars from Detroit's Big Three grew 37 percent in 1993, despite a 5.7 percent contraction in Japan's overall market.
  • Chrysler has tripled the size of its Japanese office to 17 people, with Jerry K. Hsu as the first sales and marketing executive to head the company's Japanese office.
  • Chrysler was reluctant to invest in right-hand-drive Jeeps, but has introduced a version with a 30% price cut to about 3.7 million yen (around $36,000 at current exchange rates).
  • Chrysler plans to introduce a right-hand-drive version of its Neon subcompact car in early 1996, as well as a new mini-van and luxury Grand Cherokee.
  • American vehicles designed for Japan will sell if they are attractively priced, according to Japanese officials.

Statistics:

  • 5,700 vehicles sold in Japan in 1993, up from 1,600 in 1992.
  • 13,000 vehicles sales expected in 1994, up from 1993.
  • Sales of 20,000 vehicles expected in 1995.
  • 37% growth in imports of passenger cars from Detroit's Big Three in 1993.
  • 5.7% contraction in Japan's overall market in 1993.
  • Less than one-half of 1 percent of Japan's market accounted for by Big Three imports.

Sources:

  • "Chrysler's sales surge in Japan, but company still lags," USA Today, 1994.
  • Japan Automobile Importers Association, "Vehicle Import Data," 1993.
  • Associated Press, "Chrysler sales have surged recently in Japan," 1994.