The Real Reason Why Japan Prefers Foreign Cars Over American Models

Strategic Insights -

The Japanese market's preference for foreign cars over American models is often attributed to non-tariff barriers and a closed market. However, the reality is that the main issue lies in the design of American cars, which are suited for the US market but fail to cater to the needs of Japanese drivers. The majority of American cars sold in Japan have their steering wheels on the left side, making them difficult to drive in countries where cars are driven on the left and steered on the right.

Key Takeaways:

  • Japan sold 2.7 million cars in the US market last year, taking a 30-per-cent share, largely due to the prevalence of right-hand-drive vehicles.
  • Out of 70 different Japanese models sold in the US, every one has the steering wheel on the left side, which is unsuitable for drivers in countries like Japan and Britain.
  • American car manufacturers, including GM, Ford, and Chrysler, have only sold a small number of left-hand-drive cars in Japan, with a total of fewer than 22,000 units sold in 1994.
  • In contrast, Japan sold over 2 million right-hand-drive vehicles in the US market last year.
  • The Jeep Cherokee is the only American car model widely available in Japan with a right-hand-drive option, with over 11,000 units sold in 1994.
  • Britain, a right-hand-drive country, saw sales of only 11,200 US-made GM, Ford, and Chrysler cars last year, mostly right-hand-drive Cherokees and Probes, which accounted for just 0.6% of the market.

Statistics:

  • Japan sold 2.7 million cars in the US market last year, taking a 30-per-cent share.
  • Out of 70 different Japanese models sold in the US, every one has the steering wheel on the left side.
  • Total sales of left-hand-drive cars by American car manufacturers in Japan in 1994: fewer than 22,000 units.
  • Japan sold over 2 million right-hand-drive vehicles in the US market last year.
  • Sales of right-hand-drive Jeep Cherokees in Japan in 1994: over 11,000 units.
  • Sales of US-made GM, Ford, and Chrysler cars in Britain last year: 11,200 units, mostly right-hand-drive Cherokees and Probes.

Sources:

  • [The Economist]