Toyota and Honda picked a bad time to take their foot off the accelerator in China. As the global car market went into a financial crisis-induced tailspin in 2008, Chinese demand kept expanding, accounting for one-third of the industry’s total growth over the ensuing five years.
Last year, annual sales of passenger cars and minivans remained 9 and 14 per cent below their pre-crisis peaks in the US and western Europe respectively, and recovered to 2007 levels in Japan, according to automotive consultancy AlixPartners.
Meanwhile, sales in China’s market more than doubled to 18.6m, making it the world’s largest. “The downturn didn’t really happen in China,” says Bill Russo, a former US auto executive and Beijing-based industry consultant. “China’s share of the global market rose significantly in 2009 and 2010.”