How Toyota failed to understand the biggest market in the world

Article by Christian Andrei, on October 30, 2012

Toyota Motor Corp. said that its underperformance in China was due to the anti-Japan protests caused by a territorial conflict. According to sources and dealers, Toyota failed to understand the biggest market in the world. They said that China’s budget-conscious consumers didn’t embrace the Yaris subcompact, which was launched in 2008.

This model was targeted at increasing brand loyalty and pushing China sales of a million units annually. The Yaris, which was successful in other markets, also didn’t do well in appealing to China's new emerging middle class. Several dealers and insiders said that the Yaris didn’t have 'daqi', which the Chinese refers to as 'road presence'.

When compared to Nissan Motor Co Ltd's more expensive Tiida, the Yaris seems cramped and unexciting. Thrifty first-time buyers considered the Yaris to be over-priced, priced from 87,000 yuan ($13,900), 55% higher than General Motor's Chevy Sail.

According to January-August records, Yaris sales in China averaged only 1,250 a month. This was before the protests in China against Japanese products. In comparison, Nissan sold 12,000 of its Tiida subcompacts a month and GM sold 17,000 Chevy Sails.

Topics: toyota

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