Japanese Automakers Prepare For Abe 'Shrine Visit' Blowback

Japanese automakers may have regained some of their lost ground in China, though the recovery has come at a cost as they sacrifice profit for volume, but Abe's shrine visit may spark a repeat of last year when consumers boycotted Japanese cars, and thousands of Japanese cars were vandalized and businesses attacked by mobs (after the Senkaku debacle began). “The Japanese government is always making trouble," notes on potential Chinese car buyer, adding, "there are so many other choices, so why them? I know most of them are made in China now, but why help them make money?" In Shanghai, the Japanese consulate urged its nationals to be cautious as there’s a risk of worsening sentiment given the “strong anti-Japanese” tone in Chinese media reports.

Via Bloomberg,

Japanese automakers are bracing for a potential consumer backlash should tensions with China escalate after Prime Minister Shinzo Abe visited a shrine memorializing war-dead on Chairman Mao Zedong’s birthday.

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Nissan Motor Co. said it was “closely monitoring” developments in Japan-China ties after Abe’s visit. The appearance at Tokyo’s Yasukuni Shrine, which honors the war-dead including 14 World War II leaders convicted as Class-A war criminals, drew a condemnation from China. Shares of Japan’s three biggest automakers rose today in Tokyo trading.

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Toyota Motor Corp. (7203) and Honda Motor Co. reported their first annual sales declines in China last year after the Japanese government purchased a group of disputed islands from their private owner, sparking nationwide protests and a consumer backlash. Today’s visit by Abe coincides with the 120th birthday of Mao, with Chinese leaders including President Xi Jinping honoring the founder of the communist state.

“We’re still at a stage where we need to carefully monitor the impact, but it’s obvious that this only has a negative impact on Japan,”

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“They chose today to visit the shrine, which makes it even harder for Chinese people to accept,” said Cui Dongshu, deputy secretary-general of the Shanghai-based Passenger Car Association. “The signal they are sending is very dangerous. It will deter some buyers as they may worry about the safety issue of their car and even themselves if the political environment worsens.”

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At the height of last year’s demonstrations, hundreds of riot police watched over groups of protesters as they gathered outside the Japanese consulate chanting, “down with Japan devils, boycott Japanese goods, give back Diaoyu,” using the Chinese name for the group of islands in the East China Sea.

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Thousands of Japanese cars were vandalized and businesses attacked by mobs in last year’s demonstrations.

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Two dealerships selling Toyota and Honda vehicles in Qingdao in eastern China were set on fire by anti-Japanese protesters last year, while many owners of Japanese-brand cars pasted Chinese flags or patriotic slogans on their vehicles in the hope of avoiding being attacked.