SANTA MONICA, Calif.- One year after the March 11, 2011 earthquakes that sent ripples across the auto industry, Japanese car manufacturers are finally back on track in the United States, reports Edmunds.com, the premier online resource for automotive information. Edmunds.com reports that the market share for Japan’s top automakers – most notably Toyota and Honda – are back to pre-earthquake levels following a year of supply shortages and increased prices for some of the most popular vehicles.
“The March 11 earthquake and tsunamis revealed the vulnerabilities of Japan and its once-invincible automotive industry,” says Michelle Krebs, Sr. Analyst at Edmunds.com. “But as humbling as the business fallout was in the weeks and months after the disaster, a lot of credit is due to top company executives who resourcefully restored business operations to ‘normal’ levels in less than a year.”
Japanese automakers did not feel the full business impact of the earthquake until the summer of 2011. That’s when market share and retention rates bottomed out at 12-month lows, to the benefit of U.S., European and South Korean car-makers. Japanese market share in the U.S. fell from 38.5 percent last February to 30.1 percent in June. The rate of customers trading in Japanese vehicles for other Japanese vehicles followed a similar trend.
MARKET SHARE AND TRADE-IN LOYALTY, BY BRAND ORIGIN
|Market Share||Purchase After Japanese Trade-Ins|
As much as Japan struggled to maintain market share last summer, it also fought to reign in pricing, which rose quickly as a result of dwindling supply. From February to June, the average transaction price of a Japanese vehicle climbed $813, or 3.1 percent, from $26,426 to $27,239. South Korean brands Hyundai and Kia prices also climbed more than three percent in this period, but their increases were due to brand momentum, as demonstrated by their significant market share growth (as noted in the above chart.) In the same period, average European brand prices climbed just 0.3 percent, while average American brand prices actually fell 0.9 percent.
But by the end of last month, Japanese brands had almost fully rebounded to pre-earthquake levels. Japanese market share and trade-in loyalty are each less than one percentage point shy from where they stood last February. And the average transaction price for Japanese vehicles is back under $27,000 for the first time since the middle of last year.
“We quickly learned how strong and resilient the Japanese people and Japanese companies really are,” says Krebs. “Their automotive brands could have been down even longer, if not for the perseverance and hard work to get their plants up and running again.”