Japanese carmakers eye innovation, India boost to overcome US, China speed bump

Toyota Motor Corp., Suzuki Motor Corp., Nissan Motor Co. Ltd, Honda Motor Co. Ltd and other Japanese players unveiled aggressive expansion plans during the Japan Mobility Show 2025, ranging from introducing new EV technology to small cars to reinventing iconic legacy brands.

The auto exhibition was held in Tokyo against the backdrop of ongoing negotiations between the US and China, which are locked in a long-running trade war, with the effects of the conflict being felt in the Japanese and Indian auto industries.

Rejuvenation move

Akio Toyoda, president of Toyota, the world’s largest automobile manufacturer, said Japan’s electric vehicle manufacturer BYD Co., which is rapidly expanding its global market share. Ltd. It offered a rare public reflection on its waning global influence over Chinese rivals such as China.

BYD’s international sales increased by 72% in 2024, reaching 417,204 units, accounting for 10% of its total sales. The company now aims to double that figure by focusing more on Southeast Asia and Europe.

“Japan seems to have lost some of its energy and dynamism as well as our presence in the world as a nation,” he told hundreds of international and Japanese delegates on October 29. he said.

“The era of ‘Japan No. 1’ is over and we are now in what is known as the ‘lost 30 years’,” he added.

His words were strongly influenced by BYD’s display of its first Kei car, the smallest category of legal motor vehicles, on Japanese highways to disrupt its domestic market. Kei cars have long been the province of Japanese automakers, accounting for more than 30% of Japan’s auto sales.

The automaker has announced its new luxury brand, Century, hoping to lead premium domestic and global markets, as Toyota’s president calls for the industry to reinvent itself.

Toyoda said, “Century is not an ordinary brand within Toyota. We want to develop it as a brand that carries the spirit of Japan, the pride of Japan, to the world.”

Although Toyoda did not clearly outline the challenges facing the Japanese auto industry, Suzuki chairman Toshihiro Suzuki expressed concern about China’s growing problem.

“Chinese players are reducing their prices. As they grow, it will be difficult for them to grow in the future,” Suzuki said, adding that the company does not want to compete with Chinese players internationally.

It is on its way to catch up with EV technology with the launch of its first EV, the e-Vitara, which it has started to export to Europe. At the fair, kei introduced the electric version of its car called Vision e-Sky.

Nissan, meanwhile, announced a renewal strategy (Re:Nissan) to regain its mojo in the face of mounting losses and layoffs. On May 13. It announced it would lay off 11,000 people and close seven factories to cope with falling sales in China and difficulties in the U.S. market.

Ivan Espinosa, the company’s chief executive, said at the press conference on the same day that the company supports several renewals of its core models such as the Leaf EV, Ariya, and the launch of the Patrol model in the Japanese market from 2027 to revive sales in key markets.

This comes as the company expects a loss of $1.8 billion for 2025-26, primarily due to the impact of US tariffs.

Honda also suffered huge losses, with profits in the June quarter nearly halved to 244.17 billion yen. Management attributed the cancellations to U.S. tariffs, as America is one of its largest markets.

However, Honda has upped its bets on new products in the clean fuel space by launching the 0 Series cars. Two electric sport utility vehicles (SUVs) and a sedan were exhibited at the fair. The first of these cars is planned to be released in 2027.

“Although the market environment surrounding electrification remains uncertain, Honda believes that the transition to electric vehicles will continue in the long term. Therefore, Honda is steadily preparing to offer attractive EV models in the coming electric era,” President Toshihiro Mibe said in his speech.

One November 2024 Bloomberg The analysis showed that Japanese automakers have lost ground to Chinese competition in many markets since 2019. The sharpest returns were recorded in China, Singapore, Thailand, Malaysia and Indonesia between 2019 and 2024.

In China, BYD gained 23%, while Japanese automakers including Honda, Nissan and Toyota lost 0.5% to 4% market share. In Singapore and Thailand, their combined market share fell from 50% to 35%.

india game

For most Japanese automakers, India remains a safe haven. While Chinese rivals are increasing exports to Europe, the Indian market, nearly half of which is served by Japanese companies, remains largely insulated from Chinese competition.

BYD, for example, sold just 3,401 cars in the country in 2024-25, capturing just 0.08% market share. In comparison, Maruti Suzuki controls 40% of the market, followed by Toyota with 6%, Honda with 1.5% and Nissan with 0.6%.

Supported by the cut in goods and services tax (GST) rates and strong festive season demand, the Indian automotive industry is expecting a growth of 5% in 2025-26. According to the Association of Indian Automobile Manufacturers, car sales in September alone rose 4.4% year-on-year to 372,458 units.

“Our management has decided to focus on India, along with the US and Japan, among the three important markets for Honda’s future growth,” Takashi Nakajima, chairman and managing director of Honda Cars India, said on the sidelines of the auto show.

The company plans to introduce 10 new models, including seven SUVs, in the country by 2030.

T. Suzuki also described India as Suzuki’s “most critical market”. Suzuki chairman, domestic automakers such as Tata Motors Ltd and Mahindra & Mahindra Ltd and Korean giant Hyundai Motor Co. While admitting that they are in intense competition with Maruti Suzuki, he said that it will introduce eight new SUVs by 2030-31.

Toyota may also join Suzuki and Honda in a product offensive. Reuters It said it plans to introduce 15 new cars and model upgrades by the end of this decade.

Drawing attention to the importance of cooperation with India, T. Suzuki concluded the press conference with a note about the Indian curry packages that the company started to produce to sell in Japan.

“We have sold more than 100,000 of these,” he said, citing the effort as a symbol of Japanese firms wanting to work closely with Indian companies and talent.

The author is in Tokyo at the invitation of Maruti Suzuki.