Japanese Automakers Lose Global Share as Chinese EVs Reshape Market

On May 29, 2024, major Japanese automakers released their latest financial results, revealing weaker-than-expected global performance. Toyota reported a slight increase in revenue but saw its profit decline by nearly 20% year-over-year; Honda posted its first annual loss since going public; and Nissan recorded losses for two consecutive fiscal years, totaling ¥1.2 trillion. In the Chinese market, the market share of Japanese-branded passenger vehicles plummeted from 23.1% to 9.8%—a drop of more than half. Meanwhile, the penetration rate of new energy passenger vehicles in China has surpassed 60%. Japanese automakers have lagged in their electrification transition, with delayed product updates and diminishing technological advantages, leading to their gradual marginalization in the Chinese market. Southeast Asia is also under pressure, with total new vehicle sales projected to fall 22% below 2019 levels by 2025. In contrast, Chinese automakers, rapidly expanding through new energy vehicle models, have surged to become the world’s top-selling automotive group, significantly reshaping the global industry landscape. Traditional strengths of Japanese cars—such as fuel efficiency and low failure rates—are losing relevance as consumer preferences shift toward electrification and intelligent features. To address these challenges, Japanese automakers are accelerating their electrification strategies: Nissan plans to launch 10 new energy vehicle models in China by 2027; Toyota intends to invest ¥1.6 trillion in autonomous driving and new energy vehicle R&D during fiscal year 2026; and Honda will allocate ¥800 billion to develop next-generation electric vehicles.