Japanese Automakers Post Combined $11B Loss in China, Hold Just 1% EV Market Share

In fiscal year 2026, six major Japanese automakers—Honda, Suzuki, Subaru, Mazda, Mitsubishi, and Nissan—collectively reported losses of nearly RMB 8 billion in the Chinese market, excluding Toyota. From January to April 2025, Japanese-branded vehicles accounted for just 13% of China’s overall auto market, a sharp decline from 24% in 2020. During the same period, the penetration rate of new energy vehicles (NEVs) in China reached 62%, having risen steadily since 2021 and surpassing sales of internal combustion engine (ICE) vehicles for the first time in 2025. Japanese brands have consistently held only around 1% of China’s NEV market share. Japanese automakers’ China operations suffer from limited autonomy, with critical decisions requiring approval from overseas headquarters—a lengthy process that has left them slow to respond to rapid market shifts. Rising global oil prices have further eroded the competitiveness of Japanese brands, which remain heavily reliant on ICE vehicles. Meanwhile, Chinese NEV makers are accelerating their global expansion, with multiple models seeing exponential sales growth in overseas markets such as Europe, increasingly encroaching on Japanese automakers’ international market share. Financially, Toyota’s net profit for fiscal year 2026 fell 17% year-over-year, Honda’s profit dropped by 139% compared to the previous year, Nissan continued to incur losses, and Subaru and Mazda also experienced significant declines in performance.