Japan suppliers fined to protect consumers

Although the regulatory move is not likely to shake Japanese carmakers' positions in the market, it will have a bearing on their brand image. Japanese cars have been very popular in China because many consumers believe they are more fuel efficient and "inexpensive" compared with other foreign brands, such as Volkswagen.

Because of the souring of relations between Beijing and Tokyo over a territorial dispute, Japanese carmakers once feared that their sales would drop sharply in the Chinese market. But the impact has been quite small. Take Toyota for example. In 2013, it sold 917,500 vehicles in China, up by 9.2 percent year-on-year. Its unexpectedly exceptional performance is in stark contrast to the poor monthly sales starting from late 2012, when the Beijing-Tokyo intensified.

Toyota's popularity among Chinese consumers may continue despite the regulatory move, but the result of the anti-trust investigation will make Chinese consumers realize that they would end up paying high after-sale costs if they buy Japanese cars.

What is worth monitoring, therefore, is whether the Japanese companies follow their German rivals to give up their monopolistic activities and reduce the prices of their auto parts to the benefit of Chinese consumers.

The author is a senior writer with China Daily. xinzhiming@chinadaily.com.cn

(China Daily 08/21/2014 page9)