It’s been over a year now since the devastating earthquake and resulting tsunami struck Japan, which as we all know severely altered the course of business for all Japanese automotive manufacturers. Over the course of the past year, we have watched as Japanese brands have worked to recapture lost market share, let’s take a look at share trends year-to-date, and discuss…

For the purpose of this report we will focus primarily on Honda, Nissan, and Toyota brands.
Looking at the mainstream segment the most earthquake affected brand was Toyota.  Toyota suffered a 3.8 point loss in market share, which was the largest of all Japanese brands.  Total market share for the brand fell from 12.9% in February 2011 to 9.1% in May.

The road to recapture lost market share was a long upward battle for Toyota but this past May’s 13.6% total market share was good for a 4.5% gain over the same time last year.  June 2012 total market share for Toyota fell by 1.3 points MoM landing at 12.3%, which is 2.8 points higher than the same time last year but a slight .3 points shy of what was observed in June 2010. 
Post disaster average incentive spending for Toyota increased rapidly over the May-August 2011 time period, rising from $1,307 to $2,307 per unit sold.  Since the peak in August 2011, average incentive spending for the brand has decreased landing at an average of $1,705 per unit in June 2012.   

Honda brand experienced many of the same pains that Toyota felt throughout much of 2011 with total market share falling 3.1 points from April to July, bottoming out at 6.7%.  Over the course of the past year Honda’s best performance was recorded in April 2012 where they were able to capture 9.3% of the total market.  June 2012 total market share for the brand fell by .5 points MoM landing at 8.5%, much better than last June’s 7.2%, but still 1.3 points less than was observed in June 2010.  Like Toyota brand, average incentive spending for Honda brand reached a post disaster low of $1,542 per unit in May 2011.  Honda average incentive spending peaked at $2,408 in April 2012, dropping a bit of the course of the next few months landing at $2,154 this past June.

Nissan brand saw their biggest market share declines for the year occur during the months of March to April, during this time period total market share for the brand fell from 8.8% to 5.6% making this a 3.2 point drop in total market share.  June 2012 total market share for the brand was only 0.1 point higher than what was observed during the same period last year, but over half a point better than June 2010’s 5.7%.  Average incentive spending for Nissan bottomed out at $1,928 in April of 2011, and peaked at $3,004 in February 2012.  June average incentive spending for the brand was $2,640 per unit, over $900 more than Toyota and nearly $500 more than Honda.
 
All three brands have made great progress recapturing lost market share over the course of the past year, but at what expense?  Toyota has been able to successfully increase market share while reducing average incentive spending, which will help used vehicle value retention in the long run.  Increased levels of average incentive spending on new cars can have corrosive effects on used vehicle value retention and in the case of Nissan and Honda this is something that we will monitor and report back on.