Toyota Motor is likely to miss its 2014 objective of selling over 1.1 million vehicles in China because of a faster-than-anticipated economic slowdown and resulting price war in the local auto market.
Toyota and its two Chinese joint ventures will miss the goal and will sell slightly more than 1 million vehicles in 2015, two company executives told Reuters. Researcher IHS Automotive puts sales at 1.09 million in 2014 and 1.15 million in 2015.
The shortcoming reveals continued difficulty for Japanese automakers in China even as diplomatic relations recover from a territorial spat that turned Chinese consumers against Japanese goods. Compounding matters is an increase in models from premium German brands priced within reach of mainstream Japanese cars.
"Toyota can resort to a fire sale and meet our sales targets, but our philosophy is to produce and sell as many as a market wants, not much more," said one of the executives. "We try to stay away from price wars as much as we can."
The Japanese automaker has unofficially aimed for 1 million vehicles in China since 2010, coming close with 917,500 vehicles in 2013.
But with economic growth nearing its slowest rate in 24 years, Toyota has had to revise sales plans gradually since the third quarter, said the executives, who were not authorized to speak with media on the matter and so declined to be identified.