Korea’s samurai spirit
JAPANESE car companies are in trouble and most of them don’t even know it.
They are caught in a vice that is changing the rules in showrooms globally, but especially in Australia. Korean brands are rising fast and European prestige companies are drilling down, creating large pressures in the middle ground that has been a happy place for the Japanese for more than 30 years.
It’s good news for buyers, who will get more choice and better value at both ends, but the new rules will change the game for the Japanese.
Far too many Japanese carmakers — Toyota and Honda, for sure— are also about to feel the effect of their cost cutting through the GFC.
All of the major Japanese brands cut spending and several cancelled new-model programs and urgent update work to save money, leaving them without anything new to draw buyers.
Honda has the new Civic coming but not much else, Toyota has the new Camry this year but the FT-86 sports car is more than a year away, and even Suzuki is running out of gunpowder after the Kizashi and upcoming Swift.
In the opposition camps, Hyundai and Kia are getting better with every new model — the Kia Optima is a Camry rival with more style and value from just $36,990 — and BMW, Audi and even Mercedes are coming down with a sub-1 Series, the A1 and upcoming B-Class.
The Europeans are chasing more sales at every level and know there is demand they can tap with smaller cars that suit people downsizing worldwide.
In Australia, they could even jump from a Commodore or Falcon into an A1 for city-first work.
But the challenge is coming from the Koreans, as Kia showed with the Optima.
It’s doing a great job in tweaking Hyundai mechanical parts into vehicles that people want, including the classy Sportage that was runner-up in last year’s Carsguide Car of the Year contest.
The things that once made Japanese cars so desirable — cabin quality, reliability and great airconditioning — are available in Korean models that cost less and have the advantage of five-year warranty.
In short, Korean companies now make better-value Japanese cars than the Japanese do.
That means the Japanese brands need to find a point of difference, and a reason for people to buy, and fast.
Lots still wonder about the long-term benefit of buying Korean, or remember the days of a Hyundai Excel that was a disposable car, but things are changing and changing fast.
Korea has already put a sword through Japan’s electronics business and the cars are next.