Island Row Can Turn Ugly Again

As predicted by TTAC after Chinese demonstrations against Japan's control of the Senkaku/Diaoyu islands turned into violence against Japanese cars and car dealerships in China, the matter turned into a severe sales setback for Japanese car companies in China, more severe than initially thought, or hoped. Also as predicted by TTAC, the islands did affect the sales of Japan's carmakers more than the tsunami.  Last Saturday in Shanghai, Toyota's China chief confirmed that the pain would be felt at least through August.  This was before he heard the really bad news. On Sunday, three ministers of Japan's government visited the Yasukuni Shrine in Tokyo, a place where Japan's A-Class war criminals along with other war dead were put to an uneasy rest.  These visits had enraged China's rulers in the past, and they did so again. Severely. Making matters worse, a flotilla of boats carrying more than 80 Japanese nationalists arrived in waters near the islands on Tuesday . The flotilla of 10 boats was tracked by eight Chinese government ships, while ships of the Japanese Coast Guard tried to chase off both Japanese nationalists and Chinese government boats. The Nikkei [sub] says that "a record number" of Chinese are in Japanese waters, causing fears that "tensions between the two East Asian powers may be returning after a period of relative calm." Renewed tensions will trigger a flare-up of  anti-Japanese discussions in Chinese social media, which won't help the still lagging sales on Japanese cars in China. New ugly demonstrations would put a serious dent into Japanese plans for China. Japanese carmakers most likely won't be too sympathetic for the Sunday outings of their ministers. from The Truth About Cars http://www.thetruthaboutcars.com

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