Country subsidy retreat overlaps with diplomatic fluctuations, Toyota's sales in China (TM.US) drop sharply by 12%, dragging down global performance.

Affected by the suspension of subsidies for electric vehicles in China, Toyota Motor Corp. Sponsored ADR (TM.US) saw a decline in global sales and production in November, with the significant contraction in the Chinese market being the main reason. The Japanese automaker released data on Thursday showing that its global sales, including its subsidiaries Daihatsu and Hino Motors, decreased by 1.9% year-on-year in November, dropping to 965,919 units, while production decreased by 3.4% to 934,001 units during the same period. Global car manufacturers are currently facing multiple uncertainties: ongoing trade tensions, frequent changes in industry regulations, and unclear macroeconomic prospects. Toyota's performance reflects the industry's barometer, highlighting the challenges faced by car companies in balancing long-term market demand and short-term economic policy pressures. Due to the suspension of subsidies for electric vehicles in key cities in China, Toyota pointed out that sales of Toyota and Lexus brands in China in November dropped sharply by 12% year-on-year. It is worth noting that this sales data was announced against the backdrop of escalating diplomatic tensions between China and Japan since November Japanese Prime Minister Kishida Fumio made incorrect remarks on the Taiwan issue, sparking strong dissatisfaction from China, which subsequently issued a safety warning for Chinese tourists traveling to Japan. In terms of regional production performance, Toyota saw a 15% increase in production in Thailand and a 9% increase in the U.S. market in November. In contrast, production in the Chinese market declined by 14%, while Japan and the UK recorded decreases of 9.7% and 7.9% respectively. The EU's decision to adjust the ban on gasoline cars this month provides traditional car manufacturers with greater flexibility in ramping up production of electric vehicles. For a long time, Japanese automakers like Toyota, with their advantage in hybrid technology, have taken the lead over traditional car manufacturers relying on gasoline-powered cars. However, the EU's policy relaxation may open up new market breakthroughs for Chinese electric vehicle manufacturers which are poised for a breakthrough. Meanwhile, Toyota has also been caught up in the trade policy vortex in the United States. During his presidency, President Trump planned to impose high tariffs on imported cars and parts, with Toyota being a key target. Earlier this month, Trump stated his intention to pave the way for Asian "K-Cars" to enter the U.S. market, although these types of cars have not yet met federal safety standards in the U.S. Recently, Toyota announced that it will sell three American-made models back to Japan, seen as a gesture of goodwill towards Trump.