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Toyota And Nissan No Longer Find US Auto Market Very Profitable

By James Yu , Nov 09, 2016 08:26 AM EST
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Toyota and Nissan have been among the top automakers to make their name in the US auto market. However, despite America's supposed recovery from what people called a recession, it seems that the auto market appear to be slowing down. Recent developments give the two Japanese auto manufacturers worried and come to conclusion that the U.S. auto market may no longer very profitable as before.

US Auto Market Has Reached Its Peak

In a report given by Bloomberg, Takahiko Ijichi, executive vice president of Toyota noted of the market's weaker position. The statement was given after a 43 percent drop in the operating profit under quarterly basis has been reported by the Japanese automaker. Takahiko also added that the North American market "really requires very careful managing going forward". Meanwhile, Nissan Motor Co. no longer sees any room for potential growth in the U.S.

What Could Be The Reason For The Slow Down

According to a report from The Car Connection, SUVs, trucks and crossovers are the preference of the American auto market nowadays. Although, this is considered to be a trend that may change depending on fuel costs, most people do not see this happening in the near future. The same report also stated that American auto manufacturers such as Ford and General Motors now have the advantage in the U.S market. Another factor being considered in this matter is the Japanese yen being really strong now, causing the profits of the Japanese automakers to be lower once their U.S revenue is converted into yen.

What Is Next For The Japanese Automakers

While Toyota and Nissan came to the same conclusion, there is no indication as to whether or not they will be pulling out of the U.S market. The Car Connection reported that the increase in the Asian sales is faster than that from the U.S market and both automakers see this. Since Toyota and Nissan no longer find U.S auto market very profitable, it is safe to assume that they will focus on the Asian market in the meantime.

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