Japanese sanctions on Russia: Japan’s used car exports collapse

When we think of ‘Russia’, our thoughts may quickly go to Moscow or St. Petersburg, but let’s not forget that the country on the other hand extends further east than China, borders North Korea and, via the island of Sakhalin, is not far from Japan. can touch. Used cars from Japan are very popular, especially in eastern Russia. The majority of cars here are reportedly even right-hand drive because of their Japanese origins. That’s not surprising, because the Japanese are known for taking good care of their cars. Moreover, a car in Japan is generally considered ‘old’ considerably sooner than in the rest of the world, partly due to the strict inspection policy of the Japanese. In other words: what is seen as an ‘old loft’ in Japan is probably a very fresh occasion for a Russian from Vladivostok.

This was even more true when many car manufacturers decided to cease their Russian activities after the Russian invasion of Ukraine, resulting in a huge increase in the demand for used cars in Russia. In an older Reuters report, we read that another 100,000 cars from Japan were cleared through customs in Vladivostok between January and August 2022, meaning Japan would account for more than three-quarters of imported used cars. Furthermore, Russia accounted for more than a quarter of Japan’s total used car exports during this period. The effect is still clearly visible in 2023: in the first eight months of this year, Japan would account for more than half of the total of 330,000 used cars that Russia imported.

However, Japan is also not blind to what is going on between Russia and Ukraine, so exports to Russia were restricted step by step. After Japan previously introduced a ban on expensive luxury cars, followed by a ban on heavier commercial vehicles, since August it has only been allowed to export so-called subcompacts to Russia. Cars such as the Toyota Yaris and Honda Fit (Jazz) and smaller are still allowed to be exported, but the rest are not. The consequences of this are clearly noticeable. A representative of a Japanese car exporter told Reuters that trade had recently fallen by about 70 percent, forcing staff to be laid off. Another exporter saw Russia’s share of exports drop from more than 50 percent to less than 20 percent in a few months. An additional consequence is of course that many cars are more difficult to find a new owner. Prices of used cars have reportedly already fallen by 7 percent, while supply increased by 20 percent. Other popular export markets for Japan are mainly those countries where, like Japan, driving is on the left, such as Australia, New Zealand and parts of Africa. The new sanctions are undoubtedly good for trade there, but they literally have far-reaching consequences.