Japan’s carmakers face pressure to consolidate as Chinese rivals rise and tariffs bite
The consolidation could be Japan-specific as carmakers elsewhere have already been through that cycle, Man Group’s Stephen Harget says
Japan’s export-reliant car sector will be forced to consolidate to combat competition in an environment roiled by tariffs, according to a portfolio manager at the world’s largest publicly traded hedge fund firm.
Man Group’s Stephen Harget said Japan’s carmakers are being pushed to combine their resources to counter Chinese auto firms’ aggressive business plans and rapid expansion.
“When an industry is really under pressure, consolidation is often a very good answer to that,” Harget said in an interview. Japan has a lot of listed automakers and consolidation provides “scale merits and they could share the investment burden”.
The Man Japan CoreAlpha Fund has beaten 94 per cent of its peers over the past three years with a gain of 12 per cent. The gauge of the nation’s automotive industry has fallen 21 per cent over the past year, compared with a 3.4 per cent decline in the broader Topix Index.
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Nissan Motor, Toyota Motor and Honda Motor are the funds’ top holdings as of end-January, according to Bloomberg-compiled data.