SAO PAULO -- Japanese companies want to be more visible in Latin America, where South Korean and Chinese businesses have recently built deep foundations.
Samsung Electronics and LG Electronics combine for more than 60% of Brazil's flat-panel TV market. Sony was the highest positioned Japanese maker there in 2012, ranking third after the two South Korean companies, with a 10.4% share, according to research firm Euromonitor International. Panasonic came in fifth with a 7.4% share.
In Brazil's new-car market, Japanese automakers are falling behind South Korea's Hyundai Motor, which has gained a sizable wedge of the market with its popular HB20 subcompact.
Toyota Motor led Japanese automakers in Brazil sales in 2013, but its market share languished at a mere 4.92%, placing the company seventh, a spot behind Hyundai. Even the aggregate market share of the top three Japanese carmakers -- Toyota, Honda Motor and Nissan Motor -- is only slightly more than 10%.
The Japanese trio has stepped up efforts to boost its presence in Brazil. After announcing plans to build plants there the past several years, the three are now working toward expanding their subcompact lineups. These kinds of vehicles dominate the Brazilian market.
Nissan hopes to build the strongest brand among automakers in Brazil by focusing on product quality and customer service, Chairman and CEO Carlos Ghosn said at an April ceremony to open the company's first plant in Brazil.
Rays of hope
Yakult Honsha already enjoys success in Latin America. Its probiotic drinks are sold at supermarkets in Mexico and Brazil. Its products have developed such a strong presence that many locals mistake Yakult for a domestic company.
Japanese instant noodles also do well in the region. Toyo Suisan Kaisha commands high market share in Mexico, while a joint venture between Nissin Foods and Ajinomoto dominates in Brazil. Their products are often eaten while watching soccer games. Instant noodles are now even sold at subway kiosks.
Zensho Holdings's Sukiya gyudon beef bowl restaurants and Daiso Industries' 100-yen ($0.98) stores are also popular in Mexico and Brazil.
Japanese businesses' growing interest in Latin America is evident from the expanding ranks at the Japan Chambers of Commerce and Industry in the region. The chamber in Brazil counts 368 members, and Mexico's has 280. Both are record highs. In addition, the breadth of members' industries is also widening.
Prime Minister Shinzo Abe is due to visit five countries in the region in late July and early August. This first visit to the region by a Japanese prime minister since 2004, when Junichiro Koizumi went over, will focus on economic diplomacy. High-ranking officials from major Japanese corporations, including trading companies and banks, will accompany Abe.
The visit will likely be a good opportunity for Japanese businesses to bolster their presence in Latin America. But China Inc. is not likely to idly sit by. It will also likely strengthen its ties with the region. Chinese President Xi Jinping is scheduled to visit Brazil slightly ahead of Abe to attend a BRICS (Brazil, Russia, India, China and South Africa) summit in mid-July.
Latin American markets are the furthest away from Asia, but their importance continues to grow by the day.