Political tension between China and Japan is resulting in the latter cutting car production in the former by roughly half after the Japanese government purchased a group of “disputed islands in the East China Sea from their private owner.“ With sales of Toyota vehicles in China down 40% from this time last year, and violent protests continuing outside the company`s China-based production factories, it`s no wonder Japan is slowing down it`s production effort within it`s neighbour`s borders. The big idea here is just how much influence political issues can have on businesses, all other factors constant. Toyota has their target demographic, they have their strong value promise, a strong product, strong marketing, as well as consistency in all of these areas. But all that aside, roughly 60% of their success this year has been independant of their business plan. 60% of Toyota`s sales was totally out of the company`s hands. That`s a huge share of sales to have no control over, for any company, and the fact that such a portion of a company`s success can go up in smoke due to political conflict is reason enough for governments to take corporation wellbeing into account when acting potentially unfavourably with respect to countries of major production importance to their own.

http://ca.news.yahoo.com/japan-carmakers-cut-china-production-half-nikkei-032354276–finance.html