By SEMA Editors

	The all-new ’15 Jeep Renegade.

The all-new ’15 Jeep Renegade enters the growing small SUV segment, while staying true to the adventurous lifestyle Jeep is known for, according to the automaker. The Renegade delivers a combination of best-in-class off-road capability, open-air freedom and convenience, a segment-first nine-speed automatic transmission that contributes to on-road and off-road driving dynamics, fuel-efficient engines and a host of safety and advanced technology offerings. The result is an efficient vehicle created to attract youthful and adventurous customers around the world to the Jeep brand.

“The all-new ’15 Jeep Renegade expands the brand’s product portfolio and targets the rapidly expanding small SUV segment around the globe with benchmark levels of efficiency and driving dynamics, while at the same time delivering best-in-class 4x4 capability that customers expect from Jeep,” said Mike Manley, president and CEO – Jeep Brand, Chrysler Group LLC. “Renegade symbolizes the brand’s renowned American design, ingenuity and innovation, marking the Jeep brand’s first entry into the small SUV segment in more than 100 markets around the globe.”

Leveraging 4x4 technology from the all-new Jeep Cherokee, the all-new ’15 Jeep Renegade offers two advanced 4x4 systems—Jeep Active Drive and Jeep Active Drive Low—to deliver best-in-class off-road capability. Both systems can provide up to 100% of the engine’s available torque to the ground, through any wheel, for optimal grip.

The Renegade also features a disconnecting rear axle and power take-off unit (PTU) to provide Jeep Renegade 4x4 models with enhanced fuel economy. The system instantly engages when 4x4 traction is needed.

Both Jeep Active Drive and Active Drive Low 4x4 systems include the Jeep Selec-Terrain system, providing up to five modes (Auto, Snow, Sand and Mud modes, plus exclusive Rock mode on the Trailhawk model) for optimal four-wheel-drive performance on- or off-road and in any weather condition.

The Renegade Trailhawk model delivers best-in-class Trail Rated 4x4 capability with standard Jeep Active Drive Low (20:1 crawl ratio), a Selec-Terrain system with exclusive Rock mode, increased ride height (0.8 in.), skid plates and red front and rear tow hooks, 17-in. all-terrain tires, Hill-descent Control and up to 3,300-lb. towing capability, among other features.

The Renegade builds on the Jeep Wrangler’s powerful stance, and features fresh new styling with rugged body forms and aggressive proportions that enable best-in-class approach and departure angles purposely designed to deliver off-road capability. And for segment-exclusive panoramic views, two available My Sky open-air roof panel systems stow to provide passengers open-air freedom with ease.

The interior's “Tek-Tonic” design theme is defined by the intersections of soft and tactile forms with rugged and functional details. Major surfaces, such as the sculpted soft-touch instrument panel, are intersected with bold functional elements, such as the passenger grab handle. “Protective clamp fasteners,” anodized design accents and inspired colors are derived from extreme sports equipment, while the newly familiar “X” shapes, inspired by its roof and taillamps, add to Renegade’s Tek-Tonic interior look. And to ensure all of the needed passenger gear fits, the Renegade is designed with an efficient and flexible interior package that includes a removable, reversible and height-adjustable cargo floor panel and fold-forward front-passenger seat.

Keeping the tradition of the ’41 Willys MB Jeep, the all-new ’15 Renegade offers two available My Sky open-air roof systems. With a manual removable, or removable with premium power tilt/slide feature, the segment-exclusive My Sky roof-panel systems quickly bring the outdoors inside. Designed for convenience, the honeycomb fiberglass polyurethane roof panels are lightweight and stow neatly in the rear cargo area. For added design detail, both My Sky roof systems feature a debossed “X” stamped into the roof that exude strength and play on the brand’s utilitarian history.

The Renegade will offer up to 16 strategic powertrain combinations customized to markets around the world to meet a range of performance and efficiency needs. Powertrain options include:

• Four MultiAir gasoline engine offerings
• Two MultiJet II diesel engine offerings
• Efficient and flex-fuel capable E.torQ engine
• Emissions and fuel-saving Stop & Start technology
• Segment-first nine-speed automatic transmission
• Two manual and one dual-dry clutch transmission (DDCT) offerings

Like the new Jeep Cherokee, the ’15 Jeep Renegade offers a nine-speed automatic transmission. When paired with either the 2.0L MultiJet II diesel engine, or 2.4L MultiAir2 gas engine, the nine-speed transmission delivers aggressive launches, smooth power delivery at highway speeds and improved fuel efficiency versus a six-speed automatic transmission.

The Renegade's technology features include Uconnect Access, Uconnect touchscreens and the segment’s largest full-color instrument cluster. Key features available on the Uconnect 5.0 and 6.5AN systems include a 5.0-in. or 6.5-in. touchscreen display, Bluetooth connectivity, single or dual-turner, radio data system capability (RDS), digital audio broadcast (DAB), HD Radio, digital media broadcasting (DMB), SiriusXM Radio, SiriusXM Travel Link, SiriusXM Travel Link, USB port and auxiliary audio jack input. A 7-in., full-color, premium multiview display, featuring a reconfigurable function that enables drivers to personalize information inside the instrument cluster is also available.

The Renegade is equipped with up to 70 available safety and security features, including the availability of Forward Collision Warning-Plus and LaneSense Departure Warning-Plus. In addition, engineers added both active and passive safety and security features, including Blind-spot Monitoring, Rear Cross Path detection, ParkView rear backup camera with dynamic grid lines, electronic stability control (ESC) with electronic roll mitigation and seven standard airbags.

By Amanda Gubbins

	Mike Spagnola

Mike Spagnola, SEMA’s vice president of OEM and Product Development programs, will share tools for improving the product-development process from concept to prototype at the March 13 webinar entitled, “10 Ways to Better Product Development—The SEMA Garage-Industry Innovations Center.” During his 40 years in the auto-parts arena, Spagnola has held numerous positions spanning retail, distribution and manufacturing, uniquely positioning himself to understand the issues that SEMA’s members face daily.

The SEMA Garage-Industry Innovations Center assists companies in each stage of the product design and creation process. Outfitted with nearly $2 million in equipment, the SEMA Garage serves as a research facility complete with a Tech Transfer program, custom scanning services, 3D printing and Measuring Sessions, allowing member companies to accurately model production parts. Those parts can then be installed in the garage, tested for EPA and CARB compliance and promoted using the on-site media center. All these benefits are available to SEMA members for a fraction of the current market price for comparable services. Learn how to gain the most from these resources, Thursday, March 13, 2014, at 10:00 a.m. (PDT).

Participate live or download the webinar when it’s convenient. And remember: SEMA webinars are free to SEMA members and only $29 for non-members.

For more information, contact Juliet Marshall at 909-978-6655.

By Amanda Gubbins

	Mike Spagnola

Mike Spagnola, SEMA’s vice president of OEM and Product Development programs, will share tools for improving the product-development process from concept to prototype at the March 13 webinar entitled, “10 Ways to Better Product Development—The SEMA Garage-Industry Innovations Center.” During his 40 years in the auto-parts arena, Spagnola has held numerous positions spanning retail, distribution and manufacturing, uniquely positioning himself to understand the issues that SEMA’s members face daily.

The SEMA Garage-Industry Innovations Center assists companies in each stage of the product design and creation process. Outfitted with nearly $2 million in equipment, the SEMA Garage serves as a research facility complete with a Tech Transfer program, custom scanning services, 3D printing and Measuring Sessions, allowing member companies to accurately model production parts. Those parts can then be installed in the garage, tested for EPA and CARB compliance and promoted using the on-site media center. All these benefits are available to SEMA members for a fraction of the current market price for comparable services. Learn how to gain the most from these resources, Thursday, March 13, 2014, at 10:00 a.m. (PDT).

Participate live or download the webinar when it’s convenient. And remember: SEMA webinars are free to SEMA members and only $29 for non-members.

For more information, contact Juliet Marshall at 909-978-6655.

By Amanda Gubbins

	Mike Spagnola

Mike Spagnola, SEMA’s vice president of OEM and Product Development programs, will share tools for improving the product-development process from concept to prototype at the March 13 webinar entitled, “10 Ways to Better Product Development—The SEMA Garage-Industry Innovations Center.” During his 40 years in the auto-parts arena, Spagnola has held numerous positions spanning retail, distribution and manufacturing, uniquely positioning himself to understand the issues that SEMA’s members face daily.

The SEMA Garage-Industry Innovations Center assists companies in each stage of the product design and creation process. Outfitted with nearly $2 million in equipment, the SEMA Garage serves as a research facility complete with a Tech Transfer program, custom scanning services, 3D printing and Measuring Sessions, allowing member companies to accurately model production parts. Those parts can then be installed in the garage, tested for EPA and CARB compliance and promoted using the on-site media center. All these benefits are available to SEMA members for a fraction of the current market price for comparable services. Learn how to gain the most from these resources, Thursday, March 13, 2014, at 10:00 a.m. (PDT).

Participate live or download the webinar when it’s convenient. And remember: SEMA webinars are free to SEMA members and only $29 for non-members.

For more information, contact Juliet Marshall at 909-978-6655.

SEMA News—March 2014

INTERNATIONAL
By Jeff Kagawa

Japan Custom-Car Market Overview

	There are car shows around Japan every weekend of the year. Though the styles may vary from one event to another, there is no doubt that the country loves cars, and the influence from America is quite obvious.

Though Japan slipped from the number-three car consumer worldwide in 2011 to number five in 2012, love for automobiles remains very strong among the Japanese. Like Americans, the Japanese are holding on to their cars longer, which makes for a very interesting opportunity for the custom market. People have a desire to give their cars a facelift after a few years when they hold on to them, and that results in more sales for those engaged in the custom-car market. From swapping out wheels to updating headlights to modernizing the entertainment system, the aftermarket business in Japan is booming, and consumers continue to look for new products to enhance their driving experiences.

Custom-Car History

Japan’s custom-car market developed later than in the U.S., European and Australian markets, getting its start in the late ’70s. Young people began customizing their cars and motorcycles at that time and, like everywhere else in the world, customizing preceded government laws regulating the industry.

The style created by the Japanese is called “bosozoku,” where cars are lowered with extreme, handcrafted body kits that include flared fenders, front spoilers, rear wings and modified exhausts. Most were crafted locally due to a lack of parts, but aftermarket parts—mostly from the United States and Europe—began infiltrating the market in the years that followed. The culture of custom cars slowly began to emerge, and the Japanese government also began to relax its laws as it realized that the products were safe and also good for the economy.

Japan was introduced to the idea of customizing vans in the late ’80s via the American-made Chevy Astro van. Thousands of Astro vans were customized in Southern California and then shipped to Japan, where buyers eagerly awaited this latest craze. The Astros also had customized interiors, which was a brand-new concept at the time. These trends helped the Japanese create their own custom culture for vans and wagons, which is the largest market sector today.

There was a period in the ’90s when lowriders were a big hit. Again, most of the cars originated in Southern California and were shipped to Japan. The paint schemes, custom interiors and attention to detail were what caught the attention of Japanese car enthusiasts, and those influences are quite evident in today’s custom-car market.

The Japanese custom-car market is currently flourishing. It has segmented into various followings, such as super cars and VIPs influenced by Europe, musclecars and SUVs influenced by the United States, vans and wagons that draw their roots from the Astro van and, of course, tuning and the bosozoku are still popular.

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011.

There are car shows around the country every weekend of the year. Though the styles may vary from one event to another, there is no doubt that Japan loves cars, and the influence from America is quite obvious. In fact, sometimes when you look at these cars, it is tough to believe that you’re actually in Japan.

Opportunities forU.S. Companies

American products are very highly regarded in Japan’s custom-car market, as the United States is seen as the pioneer of customization, and the Japanese follow U.S. trends and styles. Thousands of Japanese visitors come to the SEMA Show every year to look for new ideas, techniques and products to take home. U.S. products are viewed as fresh, innovative and of high quality. If that describes your product, you may have an opportunity in Japan.

Successful U.S. Companies in Japan

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011. The company’s success can be attributed to having a sales and marketing plan in place prior to its advertisement.

Diablo Wheels also hired an independent Japanese consultant/sales rep to handle this specific territory and entered the game with an adequate budget. Diablo also sends an executive to Japan at least once per year and holds quarterly meetings with its distributor to ensure that everyone remains on the same page.

“Diablo has made modifications to our wheels in regards to quality, size, offset and PCD, all for the Japan market,” said Senior Vice President Jerry Lee. “The nice thing is that these modifications were made for Japan but are big sellers in other regions as well. The eastern hemisphere definitely follows Japan!”

In another example of success, Steve DeMan began traveling to Japan in 1997 to showcase his paint techniques and share them with an enthusiastic new audience. Sixteen years later, his name is strong in Japan, and people anxiously await their turn to learn from the American legend.

DeMan’s willingness to share knowledge has earned him tremendous respect, and shops eagerly await the opportunity to work with him on special projects. He recently launched a new painter’s-tape line that was very well received by the audience at the Next Auto Show in Tokyo in May 2013, where he gave live demonstrations.

Kicker has also seen strong and steady growth in Japan over the past several years. According to Chet Weddle, the company’s international sales manager, the primary reason for Kicker’s continued success is the exceptional relationship with its distributor in Japan. They meet at least three times per year to review changes in the marketplace and to go over installations and troubleshooting.

	Car customizing has been around in Japan for many years. With Japanese cars prevalent in the United States, SEMA members have long made sought-after products for vehicles on Japanese roads.

With a product that requires accurate installation, Kicker understands that one bad install or demo can severely damage the brand and therefore takes all means necessary to ensure that it doesn’t happen. The company has also established a distribution system that allows its distributor to wholesale the product to other distributors as well as service the needs of local shops.

DIY and Superstores

Japan’s love of automobile accessories is demonstrated by the massive number of items stocked by superstores such as Autobacs. The square footage of the shopping areas of these stores is comparable to Target here in the United States, but they also have several bays to work on cars.

Enthusiasts will easily spend two hours just looking around, finding everything from air fresheners and model cars to electronics and performance parts. Basically, anything related to an automobile is sold there. But unlike U.S. stores, such as AutoZone and Pep Boys, you will not see replacement parts, such as sparkplugs, hoses or batteries. Those types of products are usually not sold to the consumer. The products sold in the Japanese superstores are for the aftermarket audience.

DIY is rare in Japan. Typically, professionals perform the installation of anything that takes longer than a few minutes. Working on one’s own car is a rare hobby due to the limited space in which the Japanese people live. Cars are typically parked in underground structures or in carports, with no available space to work or store tools.

The automotive superstores mostly cater to the domestic custom segment, which is vans and wagons, tuners, K-cars and VIPs. If your product falls into one of these categories or is universal, the superstore avenue is definitely something that should be considered, as it is big business.

Competition

Competition within Japan is pretty straightforward. U.S., European and, of course, Japanese products are typically held in high regard. Chinese and other Southeast Asian products are also readily available.

The benchmark for quality in Japan is very high, so only companies that are willing to put quality as a top priority will see success. Interestingly, price is not a huge factor in this market segment. Quality and service are probably more important than price. Many Japanese say that they would be willing to pay a higher price in exchange for better quality/service in regard to products from the United States.

Distribution/Logistics

		As a trade association, SEMA seeks to help member companies grow and expand their businesses A key program is to help its members grow is through exporting. For many of our members, exporting products to key international markets is integral to their success, and SEMA is available to help identify strategic markets and guide members along the way. The program includes, to name a few, fact-finding trips and meetings with pre-vetted buyers in key emerging markets; importation of vehicles popular globally but not sold in the United States, make/model data for key worldwide markets; international roundtables with international buyers at the SEMA Show. For more information on SEMA’s international resources and programs, contact SEMA’s international director at lindas@sema.org.

One interesting aspect of the Japanese custom-car market is that almost all distributors and shops have purchasing agents in the United States, typically on the West Coast. These U.S. companies purchase cars and accessories and ship them to Japan. In hindsight, this is a dream come true for U.S. manufacturers, but it can also work against you. Here is a simple breakdown:

Pros:
•Payment will come from a U.S.-based company.
•No need to learn export documentation and logistics, since the exporter will take care of everything.
•Language barrier will be minimal.
•Very easy, almost like another domestic customer.

Cons:
•Cannot control pricing once the product leaves your facility.
•No direct communication with your customer in Japan.
•Purchasing agent works on behalf of the Japanese customer, not you.
•Your product will likely be sold through a small network.

Getting Started

Step one is to research the market, then make a trip to Japan. Find your niche and develop a plan on how to enter the market. Most U.S. companies should probably start with cars that are sold in both countries.

Keep expectations realistic. Remember that you are not trying to create the next trend; you should just be looking for a piece of the pie. Once you get a foot in the door, expand your offerings to the mainstream audience by modifying/creating product for cars that are not sold in the United States.

Summary

A U.S. company that offers a quality product and is willing to invest in the Japanese market can be successful. Patience, willingness to adapt and a drive to build relationships are crucial traits necessary to enter the market. Though it is not easy to enter, once you’re in the Japanese market, you almost have to go bankrupt for customers to drop you. The Japanese are extremely loyal to brands, and the custom-car market is no different. Contrary to popular belief, the doors in Japan are open, but you need to knock before they let you in.

Enthusiast Magazines Available in Japan

Getting your hands on actual copies of some of the many enthusiast magazines available in Japan would be ideal. If not, Facebook is a good option because it is easy to navigate and there are a lot of photos to look at. A few to look for include:

• J-Lug—JDM, USDM, www.facebook.com/jlugmag
• Custom Car—JDM, www.facebook.com/customcar.japan
• VIP—Higher-end Japanese and European, www.facebook.com/vipcar.japan
• Style Wagon—Vans and wagons, www.facebook.com/stylewagonjapan

About the Author

Kagawa International is a Japan business consultant and exporter of U.S. automotive products. The company was established in 2000, and owner Jeff Kagawa has been exporting American goods to Japan for more than 21 years. Kagawa International works with U.S. companies to help them enter the Japanese market, providing research and creating personalized sales and marketing plans. Its vast network consists of many of Japan’s top custom-car builders, GM Japan, big-box chains and various dealerships. Jeff Kagawa can be reached at jeff@kagawainternational.com.

Auto Shows in Japan

• Tokyo Auto Salon, January
• Nagoya Auto Trend, March 1–2
• Next New Style Custom Auto Show (Tokyo), March 23
• X5 (Cross Five), various locations throughout the year

SEMA News—March 2014

INTERNATIONAL
By Jeff Kagawa

Japan Custom-Car Market Overview

	There are car shows around Japan every weekend of the year. Though the styles may vary from one event to another, there is no doubt that the country loves cars, and the influence from America is quite obvious.

Though Japan slipped from the number-three car consumer worldwide in 2011 to number five in 2012, love for automobiles remains very strong among the Japanese. Like Americans, the Japanese are holding on to their cars longer, which makes for a very interesting opportunity for the custom market. People have a desire to give their cars a facelift after a few years when they hold on to them, and that results in more sales for those engaged in the custom-car market. From swapping out wheels to updating headlights to modernizing the entertainment system, the aftermarket business in Japan is booming, and consumers continue to look for new products to enhance their driving experiences.

Custom-Car History

Japan’s custom-car market developed later than in the U.S., European and Australian markets, getting its start in the late ’70s. Young people began customizing their cars and motorcycles at that time and, like everywhere else in the world, customizing preceded government laws regulating the industry.

The style created by the Japanese is called “bosozoku,” where cars are lowered with extreme, handcrafted body kits that include flared fenders, front spoilers, rear wings and modified exhausts. Most were crafted locally due to a lack of parts, but aftermarket parts—mostly from the United States and Europe—began infiltrating the market in the years that followed. The culture of custom cars slowly began to emerge, and the Japanese government also began to relax its laws as it realized that the products were safe and also good for the economy.

Japan was introduced to the idea of customizing vans in the late ’80s via the American-made Chevy Astro van. Thousands of Astro vans were customized in Southern California and then shipped to Japan, where buyers eagerly awaited this latest craze. The Astros also had customized interiors, which was a brand-new concept at the time. These trends helped the Japanese create their own custom culture for vans and wagons, which is the largest market sector today.

There was a period in the ’90s when lowriders were a big hit. Again, most of the cars originated in Southern California and were shipped to Japan. The paint schemes, custom interiors and attention to detail were what caught the attention of Japanese car enthusiasts, and those influences are quite evident in today’s custom-car market.

The Japanese custom-car market is currently flourishing. It has segmented into various followings, such as super cars and VIPs influenced by Europe, musclecars and SUVs influenced by the United States, vans and wagons that draw their roots from the Astro van and, of course, tuning and the bosozoku are still popular.

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011.

There are car shows around the country every weekend of the year. Though the styles may vary from one event to another, there is no doubt that Japan loves cars, and the influence from America is quite obvious. In fact, sometimes when you look at these cars, it is tough to believe that you’re actually in Japan.

Opportunities forU.S. Companies

American products are very highly regarded in Japan’s custom-car market, as the United States is seen as the pioneer of customization, and the Japanese follow U.S. trends and styles. Thousands of Japanese visitors come to the SEMA Show every year to look for new ideas, techniques and products to take home. U.S. products are viewed as fresh, innovative and of high quality. If that describes your product, you may have an opportunity in Japan.

Successful U.S. Companies in Japan

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011. The company’s success can be attributed to having a sales and marketing plan in place prior to its advertisement.

Diablo Wheels also hired an independent Japanese consultant/sales rep to handle this specific territory and entered the game with an adequate budget. Diablo also sends an executive to Japan at least once per year and holds quarterly meetings with its distributor to ensure that everyone remains on the same page.

“Diablo has made modifications to our wheels in regards to quality, size, offset and PCD, all for the Japan market,” said Senior Vice President Jerry Lee. “The nice thing is that these modifications were made for Japan but are big sellers in other regions as well. The eastern hemisphere definitely follows Japan!”

In another example of success, Steve DeMan began traveling to Japan in 1997 to showcase his paint techniques and share them with an enthusiastic new audience. Sixteen years later, his name is strong in Japan, and people anxiously await their turn to learn from the American legend.

DeMan’s willingness to share knowledge has earned him tremendous respect, and shops eagerly await the opportunity to work with him on special projects. He recently launched a new painter’s-tape line that was very well received by the audience at the Next Auto Show in Tokyo in May 2013, where he gave live demonstrations.

Kicker has also seen strong and steady growth in Japan over the past several years. According to Chet Weddle, the company’s international sales manager, the primary reason for Kicker’s continued success is the exceptional relationship with its distributor in Japan. They meet at least three times per year to review changes in the marketplace and to go over installations and troubleshooting.

	Car customizing has been around in Japan for many years. With Japanese cars prevalent in the United States, SEMA members have long made sought-after products for vehicles on Japanese roads.

With a product that requires accurate installation, Kicker understands that one bad install or demo can severely damage the brand and therefore takes all means necessary to ensure that it doesn’t happen. The company has also established a distribution system that allows its distributor to wholesale the product to other distributors as well as service the needs of local shops.

DIY and Superstores

Japan’s love of automobile accessories is demonstrated by the massive number of items stocked by superstores such as Autobacs. The square footage of the shopping areas of these stores is comparable to Target here in the United States, but they also have several bays to work on cars.

Enthusiasts will easily spend two hours just looking around, finding everything from air fresheners and model cars to electronics and performance parts. Basically, anything related to an automobile is sold there. But unlike U.S. stores, such as AutoZone and Pep Boys, you will not see replacement parts, such as sparkplugs, hoses or batteries. Those types of products are usually not sold to the consumer. The products sold in the Japanese superstores are for the aftermarket audience.

DIY is rare in Japan. Typically, professionals perform the installation of anything that takes longer than a few minutes. Working on one’s own car is a rare hobby due to the limited space in which the Japanese people live. Cars are typically parked in underground structures or in carports, with no available space to work or store tools.

The automotive superstores mostly cater to the domestic custom segment, which is vans and wagons, tuners, K-cars and VIPs. If your product falls into one of these categories or is universal, the superstore avenue is definitely something that should be considered, as it is big business.

Competition

Competition within Japan is pretty straightforward. U.S., European and, of course, Japanese products are typically held in high regard. Chinese and other Southeast Asian products are also readily available.

The benchmark for quality in Japan is very high, so only companies that are willing to put quality as a top priority will see success. Interestingly, price is not a huge factor in this market segment. Quality and service are probably more important than price. Many Japanese say that they would be willing to pay a higher price in exchange for better quality/service in regard to products from the United States.

Distribution/Logistics

		As a trade association, SEMA seeks to help member companies grow and expand their businesses A key program is to help its members grow is through exporting. For many of our members, exporting products to key international markets is integral to their success, and SEMA is available to help identify strategic markets and guide members along the way. The program includes, to name a few, fact-finding trips and meetings with pre-vetted buyers in key emerging markets; importation of vehicles popular globally but not sold in the United States, make/model data for key worldwide markets; international roundtables with international buyers at the SEMA Show. For more information on SEMA’s international resources and programs, contact SEMA’s international director at lindas@sema.org.

One interesting aspect of the Japanese custom-car market is that almost all distributors and shops have purchasing agents in the United States, typically on the West Coast. These U.S. companies purchase cars and accessories and ship them to Japan. In hindsight, this is a dream come true for U.S. manufacturers, but it can also work against you. Here is a simple breakdown:

Pros:
•Payment will come from a U.S.-based company.
•No need to learn export documentation and logistics, since the exporter will take care of everything.
•Language barrier will be minimal.
•Very easy, almost like another domestic customer.

Cons:
•Cannot control pricing once the product leaves your facility.
•No direct communication with your customer in Japan.
•Purchasing agent works on behalf of the Japanese customer, not you.
•Your product will likely be sold through a small network.

Getting Started

Step one is to research the market, then make a trip to Japan. Find your niche and develop a plan on how to enter the market. Most U.S. companies should probably start with cars that are sold in both countries.

Keep expectations realistic. Remember that you are not trying to create the next trend; you should just be looking for a piece of the pie. Once you get a foot in the door, expand your offerings to the mainstream audience by modifying/creating product for cars that are not sold in the United States.

Summary

A U.S. company that offers a quality product and is willing to invest in the Japanese market can be successful. Patience, willingness to adapt and a drive to build relationships are crucial traits necessary to enter the market. Though it is not easy to enter, once you’re in the Japanese market, you almost have to go bankrupt for customers to drop you. The Japanese are extremely loyal to brands, and the custom-car market is no different. Contrary to popular belief, the doors in Japan are open, but you need to knock before they let you in.

Enthusiast Magazines Available in Japan

Getting your hands on actual copies of some of the many enthusiast magazines available in Japan would be ideal. If not, Facebook is a good option because it is easy to navigate and there are a lot of photos to look at. A few to look for include:

• J-Lug—JDM, USDM, www.facebook.com/jlugmag
• Custom Car—JDM, www.facebook.com/customcar.japan
• VIP—Higher-end Japanese and European, www.facebook.com/vipcar.japan
• Style Wagon—Vans and wagons, www.facebook.com/stylewagonjapan

About the Author

Kagawa International is a Japan business consultant and exporter of U.S. automotive products. The company was established in 2000, and owner Jeff Kagawa has been exporting American goods to Japan for more than 21 years. Kagawa International works with U.S. companies to help them enter the Japanese market, providing research and creating personalized sales and marketing plans. Its vast network consists of many of Japan’s top custom-car builders, GM Japan, big-box chains and various dealerships. Jeff Kagawa can be reached at jeff@kagawainternational.com.

Auto Shows in Japan

• Tokyo Auto Salon, January
• Nagoya Auto Trend, March 1–2
• Next New Style Custom Auto Show (Tokyo), March 23
• X5 (Cross Five), various locations throughout the year

SEMA News—March 2014

INTERNATIONAL
By Jeff Kagawa

Japan Custom-Car Market Overview

	There are car shows around Japan every weekend of the year. Though the styles may vary from one event to another, there is no doubt that the country loves cars, and the influence from America is quite obvious.

Though Japan slipped from the number-three car consumer worldwide in 2011 to number five in 2012, love for automobiles remains very strong among the Japanese. Like Americans, the Japanese are holding on to their cars longer, which makes for a very interesting opportunity for the custom market. People have a desire to give their cars a facelift after a few years when they hold on to them, and that results in more sales for those engaged in the custom-car market. From swapping out wheels to updating headlights to modernizing the entertainment system, the aftermarket business in Japan is booming, and consumers continue to look for new products to enhance their driving experiences.

Custom-Car History

Japan’s custom-car market developed later than in the U.S., European and Australian markets, getting its start in the late ’70s. Young people began customizing their cars and motorcycles at that time and, like everywhere else in the world, customizing preceded government laws regulating the industry.

The style created by the Japanese is called “bosozoku,” where cars are lowered with extreme, handcrafted body kits that include flared fenders, front spoilers, rear wings and modified exhausts. Most were crafted locally due to a lack of parts, but aftermarket parts—mostly from the United States and Europe—began infiltrating the market in the years that followed. The culture of custom cars slowly began to emerge, and the Japanese government also began to relax its laws as it realized that the products were safe and also good for the economy.

Japan was introduced to the idea of customizing vans in the late ’80s via the American-made Chevy Astro van. Thousands of Astro vans were customized in Southern California and then shipped to Japan, where buyers eagerly awaited this latest craze. The Astros also had customized interiors, which was a brand-new concept at the time. These trends helped the Japanese create their own custom culture for vans and wagons, which is the largest market sector today.

There was a period in the ’90s when lowriders were a big hit. Again, most of the cars originated in Southern California and were shipped to Japan. The paint schemes, custom interiors and attention to detail were what caught the attention of Japanese car enthusiasts, and those influences are quite evident in today’s custom-car market.

The Japanese custom-car market is currently flourishing. It has segmented into various followings, such as super cars and VIPs influenced by Europe, musclecars and SUVs influenced by the United States, vans and wagons that draw their roots from the Astro van and, of course, tuning and the bosozoku are still popular.

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011.

There are car shows around the country every weekend of the year. Though the styles may vary from one event to another, there is no doubt that Japan loves cars, and the influence from America is quite obvious. In fact, sometimes when you look at these cars, it is tough to believe that you’re actually in Japan.

Opportunities forU.S. Companies

American products are very highly regarded in Japan’s custom-car market, as the United States is seen as the pioneer of customization, and the Japanese follow U.S. trends and styles. Thousands of Japanese visitors come to the SEMA Show every year to look for new ideas, techniques and products to take home. U.S. products are viewed as fresh, innovative and of high quality. If that describes your product, you may have an opportunity in Japan.

Successful U.S. Companies in Japan

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011. The company’s success can be attributed to having a sales and marketing plan in place prior to its advertisement.

Diablo Wheels also hired an independent Japanese consultant/sales rep to handle this specific territory and entered the game with an adequate budget. Diablo also sends an executive to Japan at least once per year and holds quarterly meetings with its distributor to ensure that everyone remains on the same page.

“Diablo has made modifications to our wheels in regards to quality, size, offset and PCD, all for the Japan market,” said Senior Vice President Jerry Lee. “The nice thing is that these modifications were made for Japan but are big sellers in other regions as well. The eastern hemisphere definitely follows Japan!”

In another example of success, Steve DeMan began traveling to Japan in 1997 to showcase his paint techniques and share them with an enthusiastic new audience. Sixteen years later, his name is strong in Japan, and people anxiously await their turn to learn from the American legend.

DeMan’s willingness to share knowledge has earned him tremendous respect, and shops eagerly await the opportunity to work with him on special projects. He recently launched a new painter’s-tape line that was very well received by the audience at the Next Auto Show in Tokyo in May 2013, where he gave live demonstrations.

Kicker has also seen strong and steady growth in Japan over the past several years. According to Chet Weddle, the company’s international sales manager, the primary reason for Kicker’s continued success is the exceptional relationship with its distributor in Japan. They meet at least three times per year to review changes in the marketplace and to go over installations and troubleshooting.

	Car customizing has been around in Japan for many years. With Japanese cars prevalent in the United States, SEMA members have long made sought-after products for vehicles on Japanese roads.

With a product that requires accurate installation, Kicker understands that one bad install or demo can severely damage the brand and therefore takes all means necessary to ensure that it doesn’t happen. The company has also established a distribution system that allows its distributor to wholesale the product to other distributors as well as service the needs of local shops.

DIY and Superstores

Japan’s love of automobile accessories is demonstrated by the massive number of items stocked by superstores such as Autobacs. The square footage of the shopping areas of these stores is comparable to Target here in the United States, but they also have several bays to work on cars.

Enthusiasts will easily spend two hours just looking around, finding everything from air fresheners and model cars to electronics and performance parts. Basically, anything related to an automobile is sold there. But unlike U.S. stores, such as AutoZone and Pep Boys, you will not see replacement parts, such as sparkplugs, hoses or batteries. Those types of products are usually not sold to the consumer. The products sold in the Japanese superstores are for the aftermarket audience.

DIY is rare in Japan. Typically, professionals perform the installation of anything that takes longer than a few minutes. Working on one’s own car is a rare hobby due to the limited space in which the Japanese people live. Cars are typically parked in underground structures or in carports, with no available space to work or store tools.

The automotive superstores mostly cater to the domestic custom segment, which is vans and wagons, tuners, K-cars and VIPs. If your product falls into one of these categories or is universal, the superstore avenue is definitely something that should be considered, as it is big business.

Competition

Competition within Japan is pretty straightforward. U.S., European and, of course, Japanese products are typically held in high regard. Chinese and other Southeast Asian products are also readily available.

The benchmark for quality in Japan is very high, so only companies that are willing to put quality as a top priority will see success. Interestingly, price is not a huge factor in this market segment. Quality and service are probably more important than price. Many Japanese say that they would be willing to pay a higher price in exchange for better quality/service in regard to products from the United States.

Distribution/Logistics

		As a trade association, SEMA seeks to help member companies grow and expand their businesses A key program is to help its members grow is through exporting. For many of our members, exporting products to key international markets is integral to their success, and SEMA is available to help identify strategic markets and guide members along the way. The program includes, to name a few, fact-finding trips and meetings with pre-vetted buyers in key emerging markets; importation of vehicles popular globally but not sold in the United States, make/model data for key worldwide markets; international roundtables with international buyers at the SEMA Show. For more information on SEMA’s international resources and programs, contact SEMA’s international director at lindas@sema.org.

One interesting aspect of the Japanese custom-car market is that almost all distributors and shops have purchasing agents in the United States, typically on the West Coast. These U.S. companies purchase cars and accessories and ship them to Japan. In hindsight, this is a dream come true for U.S. manufacturers, but it can also work against you. Here is a simple breakdown:

Pros:
•Payment will come from a U.S.-based company.
•No need to learn export documentation and logistics, since the exporter will take care of everything.
•Language barrier will be minimal.
•Very easy, almost like another domestic customer.

Cons:
•Cannot control pricing once the product leaves your facility.
•No direct communication with your customer in Japan.
•Purchasing agent works on behalf of the Japanese customer, not you.
•Your product will likely be sold through a small network.

Getting Started

Step one is to research the market, then make a trip to Japan. Find your niche and develop a plan on how to enter the market. Most U.S. companies should probably start with cars that are sold in both countries.

Keep expectations realistic. Remember that you are not trying to create the next trend; you should just be looking for a piece of the pie. Once you get a foot in the door, expand your offerings to the mainstream audience by modifying/creating product for cars that are not sold in the United States.

Summary

A U.S. company that offers a quality product and is willing to invest in the Japanese market can be successful. Patience, willingness to adapt and a drive to build relationships are crucial traits necessary to enter the market. Though it is not easy to enter, once you’re in the Japanese market, you almost have to go bankrupt for customers to drop you. The Japanese are extremely loyal to brands, and the custom-car market is no different. Contrary to popular belief, the doors in Japan are open, but you need to knock before they let you in.

Enthusiast Magazines Available in Japan

Getting your hands on actual copies of some of the many enthusiast magazines available in Japan would be ideal. If not, Facebook is a good option because it is easy to navigate and there are a lot of photos to look at. A few to look for include:

• J-Lug—JDM, USDM, www.facebook.com/jlugmag
• Custom Car—JDM, www.facebook.com/customcar.japan
• VIP—Higher-end Japanese and European, www.facebook.com/vipcar.japan
• Style Wagon—Vans and wagons, www.facebook.com/stylewagonjapan

About the Author

Kagawa International is a Japan business consultant and exporter of U.S. automotive products. The company was established in 2000, and owner Jeff Kagawa has been exporting American goods to Japan for more than 21 years. Kagawa International works with U.S. companies to help them enter the Japanese market, providing research and creating personalized sales and marketing plans. Its vast network consists of many of Japan’s top custom-car builders, GM Japan, big-box chains and various dealerships. Jeff Kagawa can be reached at jeff@kagawainternational.com.

Auto Shows in Japan

• Tokyo Auto Salon, January
• Nagoya Auto Trend, March 1–2
• Next New Style Custom Auto Show (Tokyo), March 23
• X5 (Cross Five), various locations throughout the year

SEMA News—March 2014

INTERNATIONAL
By Jeff Kagawa

Japan Custom-Car Market Overview

	There are car shows around Japan every weekend of the year. Though the styles may vary from one event to another, there is no doubt that the country loves cars, and the influence from America is quite obvious.

Though Japan slipped from the number-three car consumer worldwide in 2011 to number five in 2012, love for automobiles remains very strong among the Japanese. Like Americans, the Japanese are holding on to their cars longer, which makes for a very interesting opportunity for the custom market. People have a desire to give their cars a facelift after a few years when they hold on to them, and that results in more sales for those engaged in the custom-car market. From swapping out wheels to updating headlights to modernizing the entertainment system, the aftermarket business in Japan is booming, and consumers continue to look for new products to enhance their driving experiences.

Custom-Car History

Japan’s custom-car market developed later than in the U.S., European and Australian markets, getting its start in the late ’70s. Young people began customizing their cars and motorcycles at that time and, like everywhere else in the world, customizing preceded government laws regulating the industry.

The style created by the Japanese is called “bosozoku,” where cars are lowered with extreme, handcrafted body kits that include flared fenders, front spoilers, rear wings and modified exhausts. Most were crafted locally due to a lack of parts, but aftermarket parts—mostly from the United States and Europe—began infiltrating the market in the years that followed. The culture of custom cars slowly began to emerge, and the Japanese government also began to relax its laws as it realized that the products were safe and also good for the economy.

Japan was introduced to the idea of customizing vans in the late ’80s via the American-made Chevy Astro van. Thousands of Astro vans were customized in Southern California and then shipped to Japan, where buyers eagerly awaited this latest craze. The Astros also had customized interiors, which was a brand-new concept at the time. These trends helped the Japanese create their own custom culture for vans and wagons, which is the largest market sector today.

There was a period in the ’90s when lowriders were a big hit. Again, most of the cars originated in Southern California and were shipped to Japan. The paint schemes, custom interiors and attention to detail were what caught the attention of Japanese car enthusiasts, and those influences are quite evident in today’s custom-car market.

The Japanese custom-car market is currently flourishing. It has segmented into various followings, such as super cars and VIPs influenced by Europe, musclecars and SUVs influenced by the United States, vans and wagons that draw their roots from the Astro van and, of course, tuning and the bosozoku are still popular.

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011.

There are car shows around the country every weekend of the year. Though the styles may vary from one event to another, there is no doubt that Japan loves cars, and the influence from America is quite obvious. In fact, sometimes when you look at these cars, it is tough to believe that you’re actually in Japan.

Opportunities forU.S. Companies

American products are very highly regarded in Japan’s custom-car market, as the United States is seen as the pioneer of customization, and the Japanese follow U.S. trends and styles. Thousands of Japanese visitors come to the SEMA Show every year to look for new ideas, techniques and products to take home. U.S. products are viewed as fresh, innovative and of high quality. If that describes your product, you may have an opportunity in Japan.

Successful U.S. Companies in Japan

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011. The company’s success can be attributed to having a sales and marketing plan in place prior to its advertisement.

Diablo Wheels also hired an independent Japanese consultant/sales rep to handle this specific territory and entered the game with an adequate budget. Diablo also sends an executive to Japan at least once per year and holds quarterly meetings with its distributor to ensure that everyone remains on the same page.

“Diablo has made modifications to our wheels in regards to quality, size, offset and PCD, all for the Japan market,” said Senior Vice President Jerry Lee. “The nice thing is that these modifications were made for Japan but are big sellers in other regions as well. The eastern hemisphere definitely follows Japan!”

In another example of success, Steve DeMan began traveling to Japan in 1997 to showcase his paint techniques and share them with an enthusiastic new audience. Sixteen years later, his name is strong in Japan, and people anxiously await their turn to learn from the American legend.

DeMan’s willingness to share knowledge has earned him tremendous respect, and shops eagerly await the opportunity to work with him on special projects. He recently launched a new painter’s-tape line that was very well received by the audience at the Next Auto Show in Tokyo in May 2013, where he gave live demonstrations.

Kicker has also seen strong and steady growth in Japan over the past several years. According to Chet Weddle, the company’s international sales manager, the primary reason for Kicker’s continued success is the exceptional relationship with its distributor in Japan. They meet at least three times per year to review changes in the marketplace and to go over installations and troubleshooting.

	Car customizing has been around in Japan for many years. With Japanese cars prevalent in the United States, SEMA members have long made sought-after products for vehicles on Japanese roads.

With a product that requires accurate installation, Kicker understands that one bad install or demo can severely damage the brand and therefore takes all means necessary to ensure that it doesn’t happen. The company has also established a distribution system that allows its distributor to wholesale the product to other distributors as well as service the needs of local shops.

DIY and Superstores

Japan’s love of automobile accessories is demonstrated by the massive number of items stocked by superstores such as Autobacs. The square footage of the shopping areas of these stores is comparable to Target here in the United States, but they also have several bays to work on cars.

Enthusiasts will easily spend two hours just looking around, finding everything from air fresheners and model cars to electronics and performance parts. Basically, anything related to an automobile is sold there. But unlike U.S. stores, such as AutoZone and Pep Boys, you will not see replacement parts, such as sparkplugs, hoses or batteries. Those types of products are usually not sold to the consumer. The products sold in the Japanese superstores are for the aftermarket audience.

DIY is rare in Japan. Typically, professionals perform the installation of anything that takes longer than a few minutes. Working on one’s own car is a rare hobby due to the limited space in which the Japanese people live. Cars are typically parked in underground structures or in carports, with no available space to work or store tools.

The automotive superstores mostly cater to the domestic custom segment, which is vans and wagons, tuners, K-cars and VIPs. If your product falls into one of these categories or is universal, the superstore avenue is definitely something that should be considered, as it is big business.

Competition

Competition within Japan is pretty straightforward. U.S., European and, of course, Japanese products are typically held in high regard. Chinese and other Southeast Asian products are also readily available.

The benchmark for quality in Japan is very high, so only companies that are willing to put quality as a top priority will see success. Interestingly, price is not a huge factor in this market segment. Quality and service are probably more important than price. Many Japanese say that they would be willing to pay a higher price in exchange for better quality/service in regard to products from the United States.

Distribution/Logistics

		As a trade association, SEMA seeks to help member companies grow and expand their businesses A key program is to help its members grow is through exporting. For many of our members, exporting products to key international markets is integral to their success, and SEMA is available to help identify strategic markets and guide members along the way. The program includes, to name a few, fact-finding trips and meetings with pre-vetted buyers in key emerging markets; importation of vehicles popular globally but not sold in the United States, make/model data for key worldwide markets; international roundtables with international buyers at the SEMA Show. For more information on SEMA’s international resources and programs, contact SEMA’s international director at lindas@sema.org.

One interesting aspect of the Japanese custom-car market is that almost all distributors and shops have purchasing agents in the United States, typically on the West Coast. These U.S. companies purchase cars and accessories and ship them to Japan. In hindsight, this is a dream come true for U.S. manufacturers, but it can also work against you. Here is a simple breakdown:

Pros:
•Payment will come from a U.S.-based company.
•No need to learn export documentation and logistics, since the exporter will take care of everything.
•Language barrier will be minimal.
•Very easy, almost like another domestic customer.

Cons:
•Cannot control pricing once the product leaves your facility.
•No direct communication with your customer in Japan.
•Purchasing agent works on behalf of the Japanese customer, not you.
•Your product will likely be sold through a small network.

Getting Started

Step one is to research the market, then make a trip to Japan. Find your niche and develop a plan on how to enter the market. Most U.S. companies should probably start with cars that are sold in both countries.

Keep expectations realistic. Remember that you are not trying to create the next trend; you should just be looking for a piece of the pie. Once you get a foot in the door, expand your offerings to the mainstream audience by modifying/creating product for cars that are not sold in the United States.

Summary

A U.S. company that offers a quality product and is willing to invest in the Japanese market can be successful. Patience, willingness to adapt and a drive to build relationships are crucial traits necessary to enter the market. Though it is not easy to enter, once you’re in the Japanese market, you almost have to go bankrupt for customers to drop you. The Japanese are extremely loyal to brands, and the custom-car market is no different. Contrary to popular belief, the doors in Japan are open, but you need to knock before they let you in.

Enthusiast Magazines Available in Japan

Getting your hands on actual copies of some of the many enthusiast magazines available in Japan would be ideal. If not, Facebook is a good option because it is easy to navigate and there are a lot of photos to look at. A few to look for include:

• J-Lug—JDM, USDM, www.facebook.com/jlugmag
• Custom Car—JDM, www.facebook.com/customcar.japan
• VIP—Higher-end Japanese and European, www.facebook.com/vipcar.japan
• Style Wagon—Vans and wagons, www.facebook.com/stylewagonjapan

About the Author

Kagawa International is a Japan business consultant and exporter of U.S. automotive products. The company was established in 2000, and owner Jeff Kagawa has been exporting American goods to Japan for more than 21 years. Kagawa International works with U.S. companies to help them enter the Japanese market, providing research and creating personalized sales and marketing plans. Its vast network consists of many of Japan’s top custom-car builders, GM Japan, big-box chains and various dealerships. Jeff Kagawa can be reached at jeff@kagawainternational.com.

Auto Shows in Japan

• Tokyo Auto Salon, January
• Nagoya Auto Trend, March 1–2
• Next New Style Custom Auto Show (Tokyo), March 23
• X5 (Cross Five), various locations throughout the year

SEMA News—March 2014

INTERNATIONAL
By Jeff Kagawa

Japan Custom-Car Market Overview

	There are car shows around Japan every weekend of the year. Though the styles may vary from one event to another, there is no doubt that the country loves cars, and the influence from America is quite obvious.

Though Japan slipped from the number-three car consumer worldwide in 2011 to number five in 2012, love for automobiles remains very strong among the Japanese. Like Americans, the Japanese are holding on to their cars longer, which makes for a very interesting opportunity for the custom market. People have a desire to give their cars a facelift after a few years when they hold on to them, and that results in more sales for those engaged in the custom-car market. From swapping out wheels to updating headlights to modernizing the entertainment system, the aftermarket business in Japan is booming, and consumers continue to look for new products to enhance their driving experiences.

Custom-Car History

Japan’s custom-car market developed later than in the U.S., European and Australian markets, getting its start in the late ’70s. Young people began customizing their cars and motorcycles at that time and, like everywhere else in the world, customizing preceded government laws regulating the industry.

The style created by the Japanese is called “bosozoku,” where cars are lowered with extreme, handcrafted body kits that include flared fenders, front spoilers, rear wings and modified exhausts. Most were crafted locally due to a lack of parts, but aftermarket parts—mostly from the United States and Europe—began infiltrating the market in the years that followed. The culture of custom cars slowly began to emerge, and the Japanese government also began to relax its laws as it realized that the products were safe and also good for the economy.

Japan was introduced to the idea of customizing vans in the late ’80s via the American-made Chevy Astro van. Thousands of Astro vans were customized in Southern California and then shipped to Japan, where buyers eagerly awaited this latest craze. The Astros also had customized interiors, which was a brand-new concept at the time. These trends helped the Japanese create their own custom culture for vans and wagons, which is the largest market sector today.

There was a period in the ’90s when lowriders were a big hit. Again, most of the cars originated in Southern California and were shipped to Japan. The paint schemes, custom interiors and attention to detail were what caught the attention of Japanese car enthusiasts, and those influences are quite evident in today’s custom-car market.

The Japanese custom-car market is currently flourishing. It has segmented into various followings, such as super cars and VIPs influenced by Europe, musclecars and SUVs influenced by the United States, vans and wagons that draw their roots from the Astro van and, of course, tuning and the bosozoku are still popular.

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011.

There are car shows around the country every weekend of the year. Though the styles may vary from one event to another, there is no doubt that Japan loves cars, and the influence from America is quite obvious. In fact, sometimes when you look at these cars, it is tough to believe that you’re actually in Japan.

Opportunities forU.S. Companies

American products are very highly regarded in Japan’s custom-car market, as the United States is seen as the pioneer of customization, and the Japanese follow U.S. trends and styles. Thousands of Japanese visitors come to the SEMA Show every year to look for new ideas, techniques and products to take home. U.S. products are viewed as fresh, innovative and of high quality. If that describes your product, you may have an opportunity in Japan.

Successful U.S. Companies in Japan

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011. The company’s success can be attributed to having a sales and marketing plan in place prior to its advertisement.

Diablo Wheels also hired an independent Japanese consultant/sales rep to handle this specific territory and entered the game with an adequate budget. Diablo also sends an executive to Japan at least once per year and holds quarterly meetings with its distributor to ensure that everyone remains on the same page.

“Diablo has made modifications to our wheels in regards to quality, size, offset and PCD, all for the Japan market,” said Senior Vice President Jerry Lee. “The nice thing is that these modifications were made for Japan but are big sellers in other regions as well. The eastern hemisphere definitely follows Japan!”

In another example of success, Steve DeMan began traveling to Japan in 1997 to showcase his paint techniques and share them with an enthusiastic new audience. Sixteen years later, his name is strong in Japan, and people anxiously await their turn to learn from the American legend.

DeMan’s willingness to share knowledge has earned him tremendous respect, and shops eagerly await the opportunity to work with him on special projects. He recently launched a new painter’s-tape line that was very well received by the audience at the Next Auto Show in Tokyo in May 2013, where he gave live demonstrations.

Kicker has also seen strong and steady growth in Japan over the past several years. According to Chet Weddle, the company’s international sales manager, the primary reason for Kicker’s continued success is the exceptional relationship with its distributor in Japan. They meet at least three times per year to review changes in the marketplace and to go over installations and troubleshooting.

	Car customizing has been around in Japan for many years. With Japanese cars prevalent in the United States, SEMA members have long made sought-after products for vehicles on Japanese roads.

With a product that requires accurate installation, Kicker understands that one bad install or demo can severely damage the brand and therefore takes all means necessary to ensure that it doesn’t happen. The company has also established a distribution system that allows its distributor to wholesale the product to other distributors as well as service the needs of local shops.

DIY and Superstores

Japan’s love of automobile accessories is demonstrated by the massive number of items stocked by superstores such as Autobacs. The square footage of the shopping areas of these stores is comparable to Target here in the United States, but they also have several bays to work on cars.

Enthusiasts will easily spend two hours just looking around, finding everything from air fresheners and model cars to electronics and performance parts. Basically, anything related to an automobile is sold there. But unlike U.S. stores, such as AutoZone and Pep Boys, you will not see replacement parts, such as sparkplugs, hoses or batteries. Those types of products are usually not sold to the consumer. The products sold in the Japanese superstores are for the aftermarket audience.

DIY is rare in Japan. Typically, professionals perform the installation of anything that takes longer than a few minutes. Working on one’s own car is a rare hobby due to the limited space in which the Japanese people live. Cars are typically parked in underground structures or in carports, with no available space to work or store tools.

The automotive superstores mostly cater to the domestic custom segment, which is vans and wagons, tuners, K-cars and VIPs. If your product falls into one of these categories or is universal, the superstore avenue is definitely something that should be considered, as it is big business.

Competition

Competition within Japan is pretty straightforward. U.S., European and, of course, Japanese products are typically held in high regard. Chinese and other Southeast Asian products are also readily available.

The benchmark for quality in Japan is very high, so only companies that are willing to put quality as a top priority will see success. Interestingly, price is not a huge factor in this market segment. Quality and service are probably more important than price. Many Japanese say that they would be willing to pay a higher price in exchange for better quality/service in regard to products from the United States.

Distribution/Logistics

		As a trade association, SEMA seeks to help member companies grow and expand their businesses A key program is to help its members grow is through exporting. For many of our members, exporting products to key international markets is integral to their success, and SEMA is available to help identify strategic markets and guide members along the way. The program includes, to name a few, fact-finding trips and meetings with pre-vetted buyers in key emerging markets; importation of vehicles popular globally but not sold in the United States, make/model data for key worldwide markets; international roundtables with international buyers at the SEMA Show. For more information on SEMA’s international resources and programs, contact SEMA’s international director at lindas@sema.org.

One interesting aspect of the Japanese custom-car market is that almost all distributors and shops have purchasing agents in the United States, typically on the West Coast. These U.S. companies purchase cars and accessories and ship them to Japan. In hindsight, this is a dream come true for U.S. manufacturers, but it can also work against you. Here is a simple breakdown:

Pros:
•Payment will come from a U.S.-based company.
•No need to learn export documentation and logistics, since the exporter will take care of everything.
•Language barrier will be minimal.
•Very easy, almost like another domestic customer.

Cons:
•Cannot control pricing once the product leaves your facility.
•No direct communication with your customer in Japan.
•Purchasing agent works on behalf of the Japanese customer, not you.
•Your product will likely be sold through a small network.

Getting Started

Step one is to research the market, then make a trip to Japan. Find your niche and develop a plan on how to enter the market. Most U.S. companies should probably start with cars that are sold in both countries.

Keep expectations realistic. Remember that you are not trying to create the next trend; you should just be looking for a piece of the pie. Once you get a foot in the door, expand your offerings to the mainstream audience by modifying/creating product for cars that are not sold in the United States.

Summary

A U.S. company that offers a quality product and is willing to invest in the Japanese market can be successful. Patience, willingness to adapt and a drive to build relationships are crucial traits necessary to enter the market. Though it is not easy to enter, once you’re in the Japanese market, you almost have to go bankrupt for customers to drop you. The Japanese are extremely loyal to brands, and the custom-car market is no different. Contrary to popular belief, the doors in Japan are open, but you need to knock before they let you in.

Enthusiast Magazines Available in Japan

Getting your hands on actual copies of some of the many enthusiast magazines available in Japan would be ideal. If not, Facebook is a good option because it is easy to navigate and there are a lot of photos to look at. A few to look for include:

• J-Lug—JDM, USDM, www.facebook.com/jlugmag
• Custom Car—JDM, www.facebook.com/customcar.japan
• VIP—Higher-end Japanese and European, www.facebook.com/vipcar.japan
• Style Wagon—Vans and wagons, www.facebook.com/stylewagonjapan

About the Author

Kagawa International is a Japan business consultant and exporter of U.S. automotive products. The company was established in 2000, and owner Jeff Kagawa has been exporting American goods to Japan for more than 21 years. Kagawa International works with U.S. companies to help them enter the Japanese market, providing research and creating personalized sales and marketing plans. Its vast network consists of many of Japan’s top custom-car builders, GM Japan, big-box chains and various dealerships. Jeff Kagawa can be reached at jeff@kagawainternational.com.

Auto Shows in Japan

• Tokyo Auto Salon, January
• Nagoya Auto Trend, March 1–2
• Next New Style Custom Auto Show (Tokyo), March 23
• X5 (Cross Five), various locations throughout the year

SEMA News—March 2014

INTERNATIONAL
By Jeff Kagawa

Japan Custom-Car Market Overview

	There are car shows around Japan every weekend of the year. Though the styles may vary from one event to another, there is no doubt that the country loves cars, and the influence from America is quite obvious.

Though Japan slipped from the number-three car consumer worldwide in 2011 to number five in 2012, love for automobiles remains very strong among the Japanese. Like Americans, the Japanese are holding on to their cars longer, which makes for a very interesting opportunity for the custom market. People have a desire to give their cars a facelift after a few years when they hold on to them, and that results in more sales for those engaged in the custom-car market. From swapping out wheels to updating headlights to modernizing the entertainment system, the aftermarket business in Japan is booming, and consumers continue to look for new products to enhance their driving experiences.

Custom-Car History

Japan’s custom-car market developed later than in the U.S., European and Australian markets, getting its start in the late ’70s. Young people began customizing their cars and motorcycles at that time and, like everywhere else in the world, customizing preceded government laws regulating the industry.

The style created by the Japanese is called “bosozoku,” where cars are lowered with extreme, handcrafted body kits that include flared fenders, front spoilers, rear wings and modified exhausts. Most were crafted locally due to a lack of parts, but aftermarket parts—mostly from the United States and Europe—began infiltrating the market in the years that followed. The culture of custom cars slowly began to emerge, and the Japanese government also began to relax its laws as it realized that the products were safe and also good for the economy.

Japan was introduced to the idea of customizing vans in the late ’80s via the American-made Chevy Astro van. Thousands of Astro vans were customized in Southern California and then shipped to Japan, where buyers eagerly awaited this latest craze. The Astros also had customized interiors, which was a brand-new concept at the time. These trends helped the Japanese create their own custom culture for vans and wagons, which is the largest market sector today.

There was a period in the ’90s when lowriders were a big hit. Again, most of the cars originated in Southern California and were shipped to Japan. The paint schemes, custom interiors and attention to detail were what caught the attention of Japanese car enthusiasts, and those influences are quite evident in today’s custom-car market.

The Japanese custom-car market is currently flourishing. It has segmented into various followings, such as super cars and VIPs influenced by Europe, musclecars and SUVs influenced by the United States, vans and wagons that draw their roots from the Astro van and, of course, tuning and the bosozoku are still popular.

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011.

There are car shows around the country every weekend of the year. Though the styles may vary from one event to another, there is no doubt that Japan loves cars, and the influence from America is quite obvious. In fact, sometimes when you look at these cars, it is tough to believe that you’re actually in Japan.

Opportunities forU.S. Companies

American products are very highly regarded in Japan’s custom-car market, as the United States is seen as the pioneer of customization, and the Japanese follow U.S. trends and styles. Thousands of Japanese visitors come to the SEMA Show every year to look for new ideas, techniques and products to take home. U.S. products are viewed as fresh, innovative and of high quality. If that describes your product, you may have an opportunity in Japan.

Successful U.S. Companies in Japan

Diablo Wheels entered the market with its initial advertisement in a Japanese car magazine in April 2008. Since then, the company’s products have been named “Wheel of the Year” by the readers of J-Lug magazine for four years in a row, from 2008 to 2011. The company’s success can be attributed to having a sales and marketing plan in place prior to its advertisement.

Diablo Wheels also hired an independent Japanese consultant/sales rep to handle this specific territory and entered the game with an adequate budget. Diablo also sends an executive to Japan at least once per year and holds quarterly meetings with its distributor to ensure that everyone remains on the same page.

“Diablo has made modifications to our wheels in regards to quality, size, offset and PCD, all for the Japan market,” said Senior Vice President Jerry Lee. “The nice thing is that these modifications were made for Japan but are big sellers in other regions as well. The eastern hemisphere definitely follows Japan!”

In another example of success, Steve DeMan began traveling to Japan in 1997 to showcase his paint techniques and share them with an enthusiastic new audience. Sixteen years later, his name is strong in Japan, and people anxiously await their turn to learn from the American legend.

DeMan’s willingness to share knowledge has earned him tremendous respect, and shops eagerly await the opportunity to work with him on special projects. He recently launched a new painter’s-tape line that was very well received by the audience at the Next Auto Show in Tokyo in May 2013, where he gave live demonstrations.

Kicker has also seen strong and steady growth in Japan over the past several years. According to Chet Weddle, the company’s international sales manager, the primary reason for Kicker’s continued success is the exceptional relationship with its distributor in Japan. They meet at least three times per year to review changes in the marketplace and to go over installations and troubleshooting.

	Car customizing has been around in Japan for many years. With Japanese cars prevalent in the United States, SEMA members have long made sought-after products for vehicles on Japanese roads.

With a product that requires accurate installation, Kicker understands that one bad install or demo can severely damage the brand and therefore takes all means necessary to ensure that it doesn’t happen. The company has also established a distribution system that allows its distributor to wholesale the product to other distributors as well as service the needs of local shops.

DIY and Superstores

Japan’s love of automobile accessories is demonstrated by the massive number of items stocked by superstores such as Autobacs. The square footage of the shopping areas of these stores is comparable to Target here in the United States, but they also have several bays to work on cars.

Enthusiasts will easily spend two hours just looking around, finding everything from air fresheners and model cars to electronics and performance parts. Basically, anything related to an automobile is sold there. But unlike U.S. stores, such as AutoZone and Pep Boys, you will not see replacement parts, such as sparkplugs, hoses or batteries. Those types of products are usually not sold to the consumer. The products sold in the Japanese superstores are for the aftermarket audience.

DIY is rare in Japan. Typically, professionals perform the installation of anything that takes longer than a few minutes. Working on one’s own car is a rare hobby due to the limited space in which the Japanese people live. Cars are typically parked in underground structures or in carports, with no available space to work or store tools.

The automotive superstores mostly cater to the domestic custom segment, which is vans and wagons, tuners, K-cars and VIPs. If your product falls into one of these categories or is universal, the superstore avenue is definitely something that should be considered, as it is big business.

Competition

Competition within Japan is pretty straightforward. U.S., European and, of course, Japanese products are typically held in high regard. Chinese and other Southeast Asian products are also readily available.

The benchmark for quality in Japan is very high, so only companies that are willing to put quality as a top priority will see success. Interestingly, price is not a huge factor in this market segment. Quality and service are probably more important than price. Many Japanese say that they would be willing to pay a higher price in exchange for better quality/service in regard to products from the United States.

Distribution/Logistics

		As a trade association, SEMA seeks to help member companies grow and expand their businesses A key program is to help its members grow is through exporting. For many of our members, exporting products to key international markets is integral to their success, and SEMA is available to help identify strategic markets and guide members along the way. The program includes, to name a few, fact-finding trips and meetings with pre-vetted buyers in key emerging markets; importation of vehicles popular globally but not sold in the United States, make/model data for key worldwide markets; international roundtables with international buyers at the SEMA Show. For more information on SEMA’s international resources and programs, contact SEMA’s international director at lindas@sema.org.

One interesting aspect of the Japanese custom-car market is that almost all distributors and shops have purchasing agents in the United States, typically on the West Coast. These U.S. companies purchase cars and accessories and ship them to Japan. In hindsight, this is a dream come true for U.S. manufacturers, but it can also work against you. Here is a simple breakdown:

Pros:
•Payment will come from a U.S.-based company.
•No need to learn export documentation and logistics, since the exporter will take care of everything.
•Language barrier will be minimal.
•Very easy, almost like another domestic customer.

Cons:
•Cannot control pricing once the product leaves your facility.
•No direct communication with your customer in Japan.
•Purchasing agent works on behalf of the Japanese customer, not you.
•Your product will likely be sold through a small network.

Getting Started

Step one is to research the market, then make a trip to Japan. Find your niche and develop a plan on how to enter the market. Most U.S. companies should probably start with cars that are sold in both countries.

Keep expectations realistic. Remember that you are not trying to create the next trend; you should just be looking for a piece of the pie. Once you get a foot in the door, expand your offerings to the mainstream audience by modifying/creating product for cars that are not sold in the United States.

Summary

A U.S. company that offers a quality product and is willing to invest in the Japanese market can be successful. Patience, willingness to adapt and a drive to build relationships are crucial traits necessary to enter the market. Though it is not easy to enter, once you’re in the Japanese market, you almost have to go bankrupt for customers to drop you. The Japanese are extremely loyal to brands, and the custom-car market is no different. Contrary to popular belief, the doors in Japan are open, but you need to knock before they let you in.

Enthusiast Magazines Available in Japan

Getting your hands on actual copies of some of the many enthusiast magazines available in Japan would be ideal. If not, Facebook is a good option because it is easy to navigate and there are a lot of photos to look at. A few to look for include:

• J-Lug—JDM, USDM, www.facebook.com/jlugmag
• Custom Car—JDM, www.facebook.com/customcar.japan
• VIP—Higher-end Japanese and European, www.facebook.com/vipcar.japan
• Style Wagon—Vans and wagons, www.facebook.com/stylewagonjapan

About the Author

Kagawa International is a Japan business consultant and exporter of U.S. automotive products. The company was established in 2000, and owner Jeff Kagawa has been exporting American goods to Japan for more than 21 years. Kagawa International works with U.S. companies to help them enter the Japanese market, providing research and creating personalized sales and marketing plans. Its vast network consists of many of Japan’s top custom-car builders, GM Japan, big-box chains and various dealerships. Jeff Kagawa can be reached at jeff@kagawainternational.com.

Auto Shows in Japan

• Tokyo Auto Salon, January
• Nagoya Auto Trend, March 1–2
• Next New Style Custom Auto Show (Tokyo), March 23
• X5 (Cross Five), various locations throughout the year