Resurgence of Japanese Products Amid Improved South Korea-Japan Relations

Japanese products are seeing increased sales in South Korea, rebounding from a 2019 consumer boycott. This upward trend is driven by improving diplomatic relations and a cheaper yen. Notably, Japanese cars and alcoholic beverages have seen significant boosts in sales, coinciding with shifting consumer preferences and capacity issues at Hyundai Motor.

Japanese products, ranging from cars to beer, whisky, and clothing, are experiencing a surge in popularity in South Korea. This resurgence follows a 2019 consumer boycott, buoyed by improved bilateral relations and the favorable exchange rate of the yen.

In August, sales of Japanese automobiles, including brands like Toyota and Lexus, increased by 31% year-over-year. This growth is attributed to a capacity crunch at Hyundai Motor and changing consumer preferences away from electric vehicles. South Korean President Yoon Suk Yeol's efforts to strengthen ties with Japan since taking office in 2022 further underpin this trend, with an upcoming summit scheduled with Japanese Prime Minister Fumio Kishida in Seoul.

In 2019, Japanese products faced significant sales declines due to heightened anti-Japanese sentiment following Tokyo's export restrictions linked to wartime forced labor conflicts. Despite this historical tension, a recent survey reveals that a majority of South Koreans in their 20s and 30s now hold favorable views towards Japan.

Imports of Japanese beer and whisky have soared nearly 70% and 50%, respectively, within the first seven months of the year, according to Korea Customs Service data. Even Uniqlo, a prominent Japanese clothing brand, saw a 31% revenue increase in South Korea for the fiscal year ending in August 2023 after previously closing several stores post-boycott.

Although Japanese cars make up a small segment of the South Korean market dominated by Hyundai and Kia, their sales have been climbing. In August, Lexus, Toyota, and Honda sold a combined 2,527 vehicles in South Korea, marking a 31% year-over-year increase. This contrasts with slumping sales for electric vehicle brands like Tesla, Mercedes, and BMW.

A South Korean resident named Park, who recently purchased a Toyota Camry hybrid, cited his trust in Japanese automotive technology despite personal reservations about Japan's national identity. Another Seoul resident, Maria Hwang, expressed similar sentiments, noting that historical animosities did not affect her decision to buy a Lexus hybrid vehicle.

Travel to Japan is also on the rise, with South Korean visitors reaching record numbers due to the cheaper yen. The first seven months of this year saw a 40% increase in Korean travelers to Japan, making them the largest group of foreign tourists to the country.

(With inputs from agencies.)