Trade War Watch 13: Pedal Politics

Bertel Schmitt
by Bertel Schmitt

Yesterday, a strange love-fest between U.S. Ambassador to Japan John Roos and Japan’s transport minister Seiji Maehara ensued. After their meeting in Tokyo, as reported by the Nikkei, the ambassador and the minister said that everything is hunky-dory, and that Toyota’s recent recalls won’t undermine relations between the U.S.A. and Japan. Which is odd in itself: Since when does a $15 gas pedal get a leading role on the world stage of international politics?

Ambassador Roos effusively told reporters that the recall issue ”in no way has any kind of direct or indirect impact on the strength of the bilateral relationship between the United States and Japan.” Who said it would?

Japan’s transport minister Seiji Maehara likewise said that Toyota’s troubles mean no harm to Japan’s relationship with the U.S.: “The issue shouldn’t damage the two countries’ relationship and shouldn’t hurt free and fair market competition.” Again, why should it?

Strange answers to questions nobody raised.

Kyodo News reiterated this morning in Japan that Toyota’s President Akio Toyoda will travel to the United States in March. Toyota spokeswoman Martha Voss said Toyoda ”would look forward” to the opportunity to meet with members of Congress when he visits the United States. The travel plans of the CEO of a car maker get more attention than a state visit.

There has been an odd amount of highest level governmental involvement with this issue recently, far beyond the regular regulatory ratcheting and the habitual grandstanding. The posturing is solely between the U.S.A, and Japan. Nobody in Europe, or China, which are just as affected by the recalls, turns Toyota into a political issue.

China’s state-owned news agency Xinhua couldn’t help but noticing today: “In a sharp contrast to media reports out of the US, voices of leniency and softened tones have emerged in China on the issue, with some people going as far as highlighting the massive safety recalls as a sign of ‘responsible business operations.'” China is Toyota’s second largest foreign market.

In Europe, where Toyota recalls 1.8m cars, the reaction is even more subdued. The German newspaper Die Welt yesterday cited a spokesperson of the powerful ADAC, Germany’s equivalent of the AAA: “The club does not have any complaints or claims from its members. There is no reason for panic.”


As commentator L’Avventura said: “It seems to me that a lot things are going to happen behind closed doors before the congressional hearings. The question is how it’s going to play out and how much of it is going to be predetermined and politically orchestrated.”

Out of the many possible explanations for the strange behavior, here is one of them:

Prime Minister Yukio Hatoyama had campaigned on a platform that contained moving all U.S. bases off Okinawa, or even out of Japan. The Okinawa issue had received a lot of play in Japan. In the last weeks, it turned quiet.

When U.S. Secretary of State Hillary Clinton complained with her Japanese counterpart Katsuya Okada about alleged discrimination of the Japanese cash for clunker program against American cars, it sounded oddly out of proportion. The number of cars affected wasn’t enough to fill a ship.

Now, the U.S.A. seems to have found a powerful pivot point, and Japan’s undivided attention.

As long as the U.S.A. sits on Okinawa, it doesn’t have to dump a lot of arms into Taiwan, a move that would make China increasingly grumpy. China already threatened to cut Boeing et al out of the Chinese market, after $6.4b of American arms made their way to Taiwan. China is estimated to need more than 3000 airliners worth $400 billion in the 20 years from 2009. Airbus already has the inside track in China and would be more than happy to fill the void.

Nobody claims Toyota doesn’t have problems. As many have said, they have had problems for years. Their problem management is a mess. However, the timing and intensity of the diplomatic activity should give reason for thought.

Implications of a $15 gas pedal …

Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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  • John Horner John Horner on Feb 11, 2010

    If I get this right, the thesis of this article is that the US government is making a big deal out of Toyota's safety problems because it doesn't want to move the base out of Okinawa. You should rename this a Conspiracy Theory Watch.

  • Skcusmg Skcusmg on Feb 11, 2010
    If I get this right, the thesis of this article is that the US government is making a big deal out of Toyota’s safety problems because it doesn’t want to move the base out of Okinawa. You should rename this a Conspiracy Theory Watch. ............................ Name it what you will, but the idea that the US is 'sexing up' to use a UK term, the Toyota gas pedal issue when it's a non-issue everywhere else does smack of some sort of political ulterior motive on the part of the US. Now it cannot be proven that there is an Okinawa connection or it's related to the governments 'ownership' of GM/Chrysler but neither can it be proven otherwise. It is however entirely in keeping with the style of the current US administration and there are many precendents for it in any case. It is easy to write stuff off as 'crazy crackpot conspiracy theories' just because you don't happen to like it.
  • 28-Cars-Later 2018 Toyota Auris: Pads front and back, K&N air filter and four tires @ 30K, US made Goodyears already seem inferior to JDM spec tires it came with. 36K on the clock.2004 Volvo C70: Somewhere between $6,5 to $8 in it all told, car was $3500 but with a wrecked fender, damaged hood, cracked glass headlight, and broken power window motor. Headlight was $80 from a yard, we bought a $100 door literally for the power window assembly, bodywork with fender was roughly a grand, brakes/pads, timing belt/coolant and pre-inspection was a grand. Roof later broke, parts/labor after two repair trips was probably about $1200-1500 my cost. Four 16in Cooper tires $62 apiece in 2022 from Wal Mart of all places, battery in 2021 $200, 6qts tranny fluid @ 20 is $120, maybe $200 in labor last year for tranny fluid change, oil change, and tire install. Car otherwise perfect, 43K on the clock found at 38.5K.1993 Volvo 244: Battery $65, four 15in Cooper tires @ $55 apiece, 4 alum 940 wheels @ roughly $45 apiece with shipping. Fixes for random leaks in power steering and fuel lines, don't remember. Needs rear door and further body work, rear door from yard in Gettysburg was $250 in 2022 (runs and drives fine, looks OK, I'm just a perfectionist). TMU, driven maybe 500 miles since re-acquisition in 2021.
  • 1995 SC I never hated these. Typical GM though. They put the wrong engine in it to start with, fixed it, and then killed it. I say that as a big fan of the aluminum 5.3, but for how they were marketing this it should have gotten the Corvette Motor at the start. Would be a nice cruiser though even with the little motor. The 5.3 without the convertible in a package meant to be used as a truck would have been great in my mind, but I suspect they'd have sold about 7 of them.
  • Rochester I'd rather have a slow-as-mud Plymouth Prowler than this thing. At least the Prowler looked cool.
  • Kcflyer Don't understand the appeal of this engine combo at all.
  • Dave M. This and the HHR were GM's "retro" failures. Not sure what they were smoking....
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