Japanese Automakers And Unions To Government: Lower Then Yen, Or We Are Out Of Here

by Bertel Schmitt

Published: June 9th, 2011

japanese automakers and unions to government lower then yen or we are out of here

In an (especially for Japanese tastes) strongly worded joint statement, Toshiyuki Shiga. Chairman of Japan Automobile Manufacturers Association, and Koichiro Nishihara, President of the Confederation of Japan Automobile Workers’ Unions threw down the gauntlet to the Japanese government. Executive summary: “We are sick as hell of the high yen and we can’t take it anymore. Do something, or kiss those jobs sayonara.”

Current foreign exchange rate levels represent, for the yen, an appreciation that not only far surpasses all prior projections by Japanese automakers, but also totally fails to reflect Japan’s economic fundamentals.

Over the decades, the Japanese automobile industry has carried out a steady series of cost-cutting and other measures necessary to maintain its international competitiveness. The yen’s present exchange rate level, however, clearly exceeds the limits of such efforts. The continuation of this trend seriously threatens the ability to maintain the foundations supporting the manufacturing craftsmanship that has long been the basis of Japan’s competitive edge. There are also fears that these currency market conditions will have a profoundly adverse impact on employment throughout Japan’s motor industry, including the parts supply and other vital sectors.

Having been heavily affected by the devastating March 11 earthquake and tsunami, automobile production in Japan is at last moving towards recovery. The yen’s excessive appreciation risks gravely hampering this nascent recovery and, in doing so, imperiling the resurgence of Japan’s weakened economy.

In view of these realities, JAMA and the CJAWU strongly demand that the Japanese government take swift and effective action aimed at reducing the yen’s current strength.

In other countries, talk like this would be shrugged-off as posturing. A joint statement by employers and unions would raise eyebrows anywhere. In highly polite Japan, such a statement is the last step before a suicide note. Shiga is also the COO of Nissan, a company far less exposed to the high yen than Toyota or Honda. One dollar buys 80 yen today.

#BertelSchmitt #Currency #Earthquake #Government #JAMA #Japan #Unions #Yen

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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Mikey on Jun 09, 2011

Imagine the outcry were it was the UAW, and the US Government? Here in Canada the we reaped the benifits of the 70 cent Loony. Today its 1.02 and the CAW is seeing production moving back to the U.S. Sometimes your the windshield,sometimes your the bug.

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- Geozinger on Jun 09, 2011
  
  @Mikey: You beat me to it. Although I wonder about the sanity of this Japanese union; what would they do if the Japanese auto companies offshore the production of their cars? Certainly they're not going to follow the mfrs to Thailand and other places? I know we have "GM gypsies" in the States, but I've never heard of a US one going to Canada for example. What's the end game for the Japanese auto workers union?
  
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- L'avventura on Jun 09, 2011
  
  Its a mistake to think of Japanese unions in the context of American unions... The JAW is nothing like the UAW, they actually have little to no bargaining power. Japanese union laws restrict industry-wide collective bargaining for unions, which means that each manufacturer has their own union, and only the workers union can negotiate their wages with the company they work for (a union group like the JAW cannot represent them). Moreover, each manufacturer's union is further partitioned into smaller unions, one for factories/offices, another for dealers, and another for suppliers. For this reason, the Japanese Automotive Workers Union is just a group to coordinate these sort of announcements. They are largely irrelevant. Obviously this system makes it difficult to organize massive strikes or walk-outs like you see in other countries, and Japanese unions have little power compared to the US, much less Europe. But Japanese business mindset is very different. While the employment-for-life is now a thing of the base, lay-offs are still regarded much more taboo than in West. Further more, most executives are usually promoted from within and are part of the union themselves so they tend to be a lot more sympathetic regarding labor issues.
  
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Stuki on Jun 09, 2011

Hi, I'm your union representative. I want to make sure the $50,000 you are earning, will only be worth $25,000. While at the same time quadrupling the interest you will be charged for every loan you may consider taking up. But it will all be well, since I'll do the same thing to everyone else, so you get the satisfaction of knowing that other people are even worse off than you are. That is what we do, you know. Screw you a little bit less than the next guy. Which, as you know, is very popular these days, after decades of progressive indoctrination hammering into your heads that the only thing that matters, is measuring how you stack up compared to some other group or class. It's always "us" vs. "them". And we, the nice guys leeching off of your dues, will always be looking out for you, you know. Nudge, nudge, wink, wink.....

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