By on October 6, 2011

 

Again and again, Japanese automakers had been warning that they cannot stomach the strong yen, and that it will eventually cost jobs. Today, the yen stood  at 76.6 to the dollar, and Japanese carmakers are packing.

Mitsubishi  originally wanted to sharply increase Japanese production to make up for lost volume due to the tsunami. The company now “suddenly halved its plan to hire about 800 temporary workers by the end of September, as the yen’s appreciation has been eating into the profitability of its exports to Europe,” says The Nikkei [sub]. Mitsubishi’s President Osamu Masuko told reporters in a press conference today:

“We are fighting to adjust ourselves to the currency’s levels. But these efforts sometimes get wiped out in a single day. Don’t you think there is a growing sense of futility?”

Mitsubishi tried to slash costs as much as possible by becoming leaner and by buying parts abroad. “But the room for reducing costs further is getting smaller,” said Masuko.

A few weeks ago, Nissan’s CEO Carlos Ghosn had warned that a Yen that is not going back to “normal” “will provoke a rethinking of our industrial strategy.”

Some of this rethinking became effective today.

As expected, Nissan announced today at the governor’s palace in Rio de Janeiro that it will plunk down 2.6 billion Brazilian reais ($1.5 billion)  for a new plant in Resende, near the ports of Itaguai and Rio de Janeiro.. When completed 2014, the plant is expected to crank out 200,000 units per year.

Nissan plans to introduce 10 new models to Brazil before 2016.

With only approximately 25 percent of its worldwide capacity in Japan, Nissan should be the least affected of Japan’s majors.

“Just as Nissan has demonstrated in China, Russia and India, we are investing in the regions with the most potential for growth,” said Carlos Ghosn. And that’s not Japan.

 

 

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77 Comments on “Japanese Auto Industry: We’re Outta Here...”


  • avatar
    alluster

    The Yen has not only appreciated against the dollar, but every major market where the Japanese import a lot of cars from Japan or plan to increase their presence. The Yen is near all time highs against the EURO, Chinese YUAN, Indian Rupee, Aussie Dollar, Brazilian Real, Russian Rubble, Canadian dollar and everyone else, most importantly the BRIC countries. So imports to the US are not the only ones being unprofitable. If the yen stays this high, the Japanese companies would be unable to compete and get a foothold in very important emerging markets.

    6 months data : Yen up 19.5% vs Euro, 10.7% vs USD, 17% vs GBP, 20.3% vs AUD, 21.2% vs CAD, 22.87% vs INR, 28% vs RUB, 8% vs CNY.

    http://www5.picturepush.com/photo/a/6703948/img/6703948.bmp

    Its funny how everyone is making a lot of noise except Toyota that must be hurting the most with 45% of their global production in Japan. Toyota with the most to lose from a strong yen has surprisingly remained quiet.

    • 0 avatar

      Toyota indeed is very exposed with about 50 percent of its capacity in Japan. Now, Toyota also has the largest market share in Japan’s domestic market, which evens things out a bit, but not much.

      Toyota has been complaining about the Yen for months – in a Japanese way, very politely.

      The way I hear it, the Japanese manufacturers are happy that Ghosn is taking the lead on this. He is a foreigner, he can say loudly what they think.

      The company to watch is Mazda. It has very little capacity abroad and makes most at home. They hurt a lot.

      • 0 avatar

        From what I understand, Mazda had similar problems with heavy reliance on exports and Japanese production in the mid to late ’80s, when the yen also picked up a great deal in value. They tried to increase production in the US, but it seems like they’re back in a familiarly tight spot.

        Were you around for any of the restructuring that went on in Japan in the mid-90s, or around Mazda when Ford started selling its stake in ’08? I’m just wondering if you have any perspective on how Mazda is back to getting in trouble with a high yen when it hurt them so bad in the past.

  • avatar
    korvetkeith

    Does anyone out there have the balls to bet on the “widowmaker” (short yen)

  • avatar
    minneapolis_lakers

    Mazda is building a plant in Mexico and also expanding in China (with its JV partners Changan and FAW) now that the divorce with Ford is settled. Mazda is also backed by a rich keiretsu sugar daddy — Sumitomo.

  • avatar
    Dimwit

    I’m surprised that they are still going to pull out of Flat Rock. I was sure that they will announce a great presence. They must be putting all their eggs into that Mexican basket.
    Does anyone know what the worldwide volume of Mazda is? Could they need only one factory to supply all their needed non-domestic volume?

  • avatar
    Lorenzo

    I’ve been told that the current appreciation of the yen is due to the repatriation of billions of yen after the earthquake/tsunami. If that’s the real reason for the latest appreciation, or the reason the Bank of Japan can’t take measures now to weaken the yen, don’t Japanese automakers run the risk of being seen as unpatriotic, or something worse?

    • 0 avatar
      eldard

      They tried using the tsunami as reason to move production overseas. When that didn’t fly it’s the high yen.

      As long as the dollar is in the toilet the yen will remain high.

      • 0 avatar
        aristurtle

        JPY is overpriced against EUR, GBP, CAD, RMB, and the currency for whatever the hell country you live in; it’s hurting Japanese exports worldwide, not just to America.

        They’ve been in a deflationary spiral for years, but nobody wants to take the short-term pain of a little inflation, so now they’re going to get the long-term pain of the manufacturing base leaving the country.

  • avatar
    doctor olds

    The Japanese have enjoyed competitive cost advantages due to currency manipulation. It is about time for the Yen to be reasonably valued. Now, for the Koreans….

    • 0 avatar
      eldard

      As if Amerika doesn’t manipulate its currency by printing its way out of debt (good luck with that.)

      You can’t compete with German, Jap and now Korean engineering. It’s as simple as that.

      • 0 avatar
        doctor olds

        Good point about the currency, though we really ain’t seen nothin’ yet as far as inflation.

        Wrong about the engineering.

      • 0 avatar
        eldard

        I’ve posted the following on TTAC a few months ago:

        “To achieve the same goal would take 5 Jap engineers, or 8 for a German team, or 15 for a Korean team (while still probably cheaper than the Jap team) and 700 engineers from a US team. And the Americans will demand more salaries per head, take two hour breaks shooting the $hit, high fiving each other and whining and bitching about everything under the sun. And ask for a longer time frame.

        No, you can’t compete with German or Jap engineering.”

        http://www.thetruthaboutcars.com/2011/07/ford-profitability-slides-earns-2-4b-anyway/

      • 0 avatar
        doctor olds

        @Elderd- Your notion that the American carmakers require 700 engineers to do the work of 5 Japanese engineers is profoundly, at least two orders of magnitude, in error!

        The facts are, at least at GM, engineering efficiency is greater in terms of product development output per head than Honda,as one example. Of course you have no way to know that living in a world of myth about America.

        I wonder: Why so hateful toward the Detroit companies, toward America?

      • 0 avatar
        mcs

        @eldard: You can’t compete with German, Jap(anese) and now Korean engineering. It’s as simple as that.

        I’ve worked with numerous engineers over the course of my career (Europe and North America) and have learned that the ethnic, racial, and national stereotypes don’t apply. Sure, you might find some that fit the stereotypes, but there are plenty of others that will break the mold.

        Two of the worst engineers I’ve personally known are German (from Germany) and some of the worst products and auto components I’ve owned have had Bosch on the label, but I’d never assume that all German engineers are incompetent based on those experiences. People are different and companies are different and have little to do with the country of origin or their race.

      • 0 avatar
        eldard

        @mcs:

        Of course anyone can do anything. But the deciding factor is the speed of development and cost. Sure the space shuttle is the most advanced space going vessel there is. But it turns out the old Russian rocket is just as effective for far less the money.

        US goods tend to be overpriced. And don’t give me that bullcrap about currency manipulation (what a tired broken record). With the dollar in the toilet they’re still overpriced.

    • 0 avatar

      The yen being “reasonably valued?” Let’s discuss that over a dinner in Tokyo, in a very reasonably priced (by Japanese standards) restaurant. You pay. In dollars.

      There usually is a defibrilator nearby. Just look for the “AED” sign …

      • 0 avatar
        mikey

        @ Bertel Schmitt…Okay just for my own infomation,how much. I just got back from Vegas. Dined at Mon Gabi on the strip at Paris.Not the best in Vegas,but certainly a cut above the standard. With a couple of drinks, a meal for two came to $80.

        How much approx in Tokyo?

      • 0 avatar

        I asked my in-house specialist to pick a reasonable, mid-priced steakhouse. She picked this one.

        Steak dinner for two 16,000 yen (that’s small steaks 5 ounce…)
        Medium bottle of wine: 4,000 yen.

        Grand total: 20,000 yen. $260.
        No need to tip. They’ll hand the money back.

        Of course you can have it more expensive.

      • 0 avatar
        mikey

        Thanks Bertel….$260.00..? Wow, we budget $200 a month for dining out.

    • 0 avatar
      eldard

      Reasonably valued? The worth of a currency is determined by the demand for it. Or lack thereof.

      I’ve said it before and I’ll say it again, people who don’t know about economics please stop talking out of your asses!

      • 0 avatar
        aristurtle

        It’s also determined by the supply of it, which is determined by the country’s monetary policy, which, for Japan, has been screwed up since at least the early nineties.

      • 0 avatar
        eldard

        In stable times, investors will flock to the Euro and greenback since those pose the greatest returns. Tokyo can choose to do nothing and its currency will still be undervalued since, you do realize that few will flock to the yen because Japan is now at Decade 3 of the Lost Ages?

      • 0 avatar
        aristurtle

        Their currency is overvalued, not undervalued. Did you even read? If it was undervalued, like the RMB is, industry wouldn’t be moving out, it would be moving in.

        The Bank of Japan has been keeping the currency “artificially” (whatever that’s supposed to mean) strong vs. the dollar, euro, etc. because it wants the Yen to be used as a reserve currency. Which it is, to an extent.

        The problem with that is that a strong currency is bad for exports. If you want to do a lot of exporting, you want your currency to be weak relative to the countries doing the importing. The Yen was weak against the dollar during the seventies and early eighties, which helped Japanese automakers (and electronics manufacturers, and everything else they were building back then) sell in the States (and, to a lesser extent, in Europe). Then the Yen started to rise in value in the early nineties and it hasn’t come back down, hence the deflationary spiral, manufacturing moving to Taiwan, South Korea, and China, and the infamous “lost decades”.

        That’s why China’s monetary policy has been to keep RMB pegged nice and low against a “basket of currencies” that represent markets it wants to export to. Renmibi isn’t going to be anybody’s reserve currency any time soon, but the exchange rates help keep China’s export-driven economy going.

        Since you screwed up the most basic premise of the article (Ghosn certainly isn’t complaining that the Yen is undervalued, he’d love that!) maybe you’re one of those people you mentioned who don’t know about economics?

      • 0 avatar
        eldard

        I said in stable times. Did you read?

        If there’s no crisis, no matter what anyone does the yen will be low if the dollar is not in the toilet.

      • 0 avatar
        aristurtle

        That prediction didn’t hold from the early nineties to the present day. If nothing in that range qualifies as “stable times” by your definition, I don’t think that you’ll ever see them.

        And stop focusing so much on the USD! For any other market that Japan wants to export to, the exchange rate has been unfavourable there too. Japan’s “lost decades” have been caused by their monetary policy; the do-nothing approach won’t “correct” the currency value until the manufacturing base has already left and it’s too late.

      • 0 avatar
        eldard

        I do hope China floats her currency asap. That’ll shaft the West even more. I ♥ it!!!

      • 0 avatar
        aristurtle

        You’re joking, right? China knows what the hell it’s doing. They know what a floating currency does to an export economy: they can look at Japan as an example.

      • 0 avatar
        eldard

        I’m not talking about exporting. Manufacturing is already shifting to Vietnam as it is. I’m talking about them gobbling up everything from resources to companies to technology.

        If Amerika created artificial wealth out of thin air for the last 70 years, China can suck in the wealth from the desperate carry trade whores. lolz

      • 0 avatar
        aristurtle

        Wow, you are clueless. That was Japan’s plan, genius! Successful exports -> strong currency -> use that strong currency to buy everything and stop making the exports yourself (the exchange rate won’t let you make money doing that anyway, after all). Then you’ve got a booming “service economy” where all the actual work is outsourced!

        Didn’t quite work out, did it? Hell, it’s not even working out for the US.

      • 0 avatar
        eldard

        That wasn’t Japan’s plan. It’s the carry trade whores that’s pumping up their currency. And you do realize that China lost 20 million factory jobs in 2008 yet they kept throttling ahead? They’re not as export dependent as Germany.

        And instead of taking advantage of a weak dollar, Amerikans prefer to bicker with each other. But then again who in their right minds would buy Amerikan goods outside of food and entertainment?

      • 0 avatar
        eldard

        You do know that 66% of Norway’s (a nation without debt) economy is service oriented?

        There is nothing wrong with a service economy. At least you can’t automize those just yet. Besides, US buys a whopping…$365 billion a year from China. And people lamenting the loss of their kitchenware, textiles and simple electronics industry is getting really laughable.

      • 0 avatar
        carbiz

        Norway? Gee, it’s not often you get to see the United States and Norway in the same paragraph.
        Service economy? Well, I guess it works for tiny nations with a homogenous population that has nothing anybody really wants. A service economy looks great on paper, until it comes time to design and build new tanks or weapons. Oops! All the factories are Asian-owned and controlled.
        with no television industry left in America, I guess the Pentagon will have to shop for LCD screen in Korea or China. That’s wonderful as long as we’re all friends.
        What happens when China has your money AND your factories. Who has the leverage then?
        Japan’s model failed, but China waited and watched and learned.

      • 0 avatar
        eldard

        A service industry can only exist on top of an industrial base or in Norway’s case, resources such as oil. Unless you’re a financial hub like Hong Kong. You do realize that America is still the world’s 2nd largest plane maker and 3rd largest car producer? Not to mention one of the top 5 oil producers and perhaps the biggest seller of food and still exports twice that of Japan’s.

        Of the $14 trillion wealth(?) that’s generated there, it’s not just laughable that people worry about the loss of $365 billion to China, it’s quite pathetic, really.

  • avatar
    michal1980

    eldard – posting the same FUD about american engineer twice does not make it any more true the 2nd time around.

    Have any FACTS to back up your claims about engineers? – yup, thought so.

  • avatar
    doctor olds

    General Motors is the largest carmaker in the world, and still dominant in North America despite losing half its brands and the political spin from the right.
    Just as a point of fact.
    In 2010, global number of vehicles produced per employee:
    GM 42
    Ford 32
    Toyota 26
    VW 18
    This doesn’t get to the detail of engineering output, but it is hard data that relates to personnel efficiency.

    • 0 avatar
      eldard

      Toyota is the largest by revenue. Followed by VW. From countries with a third and a fourth of your population, respectively.

      • 0 avatar
        doctor olds

        Toyota’s highest revenue region is, guess what, North America.Japan is second, but comprises a small fraction of their total. What do their home populations have to do with anything?
        Why not talk about the revenue generated by Saudi Arabia compared to its population. Quite meaningless really.
        Similarly, VW’s revenue is primarily not from the relatively(compared to the US) small economy of Germany. It’s illustrious GDP (meaning no disrespect to our Deutsche friends) is smaller than just our top three states even before PPP is considered.

      • 0 avatar
        eldard

        You, know, since you’re the biggest OECD nation, with the most number of scientists and engineers, shouldn’t the largest engineering corporations come from you?

        It’s doesn’t matter if Toyota’s income come from Mars. Point is they’re the largest. Heck, Daimler is as big as GM, How many vehicles they sell in comparison? About 1/8.

      • 0 avatar
        doctor olds

        What meaning do you place on the location of their HQ, when most sales are not in their home countries?
        If you wish to compare economic output, the U.S. GDP per capita is 29% higher than Germany and 39% more than Japan. So what??

      • 0 avatar
        eldard

        Precisely. Because their products are so good, people from other countries keep buying them.

        Now how many cars does GM sell outside of USA/China again? And have you heard before of the world’s 2nd largest industrial company (at that time) from the world’s richest, supposedly most tachnologically advanced country filing for an embarrassing bankruptcy?

      • 0 avatar
        carbiz

        eldard says, “And Bertel’s proven otherwise that Japan’s market is not closed (plesae, that gets really old.) Why would the Japs buy American cars when Americans don’t like to do that themselves? lolz”
        Really? The OECD’s 2010 report of their 28 member nations placed Korea and Japan at DEAD LAST for ‘foreign’ penetration of their automotive markets. DEAD LAST. Less than 4% of those two country’s sales are from ‘other than’ the Japanese 5.
        Do you not find that the least bit suspect? Even if you accept the notion (as I suspect YOU do) that GM builds nothing that Japan or Korea wants, what about Fiat or VW? VW outsells Toyota these days, but can barely sell 50k vehicles a year inside Japan.
        And you dare declare their market is not closed.
        Yeah, and I suppose the fact it took Toys R Us nearly 5 years to open their first retail location in Japan was just a coincidence, too.

      • 0 avatar
        eldard

        Funny. Wasn’t VW seem unable to crack 100K yearly sales in the US just a few years back? That means the market is closed then?

        Japanese will buy whatever they desire. Considering they’re the largest luxury goods market and Mercedes selling as much as the local luxury champ. If Lexus sells 200K to Merc’s 30K, then I’d be suspicious. Last time I checked, they’re crazy about the iPhone (like in KOrea.)

      • 0 avatar
        doctor olds

        Re: VW in America.
        The truth is, VW was once the dominant import brand in America. Their Market share peaked in 1970 at 5.63%
        Now they rave about soaring sales success, their share rising from 2.2% to 2.5% this year. GM share grew from 19% to 20.1%.

        In fact, Japan requires substantial re-checking of fastener torques among other non-tarif barriers to imports. At one time, a study showed that a $30K Jeep had $10K in additional costs to be sold in Japan.

        The Toyota Cavalier was, at least at the time, the only non Japanese brand to gain government approval to be shipped directly from the Lordstown plant to dealers in Japan. Other imports required extensive rework upon entry into the country.

    • 0 avatar
      eldard

      You do realize that about half of GM’s output uses Chinese labor?

      • 0 avatar
        doctor olds

        Elderd, that is factually inaccurate. GM produced 8.39M cars globally, 2.35M of them in China with none of them being exported.

        The U.S. market is by far the richest of any in the world and GM made more than all of its net profit in NA last year. European losses off-set all other region’s profits. GM is clearly still the dominant player in the richest market, enjoying the highest transaction prices of any full line carmaker and gaining market share.
        Let’s see how revenues stack up in 2011. I doubt Toyota will keep the lead selling a couple of million less than GM for the year.

      • 0 avatar
        alluster

        GM produces more cars than Toyota with 2/3rd the employees. GM employs 208,000 to Toyota’s 317,000. GM is not affected by the strong yen unlike Toyota. GM is growing faster in emerging markets like China, India, Brazil, Russia while also gaining market share in mature markets like the US and Europe. The yen is unlikely to hit 85 to dollar in the next few years, the level at which Toyota can profitably export. For every one yen rise against the dollar beyond 85, Toyota loses 34B Yen a year in operating profit. Do the math, at 77 yen to the dollar, that’s 272B yen ($3.5 Billion) wiped off their books.

      • 0 avatar
        carbiz

        Wow, I have no idea who you are but your facts are all over the place. GM is not just limited to North America and China – where do you get your facts? GM sold 657k units in Brazil last year, for 20% of the market. Brazil is reputed to become the 4th largest market in the world very soon. They outsold Renault, Honda, Hyundai, Toyota, Peugeot and Citroen COMBINED.
        Chevrolet/Opel is also very strong in the Eurozone. GM is #2 in China. Are you getting all of this?
        Now, if you take Japan’s closed market out of the equation, where Toyota enjoys 1.5 – 2 million annual sales. Well, now you’re talking!

      • 0 avatar
        doctor olds

        GM is #1 or #2 in every one of their regions, which cover the entire globe, other than Europe, where they were #4, the last time I checked. Toyota is #1 only in their closed market of Japan where all imports comprise only a few tens of thousands. And don’t manage second place anywhere else. If the closed home market is set aside, GM has always been far ahead of Toyota.

      • 0 avatar
        eldard

        Now you’re grasping at straws. Toyota is the market leader in Australia and #1 in the ASEAN region. And dominates most of Africa and the Middle East.

        And Bertel’s proven otherwise that Japan’s market is not closed (plesae, that gets really old.) Why would the Japs buy American cars when Americans don’t like to do that themselves? lolz

      • 0 avatar
        doctor olds

        Elderd- What I wrote is factually accurate based on GM’s global regions. Australia is a smaller market than the state of Texas, btw.

        Regardless of what you think Bertel proved, No foreign brand sells more than the 10’s of thousands in Japan. All imports account for only a couple percent of the market. Take away Toyota’s home market 2M to 3,000 advantage and GM is very much larger.

      • 0 avatar
        eldard

        Actually, Mercedes sells as much as Lexus does in Japan. It’s not a closed market, they just can’t be bothered to buy anything Detroit produces (that’s like torturing yourself, anyway). If Americans won’t buy American cars, why would anyone else?

      • 0 avatar
        eldard

        So what if Texas is bigger than Australia? I just torpedoed your claim that GM is #1 0r 2 in every region. I highly doubt if they are even in the top 3 where Toyota dominates.

        As I’ve said, Mercedes sells as much as Lexus does in Japan. So again your statement that ALL foreign make penetration is miniscule is asinine.

        BTW, I doubt if GM will have more productive per worker figures if you take out the China operations. Doesn’t GM (and Ford) have 2-3 times more workers in North America than Toyota’s?

      • 0 avatar
        doctor olds

        @Elderd- You THINK you torpedoed my claim, though you have not presented any data to prove otherwise. Relying on memory of an earlier report, I have to admit I was wrong about Europe. GM’s share slid to #5 in 2010, not #4 where they were in the report I remembered. The following market shares and ranks are from GM’s 2010 annual report.
        GM region Rank Market Share
        North America- #1 18.1%
        South America- #1 19.9% (#3 in Brazil alone)
        Europe- #5 8.8%
        Intl Ops- #2 8.8% (#1 in China alone)
        World #2
        (Globally, GM virtually tied with Toyota both rounding to 8.4M units in 2010, though GM was 30,000 or .0036% behind, thus #2)
        MB-Lexus compare is the irrelevant fact, far overshadowed by the reality that ALL imports combined capture only a few % of the Japanese market. Just goes to show how small Lexus is at home.

        I mentioned Texas in response to your idea that Toyota being the leader in Australia with 200K total sales has great meaning. Meaning no disrespect to the Aussies, they are not a huge market.

      • 0 avatar
        eldard

        It doesn’t matter if Australia is smaller than Haiti, they are a region themselves and GM is not # 1 there. Along with Southeast Asia where Toyota dominates. GM probably doesn’t even register in the top 5 there.

        The entire luxury car market in Japan is small. But MB penetrated it well. As I’ve said before, Japs will buy what they want. Who in their right minds would buy a small Detroit car, anyway? The only thing that’s getting noticed is the Cruze. And it had to have Korean input.

        As for Cherokee “restrictions” (another non-seller outside of NOrth America), it’s their policy. If you don’t agree with it, retaliate/protest/whine like a baby. Besides, I highly doubt if Uncle Sam would want to offend their 2nd biggest customer for treasury bonds. That’s what you get for being dependent on debt.

      • 0 avatar
        doctor olds

        @Elderd You can consider Australia a “region”if you want , though it is really one relatively small national market in the larger view of the auto industry and GM is #2 there. I suppose your next rant will be about the vibrant market in Hait.

        The bottom line remains. GM is solidly #1 in the world again, despite having virtually zero sales (along with ALL other foreigners) in Japan. They are making money doing it, and will continue to grow away from the others.

      • 0 avatar
        eldard

        Ranting is Amerikan specialty. Only you people were born with that gene aka the greatest whiners in the world. lolz But anyhoo, if you keep denying that GM is not #1 or 2 in every region as you claimed, then there is really nothing much I can do.

        And since the Camry just regained the sales crown for months now, don’t bet on it. Toyota will probably lose this year, but it’s not the end of the world. ;)

  • avatar
    alluster

    Toyota is now threatening its Japanese suppliers to cut prices to match overseas suppliers or be replaced by overseas suppliers. Nissan has already decided to source more parts from overseas suppliers. The hollowing out is happening. Toyota is also going to start exporting cars from India to Africa and South East Asia to counter the strong yen.

    • 0 avatar
      eldard

      They can always buy from Amerikan suppliers. Like those accelerator pedals. lolz

      • 0 avatar
        carbiz

        … or the electric power steering motors GM got from Japan…

      • 0 avatar
        eldard

        That’s funny coz it’s the bolting that was the cause of the Cruze’s steer popping.

      • 0 avatar
        geozinger

        The accelerator pedals that were supplied to Toyota by CTS were the only ones noted for problems. CTS supplied pedals to other
        manufacturers, notably Honda and Chrysler.

        http://tinyurl.com/y9ad87h

        The defective electric power steering units were in the Cobalt, not the Cruze. Get your facts correct.

      • 0 avatar

        The defective electric power steering units were in the Cobalt, not the Cruze. Get your facts correct.

        You first, geo. Chevy Cobalt electric power steering mechanisms fail. Chevy Cruze steering wheels fall off, as eldard correctly stated.

        Note the common “Chevy” theme…

      • 0 avatar
        geozinger

        @Rob Finfrock: Yep, wrong attribution. I owe carbiz an apology.

        Carbiz: My aplolgies.

        To Edlard’s point: ONE car. 2100 cars recalled. No other incidents.

        http://tinyurl.com/3d2e76a

        How many Toyotas were recalled for accelerator issues?

        http://tinyurl.com/yfqzhcg

      • 0 avatar
        carbiz

        … the bolts were probably from China. Curious that the Corolla and the Cobalt suffered the same fate with their shared Japanese supplier of their electric power steering.
        And your answer to that is to bring up some silly remark about bolts on a steering wheel? That could have been a disgruntled worker. It doesn’t suggest a design defect, like the power steering motors.
        eldard, you’re just going to have to get used to the new world order: GM, VW, Toyota.. and the rest. And if you deleted Toyota’s 1.5 million captured sales inside Japan, they’d be below Hyundai and Ford by now.

      • 0 avatar
        eldard

        That’s funny considering 8 million minus 1.5 = 6.5. They’d still be ahead of Hyundai and Ford by about a million units.

        Now if we delete truck sales from the Big 2…

      • 0 avatar
        doctor olds

        wrt Cruze Steering wheels-
        There is an awful lot of discussion and false logic built on (1) loose fastener on a tiny population of a few thousand cars that went through an after the assembly line repair operation to replace incorrect steering wheels. Certainly has nothing to do with who supplied the “bolts”.

        I am more critical the wrong wheels being assembled on the cars in the first place! There are very, very many opportunities for failure in the car business, far beyond the imagination of those who have never worked to identify correct and assure the problems can’t ever occur again.

  • avatar
    carbiz

    Official Notification from the Right Honorable Jun Azumi, Minister of Finance of Japan to all our nation’s international corporations:
    “Gentlemen, the party is over. The Japanese taxpayers are tapped out. The banks that have lent you money for decades at no interest so that you may assault foreign markets, are themselves in deep do-do. The March earthquake and tsunami are about to cost the taxpayers a crap-load of money and we don’t know where to get it, other than to tax the rich and call in our foreign reserves.
    Expect a high valued currency and no help from us. Ever.
    Further, although we wish you well, please be advised that as container ships transport machinery and equipment to Vietnam, Singapore and China to set up operations there, our inspectors will be looking for rich billionaires hiding in the cargo holds with their stacks of cash.”

    Best Regards, The Minister of Finance, Japan.

    • 0 avatar
      eldard

      That’s good. If Japan goes down, I’ll finally be able to afford tuna on a dally basis. Approaching $8 a kilo here now.

      • 0 avatar
        eldard

        Basically we are outbid by foreigners on our own products. Something Americans will experience first hand if they continue to pressure China to float her currency. Ooh, I hope they do. ;)

    • 0 avatar
      carbiz

      I do, too eldard: I am sick of having to replace my appliances time and time again because the Made in China crap falls apart.
      My Whirlpool dishwasher is 4 years old: the high temperature fuse went in year 2 ($130 to replace) and now the rinse agent dispenser is f$%@ed. My mom’s GE came with the house in 1971 and my cousin just replaced it a few year’s back. I’ve gone through 2 blenders in 6 years (made in China) after finally replacing the one my mother gave me in 1980 that she got in 1971. Three vacuums since 1991 that replaced the one my mother gave me in 1980 as a wedding present she got in 1960 (and boy, were my sister and I tough on THAT Eureka as kids!)
      I can’t wait until the ‘American’ companies repatriate their factories to Akron, Toledo, St. Louis and Hamilton. I’d gladly pay double for an appliance that is made here and last 30, not 3, years.

      • 0 avatar
        eldard

        Don’t bet on it. No one designs stuff to last decades anymore. Even Mercedes cars don’t last that long now (but then again they’re made in Alabama lolz)

        I can’t wait until China gobbles more resources than they do now and manufacturing shifts to Vietnam and Bangladesh.

      • 0 avatar
        Zackman

        What? I can no longer buy a Zenith TV with “Space Command” remote? Rats! Now what?

  • avatar
    wmba

    @dr olds

    Cavaliers made for Toyota to sell in Japan years ago. That was an utter disaster, from what I read in CAR magazine. A pathetic car designed in the early ’80s, never updated like the Opel/Vauxhall was, sent to Japan to sell against well made domestic product. And GM amazed that the Japanese didn’t buy them. Typical. GM so isolated that it never occurred to them that Cavaliers were crap, because they were too haughty to examine Japanese cars and see where they were better. According to GM, they were equivalent, when anyone could see the assembly quality was shoddy at best. Blind insolence which characterizes GM to this day. For some reason beyond the ken of mortal men, GM believes that the crap they make is superior to anything else, and they get belligerent when others disagree.

    GM sales in China. Still counting Wuling vans as if they were all GM, when they are the product of a JV. More delusion.

    Torquing fasteners on all imports to Japan? I call BS on this one. Sounds like an old wives tale.

    There is nothing magic in making and designing a car, and certainly nothing magic about GM. The only recent hits they have had are the Cruze and Camaro. Meanwhile, unfazed by anything logical, you defend GM to the skies. You’ve probably never owned a Japanese car, so don’t have a clue about them, but are certain they must be worse than any GM, just because.

    You sit in the middle of the woods, unable and unwilling to see the trees, with your fingers in your ears so that nothing can intrude on your reverie, and rail at everything non GM. It’s this kind of attitude that got GM into bankruptcy. Apparently that has been passed off as a mere hiccup in the history of glorious GM, that didn’t really happen. No lessons learned, no humility felt, no let’s just plow on straight ahead as if nothing bad happened. It was just a dream.

    And so I get to read your ridiculous defense of GM over and over and over and over and over again. I rate you as the number one fanboy for any brand. Amazing you are. A pity that which you defend and laud is entirely unworthy of your misplaced attempts to rewrite history.

    GM has learned nothing from bankruptcy. And neither, apparently, have you.

  • avatar
    doctor olds

    @wmba- I didn’t claim the Toyota Cavalier was a sales success, but I cite my direct dealings with the program, Toyota and the Japanese government to support my knowledge.

    As a matter of fact, one of GM’s prime motivations for the NUMMI joint venture was to get inside, detailed understanding of Toyota’s quality systems and allow performance benchmarking. You clearly have minimal understanding of how hard the car business actually is. I know where we (GM) started, and how we caught up. Not from journalists or other sideline chatterers, but from real hard data and working to improve product quality.

    I love and know the car business from more years experience than many commentors or journalists have even been alive. I don’t knock the other companies and don’t claim GM to be anywhere near perfect. I know what I know, and can see the myths and distortions among many commenter’s ideas. btw- 2nd place VW gets 27% of their global sales volume from their Chinese joint ventures. GM gets a whoppingingly higher 28%.
    I am not one bit ashamed to bring some real truth to the ideas about the industry and GM in particular. I have never knocked the other companies. I agree that Toyota and Honda have built great quality cars and how they have driven everyone (except most of the Europeans) to much higher quality levels.
    wrt- Checking bolt torque: I remember that factoid from a study initiated by Ohio US Congresswoman, Marci Kaptur, whose district included the Jeep plant in Toledo. I have a very good memory and distinctly recall that a Jeep sold for $40k in Japan vs $30k here. That study was back in the ’90’s and I didn’t surface in a quick google search.

    If not for non-tariff barriers, how do you explain the miniscule penetration of ALL foreign makers in Japan?


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