The American Automotive Policy Council does not want Japan to be part of a free trade pact with America and other countries. The lobbying arm of Chrysler, Ford and GM published a study that claims that “including Japan in the Trans-Pacific Partnership (TPP) free trade agreement combined with allowing Japan to continue to manipulate its currency could put 90,000 American auto jobs at risk.”
Matt Blunt, president of the American Automotive Policy Council, told Reuters:
“We firmly believe a free trade agreement with Japan will lock in one-sided trade benefits that Japan enjoys today at the expense of U.S. auto jobs. It will deliver a blow to America’s auto industry and auto workers at really at critical juncture in our recovery.”
Bill Duncan, head of the Washington office of the Japanese Automobile Manufacturers Association’s is shaking his head: “Something is clearly either wrong or incomplete here. Japanese makers produce 70 percent of their U.S. sales in North America, the bulk of which are in U.S. plants with U.S. workers.”
Insulting the American public while assuming that it is stupid enough to believe it, the American Automotive Policy Council is still selling the old canard of a closed Japanese car market which the poor American automakers are just dying to penetrate if the heinous Japanese government would only let them.
The AAPC banks on the illiteracy of Americans when it comes to foreign currencies. The AAPC has the gall to claim that Japan uses “currency manipulation to gain an unfair competitive advantage” while the Japanese yen is at unsustainable levels that drive Japanese auto manufacturers out of their own country.
The AAPC keeps repeating that the Japanese car market is closed, but it can’t come up with proof. Japan has a zero percent duty on automobiles. America charges 2.5 percent on cars and a massive 25 percent duty on light trucks. The AAPC cites the “non-tariff barriers” that supposedly surround Japan, but it is unable to name them. In despair, the AAPC points at the low numbers of American exports to Japan, which indeed are a disgrace.
January through July 2012, foreign manufacturers imported 135,634 vehicles to Japan, up 24 percent from the same period of 2011. Volkswagen, Mercedes, BMW, Audi all registered double digit increases. Volkswagen imported 33,414 units in the period while Blunt’s paymaster Ford only managed to sell 2,185 and was outsold by niche-players such as Porsche and Alfa Romeo. Chevrolet did even worse with just 844 units sold. In typical “it is not our fault” fashion, Detroit blames its inability or unwillingness to sell cars in Japan on “non-tariff barriers that maintain a closed auto market.”
If you truly want to sell to Japan, you need to have what Japan wants. All of the Detroit Three had ample time to learn this. They all had the inside track when it came to Japan. Chrysler had an alliance with Mitsubishi. GM at one time had control of Isuzu. Ford had been Mazda’s largest shareholder for many years and controlled the company. They all pulled out for various reasons.
While Detroit and their Washington mouthpiece are blowing smoke, Japan is rolling its eyes. The most formidable barrier keeping Japanese imports out of the U.S. is the obscenely high yen. When Blunt alleges currency manipulation, he leaves only two options: Either he is stupid, or he thinks everybody else is. The 2.5 percent import duty on cars are peanuts in comparison. Nobody is thinking of importing pickups to the U.S., the big Japanese players all have their truck production in the country already. If you ask Japanese auto executives about the aim of the shrill anti-TPP rhetoric and the desperate lies of the AAPC, they shrug their shoulders.
One executive told me: “I think they simply want to be ornery.”
|Auto Imports To Japan January-July 2012|
|Cumulative Total January-July|
|Source: Japan Automobile Importers Association|