Detroit Whines About Possible Japanese Currency Manipulation
Japanese leaders have been making noises about the Yen's slide against the dollar recently, prompting Detroit to whine about "Japanese interference in the currency market." According to Dow Jones (via CNN Money), the Big 2.8 were spooked by Japanese finance minister Fukushiro Nukaga's statement that his government will "keep watching movements in foreign exchange rates from now on." Japanese currency manipulation has long been one of Motown's pet peeves. The issue is a red herring; the majority of import-branded vehicles sold in the U.S. are made right here in the good old USA. Still, the accusations of sinister foreign forces manipulating international finances in their favor provides politicians with a welcome opportunity to look like they're fighting the good fight for American jobs and businesses. "Please stand up for American companies and workers by warning Japan that the United States will not sit idly by while it interferes in currency markets," wrote Sen. Debbie Stabenow (D-MI) in a not-so-private letter to U.S. Treasury Secretary Henry Paulson. Hey, election campaigns don't fund themselves.
I understand several Japanese owned US manufacturing plants are going to start exporting cars from the United States since the dollar has gone so low. How many US produced V8 powered F150's, Silverados and Rams do you think the 2.8 could sell in foreign countries, with gas prices ranging from $6 to $10 a (US) gallon equivalent, taxation on engine displacement, and often, small roadways? I suppose Ford could "try" to export some US built Ford Focuses (Foci?) but these POS's would be laughed off the forecourt in most other countries as hopelessly "1980's" outdated junque, and most people would simply demand the "real" Ford Focus built in their own country even if the price were higher. I understand that in Great Britain during the 1970's through 1990's, many British car buyers would demand that their Ford or Vauxhall (nee Opel) should not be built in the UK due to quality problems (real or perceived), but in Belgian or German or even Spanish or Portugese plants. Otherwise, no deal. Eventually, both GM and Ford quit building cars in the UK entirely.
They were sniveling about currency in 1980 too. Since then the J3 have gained ground in the face of a huge negative change in currency value (for them). Dear Debt3, Shut up and do something constructive.
The idea of currency manipulation always make me laugh: the $$ is getting cheaper, thus making American exports MORE competitive and imports LESS competitive. That's why all foreign manufacturers built U.S. plants. Would they do that if it was cheaper for them to build their vehicles in their home countries? It's one of the things I disagree with the AutoExtremist on. That may have been true 20 years ago, but certainly isn't the case now. If anything, the lower dollar makes margins much thinner for cars produced overseas and in Canada, as VW and others are currently learning.