By on February 4, 2012

For a long time, Japan’s automakers had pressured their government to enter free trade talks with Europe and the U.S. The Japanese government had dragged its heels, putting the interest of ageing farmers first. With a trade agreement, Japan would be a ripe market for American rice farmers and cattle breeders, and I would finally be able to enjoy a good steak in Japan without risking a heart attack. Caused by the price, not by the cholesterol.

After the Japanese car industry did flee the strong yen and the country, its government reluctantly entered negotiations. Not surprisingly, the American car industry is opposed.

When Japan announced its intentions to join the Trans-Pacific Partnership (TPP) negotiations, U.S. car companies represented by the American Automotive Policy Council (AAPC) expressed “adamant opposition,” Inside U.S. Trade reported. The AAPC represents Ford, Chrysler, and GM. Last November, AAPC President Matt Blunt demanded that Japan should not be allowed to join the TPP negotiations until U.S. and other foreign cars have achieved a higher market share in Japan. Which is a crafty way of saying “never.”

Now, the AAPC found another straw man argument. Japan should give up its beloved kei cars. Or rather the preferential tax treatment of the pint sized cars.

“Japan’s ‘Kei’ super-mini car segment has consistently represented over 30 percent of the auto market, but no longer has a clear policy rationale to be provided preferential treatment,” the AAPC wrote in an opinion paper submitted to the U.S. Trade Representative.  Imagine the uproar it would cause if a foreign trade organization would dare to doubt the policy rationale behind preferential treatment of the American pick-up. There is nothing that precludes the importation of foreign kei cars to Japan. If there would be foreign kei cars.

Of course it would be more honest to say: “Look, 2.5 percent import duty on foreign cars brought to the U.S. is low enough, who wants zero like in Japan. We want to keep that tariff. We especially want to keep the 25 percent chicken tax on trucks that worked so well. Exports to Japan? Are you kidding me?” That would be honest, but honesty does not get you far in politics.

Nobody knows that better than the former governor of Missouri Blunt, who did not run for re-election after one term, rocked by scandals. He chose a career in lobbying, which got him the job as AAPC president last year. Blunt riles against non-tariff barriers that unfairly prevent the success of American cars in Japan, but Blunt is hard pressed to name the barriers when asked what they are.

In an interview with Inside U.S. Trade, Blunt said that the AAPC will not develop an exact list of barriers its members face in Japan. Blunt said that would be a “classic whack-a-mole” approach under which the United States would seek to address one barrier only to have another one pop up.

Come on, Matt Blunt. Release the documents.

Meanwhile, the AAPC “is fully supportive of the ambition of a 21st century TPP agreement with Australia, Brunei, Chile, New Zealand, Malaysia, Peru, Singapore and Vietnam.” No wonder, they don’t have much of a car industry.

In the unlikely case that Japan should succeed with that TPP business in an election year, Blunt could always declare an emergency and shoot them.


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9 Comments on “While American Automakers Want Japan To Abandon Kei Cars, Matt Blunt Won’t Release The Documents, Again...”

  • avatar

    Would lack of demand be considered a trade barrier?

  • avatar

    Would there really be any demand for American rice? I’ve never had American rice that was palatable. Given a choice I’d much prefer Thai rice to Japanese rice.

    • 0 avatar

      40 years ago it was accepted that there were no good American wines. The 1976 Judgement of Paris changed that. 30 years ago it was accepted that American beer was best poured back into the horse it came out of. Micro-breweries changed that. Given a market opportunity, American farmers could grow the type of rice that Asian consumers want – the right size, shape, taste and mouth feel. Still might not change your affection for Thai rice, and that’s fine.

      I can remember long ago the Japanese tariffing American skis – something about the uniqueness of Japanese mountain snow….. Its an old game all countries play yet baldly deny.

    • 0 avatar
      Felis Concolor

      Having consumed scores of brands and varieties of rice grown domestically and around the world, I can vouch for the superior quality of American grown specialty rice varieties. My personal preference is for Tamaki’s short grain with the occasional smattering of Kokuho Rose for sushi preparation and I do enjoy several southeast asian brands depending on the situation.

      And that reminds me it’s time to prep a few cups of Tamaki Gold and whip up some musubi. My rice cooker may be Japanese, but most of the rice it prepares is 100% American.

  • avatar

    “We especially want to keep the 25 percent chicken tax on trucks that worked so well….”

    And don’t forget the two tier CAFE that entices Detroit to make the big and thirsty vehicles that have no hope of selling in crowded and expensive Japan.

  • avatar

    Rice, meat, Tobacco. These are things America does well. Is American Tobacco still sold by their Japanese rivals?

    Hm, I wonder where Canada stands on this.

  • avatar

    Perhaps we could drop the subsidies for electrics in exchange, up to and including the $1.4 billion subsidy of Nissan’s US Leaf and battery plant which is supposed to create 1,300 jobs at 1.1 million a piece when US Leaf demand reaches 150,000 a year.

  • avatar

    California short grain rice, grown with the Asian market in mind is pretty good. My Japanese wife has no problem with a couple of the specialty brands. Her sister in Japan is absolutely convinced fhat American rice is distinctly inferior, but it’s really a psychological bias – sort of along the lines of the old Coke/Pepsi thing
    As for the car barriers, they’re also psychological any more and not at all governmental or business based. My theory is this: the American unions complained loudly in the 80’s about Japanese cars, even going as far as holding sledge-hammer car beating parties; the kind of stuff that makes great news clips. These were shown widely in Japan followed, of course, by commentary about the trash-quality of American cars. Such turnabout is fair play particularly when true. This left a well-earned quality bias against American cars compounding the bias that already existed because American cars were big and flashy -so big as to be blatently impractical. Recall that in Japan, “the nail that sticks up gets hamered down” so, only gangsters and such types drove them. Of course, being left-hand drive didn’t help either.
    As for kei class cars, I don’t see any way that an American company could build a kei – even overseas – that could find an unfilled niche in the Japanese market.

    • 0 avatar
      Felis Concolor

      The Japanese know quality when they see it. I still get a chuckle out of Suzuki’s Lapin product sub site: at the top of their interior space page, prominently displayed along with the carpet roll and throw pillows, is an Eames Plywood Chair.

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