Japan automakers willing to work with U.S. on trade grievances

TOKYO — Japan’s auto industry, under increasing trade pressure from U.S. President Donald Trump, has struck a conciliatory note, saying it is open to addressing American grievances and even defending the president’s stance as a “natural” job-building strategy, not protectionism.

Japan’s auto market is open, but its carmakers, including Toyota Motor Corp., Nissan Motor Co. and Honda Motor Co., are willing to work with governments in Tokyo and Washington on smoothing out disputes over access, said Hiroto Saikawa, chairman of the Japan Automobile Manufacturers Association.

Earlier this month, the U.S. government filed a complaint about Japan to the World Trade Organization citing non-tariff barriers that limit access to the country’s auto market.

Japan imposes no tariffs on imported vehicles, unlike the U.S., which does. But regulatory and inspection differences in Japan might be perceived as non-tariff barriers, he added.

“We think the Japanese market is becoming open,” Saikawa said Thursday at JAMA’s monthly news briefing. “But from the external point of view, if there are areas where they find difficulty doing business, then we would like to have active discussions and come up with a solution.”

Saikawa, who was tapped last month to be sole CEO of Nissan Motor Co. after being co-CEO with Carlos Ghosn since last fall, also disputed portrayals of Trump’s policies as protectionist.

Trump has urged automakers from Japan, the U.S. and elsewhere to build more vehicles in the U.S. by threatening imports with a border tax. He has also proposed renegotiating the North American Free Trade Agreement in a bid to spur job growth inside the U.S.

“I don’t think they want to harm the free trade the country enjoys,” Saikawa said. “They are trying to increase employment in the U.S. I don’t think this equals protectionism.”

Saikawa said promoting the local economy is part of a political leader’s job.

“Looking at it from the perspective of a prime minister or president, it is natural they would like investment to be made in their respective countries,” he said.

Impact on costs

The trade policies Trump has floated, especially a renegotiation of NAFTA, would affect U.S. automakers almost as much as Japanese automakers, Saikawa said. Indeed, various independent studies have forecast that Trump’s proposed border adjustment tax or NAFTA reboot could dramatically boost costs across the board for U.S., European and Japanese players.

“The Detroit 3 and Japanese companies are in a similar situation,” Saikawa said. “If NAFTA changes from the current form, then we will take steps and address the issues together.”

Saikawa also downplayed the impact of Trump’s proposal to possibly roll back aggressive U.S. fuel economy targets set by the Obama administration. Carmakers worldwide are locked into product strategies that turn on improved fuel economy, and the trend is set to continue.

“In terms of the major direction of technology development, I don’t think there will be much change,” he said.

Next month, the U.S. and Japan will begin talks about economic ties. The dialogue will be led by Deputy Prime Minister Taro Aso and U.S. Vice President Mike Pence.

“We have high hopes,” Saikawa said, “for a constructive discussion going forward.”


Source: AutoNews

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