WASHINGTON, June 7, 2007 -- Amid a domestic landscape of sagging sales, shuttered factories, massive layoffs, soaring health care costs and product lines overly dependent on gas guzzling SUVs and trucks as consumers move toward fuel efficient cars, the Chairmen of DaimlerChrysler USA, Ford Motor Company and General Motors Corporation encouraged Congress yesterday to address what they charge is a major cause of their woes -- a misaligned and undervalued Japanese yen.
Speaking at a “Manufacturing Summit” held by the U.S. Senate Democratic Policy Conference on Capitol Hill, Alan Mulally, President and CEO of Ford Motor Company said, “Currency values must be fairly determined – through an open market – not pre-determined by governments. While much of the recent focus has been on China in this regard, Japan's actions have been most troubling to our industry.”
The automakers contend that Japan's undervalued yen is one of the factors causing US auto sales to decline against their Japanese competitors. They want the Japanese government to allow the yen to regain what they say is its “true value.”
“Nearly every major currency other than the yen has appreciated significantly against the dollar – including gains of 25% percent by the Euro, 30% by the Canadian Dollar, and 33% by the Korea Won,” said Automotive Trade Policy Council (ATPC) President Stephen Collins. While these other currencies have risen, the Japanese yen has sharply dropped against the dollar and other major industrialized currencies.
“Japan’s weak yen policy is causing serious damage and disruption to America’s auto manufacturers,” continued Collins. “The Japanese yen has now reached its lowest valuation in 20 years.” Collins and others said that the weak yen gives a boost to the country’s vehicle and parts exports. This has caused Japan’s car, truck and SUV exports to the U.S. to surge putting them on track to reach 2.5 million vehicles this year.
The Chairmen of DaimlerChrysler USA, Ford and General Motors, in today’s meetings with Members of Congress, voiced their support for Senator Debbie Stabenow’s legislation (S. 1021) that would require the US Treasury to take aggressive action bilaterally to raise the value of the Japanese yen.
“American auto manufacturers are very pleased that the misalignment of the yen is receiving the serious attention it has long needed from Congress,” said Collins.
The CEO’s stated that resolving the yen issue is one of the “core elements of ensuring US competitiveness” in the auto sector.
One issue the executives chose not to discuss was the increasing number of vehicles that Japanese companies build in the United States. Toyota alone expects to boost North American production to 2 million vehicles by the end of 2008.
Its recently announced Mississippi plant – just down the road from the birthplace of Elvis Presley-- slated to be open by 2010, will bring the total to 2.2 million.
Toyota is not alone. Currently, Honda and Nissan use local factories to produce about 75% of the vehicles they sell in North America.
As these companies import less and build more vehicles domestically it’s becoming increasingly difficult to make the case that the unfair practices of the importers – currency issues aside -- are responsible for the declining fortunes of the manufacturers formerly known as the Big Three.
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GRIEF SINCE EARLY 70's. They kept building gas guzzlers
and refused to address the issues (i.e.RELIABILITY) they
made BIG INEFFICIENT VEHICLES THAT WOULD MAXIMIZE PROFITS"
Yes the legacy costs have to be addressed by Congress but
the American people got fed up with their lack of quality control that is the reason they only have a 54percent
market share today! And until they build vehicles better
than Japanese,Koreans, Americans should buy the best car $