Seiichi (Sean) Sudo, president of Toyota Engineering & Manufacturing in North America. “Our competitors are jealous of our success.”
Detroit’s congressional allies of GM, Ford Motor Co. and DaimlerChrysler AG’s Chrysler Group say it’s not jealousy. They say Japanese automakers are exploiting an artificially weak yen to make their products more affordable.
Japanese automakers “are importing the more expensive cars to the U.S., and getting the benefit of the yen imbalance,” Levin said. Japan has “a clear-cut set of policies, and we don’t have any.”
In the briefing to other Toyota managers, Sudo cited political and social risks. The report, left unsecured on computers at the company’s Georgetown, Ky., complex, said Toyota could come under fire for:
• Selling vehicles to U.S. customers with high proportions of foreign-made parts. Less than half of all content of Toyota vehicles sold in the United States is made in the United States or Canada.
• Leaving a vacuum in U.S. communities as GM, Ford, Chrysler and their suppliers shed plants and workers.
“A Democratic Congress, particularly those members with districts hit by Big 3 and supplier plant closings, may call for further oversight of the industry and Japanese companies in particular,” the presentation said.
Michigan Dems threaten to act
Toyota’s concerns are not far off the mark. With a new Democratic majority in Congress, Michigan’s Democratic lawmakers have pledged to press harder on trade and other issues where Detroit automakers say Japanese companies have an unfair advantage.
Last week, two Democratic House members from Michigan — Levin and Rep. John Dingell of Dearborn — sent a letter to Treasury Secretary Henry Paulson, urging him to press Japan over the value of the yen during a meeting of world economic powers.
Dingell, Levin and two other congressmen said that a weak yen had helped Japanese automakers increase their exports to the United States by more than 30% in 2006. Detroit automakers and their congressional allies say the yen bestows up to a $4,000-per-vehicle benefit for Japanese automakers.
The Harbour-Felax Group, a Royal Oak automotive consulting firm, estimated the yen benefit at $1,054 per vehicle in a study it released last fall.
“It is a little-understood fact that Toyota’s exports to the United States are almost as great as the number of vehicles produced in the United States by Toyota,” the lawmakers wrote. “We are certain that the weak yen is also boosting Japanese exports in other economic sectors and is having a significant impact on many U.S. producers.”
