This may have already been discussed, but here it is. . . .
Toyota Exec Acknowledges Backlash Worry
TOKYO
A senior Toyota executive acknowledged worries Wednesday about a possible U.S. political backlash to his company's booming success that is in stark contrast to the woes facing American rivals.
In recent months, U.S. lawmakers from manufacturing states have charged that the Japanese government has kept the yen artificially low, giving Japanese automakers an advantage, and that just under half of the vehicles that Toyota sells in the U.S. are imported.
Continued at link.
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-Behind every argument is someone’s ignorance.
-Never underestimate the power of stupid people in large groups.
Not only is the yen cheap in nominal terms, but many years of falling prices in Japan have made it even more competitive. Its real trade-weighted value fell this month to its lowest since 1982 (see chart). The latest update of The Economist's Big Mac index (see article) showed that the yen was by far the most undervalued of the developed world's currencies—ie, hamburgers are cheapest in Tokyo. Using a more sophisticated model, Stephen Jen, of Morgan Stanley, reckons that the yen is 12% undervalued against the dollar, whereas the yuan is only 7% too weak. Against the euro, the yen is almost 30% below its fair value.
Ever wonder why the US trade deficit is so high? The United States' #1 holder of trade debt is Japan, and so long as we keep buying Japanese products with US dollars vs the (undervalued) yen, we will continue to see this deficit grow. . . . Just imagine if the yen was correctly valued. How much would that Scion, Toyota, or Lexus cost?
I'm not a fan of protectionist policies. I think we all might be better served if the government came up with some kind of solution for the growing health care problem in this country. That alone could help out the Big 3 greatly. Then again, I'm not for nationalized health care either.
At any rate, I believe I read something somewhere that said Japan stopped manipulating its currency in 2004. Still, it would be nice if car manufacturers outside of Toyota, Honda and Nissan had any kind of real access to the Japanese market.
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2001 Camaro SS
310 RWHP, 330 RWTQ stock @ 12,000 miles
28 mpg highway
Imagine if GM didn't squander it's market share building poor quality vehicles. Imagine if Ford didn't whore itself to the rental companies. Imagine.
Fan
Imagine if those quality and rental car issues were the fault of the corporation (Oh, wait, they are. . . .nobody denies that). Imagine if those issues were resolved (Oh, wait, the quality gap is shrinking or non-existent for a large portion of domestic vehicles, and fleet sales for both GM and Ford have dramatically shrunk in the last year). . . . What else you got?
The point is, American (or Canadian) companies that try and compete with Japanese companies (for the same product) are at a disadvantage due to the yen being undervalued. . . . The fact that you did not respond to that leads me to believe you came to the same conclusion, yet are unable to criticize this disparity due to your "Toyota's the best" mindset. . . .
__________________
-Behind every argument is someone’s ignorance.
-Never underestimate the power of stupid people in large groups.
Imagine if those quality and rental car issues were the fault of the corporation (Oh, wait, they are. . . .nobody denies that). Imagine if those issues were resolved (Oh, wait, the quality gap is shrinking or non-existent for a large portion of domestic vehicles, and fleet sales for both GM and Ford have dramatically shrunk in the last year). . . . What else you got?
The point is, American (or Canadian) companies that try and compete with Japanese companies (for the same product) are at a disadvantage due to the yen being undervalued. . . . The fact that you did not respond to that leads me to believe you came to the same conclusion, yet are unable to criticize this disparity due to your "Toyota's the best" mindset. . . .
No the point is that you do business in the climate that you live in. Imagining is for fools.
By no means am I advocating a “protectionist” approach to this problem. I do, however, believe in holding Japan accountable for what amounts to government sanctioned subsidies and policies that favor Japanese auto manufactures while shutting out Foreign makes. . . . With that being said, I can’t think of one legitimate product a US auto manufacturer makes that the Japanese would like (maybe the HHR, Cobalt SS, and European spec’ed Focus). That is not a knock on US auto makers, just that their taste in style and power does not mesh with ours (US likes big cars, with big power, relatively speaking).
Anyhow, the fact that anyone would excuse this policy just to cheer for Toyota (and their continued success) is appalling. Not only is it short sighted, it’s dangerous (cheering on a foreign policy contrary to the best interest of the US just so a corporation can “win”). I dare anyone to tell me this Japanese currency policy is good for both Toyota AND the US. . . .
__________________
-Behind every argument is someone’s ignorance.
-Never underestimate the power of stupid people in large groups.
No the point is that you do business in the climate that you live in. Imagining is for fools.
Quote:
Originally Posted by toyotafanfan
Fan
Huh?
No, the point is:
It's a global economy, and for one nation to purposefully manipulate it's currency to benefit it's own manufactures’ is unfair and a practice that should not be excused. There will always be exchange rates, no doubt, but these rates should be influenced by a FREE MARKET, and not by government policies.
I do not know how to fix this, that is not my area of expertise, but I do know that the yen being 12% would make the American products alot more appealing. Take a loaded Camry ($32,000) and Impala ($30,000). The Camry has more equipment, and is by most accounts a better vehicle. Now, take on a 12% "readjustment" fee due to the yen being undervalued. That's a $3840 increase in price. Now, how may car buyers would skip the $36,000 Camry and instead buy the $30,000 Impala (or 500, or 300C). Now, what if GM, instead of keeping the price at $30,000 decided to invest $3000 per car into the Impala, do you think that would make for a better Impala? You bet it would. This disparity is even more pronounced with the Luxury cars. Domestics have to stay competitive (price wise), so they do that by offering less content, or the dreaded "corporate radio" so many here hate. It's not always about GM being cheap, it has alot to do with GM and Ford’s current disadvantage in the world economy (healthcare, pensions, and making cars/buying parts with US dollars).
__________________
-Behind every argument is someone’s ignorance.
-Never underestimate the power of stupid people in large groups.
If anything the backlash is going to be because of declining quality.
Agree. My 6 month old 07 Camry XLE V6 has already had the transmission and 4 rotors replaced, along with a rattling and poorly fitting dash and other issues not expected from a car with a $31K MSRP, and certainly not from Toyota. Toyota better get a grip on growth and slow down a little, because if growth comes at the expense of quality, the big three, Honda, Nissan, and others will be all too happy to take the market share.
I'll think twice before buying another Toyota.....maybe it'll be a Lexus next time.
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