WASHINGTON-The fight between the U.S. and Japan in the auto and auto parts trade came home to Washington June 8, when the International Trade Commission held a hearing on the proposed 100-percent tariff against Japanese luxury cars. ``Open your doors!'' was the chant of U.S. auto and parts industry supporters, who claimed the closed Japanese markets have cost them billions of dollars and thousands of jobs.
``Save our jobs!'' was the cry from representatives and employees of the nation's 2,000-plus Japanese luxury car dealers, who insisted their businesses will collapse if the tariff goes into effect, and also said their vendors for tires, parts and other items would suffer as a result.
Protesters for both sides waved placards and chanted slogans outside the ITC. Supporters of the U.S. auto and parts industry staged a press conference there, in which they accused the Japanese of bad-faith bargaining over the last 25 years.
``While we've talked year after year, Japan has kept its grip on its own market while flooding ours with their automotive products,'' said Andrew H. Card, president of the American Automobile Manufacturers Association.''
The combined U.S. trade deficit with Japan since 1980 has surpassed $100 billion, according to Lee Kadrich of the Automotive Parts & Accessories Association. If Japan would open its markets, he said, there could be as much as $5.9 billion worth of business opportunities available immediately to U.S. parts makers, translating into as many as 200,000 jobs.
Anti-tariff forces countered these statements with a press conference at the National Press Club later that day. Lexus, Acura and Infiniti dealers, their employees and association representatives accused the U.S. auto industry of stacking the deck against them.
``Not many people want to talk about the real pain that will be inflicted on American small-businesspersons, their employees and their families,'' said Walter E. Huizenga, president of the American Independent Automobile Dealers Association. More than 80,000 jobs at these dealerships are at stake, he said, as well as an unknown number of jobs with the vendors who serve them.
The 100-percent tariffs, affecting the Mazda 929 and Millenium and the Mitsubishi Diamante four-door, as well as 10 Lexus, Acura and Infiniti models, are set to become effective June 28 unless the U.S. and Japan can reach some sort of compromise.
The tariffs would effectively double the cost of the roughly 200,000 Japanese luxury cars sold annually in the U.S.-and likely severely depress sales.
Also involved are the 1 million original equipment tires (including spares) that come on these vehicles-not all of which are made by Japanese nameplate companies. A spokesman for Bridgestone/Firestone Inc. said only about 20 percent of the OE tires for those models are Bridgestone.
Michelin North America and Goodyear both acknowledged that they supply OE tires for several of the affected models.
BFS and Goodyear both said they hoped the trade differences could be settled without invoking the tariffs. Goodyear spoke of ``the sensitivity of our position as a supplier. . . (to) both U.S. and Japanese automakers.''
It's difficult to say how the sanctions will affect the sale of replacement tires for those cars, said Larry Morgan, president of Don Olson Tire & Auto, a 71-store tire dealership chain based in Clearwater, Fla. But Mr. Morgan opposes the tariffs on general principle.
``Would I like to see Japan open its doors to U.S. trade? Yes. Would I like to see sanctions? No,'' Mr. Morgan said. The Clearwater newspaper ran an article about how the local Lexus dealer's business would suffer from the tariffs, he added. ``My heart went out to him.''
U.S. and Japanese trade negotiators met June 12 in Geneva to discuss the sanctions. Although the talks were inconclusive, further meetings were scheduled for June 22-23, as this issue was going to press.