Automakers in Japan hint defiance of US curbs

When was it decided that only the United States had the right to make cars?" "Why should we have to suffer because we can make products more efficiently than others?"

The two comments, by top executives of Japanese automobile manufacturers, reflect some of the growing exasperation here over the prolonged trade dispute with the United States.

Some of this is now being turned against the government. There are hints of rebellion in the air -- suggestions that the manufacturers might not go along with any "political settlement" that seeks to drastically restrict their shipments to the American market.

The industry's defiant stance is hardening as Japanese and American government officials discuss ways to take some of the heat out of the current main source of trade friction between the two countries.

The industry's attitude is that there is no auto trade problem between Japan and the US. There is only the poor business performance of America's Big Three manufacturers, which are using the rapid increase in Japanese car exports as a convenient scapegoat.

Takashi Ishihara, president of Nissan (Datsun) Motor Company, insists that "this is strictly a domestic US problem."

He said the government was trying to resolve the issue purely for political reasons, to ensure it is not on the agenda for Prime Minister Zenko Suzuki's May 7-8 meeting with President Reagan. Government ministers concerned have been pledging repeatedly in recent days that the auto dispute will be settled before Mr. Suzuki arrives in Washington.

Mr. Ishihara also described as "totally irrelevant" officially expressed fears that the auto problem may become entangled with the American pressure for Japan to assume a larger defense burden.

This derives from a growing notion that the US is not spending billions of dollars to provide security for the Asian-Pacific region just so Japan can devote all its energies to destroying key segments of American industry. Most Japanese, however, don't see themselves in this villainous role.

According to one industry executive: "Both we and the Americans are engaged in business where no one has ever claimed sentiment plays a big role. If we have a competitive advantage in a product, then that is our good fortune, and we should exploit it fully . . . just as Americans would do if the positions were reversed."

There is growing industry mistrust of the Ministry of International Trade and Industry, which would have to oversee any voluntary export restraint agreement.

One executive claimed the ministry was "breaking its neck" to give the US what had not been officially requested -- "like a waiter bringing you a menu and asking you what you'd like."

The industry says all this haste is unnecessary. For example, the Kyodo News Agency has released a report of a team of reporters who spent three weeks in Detroit.

"There is a deep-rooted desire by the Big Three [manufacturers] and the United Automobile Workers union to revive the industry by making Japanese cars the scapegoat," the report said, adding, however, that they were basically the only ones demanding an import quota.

The reporters admitted there was desolation in the heart of Detroit "beyond our expectations," which showed the agony of the declining industry. But even in Detroit, Japanese cars were selling well.

Curbs on Japanese car exports are being sought partly to allow "breathing space" for Detroit to retool. Japanese officials, however, dispute this rationale.

Said one executive: "The only way you really improve your competitiveness is to meet tough competition head on. If you can't do that then you don't deserve to stay in business -- an American philosophy, surely?"

The Japanese industry says its American counterpart has been caught napping by a decline in domestic car sales and its failure to anticipate a switch by consumers to small, fuel-efficient cars.

It argues, however, that this advantage will soon be lost as Detroit starts mass-producing rival models, and that the problem of Japan's massive market share will soon disappear as domestic demand picks up.

But there are sharp differences on this latter point. The Japanese claim that sales in the US of foreign and domestic-made cars will be 11 million next year and 12 million in 1983. The US regards this as grossly overoptimistic when sales last year were only 7,830,000.

On this point, however, hinges whether the Japanese auto industry can be persuaded to restrict its shipments to the US this year to 1.6 million (from last year's 1.83 million).

Japanese companies are concerned about the wider implications of the auto dispute. If they give in easily to the Americans they will have no bargaining counter against similar European demands (Britain's foreign secretary, Lord Carrington, warned in Tokyo last week that Japan could not deal separately with the US and Europe on trade problems.

Surrender would also set an unfortunate precedent for future US-Japan trade.

One analyst commented: "The fact is that the two countries are bound to meet continuous friction as Japan becomes Stronger and encroaches on areas where American companies thought they had a monopoly.

"Computers and the entire field of electronics, in fact, are likely to be the next battleground."

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