For many years, Detroit has blamed Japan for Detroit’s insipid sales in the island nation. Detroit, and its mouth pieces in Washington, claim this is because the Japanese market is closed. A look on the customs charts and into sales statistics would unmask this as blatant lies. In an overall flat Japanese auto market, sales of Imports rose 9.5 percent in 2013. Japan’s tariff on cars is zero. But then, who reads sales statistics and customs charts? Hopefully, more people read Reuters.
Imports hold a 10.6 percent share of Japan’s regular vehicle market. With Kei cars taken into account, a segment where imported cars have no offers, the import market share stands at 6.4 percent. Hoping that their constituents can’t read, the alliance of Detroit automakers, the UAW, and Democrat lawmakers nevertheless continues to uphold the lies of a closed market.
As data published by the Japan Automobile Importers Association show, the Volkswagen Group made good on what had been predicted on these pages last summer, and sold more than 100,000 cars in Japan. Its Golf was the first import to be named Japan’s car of the year. The Volkswagen Group alone sells seven times more cars in Japan than all of Detroit. Mercedes or BMW each outsell all of Detroit four times in Japan, and you won’t hear them complain about a closed market.
But then, if Detroit, the Democrats, and the UAW all say the market is closed, why should anyone believe a man with the initials BS? Help arrives from Reuters, the furiously independent wire service that, under the leadership of Pulitzer winner Paul Ingrassia, has some of the best and most reliable reporting in the auto business. In an article about imports to Japan, Ford’s Japan Marketing Director Hiroshi Kinoshita, says that “if the non-tariff barriers are gone, that would certainly lessen the burden, but that won’t mean our cars are going to automatically take off.” Reuters quotes a Japanese dealer of American muscle cars, who “is on the verge of extinction.” Satoshi Kimiwada “does not blame the “non-trade barriers” that U.S. automakers say block their access to Japan’s car market,” writes Reuters.
“Instead, he points to the brash image of the U.S. brands he has been selling in Japan for 20 years, which clashes awkwardly with mainstream consumer tastes in the world’s no.3 car market.”
While complaining about a closed market, “Detroit’s Big Three seem to have long settled for a narrow, shrinking niche even as European manufacturers stake out a growing presence,” writes Reuters’ Yoko Kubota. Indeed, the Detroit Three do very little to shape the brash image of the American car. “The Big Three each spent roughly a tenth to a twentieth of Volkswagen’s promotional costs,” Reuters writes.
While Detroit is not interested in the Japanese market, it is highly interested in keeping up the myth of an unfair, manipulative Japan, and to paint it as the foreign enemy. All of this helps the keep the huge 25 percent tariff wall intact that protected the American pickup market for decades, and that guarantees fat profits for Detroit carmakers that are as dependent on protected pickup sales as a junkie on a fix.
Ford clears around $10,000 on each F-Series pickup truck, says the Wall Street Journal. This is an outrageous profit margin that makes drug dealers envious. Pickup prices are rising at 2 times the industry average. From an already heady $31,000 in 2005, average transaction prices for large pickups have risen to almost $40,000, Edmunds told Automotive News. America’s true blue-collar vehicle fetches the same prices as luxury cars like the Cadillac ATS, or the BMW 3 Series.
These profits can only be made in an American market that is effectively closed to imported trucks. The American consumer pays dearly for closing the market to imported trucks, and on top of it, the American consumer is being lied to by the trifecta of Detroit makers, Democrat lawmakers, and UAW. Every second auto sold in the U.S. is a light truck.
The anti-Japan rhetoric increased in volume as the Big Three lobbied against the Trans-Pacific Partnership. Allegedly, their aim was to open an already wide-open Japanese market. In truth, they want to keep the American market closed to threats to their high margin pickups. According to Reuters, “the Big Three are arguing for a slow-paced 25-year phase-out” of the 25 percent tariff on trucks, “with an option to re-impose them should Japan violate agreements.” With Detroit’s low standards for proof, that violation is pretty much a given, and the U.S. truck market will remain closed, and truck buyers will remain fleeced, forever.