🚀 go-pugleaf

>            kusogari@sheffield.ac.uk "Earl H. Kinmonth" writes:
>
> > EK = Earl Kinmonth
> >
> > (EK) It is North American market vehicles by the big three that are the issu
 e
> > (EK) in the current trade dispute.  These don't sell in Japan.  They don't
> > (EK) sell in any European country either, at least not in any numbers.
>
(MB) > Is it? I thought the bulk of the friction was about auto *parts*.

(EK) Possibly, but my generalization still holds.  Go into an auto
(EK) parts store in the UK or continental Europe and your're not going
(EK) to find it stocked with US auto parts....

(MB) > Even the big three seem to have realised that successful big cars in
(MB) > the US are unlikely to sell well in countries where roads are narrow,
(MB) > parking space limited and petrol is hugely expensive.

(EK) I think you give them far more credit than they deserve.  As far
(EK) as I know, the US auto firms have never made even a token effort
(EK) to design a car specifically for the Japanese market, not even to
(EK) tailor an existing model.

[reason for not attacking Europe for closed markets.]

> More likely because the US companies already own big chunks
> of the European industry anyway. So no US-Europe trade imbalance.

(EK) US firms own respectable if not huge chunks of Japanese
(EK) automakers or have in the past (Chrysler).

(EK) Ownership as such does nothing for the trade balance and, unless
(EK) there are profits to repatriate, ownership does nothing for the
(EK) balance in "invisible" items.

> > (EK) That suggests the UK market is de facto closed to the kind of vehicles
> > (EK) that are in dispute between the US and Japan.
>
> The UK market is not closed to these cars. Anyone that wants to buy one
> can buy one. The fact is that there is *no* demand for them.
> Few people can afford to run them here, only rich enthusiasts.

(EK) Agreed, but ultimately this is probably the main reason Japanese
(EK) did not buy US cars unless they were gangsters with a big bank
(EK) account and a desire to show their wealth by owning a largely
(EK) impractical vehicle.

> The US government could try putting pressure on the UK to reduce the
> fuel tax on petrol (gasolene), but it might be better for conservation
> of the world's resources if US petrol prices were raised in line with
> those of the UK and Japan. Then US car makers could really compete.

(EK) US gas prices are ridiculously low, but I'm not sure fuel economy
(EK) really makes a big difference given the lower average miles
(EK) driven in Japan.

It may well be true that the Japanese have in place various structures
that inhibit the sales of North American market automobiles and
automobile parts manufactured in North America.  But, at the same time,
North American market automobiles and automobile parts do not sell in
Europe.  That suggests two major possibilities:

1) Europe has inhibiting structures similar to Japan;

2) North American cars and parts are crap and won't sell anywhere
outside of North America (if in competition with better products).

Either way, the American position looks pretty stupid and grossly
hypocritical.  If 1) is true, why isn't the US dumping on Europeans?  If
2) is true, what's the point of dumping on the Japanese.

The response that US firms own European producers and don't dump on
Europe as a result doesn't wash for two reasons:

1) US firms also have substantial equity stakes in Japan;

1) the US is asserting "principles" that are being "violated" by the
Japanese.  Principles, by definition, are universal.  If Europeans are
violating "principles," the US should, in it's self-appointed role as
moral trade conscience to the world, dump on the Europeans as well.

A more interesting question is given the European evidence --
that North American cars and parts won't sell outside of North
America -- don't the Japanese just give the US what it wants, let
the US firms fall flat on their corporate *****?