Belfast Telegraph

Toyota’s loss not a gain for declining US auto industry

There has been a suspicion in Japan for several weeks that certain American politicians are keen to make as much fuss as possible about the Toyota recall scandal because of the ailing condition of their own automotive sector.

The call yesterday from Mike Johanns, a Republican senator, for a ban on imports of Japanese cars until the “Japanese Government can assure us that all the defects are out of these vehicles”, will have done nothing to allay those fears.

Mr Johanns, and others, clearly do see this episode as an opportunity for a spot of protectionism.

That's a mistake. For one thing, retaliation would be a certainty and with a GM recall announced only this week, the Japanese, and anyone else eager to protect their own auto manufacturers, would have the excuse they needed to impose restrictions on imports of US vehicles.

Moreover, the US auto industry does not need the help of a ban on Japanese vehicles.

Last month alone, Toyota sales in America were down by 11%, with GM and Ford both big beneficiaries.

People can see the problems that the Japanese manufacturer has had for themselves, and they've reacted accordingly.

That trend will go on until Toyota convinces US buyers that its problems have been sorted out. And the Japanese company will be busting a gut to do that, not because it wants to do the right thing, but out of straightforward economic self-interest.

This is how free markets work.

The US auto sector went into decline because its products are generally less attractive than those of the Japanese.

For now, the tables have been turned.

The long-term prognosis for American car manufacturers, however, is not a good one if it |depends on rivals' quality falling, rather than upping its own game.

Belfast Telegraph