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Report: Obama urged to push Japan to open its cash-for-clunkers program to U.S.

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Filed under: Government/Legal, Japan, Earnings/Financials

japanese-car-shopper.jpg

Like everywhere else on the planet, new car sales are down in Japan (17 percent versus 2008 levels, to be exact). And, like a number of other countries, Japan has decided to spur automobile sales by creating a cash-for-clunkers-style program at a cost of $3.7 billion. Unlike similar programs from other countries, including the one that ended late last year in the U.S., Japan has drafted a set of rules that strongly favors its own automakers - in effect precluding American cars from qualifying for sales incentives of up to $2,830 per vehicle. Eighty-seven percent of all Japan's domestic models qualify.

By way of comparison, there were multiple C4C bills considered by U.S. policymakers, and the program that eventually went into effect allowed any and all sufficiently fuel efficient vehicles to qualify for its incentives, regardless of their country of origin. After it was all said and done, 319,300 out of a total of 677,000 (just about half) of all C4C sales were Japanese cars.

According to the Detroit News, a number of American lawmakers, including Rep. Betty Sutton, D-Ohio, have called Japan's program "discriminatory and fundamentally unfair... unacceptable and outrageous." To highlight her displeasure over Japan's insular auto market - to wit, imports make up less than five percent of all new car sales in Japan - Sutton has introduced a bill this week urging President Obama to attempt to force Japan into including American automobiles in its C4C program. What are the chances of it passing? Something about snowballs comes to mind...

[source: Detroit News | Image: Yoshikazu Tsuno/AFP/Getty Images]

Report: Obama urged to push Japan to open its cash-for-clunkers program to U.S. originally appeared on Autoblog on Thu, 07 Jan 2010 16:01:00 EST. Please see our terms for use of feeds.

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Japan already essentially shuts out outside companies from their market, so this isn't a particularly hard hit, just an insulting one. I say we follow their lead, though, and if we ever do another similar program, and offer:

Domestic brand, domestic built cars get 100% of incentive

Domestic brand, Canadian or Mexican built cars get 90% of incentive

Domestic brand, foreign (other than Canada or Mexico) cars get 80% of incentive

Foreign brand, domestic built cars get 70% of incentive

Foreign brand, foreign built cars can sit in the corner and cry.

or something like that.

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^ I like the above list muchly, tho I would amend it like so :

Foreign brand, domestic built cars &

Foreign brand, foreign built cars

both get 35% of incentive.

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That would require the US to grow a pair.

Unlikely, in my view.

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That would require the US to grow a pair.

Unlikely, in my view.

+1

Obama is such a pussy.

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What?

Obama isn't at issue.

Long-standing stupidity/timidity in trade policy is.

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Camino is quite correct, but at the same time, the current administration is certainly NOT going to change that, either.

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It is not only the administration it is the entire Senate and Congress to grow a pair and change the status quo.

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Pretty pointless considering how many American cars are actually sold in Japan (a tiny % of their market, maybe less than 1%?)

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Pretty pointless considering how many American cars are actually sold in Japan (a tiny % of their market, maybe less than 1%?)

Thats a direct result of their laws only allowing JDM manufactures to sell cars in their country, foreign makes must be sold at those dealers(in dirty dimly lit corners)

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>>"Pretty pointless considering how many American cars are actually sold in Japan"<<

And would not American inclusion in a japanese C4C be a good step toward broadening that marketshare ??

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Just because Japan restricts their auto market more doesn't mean the US should follow suit. We are the leaders in the world and should act according to our own morals and ethics.

In the end, Japan is only hurting themselves by restricting their market. Less choice for their own consumers.

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What we should have always done is to demand fair-play from our trading partners.

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>>"Just because Japan restricts their auto market more doesn't mean the US should follow suit. We are the leaders in the world and should act according to our own morals and ethics."<<

I would agree for the most part, but I see no reason --ALSO being the world's auto market leader-- that we should not exert some pressure towards these closed markets to match our 'leadership example', if you get me. Like Camino indicated: a fair / level field... or there have to be some reprocussions for our own economic salvation. Right now and for far too long NOTHING has been done except from an adverse perspective.

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Camino is quite correct, but at the same time, the current administration is certainly NOT going to change that, either.

mass understatement there. why didnt folks figure that b4 the election

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Just because Japan restricts their auto market more doesn't mean the US should follow suit. We are the leaders in the world and should act according to our own morals and ethics.

In the end, Japan is only hurting themselves by restricting their market. Less choice for their own consumers.

we should openly call them out on this in the world PR arena. heck, even in our own country. people need to hear this.

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We did. We realized that "the other one's" response to this would have been to invade Tibet.

Just because Japan restricts their auto market more doesn't mean the US should follow suit. We are the leaders in the world and should act according to our own morals and ethics.

In the end, Japan is only hurting themselves by restricting their market. Less choice for their own consumers.

Reciprocal trade agreements. Simple as that.

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