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NINETY EIGHT REGENCY

Trade chief cites auto concerns

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Trade chief cites auto concerns

U.S. official likely to touch on Japan, Korea and Toyota in talk to Detroit Economic Club

David Shepardson / Detroit News Washington Bureau

Washington -- The U.S. trade representative said he's not satisfied with Japan's opening of its "cash for clunkers" program to U.S. automakers.

In a Detroit News interview on the eve of his scheduled address today to the Detroit Economic Club, Ron Kirk rejected suggestions that the U.S. government's wide-ranging investigation into Toyota Motor Corp. is motivated by anything but safety concerns. The government owns a 61 percent stake in General Motors Co.

He noted, for example, that Japan decided to restrict imports of U.S. beef because of safety concerns.

Under pressure from Congress and the Obama administration, Japan last month opened its $3.7 billion "cash for clunkers" program to the Detroit Three automakers, with special import rules, to sell a few thousand vehicles a year.

But automakers complain that only a handful of U.S. vehicles qualify because of the emissions rules that Japan, one of the world's most closed auto markets, is using.

"We are not satisfied until we can get a market that is free from government distortion," Kirk said. "In this case, we kind of took one step forward and two steps back."

While in Detroit today, the former Dallas mayor plans to meet a number of Michigan officials and auto leaders, including Gov. Jennifer Granholm; U.S. Rep. Sander Levin, D-Royal Oak; and United Auto Workers president Ron Gettelfinger. Kirk also is visiting GM's Tech Center in Warren.

Among the issues he will address in his speech today is the Korea Free Trade Agreement, signed by President George W. Bush in 2007 but never sent to Congress for arbitration. Most U.S. automakers oppose the agreement because it did little to open the closed auto market.

GM has stayed neutral, because of its South Korean unit GM Daewoo, which is the fourth-largest automaker there.

Kirk's office said in a study that the agreement would boost U.S. exports by $10 billion annually.

But many in Michigan say the agreement traded the interest of U.S. cattle farmers for automakers.

Kirk said he is fully aware of the "disparity" that Korean automakers sell 700,000 vehicles annually here -- but U.S. automakers export less than 7,000 vehicles annually to Korea. He said members of Congress in Ohio and Michigan regularly bring up the Korea auto issue.

Rep. John Dingell, D-Dearborn, has called for amendments to the agreement because U.S. automakers "continue to have grave difficulties accessing the Korean market."

But Kirk warned that the European Union has signed a similar agreement to the U.S.-Korea Free Trade Agreement

President Barack Obama wants U.S. and Korean trade officials to negotiate an acceptable resolution, Kirk said.

Free trade agreements have long been deeply unpopular among unions, which argue that other countries haven't lived up to the agreements.

"I think I can honestly assess both the promises of trade and what some of the challenges are," said Kirk, whose in-laws are retired autoworkers.

From The Detroit News: http://detnews.com/article/20100219/AUTO01/2190345/1148/auto01/Trade-chief-cites-auto-concerns#ixzz0fzZrWlcn

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