Breaking News Emails
President Donald Trump on Monday pressed leaders of the Japanese auto industry to up their game, even though many Japanese brands have significantly higher American content than iconic Detroit products like the Ford F-150.
The president, who landed in Tokyo at the beginning of a 12-day Asian tour, told Japanese business executives, “Try building your cars in the United States instead of shipping them over. That’s not rude. Is that rude? I don’t think so?”
Trump made automotive manufacturing and jobs a central tenet of his 2016 campaign for the White House. And while he primarily focused on Mexican car plants he also cited Japanese automakers, Toyota in particular. But his latest comments raised more than hackles as automotive observers pointed out that Japan has invested heavily in U.S. automotive manufacturing over the past three decades.
“The president didn’t express himself well,” said David Cole, director-emeritus of the Center for Automotive Research in Ann Arbor, Michigan. “There’s no question the Japanese produce a significant portion of the cars they sell in the U.S. here in the U.S.,” and even more if you include NAFTA.
This isn’t the first time the subject of Japanese auto imports has been raised. Detroit’s Big Three automakers were able to force the Japanese to accept supposedly voluntary import restraints in the early 1980s. That led Honda to open its first U.S. plant in Marysville, Ohio in 1982, and Toyota following up several years later in a partnership with General Motors called New United Motors Manufacturing. (That Fremont, California facility today is run by Tesla.)
Today, virtually every Japanese automotive manufacturer operates at least one assembly plant in the States. Mazda, which walked away from a Michigan plant operated as part of a joint venture with Ford, plans to return by 2021 in another partnership, this time with Toyota.
According to the Japan Automobile Manufacturers Association, that country’s carmakers produced about 4 million vehicles in the United States in 2016 – and when plants in NAFTA partners Canada and Mexico are included that accounts for three-quarters of their total U.S. sales.
Over the last 30 years, imports of Japanese-made vehicles have tumbled sharply, from 3.5 million annually to just 1.5 million last year. Meanwhile, Japanese automakers have become some of the largest automotive exporters from the U.S. In 2016, for example, Toyota shipped over 135,000 vehicles – over half an assembly plant’s worth – from the U.S. to 40 foreign markets.
Counting the number of vehicles assembled in the U.S. is just part of the debate. In their early years, Japanese makers largely relied on engines, transmissions and other high-value components, most produced in their home market. But that also has shifted. Nissan, for example, produces everything from sheet metal stampings to powertrains in Tennessee, where it also operates the largest assembly plant in the United States. The Smyrna plant, an hour outside Nashville, even produces batteries for the Leaf electric vehicle.
As a result, many Japanese products now rank at the top of the “Most American” vehicle lists, including the Camry, which was number one for 2017 according to research done by both Autoguide.com and Cars.com. (A third study, by Marketwatch, ranked two Jeep models at the top.)
On the flip side, many supposedly "American-made" cars use components imported from Japan, China, South Korea and other parts of the world, even if they are assembled somewhere in this country.