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Last Updated: Tuesday, 26 April, 2005, 10:53 GMT 11:53 UK
Toyota boss fears US trade fury
Toyota Prius
Japanese designs are proving popular in the US
Japan's car makers should consider giving their US rivals a breathing space to avoid the risk of a political backlash, the boss of Toyota has said.

Japanese car makers have taken nearly one third of the US market. Last week, General Motors posted a quarterly loss of $1.1bn, and Ford's profits fell.

By contrast, Nissan had record profits, and Honda's net profit rose 27%.

"We need to give time for some American companies to take a breath," said Toyota Motor chairman Hiroshi Okuda.

Mr Okuda, who is chairman of the Japanese employers' group Keidanran, said he was "concerned" about the situation at General Motors, the world's biggest car maker.

New trade wars fear

"Although a trade conflict, like ones....in the past, may be avoided, there may be some impact, because the car industry is symbolic in the US economy," the Asahai Shimbun newspaper quoted him as saying.

GM cars lined up a showroom lot
GM is suffering from weak sales in North America

As a solution, he suggested either forming technical alliances with US firms, or raising the price of Japanese cars sold in the US.

However, a spokesman for Toyota later dismissed price rises. "Our basic stance is that prices are something for the market to determine," the company spokesman said.

During the 1980s, Japanese firms faced political tensions in the US as lobbyists for local industries accused them of dumping unfairly cheap goods on the North American market.

Since then, Japanese car makers have switched production to US factories and boast their cars contain a high level of locally-made parts, and US manufacturers have become more concerned about competition from China.

But in the last couple of years, the popularity of Japanese cars with American consumers has hurt US car firms. Toyota last year sped past DaimlerChrysler to take third place in the US market

Many motor industry analysts argue that US motorists prefer Japanese brands because US manufacturers' designs are dull and dated.

Honda profits

Honda continued the Japanese challengers' successes with its fourth quarter results on Tuesday.

Net profit rose 27% to 95bn yen ($896m; 470m) against a year earlier, while sales climbed 9.5% to 2.35 trillion yen, shrugging off an the impact of an unfavourable dollar exchange rate.

Operating profits jumped 24%.

Nonetheless, analysts were disappointed as Honda's figures came in slightly below their forecasts, as did its prediction of overall profits growth of 3% in the 12 months to March 2006.

Honda is best known for motor bikes, and the popular Honda Civic family saloon.




SEE ALSO:
Record profit for carmaker Nissan
25 Apr 05 |  Business
Ford sees profits fall to $1.2bn
20 Apr 05 |  Business
GM loses $1.1bn as car sales slow
19 Apr 05 |  Business
Nissan names successor to Ghosn
21 Feb 05 |  Business
US sales bolster Nissan profits
09 Feb 05 |  Business


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