"Dwight Stewart" wrote in message
link.net...
"Dee D. Flint" wrote:

"Dwight Stewart" wrote:
Wasn't that much more the result of our own import
tariffs, significantly increased in the 80's to "protect"
companies like Chrysler from foreign competition?

Nope. It was a result of two things. One, the US automakers
buckled down and reduced their production costs to be
competitive. Secondly in the case of Japanese automobiles,
the Japanese government quit subsidizing car production when
their automakers succeeded in obtaining a significant
percentage of the US market (their government then put the
money into subsidizing other industries they wanted to get off
the ground). Once that happened the prices of Japanese cars
rose. The net result was that US and Japanese automakers
were now on a "level playing field" (snip)


I don't understand. Does the U.S. collect tariffs on imported foreign
products? If so, how can U.S. and Japanese automakers possibly be on a
"level playing field" if everything else you say above (no subsidies in
Japan) is true? Japanese automakers have the added burden of shipping
vehicles from Japan and the added costs of the import tariffs. They were
obviously willing to absorb the extra shipping costs prior to the increase
in tariffs during the 80's. So, with all that in mind, it appears the
tariffs is actually what drove a few Japanese automakers to build cars
here.


Let me make this as plain as possible. At one time (prior to the 1980s),
the Japanese government actually gave Japanese automakers money from
government coffers so that the automakers could sell their product at a
price less than it actually cost to get it to market. The goal was to
penetrate the market. Once they penetrated it, they believed that they
could hold a significant share of it as the consumers would be used to
buying their product. Once they penetrated the market, the Japanese
government classified autos as a mature industry and quit subsidizing it.
Once the automakers had to make profits without the benefit of subsidies,
the US companies were able to compete and the Japanese found that they
needed to have manufacturing sites in the US to continue to stay in the
market. The tariffs were never high enough to make much difference in the
situation.

Dee D. Flint, N8UZE