Japanese carmakers shift more production to the US and other locations, as yen rises

Article by Christian Andrei, on February 8, 2011

Due to the rising yen, Japanese automakers, long protective of their domestic manufacturing base, are shifting more production to the United States and other overseas locations or are seriously talking about doing so.

Some of these carmakers include Nissan, Honda, Mazda, Mitsubishi, and even Japan’s flag-bearer – Toyota.

The rising yen weakens the value of profits repatriated from overseas and pressures Japanese automakers to raise prices on their exports, a move which makes their products less competitive. The yen, since May 2010, has climbed 14 percent against the dollar.

In early May 2010, each dollar taken in from the sale of a vehicle exported to the United States meant about JPY94 in revenue to a Japanese automaker. Nowadays, that same dollar equates to just JPY81 in revenue, but the automaker's costs, in yen, to build a car in Japan have not changed.

In March 2010, Nissan Motor Co. (among the first to act) moved production of its March subcompact car overseas. For decades, Nissan has built the car in England for European markets, where it is known as the Micra.

However, the 2010 move means the March sold in Japan is imported from a Nissan plant in Thailand - a dramatic shift in strategy. Tatsuo Yoshida, an auto analyst with UBS Securities Japan, said that with the yen at such rates, it's almost “suicidal” to make small cars in Japan and export them. [via autonews - sub. required]

Topics: japan, united states

If you liked the article, share on:


Login or Create new account to add a comment!


Ever heard of the “Lynk & Co” automotive brand? Well, it is highly likely people haven’t. This is practically because this is new brand created by the joint venture between...
by - October 25, 2016
Mitsubishi is now officially part of the Renault-Nissan alliance after Nissan took over the Japanese car company recently. We know a lot has been happening in the car industry, but...
by - October 24, 2016
Driving the newest 2017 BMW 5-Series (G30), Clive Owen (Closer, Children of Men) returns to his role as “The Driver”. In this latest installment, what initially starts as a simple...
by - October 24, 2016
Many had wished that a Lamborghini Huracán Superleggera would somehow make a surprise debut at the recently held Paris Motor Show. Sadly, not a single Lamborghini appeared anywhere in sight....
by - October 24, 2016
Aston Martin and Red Bull Racing teamed up for the first time in creating what looks like one of the most ferocious beasts in history. The British car manufacturer has...
by - October 24, 2016