For Ford, Japan’s Economic Policy Is an Unfair Disadvantage
Ford’s (NYSE:F) vehicles have been selling exceedingly well, but that hasn’t stopped Ford’s Joe Hinrichs — who heads up Ford North America — from becoming increasingly vocal about the advantage that Japanese manufacturers have, notably Toyota (NYSE:TM), due to the intentionally weak state of the Japanese Yen.
During a talk at the Economic Club of Chicago, Hinrichs said Ford would “urge Congress to oppose a TPP [Trans-Pacific Partnership] if it does not include strong currency disciplines,” Automotive News quotes him as saying.
“When Toyota came out and said half their profits are due to currency change of the yen, that’s a big deal. They said that,” Hinrichs told reporters after the speech. “When [Toyota President] Akio [Toyoda] came out in support of [Japanese Prime Minister Shinzo] Abe saying we need a weaker currency, that’s a corporate policy statement.”
Japan’s economy is largely export-based, and to help recover from the financial crisis — and the massive tsunami that paralyzed a swath of Japan’s economy — Shinzo Abe has allowed the yen to slide in order for Japan’s multinationals to gain a favorable price advantage abroad. Naturally, it’s been troublesome for companies competing against the changing currency climate.