Chamber, lawmaker pressure Japan on clunker program

The U.S. Chamber of Commerce asked Japan to modify its program in a Jan. 5 letter to the Japanese ambassador, saying the U.S. and Japan must work together to “contain protectionist pressures evident around the world.”

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Separately, Rep. Betty Sutton (D-Ohio) on Wednesday offered a House resolution calling on the Obama administration to initiate discussions with Japan on its program. If talks through the Office of the U.S. Trade Representative (USTR) are unsuccessful, Sutton’s resolution calls on the administration to litigate at the World Trade Organization.

U.S. automakers and the United Auto Workers union have also raised complaints about Japan’s program, which allows consumers who trade in a car at least 13 years old to get a tax cut of up to $2,800 toward the purchase of a new car.

Most U.S. vehicles are ineligible because they do not take part in a Japanese program that determines fuel-efficiency ratings. Japan allows American cars to be imported under a separate program.

Sutton argues that many American cars have fuel-efficiency ratings that should allow them to be covered by Japan’s cash-for-clunkers program. In a call with reporters on Wednesday, she called Japan’s program “fundamentally unfair.”

Hundreds of thousands of Japanese cars were traded in under the U.S. cash-for-clunkers program.

According to U.S. Department of Transportation data cited in Sutton’s resolution, 120,507 Toyotas, 87,584 Hondas and 58,700 Nissans were sold under the program.

More Toyotas were sold through the U.S. cash-for-clunkers program than the highest-ranking U.S. automaker, Ford. It sold 90,135 vehicles.

The Chamber letter noted that Japanese automakers received roughly half the $3 billion in cash incentives provided by the U.S. government. It also noted that Chamber lobbyists worked to ensure that U.S. legislation creating the program made all vehicles eligible.

Japanese officials have noted that about 80 percent of Japanese vehicles sold in the U.S. are built in the U.S.

Sutton said U.S. Trade Representative Ron Kirk had expressed concern to her over the program and that she understood U.S. and Japanese officials had discussed the issue at a senior staff level.

“We cannot sit idly be while we play by the rules and allow the Japanese cash-for-clunkers program to continue to discriminate against our American manufacturers and workers,” Sutton said in a statement.

The U.S. and Japan have agreed to continue to consult on the issue, a spokeswoman for USTR said in a statement.

“Our position remains that changes are necessary to give U.S. vehicles greater opportunity to qualify under Japan’s program,” said spokeswoman Nefeterius McPherson.

In light of serious U.S. concerns, McPherson said USTR hoped to find a way forward through discussions at a senior level.

This story was updated at 5:23 p.m.

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