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UAW URGES BUSH TO DEMAND THAT JAPAN REDUCE CAR EXPORTS TO THE U.S. TO 800,000 UNITS

 UAW URGES BUSH TO DEMAND THAT JAPAN REDUCE CAR
 EXPORTS TO THE U.S. TO 800,000 UNITS
 DETROIT, Dec. 29 /PRNewswire/ -- The United Auto Workers (UAW) today announced it has urged President Bush to demand that Japan lower its car exports to the United States to 800,000 from the current 1.8 million annually.
 "The time has come to press the government of Japan to take action to limit the share of the U.S. auto market being captured by Japanese auto companies," UAW President Owen Bieber said in a letter to Bush.
 "Japan can do so by agreeing to reduce car exports to the U.S. to 800,000 units in the fiscal year beginning April 1, 1992, as an interim measure while a market share cap is put into effect," Bieber said.
 The UAW president noted that, in the last major recession, the Japanese government agreed in 1981 to limit car shipments to the United States to 1.68 million units annually.
 At that time, there was no Japanese automaker assembling cars in the United States. Today, in addition to the 1.8 million cars exported from Japan, another 1.5 million cars are assembled by Japanese auto firms in the United States with high levels of imported parts and components.
 "As you know, of the more than $40 billion bilateral deficit, some $30 billion is in automotive products," Bieber wrote the president. "It is absolutely imperative that the U.S. government take steps to see that this imbalance be substantially reduced."
 In a separate letter to the minister of Japan's Ministry of International Trade and Industry (MITI), Kozo Watanabe, Bieber urged that restraints on car exports to the United States be lowered to the 800,000-car level.
 For the fiscal year ending March 31, 1992, MITI has imposed a restraint level of 2.3 million -- far above the 1.8 million cars being shipped to the United States from Japan currently.
 "The crisis in the U.S. auto industry is so severe that it would be folly for the Japanese government to merely extend the current restraints which have no meaningful impact," Bieber's letter to the MITI minister stated.
 "The immediate reduction in car exports would help in the short term, while a market share cap would provide a long-term assurance that the auto trade imbalance can be improved," the UAW president said.
 His letter stated that if adjustments were required to meet the market share limit, they must be made by reducing imports of fully built-up cars from Japan.
 "We would oppose any plan that reduced transplant production (in the U.S.) in order to allow additional imports to enter the U.S.," Bieber said.
 The text of Bieber's letter to Bush and Bieber's letter to Watanabe follow:
 Dear Mr. President:
 You will be leaving soon on a trip that will take you to Japan among other countries. Your meetings with Prime Minister Miyazawa and top Japanese officials provide an excellent opportunity to press them for concrete actions that will reduce the huge U.S. trade deficit with Japan. I note you are including the CEOs of the Big 3 auto companies in the official delegation that will accompany you.
 As you know, of the more than $40 billion bilateral deficit, some $30 billion is in automotive products. It is absolutely imperative that the U.S. government take steps to see that this imbalance be substantially reduced.
 When the Reagan-Bush Administration was faced with a major recession in 1981, it demanded and got a voluntary restraint agreement that limited Japanese car exports to the U.S. to 1.68 million units annually. Today, the U.S. auto industry is suffering huge losses, closing and idling plants and laying off many thousands of workers. Yet Japan is shipping about 1.8 million cars a year here and assembling another 1.5 million in the U.S. with low levels of U.S. content.
 The time has come to press the Government of Japan to take action to limit the share of the U.S. auto market being captured by Japanese auto companies. Japan can do so by agreeing to reduce car exports to the U.S. to 800,000 units in the fiscal year beginning April 1, 1992, as an interim measure while a market share cap is put into effect.
 Attached is a letter I have sent to MITI Minister Watanabe proposing such a restraint agreement. The UAW respectfully urges you to encourage the Japanese government to adopt a proposal along these lines.
 The crisis in the U.S. auto industry is so serious that vague promises about new "market opening initiatives" just won't do. Japan has proven very adept at heading off meaningful actions to reduce the auto trade deficit with such promises that, in the end, seldom are fulfilled. Your meetings need to result in concrete, meaningful commitments that will help reduce that deficit and get the U.S. auto industry back on the road to health.
 I wish you a good trip and thank you for your consideration of the UAW's views.
 ------
 Dear Minister Watanabe:
 The Government of Japan soon will consider the issue of its voluntary export restraints on autos shipped to the United States for the fiscal year beginning April 1, 1992.
 The situation facing the U.S. auto industry and its workers is extremely dire. We are suffering the worst year since 1982 with little prospect that next year will be much better. The domestic car manufacturers are closing and idling plants as are the U.S. parts firms. Many thousands of workers have lost their jobs in what is an increasingly desperate situation.
 My country suffers a bilateral trade deficit with Japan of more than $40 billion. More than three-quarters of that deficit -- some $30 billion -- is in automotive products. The trade imbalance has improved in a number of sectors, but in auto it remains at an extremely high level with no sign of moderating. If the huge auto trade deficit with Japan does not come down in a period of very low overall auto sales in the U.S., when will it ever decline?
 In the last major recession, the Japanese government agreed to limit car shipments to the U.S. to 1.68 million units annually. At that time, there was no Japanese automaker assembling cars in the U.S. Today, Japanese firms build more than 1.5 million units in the U.S. with high levels of imported parts and components. In addition, about 1.8 million cars are shipped here from Japan.
 The Japanese automakers thus have captured more than 30 percent of the U.S. car market -- an unacceptably high level. Rather than replacing fully built-up imports from Japan, the transplant vehicles with low U.S. content have been in addition to them. Meanwhile, production by the U.S. companies has dropped by more than 1 million units -- a decline due largely to the transplant output.
 This situation cannot continue, because of its devastating impact on the U.S. auto industry and its workers.
 I urge you to reduce the export restraints on cars shipped to the U.S. to 800,000 units as an interim measure while an overall market share limit is put into effect. The immediate reduction in car exports would help in the short term, while a market share cap would provide a long-term assurance that the auto trade imbalance can be improved.
 We are aware, of course, that Japan has reached an understanding with the European Community that will limit the total share of the Japanese automakers through the end of the decade. Total vehicle sales in Europe are higher than in the U.S., yet your government agreed to limit exports to the EC to 1.23 million -- more than 1 million units below your current "restraint" on shipments to the U.S.
 As I have made clear previously, a market share limit would have to include all imports from Japan and all cars assembled in plants owned entirely or in part by Japanese auto companies regardless of location. Should adjustments be required to meet the market share limit, they should be made by reducing imports of fully built-up cars from Japan. If transplant production continues to expand in a stagnant or shrinking market, there would have to be a decline in car imports from Japan. We would oppose any plan that reduced transplant production in order to allow additional imports to enter the U.S. Under the market share limit, there also should be requirements to increase the U.S. content of the transplant vehicles.
 The UAW hopes you will give this proposal serious consideration. The crisis in the U.S. auto industry is so severe that it would be folly for the Japanese government to merely extend the current restraints which have no meaningful impact.
 Your decision on this crucial matter will affect many thousands of American workers and communities as well as the very relationship between the U.S. and Japan. I hope you will take meaningful action.
 -0- 12/29/91
 /CONTACT: Don Stillman, 202-828-8540, or 202-291-8263, or Frank Joyce, 313-926-5291, or 313-331-2785, both of the UAW/ CO: United Auto Workers ST: Michigan, District of Columbia IN: AUT SU:


CK -- NYSU006 -- 5604 12/29/91 14:51 EST
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