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AMERICAN INTERNATIONAL AUTO DEALERS CRITICIZE DETROIT AUTOMAKERS

AMERICAN INTERNATIONAL AUTO DEALERS CRITICIZE DETROIT AUTOMAKERS
 ALEXANDRIA, Va., Jan. 9 /PRNewswire/ -- Walter E. Huizenga, president of the American International Automobile Dealers Association (AIADA), today criticized efforts by Detroit automakers to seek more protection from foreign competition as "short-sighted, self-destructive, anti-consumer and a strategy of failure."
 "It will be a tragedy if the result of President Bush's trip to Japan with the Big Three chairmen in tow is to expand the kind of protectionism that has been so costly to America already," said Huizenga. "The main effect of existing protectionist measures has been to drive up the price of cars and light trucks to the point that consumers can hardly afford to buy them," he said. Noting that it now takes the average family 30 weeks' wages to buy the average car, compared to 25 weeks in 1981, before import quotas were imposed, Huizenga said: "High prices are a direct result of coddling the U.S. auto industry. The U.S. industry used quotas in the 1980s to raise prices, gain short-term profits, pay executive bonuses, and make expensive diversifications, not to build worldwide competitive products."
 Detroit is already protected by a 25 percent tariff on light trucks, a 2.5 percent tariff on imported cars and an import quota that for years limited the number of cars that Japanese competitors could sell in the United States. U.S. policymakers further aided Detroit by engineering a dramatic rise in the value of the yen against the dollar, thereby making Japanese imports far more costly in the United States and U.S. goods cheaper abroad. "Yet with all of these advantages, Detroit has made little headway," said Huizenga.
 Now citing American jobs as the rallying cry, instead of fat executive bonuses and perks, the Big Three have brought pressure to reduce the so-called voluntary quota from 2.3 million by drastic amounts. "The fact is the Big Three have been cutting jobs for the past decade, while the international automobile industry has added tens of thousands of jobs since 1981. The only American job growth in the automobile industry in the last decade has come in the international sector -- and Detroit knows it," Huizenga said.
 "Ten years ago we demanded that Japan build cars in the U.S.; now virtually every Japanese automaker selling in the U.S. is building its cars in the U.S., and that production is expanding daily. With that expansion comes American jobs and growth in American trade exports. Chrysler Chairman Lee Iacocca wants to count that production in a fixed market share for Japanese autos. His fear of real competition apparently knows no bounds.
 "Detroit blew it," Huizenga said. "Instead of using the tariffs and quotas to build market share and better products, they used the 1980s for bonuses, diversification, and short-term profits. Now they want the American consumer to pay more again, so they can profit from artificial price increases."
 Huizenga also denounced a demand by Ford President Harold A. Poling and Iacocca that Japan be required to reduce its trade surplus with the United States by 20 percent a year for five years. "It is little more than a ploy to force Japan to reduce sales of cars in the U.S.," said Huizenga.
 AIADA represents the 9,700 franchised automobile dealers who sell international nameplate vehicles.
 -0- 1/9/92
 /CONTACT: Lori Gribbin of American International Automobile Dealers Association, 703-519-7800/ CO: American International Automobile Dealers Association ST: Michigan IN: AUT SU:


MK -- DC010 -- 8156 01/09/92 10:56 EST
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Publication:PR Newswire
Date:Jan 9, 1992
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