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JETRO SURVEY REPORTS OVER HALF OF JAPANESE MAKERS IN U.S. REPORT LOSSES AND JAPANESE INVESTMENT DECLINES

 CHICAGO, Feb. 25 /PRNewswire/ -- More than 50 percent of the Japanese-affiliated manufacturers operating in the United States recorded losses in 1991, while about 40 percent recorded at least some profit, according to a recent survey just released today by the Japan External Trade Organization (JETRO). JETRO has an office located in Chicago, one of seven in the U.S.
 The survey showed profits were recorded by a relatively high percentage of plants that began operating between the 1970s and early 1980s. In contrast, about 70 percent of the plants that started operating in the current decade recorded losses in 1991.
 More than 60 percent of the survey respondents expected improved performance in 1992, while only 10 percent foresaw worse performance. Companies expecting to do better were in the fields of metal products, chemicals and transportation equipment including automobiles, one of the Midwest's largest industries.
 Many of those with bearish outlooks were in the fields of precision machinery and foodstuffs.
 The survey also found the number of Japanese-affiliated plant starts continued to decline, totaling just 17 in roughly the first three quarters of 1992 after falling from 145 in 1990 down to 58 in 1991.
 By region, the greatest proportion of companies that earned a profit were based in the Far West and the West North Central regions of the U.S. By industry, larger proportions of profitable companies were in the fields of food and precision machinery outweighing those in transportation equipment including automobiles.
 Research conducted prior to the 1992 survey revealed that 1,724 manufacturing plants (an increase of 161 firms over the prior year) with Japanese affiliations were operating in the United States. By region, the Pacific Coast had the greatest number of plants at 454, followed by the East North Central with 420, and the Atlantic South with 253. These three regions accounted for 65.4 percent or two-thirds of all the Japanese-affiliated manufacturing plants so far identified.
 Ranked third in the top 10 states is Illinois with 114 plants. Other Midwest states in the top 10 included Indiana, ranked sixth with 70; Michigan, ranked fourth (85); and Ohio, ranked second (128). California has the most installations with 316 plants. The rest of the top states are Georgia (84), North Carolina (70), Kentucky (70), Washington (65) and New York (63).
 The others are Maine (3), New Hampshire (8), Vermont (2), Massachusetts (37), Rhode Island (2), Connecticut (8), New Jersey (49), Pennsylvania (43), Wisconsin (17), Minnesota (14), Iowa (11), Missouri (24), South Dakota (1), Nebraska (15), Kansas (9), Delaware (2), Maryland (10), Virginia (28), West Virginia (1), South Carolina (35), Florida (23), Tennessee (55), Alabama (24), Mississippi (14), Arkansas (13), Louisiana (5), Oklahoma (15), Texas (60), Montana (1), Idaho (1), Wyoming (2), Colorado (13), New Mexico (3), Arizona (10), Utah (4), Nevada (12), Oregon (28), Alaska (29), Hawaii (16) and Puerto Rico (6).
 Firms exporting products from the U.S. increased to 66.4 percent, up from 61.8 percent in the 1991 survey and 57.8 percent in 1990. The major reason cited for exporting was market expansion. Other responses included international division of labor, revenue and avoiding trade friction. The value of total exports came to $1.88 billion, an average of $6.45 million per plant. More than 40 percent in the survey said they exported to Japan.
 The respondents reported they employed 290,455 employees, an average of 294 per plant, including companies not responding to the survey, it is estimated that Japanese-affiliated manufacturers in the U.S. employ over 400,000 people.
 The average number of Japanese employees per plant was 6.2, representing a continuing decline. Moreover, the number of plants with no Japanese employees continued to increase, JETRO found.
 Nearly two out of every three plants reported at least 70 percent local procurement from 100 percent U.S.-owned firms. Those reporting at least 90 percent local procurement rose to 27.7 percent, up from 25.5 percent in the 1991 survey.
 Only 3.9 percent said at least 90 percent of their procurements were from Japan and just 0.9 percent bought 90 percent or more of their supplies from other Japanese-affiliated firms in the U.S.
 Firms planning to shift operations to Mexico in response to NAFTA amounted to 13.1 percent, nearly double the 7 percent figure of the previous survey. Firms that had already shifted operations to Mexico came to 8.8 percent, compared with just 1.7 percent in 1991.
 Nearly 90 percent of the manufacturers were engaged in philanthropic or community-service activities. The largest number of respondents donated funds and product, while others participated in local chambers of commerce and employee-volunteer services. Nearly 9 of every 10 plants continued to contribute to their host communities regardless of company performance.
 JETRO is a non-profit government-related organization established in 1958 with a mission to support trade between Japan and other countries, with the aim of achieving balanced global trade. Its Midwest offices is at 401 N. Michigan, Suite 660, Chicago, Ill., 60611.
 A summary of the report is available.
 -0- 2/25/93
 /CONTACT: Toshiaki Abe or Cathleen Moore, 312-527-9000, both of JETRO/


CO: Japan External Trade Organization ST: Illinois IN: SU: ECO

WB -- NY029 -- 0339 02/25/93 11:07 EST
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