Lawmaker Urges U.S. to Increase Pressure on Japan’s Auto Program

U.S. Lawmaker Calls for Action on Japan’s Cash-for-Clunkers Program

On January 6, a U.S. lawmaker expressed concerns regarding Japan’s cash-for-clunkers renewal program, urging the Obama administration to consider filing a case with the World Trade Organization (WTO) if Japan does not allow American cars to participate.

Rep. Betty Sutton, a Democrat from Ohio, stated, "We cannot sit idly by while we follow the rules and the Japanese cash-for-clunkers program continues to discriminate against our American manufacturers and workers." She announced that she introduced a resolution calling for the U.S. Trade Representative to engage in discussions with Japan’s government to address potential violations of trade obligations.

Should these discussions prove unsuccessful, Sutton suggested that the United States should proceed with a formal complaint at the WTO.

In December, Ford Motor Co., General Motors Corp., and Chrysler raised concerns with U.S. Trade Representative Ron Kirk, arguing that Japan’s fleet renewal program effectively excludes U.S. companies from participation. Sutton noted that the American cash-for-clunkers program was inclusive of all auto manufacturers operating in the United States.

During the U.S. program, which operated from late July to late August, vehicles from Japanese brands made up nearly half of the 677,842 vehicles sold, highlighting the disparity in participation opportunities. U.S. trade officials have indicated that reforms in Japan’s scrappage program are necessary to provide U.S. vehicles with a fair chance to compete.