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Japan’s auto exports to U.S. rise for 2nd straight year

By Kentaro Iwamoto, Nikkei staff writer


TOKYO — Automobile exports from Japan to the U.S. increased in 2016 for the second year in a row, according to data released by Japan’s Ministry of Finance on Wednesday. The imbalance could trigger a complaint from the U.S., where President Donald Trump has rebuked Japanese trade practices with regard to autos.


Japan’s total trade surplus with the U.S. dropped 4.6% to 6.83 trillion yen ($60 billion). Exports fell 7.1% to 14.14 trillion yen while imports declined 9.3% to 7.3 trillion yen.


Mainly driving the decline in exports were a 32.9% drop in steel shipments, an 8.2% fall in exports of power-generating machines, and a 16.9% decrease for electronics devices, including semiconductors.


Despite the overall decrease in exports, automobile shipments, which accounted for 31.2% of total exports, grew 0.6% to 4.41 trillion yen. Unit shipments rose 7.7% to 1.75 million. Autos sold well in the U.S. as the nation’s economy recovered.


In 1988, Japan exported 2.87 million vehicles to the U.S., amounting to 3 trillion yen in value. As trade conflicts emerged, Japanese automakers shifted production sites to the U.S. As a result, Japanese manufacturers produced 3.84 million vehicles in the U.S. in 2015, surpassing the number of vehicles exported. Nevertheless, Japan’s auto exports have grown because more large cars and luxury cars are being sold.


Last year’s drop in imports from the U.S., the first in seven years, was driven by a decline in grain imports. Japan now buys more grain from other trade partners.


Japan’s trade surplus could be reduced if the nation were to buy more shale oil and other items, but it seems to remain unchanged.


Japanese government statistics are denominated in yen, but nearly 90% of exports to the U.S. are traded in dollars. If calculated by the exchange rates the ministry used for the data, Japan’s trade surplus exceeded the previous year in dollar terms. 


The U.S. has continuously recorded trade deficits with Japan. In dollar terms, last year’s deficit appears to be almost at the same level as 2015’s figure of $68.9 billion. Given the situation, it is possible that the Trump administration will call for a revision of the Japan-U.S. trade structure.

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