Is Chrysler's bankruptcy good news for Japan?

I have voted NO because it is a public forum but if you ask me privately i would say YES. Why so? just to respect moral values, this question is same as asking a grand-child "are you happy with the passing away of your rich grandpa?"

Obama's banana republic capitalism is going wreak havoc with the economies of both countries.

What a strange question, even by Japantoday standards. Of course the Japanese and the media here are extatic about the perceived demise of both Chrysler and GM. They have been working towards this goal as far back as the early 1990's. Why should they worry now that their objectives have been met ? I mean just a few years ago American auto executives asked Toyota to back off, their obsessive focus on the US market and becoming #1 was essentially destroying the market at a heightened pace. At that time Toyota was extremely uncooperative. They had already destroyed their domestic market here in Japan so after the US they went, and to hear how they are targetting the Europeans now... well, wtf ! Again, a very strange question indeed, Japan has simply gotten what it asked for, at least so they think ! I for one have gone on and on about the strategy behind all this. What Japan should be more concerned about is how they're auto makers will make the dramatic jump to electrics like GM and Chrysler are about to. Brilliant strategy by the Americans. The objective was to "out-tech" the chinese as they are closing their markets to both Japan and US auto makers. The chinese will be stuck with gas guzzlers for the next 20 years while the US moves on, creating a whole new industry in the wake. Again, brilliant !

It's not good news for the Japanese parts makers who were selling parts to them, and GM and Ford.

Worried Sarge ?

"It's not good news for the Japanese parts makers who were selling parts to them, and GM and Ford."

Whats it matter ? In due time Japanese and Korean auto companies will simply pick up the slack. Don't you folks see how it works ? When one company folds, another moves into take its place... ah, but there in lies the real concern... the Japanese have flooded the US market, along most recently with the Korean. Now, if those markets were just as open to US manufacturers we would be looking at the survival of all, but the closed markets in both Japan and Korea shut out US manufacturers... unfair to the hilt, and one of the leading causes for the demise of the auto industry... thank you Japan, oh yeh, and Korea.

saru - Japan's not closed to U.S. autos - heck, you can go to your local Ford or Yanase dealer and buy almost any U.S. car you want. Korea's closed, I'll give you that one.

Sarge, for all intents and purposes, mostly through unfair media and political shenanigans, Japans markets are closed to "all" foreign auto makers. Want an example ? Volkswagen is the leading foreign auto seller in Japan. This company sells 250,000 plus vehicles in the US in a year.. in Japan ? Try less than 30,000 ! Now if Japan is soooo welcoming to foreign auto dealers, how do you explain these miserable numbers ? Sorry, simply saying the markets are open doesn't make it true.

quite an odd question. with the bankruptcy , chrysler will be able to restructure w/out worrying about all its debt. the company isn't going anywhere. & with the partnership with fiat, they will have access to newer gas saving technology. we'll see what happens .

saru - Of course VW sells way more cars in the U.S. than in simply prefer Japanese cars to VWs. Heck, if I could afford to have a car ( and a parking space for it ) I'd probably buy a Toyota or a Honda or a Subaru or even a Nissan before I'd buy a VW.

"Of course VW sells way more cars in the U.S."

Cmon Sarge, 10X's more ? Har !

"Heck, if I could afford to have a car ( and a parking space for it ) I'd probably buy a Toyota..."

But Sarge, at the current exchange rates you should be able to afford a decked out brand new right side steering column American made auto like the Ford Fiesta... ranked as the worlds second best car, behind the VW Golf, by 59 auto critics from around the world !

BTW Sarge... any ideas where I could get a Kia or Hyundai here in Japan ? You see kids, its not only the Americans Japan is blocking out ! Time for the US to do the same, protect American companies and American workers.

But Saru, you know the current exchange rates have no influence whatsoever on the prices of imported goods!

And these 59 auto critics that say the VW Golf and the Ford Fiesta are the world's best two cars obviously have different opinions than the people who actually buy cars.

And if I want a Hyundai, heck, I just go to my local, uh, Hyundai dealer!

To all those debating with Sarge. Sarge is right, but he isnt presenting his point well.

Japan has 2 issues. A fierce ideal of buying Japanese made products and because most Japanese automakers focus on....hmm...well lets think about it, Japanese consumer opinions first, then everyone else's, in what they want in a car. Some auto makers even go to lengths such as make a whole line specific to that nation, like Toyota did with a truck design for the US market. If one foreign car of a foreign brand is sold in Japan the market isnt closed, just comparably they arent doing as well as they could based on the volume of the market.

It is just like Japanese car brands back in the 80s and early 90s in the US. They were rare. The Japanese adapted designs to the US market and look at where they are now. There is always room for improvement, whether the company takes initiative to make that improvement is up to them. But dont go around saying the market is closed when it very much isnt.

On topic point now. Overall, Chrysler's bankruptcy will only be bad to Japan in the near to semi-near future. Long run it is neutral or possibly good. Mainly because Chrysler as a car maker isnt "going away" it just is trying to get rid of debt. A company only "goes way" when the it cant remove enough debt to maintain operations. And as it looks, they are going to get rid of debt, get another installment of loans from the Federal Government and be back in operation. When will they be back in operation? Only the bankruptcy court knows.

I think that in the end is good for any other automaker, including Europe, not just Japan. But I cant stop feeling terrible for the workers. When your company close and there is no other company taking people is like the end of the world. Is difficult get a job in the auto industry anywhere right now.

Hmm... about the protect americans workers idea, I dont mind working for an american car company if they want to build some factories here in Japan, just like maybe some americans dont mind working for a japanese or italian company in the USA. I think that most of we blue collars workers dont really care about flags, just about jobs. If people really want to save Chrisler, try to contract Carlos Ghosn, it worked for Nissan in Japan.

just yes or no is rather simplistic don't you think?

saruzenki

Once in a while I'll see a Korean car like a Hyundai on the road here and I always wonder where it came from because I've never come across a Korean dealership. And I also wonder about the driver, whether he's actually Japanese or a someone with ties to Korea and a reason for going out of his way to buy a Korean car in Japan...

The reason, why VW is not so competitive in Japan is very simply: it is the price. In Japan, japanese made cars are more cheaper than imported cars. Just look at carsensor and compare the prices. On the other hand, Japanese makers in Germany match their prices to be almost same as their German counterparts, but having options like air-conditioning already included.

Sarge;

"you know the current exchange rates have no influence whatsoever on the prices of imported goods!"

Now you are getting to the crux of the matter, exchange rates... live by em-die by em. And unfortunately Japan's "export till the cows come home" mentality is what is sinking their ship. Way back in the 1970's the exchange rate hovered around 280 yen to the dollar. When Japanese auto makers were "invited" into the US (open arms, tax breaks, new deals and laws, etc) they took full advantage of this. By the 1980's the US asked Japan to tone down it's over dependancy on the US market as they were damaging it with once again too much emphasis on the American consumer, now the problem was in the exchange rate. Japan had a clear advantage as the US maintained a policy of supply and demand to set consumer prices, this has not changed to this day. Japan however has never abided by this philosophy, instead jacking up unreasonable prices on foreign imports especially cars. I mean lets be honest, a Ford Fiesta was a deal at $6,000 back in the early 80's. Japan wanted to tag you for $10,000... and then make no guarantees about maintenance. Hey, American auto dealers were offering same day service for defective Toyotas, but Japan wouldn't do that here ? Now I've heard people talk about how Japanese auto manufacturers made more attempts to move into the US to address such issues. That is nonsense ! Toyota didn't open their California headquarters till a good 15 years after they started selling in the US. And they were given huge tax breaks and incentives to move in, similar offers have never been recipricated by the Japanese.

Now Sarge the story has come full circle. The Americans now have a slight advantage in terms of exchange rates, yet the Japanese have refused to lower their prices on American cars... Foul ! This is what the Japanese offer you, limited access at unreasonable prices... much like so many other imported consumer goods in Japan. This in itself is a way to block access to the market, the consumers. It's all about price ! Nothing to do with quality. Uniqlo, McDonalds, Daiso, have all proven that Japanese consumers are looking for a financial break. And why oh why would anyone out there be purchasing automobiles from a nation, Japan, that has been notorious for millions of defective cars, death from overwork, hidden defects, documented cases of gender bias and sexual harrasment, polluting of national waterways, unpaid overtime... I mean the list is endless. Sarge you rattled off a short list of companies you would buy a car from. By doing so you throw your support behind everything I have listed here. Thats embarrasing ! In short I don't think Chrysler filing for bankruptcy protection has anything to do with Japan, the exchange rates and Japans over selling of the US market is more pertinant. I mean if Japanese automakers were so good, why worry about a mere 3-5 yen disadvantage in exchange rates. The Americans kicked Japan's tail for better than 50 years and were at a 200-150 yen plus disadvantage for most of the time. Japan needs to quit whining and start producing.

Sorry sarge you dont have a clue. Yanasey charges almost a 3rd more for the same car in the states. They have almost zero intrest in warrantying it. And what parts does japan supply to Chrysler, do you even have a clue dont go grab some postit note on your monitor. I have tore down plenty of new dodge and Chrysler cars and almost everything says made in Mexico or Canada, so do you still want to banter about something you have no clue about.

Here Ill give you an example. I used to import the US 300C and sell it wholesale for 4800000yen with plates and insurance. The same exact car from yanase was selling for 6200000yen before registration and tax. now tell me that japan isnt a closed market, you want more Motorola had to file suit to get into the japanese cell phone market. Dokomo which is owned by NTT had the only towers back then, they wouldnt let them in on their towers and the government wouldnt allow them to get a telecommunications license. Guess who is selling motorolas. You see you dont know squat about how bad the J gov manipulates trade inside its borders.

How this up until about 10 years ago you couldnt open a foreign owned business with out a japanese partner ( Keidetsu) you either needed a japanese national as the ceo which was more or less a franchise or a partnership with a company (usually your competition) to legally enter the market bigger than someone importing small quantities. Now you see how Yanase has the contract on Benz,Gm, VW, and so forth.

3rd option, don't care.

And what parts does japan supply to Chrysler

Panasonic sells $3.5~billion in autoparts(Audio mostly) to Chrysler a year.

I have tore down plenty of new dodge and Chrysler cars and almost everything says made in Mexico or Canada, so do you still want to banter about something you have no clue about.

http://www.nhtsa.dot.gov/staticfiles/DOT/NHTSA/Traffic%20Injury%20Control/Articles/Associated%20Files/AALA/AALA2008a.pdf

Japan, that has been notorious for millions of defective cars, death from overwork, hidden defects, documented cases of gender bias and sexual harrasment, polluting of national waterways, unpaid overtime... I mean the list is endless. Sarge you rattled off a short list of companies you would buy a car from. By doing so you throw your support behind everything I have listed here. Thats embarrasing !

If you look at the link I posted in the above part of my post, Japanese cars sold in America have on average around 65%~%70% of their parts being built in US/Canada. When means that you mostly throwing support behind those workers, because the remainder the profit after that mostly goes to Executives and Shareholders(who are the same in Japan and North America).

I can say with great certainty that Chrysler's bankruptcy has tightened many sphincters of Japanese executives from Akebono and Asahi Glass. They are sending many of their Japanese employees back to Japan and the ones that are remaining have been voluntold that they will extend their overseas contracts from 2 or 3 years to 5 or 6.

Taka

Those whinging that Japan's markets are closed, can you point to a single piece of legislation banning US autos from bring sold in Japan?

It is just like Japanese car brands back in the 80s and early 90s in the US. They were rare. The Japanese adapted designs to the US market and look at where they are now.

Er, Tatsumaru, your remark is off by more than a decade. Japanese compact cars and mini-pickup trucks were already being sold in the US in the 60s and their demand underwent a quantum leap after the 1973 mideast war.

I think it is good news.... I mean less competition is always good.... But then again who was buying a Chrysler anyways??? They are the biggest joke on the auto industry ever!!! haahhaahah Chrysler and there so called "Luxury cars" were more like... buy another one in 6 months, they are most known for bad engines, bad transmissions and horrible designs!! hahahahah and they are pricy too! I've worked for a "parts provider" Custom Injection Molding company for the past few years... and the best business is Non-automotive. The car companies in general are a pain to work with...

earthcreature

But then again who was buying a Chrysler anyways???

Uh, I don't know, maybe like the millions in the US and around the world (even here in Japan) driving Jeep vehicles, Dodges, Plymouths and yes even Chryslers? Just out of the people I know personally I can think of a dozen or so that drive a Chrysler product...

USNinJapan2,

If there are millions of customers... why is it in a DEBT!! hahahahah, the company had some bad management and bad cars came out as a result, I don't know any one with a "NEW" Chrysler. The last one bought was in 2001, or around that year. My brother had a Jeep that he had to replace the transmission twice within a year, and he ended up selling it hahahah.

DX - I never said you'd pay the same for your GM car in Japan as you would stateside.

earthcreature

If there are millions of customers... why is it in a DEBT!!

So according to your logic, if there really are that many Chrysler vehicles being bought it isn't possible for the company to become bankrupt? You're entitled to your unfavorable opinion of Chrysler vehicles, I myself am no fan of them, and I don't doubt that you and your brother have had sour experiences with Chrysler products, but you asked, perhaps rhetorically,

But then again who was buying a Chrysler anyways???

and the answer is 1,453,122 people, just in the US in 2008 alone. You're right about Chrysler's terrible business practices but to say that their vehicles are so bad that NO ONE buys them is being simplistic and obtuse.

I don't know any one with a "NEW" Chrysler.

You may live secluded in the mountains, you may not have many friends, who knows, but there indeed are plenty of people buying new Chrysler cars whether you know them personally or not.

The bankruptcy of Chrysler probably poses more problems for Japanese companies because of their tie-up with Fiat. In essence their car line will grow and they will be a larger company. If the products are good it means Japanese makers will face more competition in the US.

"They will probably market the Indian minicars as well, which I personally think will be cheap and competitive."

But aren't "electric" ! Again, let me repeat... the gasoline powered automobile industry is D-E-A-D ! The big three are gearing up for a future of electrics and hybrids, subsequently moving the US away from foreign oil dependancy... EXCELLENT !

Saruzenki - Tata intend to market an electric version of the Nano.

Your national pride is laudible but illinformed. There are few global makers that dont have electric vehicles either in test or penned. Its debatable that the US has any lead in electric vehicle technology and no-one has all the answers yet.

Should Chrysler go down (hopefully unlikely now) there would be a huge impact on the many Japanese companies that supply it. In the short term that would be no consolation for the remaining suppliers as the whole point of the collapse is there's little market anywhere right now to sell cars or parts to.

Gee don'tpanic the way you fired out of the gate I thought maybe you had some professional insight... but when all is said and done all you can muster is...

"Its debatable that the US has any lead in electric vehicle technology and no-one has all the answers yet."

I for one completely disagree, and the time lines provided by US auto makers add more proof that they are more than prepared to "hit the roads" ! Make no mistake, the US will control this new market for years to come, thats why the US government is so interested in gettings its paws into it... they've seen the projections and have listened to the strategies for success. Lets hope you don't let your "national pride", whatever it may be, keep you from missing out on the newest and biggest market since the P.C. !

I can provide a little professional insight. Timelines within the industry are such that it takes years to design, test, revise and then market any new car and more especially the revolution you espouse. My feeling is that if the US makers are ready to go to market why have we seen so little product and why is the US government looking so closely before providing its citizens hard earned cash?

Unless your hopes are pinned on the GM Volt, but if you knew anything about the market you would know its no revolution. Blind faith is no substitute for pragmatism.

Ummm, don't panic... you worry me !

"My feeling is that if the US makers are ready to go to market why have we seen so little product"

Huh ? Where have you been for the past two years, in a cave ? Cripes just wiki up "electric cars" and prepare yerself for dozens of makes and models by the big three !

"and why is the US government looking so closely before providing its citizens hard earned cash?"

Because it's part of "the show" ! Like I've said before, this has been in the works for years, ever since 9-11. Before the US government pays for these auto companies to shift over to electric hybrids, they better sell the whole program to the American people. This is showtime folks, plain and simple ! Quote me now... "nothing in America changes without a crisis... even if you have to create it" !

Oh well if Wikipedia's your source and the governments engaged in machinations as part of "the show" then Im convinced.

their "cars" wont be missed in japan so not really a bad thing for japan