It’s “difficult to make an investment in a country with no return,” Ghosn said at the Tokyo Motor Show today, without giving a time frame for moving production overseas. “The yen is a huge handicap for exporters from Japan.”
Japanese automakers, hampered by the yen trading near a post-World War II high and disruptions from this year’s record earthquake and Thailand’s floods, are seeing domestic sales slow, threatening local manufacturing jobs.
The yen has gained more than 9 percent in the past six months, the best performance among 10 developed-nation peers tracked by Bloomberg Correlation-Weighted Currency Indexes. The currency appreciation slashed Japanese automakers’ profit by a combined 330 billion yen ($4.2 billion) in the first half as the gain reduces the value of repatriated earnings and makes exports less competitive, according to Japan’s automakers group.
Nissan’s shares slid 0.4 percent to 690 yen at the close of trading in Tokyo, with the benchmark Nikkei 225 Stock Average declining 0.5 percent.
Toyota Motor Corp., the nation’s largest automaker, built 43 percent of its vehicles in Japan last year, compared with less than 30 percent at both Honda Motor Co. and Nissan.
“If Japanese exporters shift production out of Japan, employment will be affected,” Ghosn said today. “The auto industry employs more than 5 million people in Japan.”
Domestic vehicle sales are forecast to drop 14 percent to 4.25 million this year, compared with 7.77 million at the industry’s peak in 1990, according to the Japan Automobile Manufacturers Association. Deliveries have declined annually since 2004 apart from last year, when government subsidies for fuel-efficient cars led to a rebound.
Ghosn said yesterday at an auto conference that the largest threat to Japan’s auto industry isn’t natural disasters but the strength of the yen and that Japan should learn from the Swiss and make “adjustments” to the currency.
Toyota President Akio Toyoda said at a Nov. 7 briefing that Japan’s car industry will “collapse” if the yen continues to gain.
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