Of Honda And The Japanese Presence In America

Your story "Honda: Is it an American car?" (Cover Story, Nov. 18) attempts to raise an important question: Is Japanese investment good for the U. S.? Our answer is simple: Honda's investment is good for America.

At our four plants in Ohio, Honda is building cars, engines, and motorcycles with the help of a substantial number of American supplier companies. This has not only resulted in thousands of jobs for Americans like myself but has improved the technological capability of many American companies and the technological knowhow of Americans. BUSINESS WEEK could have learned this from speaking with representatives of our supplier companies.

Unfortunately, because of several distorted and inaccurate statements, BUSINESS WEEK led its readers to believe that Honda's $2.2 billion investment in the U. S. is not what it appears. Worst of all was the assertion that Honda is attempting to "manipulate" the U. S.-Canadian Free Trade Agreement (FTA) rules as a means to increase the local content of Honda cars. This is impossible because, as the U. S. Customs Service admits, Customs has not yet adopted rules for calculating origin, and the audit -- which is routine under the FTA -- has yet to be completed. We believe that the cars Honda produces in North America are substantially North American.

It is ironic that the story and the Customs audit focus on an engine produced by Honda in Ohio. At a time when General Motors, Ford, and Chrysler import small engines for their cars, Honda is the only auto maker that manufactures a small, fuel-efficient engine in the U. S. In fact, we produce more than 500,000 engines a year in the U. S.

Honda is working with many of the same parts suppliers as GM, Ford, and Chrysler. Importantly, the local content of Honda products in the U.S. has increased every year since 1982, when we became the first Japanese auto maker to build cars in America. Today, 65% of Honda Div. cars sold in the U. S. are manufactured in North America. Our bottom line is to produce the best product for our customers. And to do it in a way that also benefits America.

Scott N. Whitlock

Executive Vice-President

Honda of America Manufacturing Inc.

Marysville, Ohio

You mentioned my company, Copperweld Steel, as being 63.6% Japanese-owned. This is true. Until 1987, we were 66% French-owned and 33% public. Today, we are 63.4%-owned by four Japanese companies, 28%-still-owned by a French company, with the balance publicly held. Without the capital supplied to our company by our Japanese owners, we would no longer exist.

Our negotiations with Honda on serving them by providing the crankshaft and other high-quality alloy steel bars to their manufacturing process has been very competitive, and we are but one of three high-quality alloy bar suppliers at the Honda facility. I assure you that the steel for the Honda Accord's crankshaft, as well as other products that we supply, is 100% American.

W. Lawrence Weeks

President & CEO

Copperweld Steel Co.

Warren, Ohio

Are we so naive to think Japan Inc. has any intention to show or teach us about their latest technological achievements in such areas as research and development or manufacturing? Hell, no -- they are our competitors, out to beat the pants off us!

Your article shows clearly that they are willing to go to any lengths to manipulate the books to look like they want to play fairly when in fact they are going to keep the most sensitive technology to themselves and give us the lower-tech jobs of assembly or painting and the like.

Pascal G. Houcke

Richboro, Pa.

How can people like U. S. Customs Service Commissioner Carol Hallett do their jobs as long as Japanese industry is permitted to lobby the same people we elect to represent us?

William H. Kury

Charlevoix, Mich.

I believe that we have sustained another Pearl Harbor, but this time it was economic, not military. And this time, it was so insidious and veiled that many of us don't know it has happened. (What's more American than a Honda or a Sony or a Panasonic?) Sadly, many of us don't care. We don't want to be distracted from the pleasure of being plugged into a Walkman or a Nintendo.

Erwin P. Molnar

Bellevue, Wash.

If most Americans really cared about the nationality of the parts in their new cars or the nationality of their cars, Honda's Accord would not be the leading car sold in the U. S. If most Americans wanted to sacrifice a quality car for nationalism, they'd agree with Lee Iacocca's cry for trade quotas on Japanese autos and would buy Mr. Iacocca's products. Smartly, American consumers know what capitalism is about: Superior products deserve their place in the market, regardless of national origin. And as Robert Reich has argued for years, the American worker truly benefits by the training that successful manufacturers provide.

Anthony F. Calianese

Oradell, N. J.

In an issue that spent most of its pages talking about corporate downsizing, layoffs, recession, and job losses, it was ironic that the feature article then pointed an editorial finger at the Japanese, not to praise the jobs they have created in America but to stress that their efforts are not good enough.

W. Jeffrey Weise

Holliston, Mass.

You argue that Honda's cars are not as "American" as they claim because they use inputs from companies that, although located here, are Japanese-owned. Why should it matter who owns these input companies? What should be relevant is the level of capital investment they are making domestically. American workers and managers were employed throughout the entire process. The Japanese are pumping money into our economy, and we are complaining.

Brian A. Heller

Brookline, Mass.

The Japanese auto makers and parts suppliers have provided thousands of good jobs for Americans in times when many traditional "American" employers were paring their payrolls. By setting new standards for quality in their fields, these companies have shown that U. S. workers can be as productive as those from any other country.

John H. Hollenback

Woodbury, Conn.

Is this latest criticism mostly "pickle smoke" from the Big Three, when in fact they have eliminated a huge share of the domestic jobs themselves and now want to point fingers at their competitors? I saw what the effect of the protective duty was a few years ago: The Big Three raised their prices also, and everyone grabbed a big bonus at the expense of the American customer. It seems to me that there is a determined effort on the part of Japanese industry to keep jobs for their people, and that ingredient is factored into the whole picture. That seems pretty noble to me.

Lynn Gilbertson


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