2003 Tokyo Motor Show, Part I

2003 Tokyo Motor Show Index (10/21/2003)

 

Dollar Versus Yen

The opening of the Tokyo Motor Show was almost overshadowed by the long-festering argument over the value of the U.S. dollar. The Big Three have complained for more than two years that the Japanese competitors have gained an unfair advantage because the Japanese yen has been undervalued. John Devine, GM's chief financial officer and vice chairman, made it plain this week during a visit to Tokyo that he believes the dollar is still overvalued versus the yen. The yen should be valued around 100 yen to the dollar but the dollar continues to buy more yen because the Japanese government has used its power to depress the value of the yen in an effort to stimulate the economy. The Japanese government is estimated to have spent more than $80 billion this year alone to protect the yen from increasing in value, critics of the Japanese policy note.

Fujio Cho, president of Toyota Motor Co., the Japanese company that benefited the most from the policy, however, also told reporters in Tokyo that the yen is already overvalued and it should actually trade at between 110 yen and 120 yen to the dollar. Helmut Panke, the chairman of the chief executive officer of BMW, said after a press conference in Tokyo that he believes the euro is overvalued and the dollar is undervalued, given the relative strength of its economy. But he also noted that no two economists seem to agree on what the proper values should be.

The word coming out of Washington, D.C., however, is that the automakers and their allies, frustrated that President George Bush's lack of progress in lobbying the Japanese government for a cheaper dollar have gone for naught are now contemplating a using federal trade laws against the Japanese competitors. The so-called Section 301 actions were used for great effect by the steel companies, which pressured the administration to impose tariffs on the foreign rivals because they were subsidized by their government.

 

Kia KCV3 Catches Attention

The South Korean automaker Kia didn’t have a press conference at this year’s Tokyo Motor Show but it did manage to sneak in a sporty concept vehicle, the KCV3, which got plenty attention thanks to a strategic display — and elegant models — placed along the well-traveled path between the three exhibit halls housing the displays of the various car manufacturers. If the throngs of male journalists lining up to snap picks actually took a glimpse at the KCV3, they'd get a good idea of a very real ragtop project underway at Kia. It is, however, several years away from production, sources suggested, a bit further out than the convertible being developed by the Korean carmaker's parent and one-time rival, Hyundai.

 

Mazda Ibuki: The Next Miata?

Mazda used the Tokyo Motor Show to unveil the Ibuki concept vehicle, which is expected to serve as the prototype for the next Mazda Miata. Mazda itself has done little to quell the speculation and fed the interest of the media assembled in Tokyo by mentioning it could serve as the replacement for the Miata. (Indeed, senior Mazda officials reportedly acknowledged that to their rival company counterparts over the last few days.) Exactly how much of Ibuki makes it into production is unclear, but while there are definite similarities to the long-lived Miata, the show car is a bit more chunky overall, with creased "character lines," such as on the front fenders. In  prototype firm, Ibuki boasts a lightweight body with a front-midship powertrain configuration that should mean a quicker, more stable ride.