Toyota Motor Corp., the biggest exporter of autos to the U.S., is trying to cut production costs for Yaris and Corolla cars as a rising yen makes it unprofitable to build economy cars in Japan for sale abroad.
“Given the current exchange-rate situation, it isn’t feasible, in terms of a business model, for us to produce Corolla or Yaris in Japan and export them,” Atsushi Niimi, executive vice president for global manufacturing, said in an interview in San Antonio on Aug. 6. “We’re working very hard to reduce costs to maintain the appeal of these cars.”
Toyota, the world’s largest automaker, and its domestic competitors are scrambling to combat the surging yen, which is up at least 3 percent against each of the world’s 16 major currencies in 2010. Speculation that Europe’s sovereign debt crisis will worsen and the U.S. economic recovery will slow has boosted demand for the relative safety of the Japanese currency.
The yen traded at 85.38 against the U.S. dollar as of 8:08 a.m. in Tokyo, from 85.51 yen in New York on Aug. 6, when it reached 85.02 yen, the strongest since Nov. 27. The currency is up more than 7 percent against the dollar and more than 14 percent against the euro this year.
Toyota sold 325,398 Toyota, Lexus and Scion cars and light trucks imported to the U.S. this year through July, down 15 percent from a year earlier.
Shifting Overseas
The total is more than four times the 75,357 imports sold by Tokyo-based Honda Motor Co., which sells the highest proportion of North American-built vehicles among Asian automakers in the U.S. Yokohama-based Nissan Motor Co.’s import sales grew 19 percent through July to 159,904, the second- highest volume after Toyota.
