Sens. John C. Danforth (R-Mo.) and Lloyd Bentsen (D-Texas) yesterday said they would "reluctantly" introduce legislation to limit the number of Japanese cars sold here for the next three years.
Danforth said during a press conference that he thinks the bill "is going to pass or, in the alternative, that the administration may negotiate restrictions at the executive level."
U.S. Trade Representative William Brock immediately issued a statement calling the senators' action "understandable in light of current distress in our automotive industry." But Brock also said the automobile "crisis cannot be explained solely in terms of imports." Administration sources said Brock's statement isn't an endorsement of the concept of quotas and that the administration hasn't developed a position on the issue yet.
In addition, an administration source said the bill "sends a message" to Japan to voluntarily restrict the sale of their cars here, particularly since many European countries appear ready to take some action against the Japanese automakers.
If the Europeans somehow restrict the Japanese, the U.S. market will become "a dumping ground" for Datsuns, Hondas and Toyotas, Danforth said. In addition, sources said other factors, such as expected record losses for 1980 by Ford Motor Co. and the Chrysler Corp., may have hastened the senators' decision. On Monday General Motors Corp. reported it lost $763 million last year.
A spokesman for the European Economic Community in Washington said it is unlikely the Europeans will impose any restrictions on the Japanese without discussing it first with the United States. However, the spokesman also said EEC officials will be meeting with Brock and other administration figures next week to discuss autos and other issues.
In addition, continuing gasoline price increases precipitated by price hikes by the Organization of Petroleum Exporting Countries and the recent decontrol of gasoline by President Reagan will push prospective car buyers more toward the small imported cars, sources said.
The legislation would limit the numbers of Japanese cars sold here annually to 1.6 million -- 300,000 less than were sold here last year. The quota is higher than limits suggested by Ford, the United Auto Workers union and Chrysler Corp. The figure was reached by averaging the number of Japanese cars imported during 1978 and 1979, years when the U.S. auto industry was at its peak, sources said.
The legislation is intended to give the U.S. auto industry time to retool its plants to build its own small, fuel-efficient cars to compete with the Japanese. The industry is planning $80 billion in capital spending for modernization through 1985.
Danforth, Bentsen and Brock emphasized that aid for the automakers must include tax benefits and capital investment incentives.