U.S. Trade Representative William E. Brock said yesterday that President Reagan's top advisers soon will make a final recommendation on whether the administration should ask for a fifth year of quotas on Japanese auto exports to the United States.
A reliable auto industry source who has been in contact with the White House said last night that the final recommendation to the president will be made today.
The so-called voluntary quotas, in effect since April 1, 1981, are scheduled to expire March 31.
Since the inception of the quotas, the administration has requested their renewal each year, albeit at higher levels.
The quotas initially limited the Japanese to annual shipments of 1.68 million cars. That official ceiling was raised to 1.85 million units last April. But the Japanese exceeded restraint levels in each quota year, largely because of cars sent to the United States through third-party territories.
Reagan's Cabinet Council on Commerce and Trade last week urged the president to let the Japanese decide on their own whether to continue or end the restraints.
Brock told a House subcommittee yesterday that the Cabinet deliberations have been "widely and fairly accurately reported by the press."
But, "I wish to emphasize that, at this date, no final Cabinet recommendation has gone forward to the president, nor has the president made any decision on this matter," Brock told the trade subcommittee of the House Committee on Ways and Means.
In comments to reporters after his testimony, Brock said Reagan's top advisers are reviewing the Cabinet council's work and soon will make a final recommendation to the president. Brock declined to speculate on what that recommendation, and the president's response to it, might be.
However, auto makers who want continued restrictions on Japanese car exports to the United States indicated yesterday that they expect the quotas to end. For example, Chrysler Corp. announced that it is firming up a deal with its Japanese partner, Mitsubishi Motors Corp., to import an additional 200,000 cars a year for Chrysler's U.S. sales.
That is 100,000 more cars than Chrysler previously said it would import from Mitsubishi if quotas are lifted. According to the latest available figures provided by Detroit-based Ward's Automotive Research, Chrysler brought in 91,718 Mitsubishi cars last year -- which means Chrysler eventually could end up with nearly 300,000 subcompacts a year from its Japanese partner.
Japan currently produces cars at a per-unit cost that is at least $1,500 less than that of comparable American products. General Motors Corp., America's largest auto maker, has mounted an aggressive campaign to take advantage of that production-cost advantage by importing as many as 300,000 cars a year from its Japanese partners -- Isuzu Motors Ltd. and Suzuki Motor Co. Ltd.
GM's "Asian Strategy" was held in check last year by the quotas, which limited its Suzuki imports (Sprint subcompacts) to 13,500 units sold on the West Coast and its Isuzu cars (Spectrum subcompacts) to 15,000 units sold on the East Coast. GM plans to sell 66,500 Sprints and 89,500 Spectrums -- about 3 percent of GM's projected 1985 sales -- if quotas end in March. A full year without quotas could get GM up to the 300,000-unit import level -- which Chrysler and other domestic auto makers say they would have to match to remain competitive in the important small-car segment of the U.S. auto market.