Japan has agreed to a new series of trade talks with the United States on transportation equipment, including the use of American-made auto parts in Japanese assembly plants in both countries, administration officials said yesterday.
Nobuo Matsunaga, Japanese ambassador to the United States, informed President Reagan of the agreement yesterday as the president was boarding Air Force One to return to Washington from the economic summit in Tokyo, the State Department said.
Secretary of State George P. Shultz and Foreign Minister Shintaro Abe agreed in January to hold the new series of trade negotiations. But until this week, officials were unable to agree on what products should be covered in the talks. The State Department originally proposed market-opening talks for four other areas -- processed foods, wine and liquor, chemicals and emerging technologies. All were rejected by the Japanese. Reagan brought up transportation equipment as a substitute during his meeting in Washington last month with Prime Minister Yasuhiro Nakasone.
The Japanese government has been under great pressure from Congress and the Reagan administration to press its auto makers to buy more American parts for their home market as well as their factories in the United States.
The Commerce Department said that U.S. auto parts account for less than 1 percent of cars produced in Japan and 20 percent of the cars made in Japanese assembly plants in this country.
The combined trade deficit for autos and parts totaled $24 billion last year, about half of the total U.S. deficit with Japan.
Japan's agreement to make auto parts a major element of trade talks was hailed by Reps. Sander M. Levin (D-Mich.) and Marcy Kaptur (D-Ohio), who had mobilized congressional pressure on the issue. They promised "continued congressional involvement" to "reinforce the importance of reducing the U.S. trade deficit in auto parts."
Sen. Pete Wilson (R-Calif.), who held hearings last month on the auto parts issue, said he wants the trade talks to assure U.S. parts makers of access to all Japanese auto plants, whether they are in Japan or in this country.
Commerce Undersecretary Bruce Smart, who called auto parts "the key" to the new trade talks, said getting Japanese auto makers to buy more American parts for cars they make in Japan should help U.S. manufacturers crack the Japanese factories in this country. Smart will be the lead negotiator for the United States in the new round of talks.
The traditional parts suppliers, who often have close ties with Japanese auto makers, are now clustering around the newly opened assembly plants here, cutting their American competitors out of this market as well as the one in Japan.
"Japanese car makers who lock quality American suppliers out of their vast $26 billion home market are bringing the same tactics to their transplanted asembly plants here," complained Robert W. McMinn, senior vice president of the Automotive Parts and Accessories Association (APAA), at the Wilson hearing.
Left unchecked, he said, the traditional suppliers to the Japanese auto makers could control half the contents of all cars sold in this country by 1989.
Assistant Secretary of Commerce H. P. Goldfield agreed that the traditional relationship deprived American makers of an equal shake in the Japanese market. "We don't believe we are being given an equal opportunity to compete with Japanese auto parts suppliers," he said three week ago after returning from leading an auto parts trade mission to Japan.
APAA Chairman Denis J. Healy said "deeply entrenched barriers . . . ranging from elusive parts specifications to bid lots so small that competitive pricing is impossible" have prevented American companies from selling in Japan.
He added that, if a company can't crack the market to sell original parts, "a tall wall" keeps it from supplying spare parts. "It's no wonder we have less than 1 percent of their home market."
State Department officials said auto parts will be "the major component" of the new trade talks.