The Japanese government turned aside harsh U.S. criticism over its decision to raise the limit on auto exports to the United States today, and said the new limit was evidence of Japanese "moderation" intended to foster good bilateral relations.
Makoto Kuroda, director general of the International Trade Policy Bureau, said that Japan was "prepared to accept . . . criticism" from Washington that the new limit was too high.
At the same time, Japanese auto manufacturers condemned the new limit as too restrictive and said it would contribute to the spread of worldwide protectionism.
In a news conference officially announcing the new 2.3-million-auto export ceiling, a 24 percent increase over the current limit that expires Sunday, Minister of International Trade and Industry Keijiro Murata said that the decision "does not in any sense affect our efforts to open our market" to allow more U.S. goods to enter Japan.
The announcement came amid growing antagonism toward Japan in Washington, where Reagan administration officials and Congress yesterday and today denounced the new ceiling, of which they had been informally advised before its final approval by Prime Minister Yasuhiro Nakasone today, as continuing evidence of unfair Japanese trade practices.
Although President Reagan had declined to ask Japan to enter a fifth year of "voluntary restraints," the administration had hoped that the Japanese would set a low limit without U.S. prodding. Such a move, the administration felt, would be evidence of Japanese seriousness in beginning to address the overall trade imbalance between the two countries, which the United States has charged is due primarily to Japan's protectionism restricting U.S. imports.
Japan's trade surplus with the United States last year topped $35 billion. Kuroda, of Murata's ministry, which is known as MITI, estimated today that the new quota will add $2.5 billion to Japan's exports to the United States, although some estimates were higher.
Japanese trade officials denied assertions in Washington that the new 2.3 million ceiling effectively would mean no restraints are in place. Without government controls, Kuroda said, exports probably would increase to between 2.6 million and 2.8 million cars.
He also denied that the 2.3-million figure will have the industry producing at full capacity. Japan's nine auto manufacturers could turn out enough cars to allow a rise to the 2.6 million-2.8 million range, he said.
In Japan's auto industry, the plan generated condemnation as too restrictive. Domestic demand is stagnant and companies reportedly had pushed for a rise to about 2.7 million cars.
Takeshi Ishihara, president of Japan's largest producer, Nissan, called the decision "truly regrettable in the face of President Reagan's unequivocal statement of March 1 that he did not seek another year's extension" of quotas and said it "will risk spreading protectionism on a global level." Isuzu president Kazuo Tobiyama said, "The United States has finally called for abolition of restraints. Nonetheless, we are continuing them. It is very regrettable."
MITI officials said the decision to raise the quota grew from four major considerations:
* The improved performance of the U.S. auto industry. The quotas were originally applied in 1981 to give relief to the Detroit companies, which were laying off workers as recession and high oil prices cut deeply into sales.
* Strong consumer demand in the United States. The quotas will mean lower prices for American car buyers and fewer difficulties in obtaining Japanese cars, Kuroda said.
* Low inventories at U.S. dealerships selling Japanese cars. Currently, they have only a 20-day supply of cars, MITI officials said, while dealers handling U.S. cars have about a 60-day supply.
* The needs of smaller Japanese companies that have entered into "captive import" contracts to produce subcompacts for major U.S. auto makers to market as their own.
General Motors has signed for 200,000 cars a year from Isuzu and 100,000 from Suzuki. Chrysler is reported to want up to 290,000 a year from Mitsubishi. In all cases, the quotas have allowed the Japanese companies to ship only a fraction of those numbers.
Small Japanese companies like these pushed hard for new access to the United States. In contrast, Toyota and Nissan, which control more than half of the current quota, are said to have counseled more for moderation.
Kuroda asserted that no decision has been made on how to divide the new quota among the manufacturers, though he said "we'd like to make the allocation of unhappiness a fair one." Press reports here say the smaller companies are likely to get a proportionately larger share.
MITI has depicted the new restraints as different from the old ones. But it will police them in the same way, using laws that empower it to regulate exports in the national interest.
Ishihara and other industry leaders had called for letting each company use its own judgment in holding exports to prudent levels.