The Automakers and the Yen

The American Automakers , General Motors , Ford and Chrysler had been losing profit compare to foreign car companies . An enormous gap still separates the performance of Detroit automakers from their foreign competitors ' according to Alex Taylor , Fortune senior editor

2006 was the first year since 1991 that Detroit 's Big Three were all in red . Ford 's situation seems drier than ever : Chrysler , which was profitable until mid 2006 , is now preparing a restructuring plan to roll out February 2007 and Toyota has claimed the number-two spot in the U .S . auto market

, just behind GM

The causes of U .S . Automakers ' profit loss are various . The most trivial is the US-Japan trade policy that is affecting the dollar exchange rate to the yen . The U .S . government continues to passively accept subsidized imported vehicles from Japanese automakers that are not competing fairly because their government effectively subsidizes its auto industry through the use of an artificially low yen . This policy has led to the skyrocketing levels of auto exports to the U .S . that harm the economy and cost American jobs by giving Japanese automakers an unfair and unearned advantage over American automakers . The artificially low yen has helped fuel our trade deficit with Japan , which hurts the U .S . economy and gives Japanese automakers an unfair advantage over American automakers . Nearly two-thirds of that deficit , or 56 billion out of a auto products

Certain facts about the policy were cited that affect the profit . One with a yen valued at 118 to the dollar , Japanese automakers take a 4 ,000 cost advantage per vehicle more than they would when traded at its true value . The overall subsidy Japanese automakers gain for the 2 .2 million vehicles they import is a the billion - 8 .8 billion for car truck exports to the U .S . and 4 .6 billion for imported parts used in American-made Japanese cars . Three 52 of all automobiles manufactured in Japan were designated for export in 2006 , exceeding 50 for the first time in 19 years . In fact , even as demand within Japan for new autos is declining , Japanese companies are adding production capacity to Japan-based facilities , reactivating assembly lines , adding workers and postponing planned factory closures as they move to export ever greater numbers of vehicles

Another reason that could keep the U .S . automotives from increasing its sales was to the slipping consumer satisfaction the quality of the cars assembled . American automakers are riding the yellow line for customer satisfaction , the American Consumer Satisfaction Index finds . Of the six automakers at or below the industry average for customer satisfaction , five are domestic and the gap in customer satisfaction between domestic and foreign producers is once again growing , with Japan regaining the lead followed by the Europeans . This will not make it easier for the Big Three to curb further erosion of market share by overseas competition

Another reason being looked at is the cost of labor . American labor used to assemble a car is definitely...