Crushed by lopsided dollar/yen exchange rates, Honda is cutting back on exports from Japan to the U.S., even though that will curb potential sales and market share growth, the maker’s CEO says.
The maker hopes to offset those reductions by ramping up production in the U.S. and other parts of North America. Honda recently broke ground in Mexico for a new plant that will supply American dealers with the subcompact Fit and possibly other products.
“Under the current exchange rate of 80 yen per dollar, our export business doesn’t make any profit,” Honda Motor Co. CEO Fumihiko Ike told the trade publication Automotive News. “Definitely, the absolute number of exports to the United States will be decreasing.”
Honda is by no means the only Japanese maker to curb exports to the U.S. as a result of the weak dollar. And European makers, including BMW and Audi, have also curtailed exports due to lopsided exchange rates – though with the Euro sliding the gap has narrowed in recent weeks for German and other Continental manufacturers.