- Jun 8, 2006
GM's Wagoner joins chorus blaming weak yen
General Motors CEO used the bully pulpit at GM's annual shareholders' meeting to repeat a complaint that has been made several times in the past few decades (and will likely will be heard many times again) - the Japanese government is artificially holding the value of the yen low relative to the dollar to help its exporters. The same complaint was recently issued by Chrysler's Tom LaSorda as well. A lower value for the yen makes it easier to stick a lower price tag on an auto that's imported from Japan; or, alternatively, it makes the sale of that vehicle more profitable at the same price.
The yen has experienced two significant slides in value relative to the dollar twice in the past ten years, but at this time it is close to trading near its strongest position over the same time period. While the Big Three do not enjoy the same relationship with their government as the Japanese automakers, it's unclear whether the Hill's financial policy of large federal and trade deficits would allow any significant manipulation of the dollar's value, even if the feds wanted to help the automakers.