US auto imports reach historic high
The record value of imports isn't necessarily good news for the US economy, though. For June, the auto industry alone was responsible for over a third of the country's $43.8 billion total trade deficit for that month, according to The Detroit News. For all of last year, the vehicle deficit figure amounted to $169 billion.
"Going forward, for the next two years, we expect net exports to be a drag on growth as domestic growth and a strong dollar bring in more imports and the strong dollar discourages exports," IHS economist Patrick Newport said to The Detroit News. The opposite issue is giving Japanese automakers a boost at the moment because the currently weak yen allows brands to make more on exported vehicles. For example, in its first fiscal quarter financial report, Toyota attributed some of the automaker's record-setting performance on "favorable foreign exchange rates."
With a $35 billion auto trade deficit in the first half of the year, Mexico is among the leaders in sending vehicles here. That trend doesn't look to change either. Earlier this year, Ford announced a $2.5-billion investment to build two new factories there, and Toyota laid out plans for a $1-billion plant. Over three million vehicles were built there in 2014.
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