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GM: Japanese Rivals Unlikely to Start U.S. Price War
General Motors Co. doesn't expect its Japanese competitors to take advantage of the weaker yen to launch a wave of discounts that would undercut the pricing of American carmakers.
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General Motors Co. doesn't expect its Japanese competitors to take advantage of the weaker yen to launch a wave of discounts that would undercut the pricing of American carmakers.
Mark Reuss, president of GM North America, tells reporters he believes that Japanese automakers will choose to protect profits and brand image by maintaining current pricing, rather than slashing prices to capture sales.
The yen's value has plummeted by one-third against the dollar since late September to 103.26 per dollar on Monday. Before that plunge, the strong yen hurt Japanese exporters by making their goods more expensive abroad and eroding repatriated profits.
Toyota's incentives per vehicle in the U.S. have climbed 20% from April 2012 to an average of $1,650 last month, according to Edmunds.com. But that level is down 3% from March. In April GM's incentives dipped 1% from a year earlier and 4% from March to average $3,290 per vehicle.
Edmunds tells The Wall Street Journal that if the U.S. sales of Honda and Toyota suffer this summer, the companies might resort to discounting to spur demand but not just to recapture market share from domestic rivals.
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