[Title] The Settlement of U.S.-Japanese Conflict on Automobile and Auto Parts Trade, Statement by Ambassador Kantor

Statement by Ambassador Kantor

Today I am announcing our proposed sanctions list in the section 301 case regarding barriers in the Japanese "aftermarket" for replacement auto parts and automotive accessories. This follows the May 10 unfairness determination that covers acts, practices, and policies of the Government of Japan with respect to the aftermarket that are unreasonable and burden and restrict United States commerce.

The list consists of imports of Japanese luxury cars, which would be subject to duties of 100 percent ad valorem. Imports of vehicles on the list in 1994 were valued at approximately $5.9 billion. The models on the list are:

Manufacturer Model

Honda Acura Legend

Acura 3.2 TL

Toyota Lexus LS 400

Lexus SC 400

Lexus SC 300

Lexus GS 300

Lexus ES 300

Nissan Infiniti Q 45

Infiniti J 30

Infiniti I 30

Mazda 929

Millenia

Mitsubishi Diamante (4 door sedan)

None of these cars is made in the United States.

In accordance with the requirements of section 301, we are requesting public comment on this proposed action. Written comments must be submitted by Monday June 19, 1995. There will be a public hearing on June 8, 1995, to be continued on June 9, 1995 if necessary. The final determination will be made on June 28, 1995.

Because the list contains a narrow range of products, we do not expect at this juncture that the final list would be altered significantly. However, we will carefully consider, and fairly evaluate, any and all information provided in this process in reaching a final determination.

This list is the work of an interagency team that made recommendations to me. In compiling the list, we took into account a number of factors. We sought to include a Japanese industrial sector that would have an interest in having this issue resolved and that was important to Japan. On the other hand, we sought to minimize the adverse impact on the U.S. economy. In particular, we wanted to minimize the impact on U.S. workers, U.S. businesses, and U.S. consumers - especially low and moderate income consumers. We also sought to include goods for which there are alternative sources of supply.

I have asked the United States Customs Service to withhold liquidation of entries of the vehicles on the list as 12:01 am Saturday, May 20. If the increased tariffs go into effect, we intend for them to go into effect as of May 20.

We welcome the statements of the U.S. auto companies that they intend not to take advantage of this situation at the expense of American consumers. However, we need to ensure that we work together to protect American consumers as we address the issue of U.S. competitiveness in this automotive market and creating high-wage, high-skill jobs.