US: Japanese auto jobs decline because of Mexico image

Both Japanese carmakers and their suppliers were slower to add new jobs in the US last year, after they move to expand in Mexico and overseas to reduce currency fluctuation spending.

Figures reported by a study commissioned by the Japan Automobile Manufacturers Association show that the nation’s automakers and suppliers had 82,816 people directly employed in the US in 2013, a 2.2% rise form the 2012 level. But that compares to that year’s jump of 12% from 2011.

“You just have to deal with the consequences of changing circumstances,” said Rutgers University economics professor Thomas Prusa, the study’s author. “One way to do that is to diversify global production.”

“Japanese automakers like to build where demand exists, and there’s a lot of demand in the United States,” said Ron Bookbinder, general director of JAMA USA.

Since June this year, Mexico has become the second largest exporter of cars to the United States, passing Japan thanks to new factories created by the Asian automakers. Nissan, Honda and Mazda all created new plants in the Central American nations, aiming to shield themselves from the rising currency fluctuations.

Last year, when Japanese auto businesses added around 1,800 new jobs, new car sales in the US rose 7.6% to 15.6 million units.

Via Bloomberg