Washington, DC — The Auto Trade Policy Council (ATPC), whose members include Chrysler, Ford and General Motors, called on G7 Finance Ministers to use the opportunity of their October 19 meeting in Washington, DC to address the artificially weak yen. Japan’s policies which artificially weaken the yen provide Japanese automakers an average $4000 subsidy on millions of vehicles they export from Japan to the United States.

“There is a growing consensus around the world that Japan’s misaligned yen is also damaging the economies whose currencies have been allowed to trade freely in the markets, such as the European Union, Canada, Korea, and Australia,” said Stephen J. Collins, President of ATPC. “The U.S. government should join European Finance Ministers in insisting on a serious discussion with the government of Japan on a definitive plan and timetable to realign the yen to a level that represents its true economic value.”

Friday’s G7 meeting follows the Wednesday release of the IMF’s Global Economic Outlook, which stated “In the IMF’s view, the dollar remains overvalued relative to medium-term fundamentals” and that “the yen remains undervalued relative to medium-term fundamentals.”

Collins added “The IMF report only serves to underscore the fact that the Japanese yen is being artificially undervalued, placing additional burden on other countries to promote global economic growth. In today’s volatile international currency markets, mechanisms such as ‘jawboning’ the yen and promoting the carry trade only serve to increase the risk of large and potentially disruptive economic corrections.”

Since 2002, the Japanese government intervened in currency markets to weaken the yen, spending more than $400 billion, and has engaged in public ‘jawboning’ to ensure the yen remains low. The resulting ‘yen subsidy’ has facilitated a Japanese auto manufacturing resurgence; in 2006, more than half of all vehicles made in Japan were designated for export, exceeding fifty percent for the first time in 19 years.

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The Automotive Trade Policy Council, Inc. (ATPC) is a Washington, D.C. — based non profit trade association that represents the common international economic, trade and investment interests of its member companies: Chrysler LLC, Ford Motor Company and General Motors Corporation.