Shocked by Attack on Toyota

President-elect of United States, Donald Trump, accused Toyota Motor Co. of its plan to build car-making plant in Mexico on his Twitter account on Thursday. Japanese business sectors realized biased protectionism of incoming Trump administration through his fingertip intervention to international trade. Economic policy of Shinzo Abe administration may be affected by unilateral ruling of U.S., which may defeat the driving force of economic growth, exporters.

As in his Presidential campaign, Trump’s criticism was straightforward. “Toyota Motors said will build a new plant in Baja, Mexico, to build Corolla cars for U.S. NO WAY! Build plant in U.S. or pay big border tax,” described Trump. To maintain or increase jobs in U.S., Trump has been accusing carmakers of shifting their factories to Mexico. Toyota became the first foreign carmaker targeted by him.

Several hours before Trump’s tweet, President of Toyota Motors, Akio Toyota, told the reporters his firm intention to build new plant in Mexico in a new year’s meeting in Kyoto. Toyota has a plan to start produce annual two hundred thousands of Corolla in new factory in Guanajuato, Mexico, that will produce two thousands of new jobs, in 2019. “I will be closely watching the decision of new U.S. President,” said Toyota, related to current retreat of Ford from building a plant in Mexico. It is possible that Trump responded to that comment.

Stock market in Tokyo was shaken by Trump’s abrupt attack on Japanese carmaker. The stock price of Toyota Motors temporary declined by 3% from the previous day on Friday. U.S. Toyota immediately released a statement against Trump’s tweet that argued production volume or employment in U.S. would not decrease as a result of their new plan in Mexico. “Toyota looks forward to collaborating with the Trump administration to serve in the best interests of consumers and the automotive industry,” said the statement. But an official of Toyota Motors in Japan revealed his anxiety being targeted Trump. “It comes at last,” said him.

Ministry of Economy, Trade and Industry thinks Trump’s possible policy to apply high-level tariff only on foreign company like Toyota can violate international trade rule. An officer of METI indicated that Trump’s idea would violate U.S. Constitution, which upheld equality of taxation. It is possible for Japanese government to have discussion on the issue. However, it is unclear whether Japanese manufacturers will maintain its policy to produce outside U.S. even after U.S. major corporations rethinks their outsourcing.