Jan 30 2015

Ford Motor Co.’s top financial executive said the weak yen gives Japanese automakers as much as $11,000 more profit per car and allowed Toyota Motor Corp. to earn an extra $10 billion in 2013. Ford wants the U.S. to intervene against what it sees as currency manipulation. “The competitive landscape really shifts when you’ve got a competitor that suddenly has got that kind of windfall simply because the currency has moved.” “The concern we have is what do you do with all that money,” Bob Shanks, Ford’s chief financial officer, in an interview said. In the past three years, the yen has weakened 35 percent against the U.S. dollar, according to data compiled by Bloomberg. There are internationally recognized and agreed principles that could be used and put in these agreements so that when there is outright currency manipulation, there would be consequences,” Shanks said. “Sometimes currencies move just because the market moves and they should move. But sometimes they move because governments intervene inappropriately. The weakening yen added $6,000 in profits to an average car imported from Japan from 2012 to 2013, Shanks said. With today’s yen trading at about 118 to the dollar, that additional profit has increased to about $11,000 from 2012. Ford is encouraging U.S. trade officials to include rules to prevent currency manipulation in the Trans-Pacific Partnership treaty under negotiation between North American and Asia-Pacific countries, including Japan. Ford contends the weak yen allows Japanese automakers to cut prices or add features to their cars without hurting profits.