TOKYO (AFP) ― Honda Motor intends to slash its exports from Japan by about half over the next decade as it looks to cope with a high yen, its president said in an interview published Wednesday.
He added the Japanese automaker would focus on smaller vehicles at home in order to boost domestic sales in the near term.
“Battered by such appreciation of the yen, the company sees clearly that Japan can no longer be the world centre of its production and exports,” Honda president Takanobu Ito told the leading Asahi Shimbun newspaper.
“Honda currently exports 30-40 percent of its domestic production, but it is hard to sell overseas while fretting over currency movements,” he said.
“The company will continue exporting, but up to 10-20 percent of domestic output.”
The safe haven yen has soared on eurozone debt worries and a slowdown in the U.S. economy, as investors move into the unit to escape global market turmoil, which also attracts speculative funds.
Despite efforts by Tokyo to intervene in markets, the yen hit a postwar high of 75.95 against the U.S. dollar in August and this week fetched fresh 10-year highs versus the euro.
Prime Minister Yoshihiko Noda has warned of a possible “hollowing out” of Japanese industry as manufacturers, seeing repatriated profits eroded, consider shifting more production overseas in search of cheaper labour costs.
