Japanese Big Three in North America

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Much of the production increase in North American automotive assembly plants is attributable to the three key Japanese automotive manufacturers, Toyota, Honda and Nissan; each with assembly plants located in North America. Increasing financial commitments from these Japanese automobile manufacturers over the past 3 years is in part due to the decline of the U.S. Dollar in relation to the Japanese Yen.

Production in Japan begins to get massively more expensive with every incremental rise in the yen; Bloomberg calculates that every single-digit increase in the yen's value against the dollar robs Nissan of $232 million in yearly operating profit… For Toyota– Bloomberg figures each single-digit increase in the yen costs Toyota $402 million every year.2


Toyota builds 70% percent of its US Sold cars in North America. In particular, the high volume models such as Camry, Corolla, Highlander, Tacoma and RAV4. Slower selling vehicles such as Land Cruiser & FJ Cruiser are assembled in Japan and shipped to North America.

Toyota’s plan is to invest 1.6 Billion & 3,500 jobs in North America by 2015.3


Seven Honda auto plants have the capacity to produce 1.63 million automobiles each year. In 2011, 85 percent of the Honda and Acura automobiles sold in the U.S. were produced in North America. This will increase to 1.92 million vehicles per year in 2014, when the sales percentage of locally produced automobiles is expected to rise to more than 90 percent.

In the last three years, (2009-2012) Honda has announced investments at its Ohio manufacturing facilities exceeding $800 million. They include projects to establish on-site parts consolidation centers, renovate auto assembly and painting operations, and major investments at the Anna Engine Plant, as well as its transmission plant in Russells Point, to manufacture continuously variable transmissions (CVTs.4


Bill Krueger, vice chairman of Nissan Americas. "With the addition of this new model in Canton, Nissan is well on its way toward meeting our goal to manufacture 85 percent of the vehicles we sell in the U.S. right here in North America."

Nissan has three production plants in the United States - in Smyrna and Decherd, Tennessee, and Canton, Mississippi. Production at Nissan's Smyrna Plant began in June 1983. The vehicle assembly plant has an annual production capacity of 550,000 vehicles and represents a capital investment of $2.5 billion.

The vehicle assembly plant in Canton, Mississippi, began producing vehicles in May 2003. The plant now produces the Nissan Altima, Nissan Armada, Nissan Titan and NV Utility and Passenger Vans. The plant has an annual production capacity of 450,000 vehicles.

Nissan's North American vehicle production will increase from about 1.0 million units in 2010 to about 1.29 million units in 2015. That corresponds to a compound annual growth rate of 5.3 percent between 2010 and 2015.5

Chart Source: Autoblog.com

Citing recent market trends, the US Dollar is showing signs of strengthening against the Japanese Yen during the first several weeks of January 2013, with predictions of returning to 2010 levels. North American vehicle production would then be utilized to support overseas markets as well.

1 Source: www.irs.gov

2 Source: Bloomberg

3 Source: Detroit Free Press

4 Source: Honda Press Release

5 Source: Statista.com