Honda to shift car production to the US

An International Herald Tribune article (February 2, 2011) describes Honda’s CFO statement that more of Honda’s CRV production will move to its US plants.  The strong yen has hurt the profitability of producing in Japan, and Honda joins other Japanese automakers, like Nissan and Toyota, in announcing this move.  This is despite the fact that it is an automaker with the least amount of Japanese production exported (30 % vs 53 % by Toyota and 59 % by Nissan per the article).  Is it reasonable to expect continued strength of the Japanese yen and thus shifts in production out of Japan ? Is a strong yen or a weak local Japanese demand the driver for such decisions ?

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About aviyer2010

Professor
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