KEITH CRAIN

What to do with the empty ships

COMMENTARY
Keith Crain is editor-in-chief of <I>Automotive News</I>.
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North American auto exports seem odd after decades of seeing so many vehicles being imported.

The U.S., Canadian and Mexican markets have always been large enough to take care of all the vehicles that their plants could build. No one really thought -- for the last half century at least -- that North American new vehicles would be shipped elsewhere.

We have imported millions of cars from Asia and Europe for so long that we expect boats to arrive on our shores filled with automobiles and then leave empty.

Oh, sure, North America exported the odd car from time to time, but the total never seemed to amount to a hill of beans.

However, there really are markets outside North America for vehicles built in North America. It comes as a bit of a surprise.

One of the first things you discover when you start shipping from North America is how protective the rest of the world is about local manufacturing. It's nice to ship a car to Brazil or Japan or Korea, but be ready to jump through hoops before you can retail it.

But in spite of all the perils of exporting autos from North America, it seems that the demand is growing. I imagine that the shipping costs are fairly low considering how many ships are returning empty to their home ports after discharging a couple thousand vehicles here.

I doubt we are going to hear of a groundswell of shipments to China or India anytime soon. There, the demands are so tight and the import rules so stringent that local assembly seems like the smarter move.

But, who knows, there may well be a cachet for cars exported from the Americas in the future.

I am sure that our government isn't going to try to achieve trade reciprocity with other nations, but it might be nice to give it a try. The United States has always been quite a free trader. Everyone wants to export to the United States, but it's an interesting exercise to explore the real costs of shipping from here.

It seems perfectly natural for automakers to consider balancing production of their vehicles in North America with exports flowing the other way as a hedge against currency fluctuations.

It's a breath of fresh air to see North American plants shipping vehicles overseas. Hopefully, it will continue to grow.

You can reach Keith Crain at kcrain@crain.com.

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