Toyota: U.S. auto woes spell trouble for Japanese makers too

TOKYO -- Even as General Motors and the entire U.S. auto industry teeters on the edge of collapse, its major rivals are hardly celebrating. Toyota and other Japanese carmakers say the bankruptcy of any of Detroit's Big Three would spell serious trouble for them as well.

Should that happen, "the damage to our business is certain to be tremendous," Toyota Motor Corp. spokesman Hideaki Homma told The Associated Press Monday. "The conditions for the U.S. auto market are extremely tough right now, and any additional negative is sure to make things worse."

One major problem is that Japanese carmakers in the U.S. share many of the same parts suppliers. If a Detroit automaker were to collapse, suppliers would likely follow, setting off a chain reaction that could would wreak havoc for Japanese production in the U.S., a vital market.

More broadly, the U.S. crisis could lead to huge job losses and further weaken consumer spending, especially for big-ticket items like automobiles. Together, the three big American automakers employ 239,000 workers in the United States. Counting other businesses that depend on the automakers, economists estimate that 2.5 million jobs would be lost if all three companies went out of business.

"Whether it is the impact on consumer confidence or the impact on the suppliers that we all share, having one or more of the major automakers in severe distress has consequences for the entire industry," said Simon Sproule, corporate vice president of global communications at Nissan Motor Co., Japan's third-biggest carmaker.

A possible advantage from a collapse of the U.S. auto industry could come only many years later — perhaps in a decade — when Japanese manufacturers would compete against weaker rivals in the U.S., especially if they further exploit their lead in green technology with hybrids or electric vehicles, said Koji Endo, auto analyst with Credit Suisse in Tokyo.

"But that's for the long, long term," he said. "For now, the situation is bound to get worse for the Japanese."