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Japanese Car Importers Differ on Tariff Tactics : Commerce: Meanwhile, Washington reverses position and says it will abide by any ruling of the World Trade Organization.

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TIMES STAFF WRITER

Just two days after the Clinton Administration’s 100% import tariff on most Japanese-made luxury cars provisionally took effect, the five Japanese import companies affected were split on the tactics for handling the looming crisis.

And while both sides in the trade talks so far have been intransigent, U.S. Secretary of Commerce Ronald H. Brown said Monday that Washington would abide by any ruling of the World Trade Organization over the sanctions it has imposed. Earlier, the Administration had seemed determined to impose the sanctions unilaterally.

American Honda Motor Co., Mazda Motor of America and Mitsubishi Motor Sales of America have halted imports of targeted cars, but Toyota Motor Sales USA and Nissan USA say they will continue business as usual--including importing cars that are subject to the tariff.

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Ironically, one of those cars--the Honda-built Acura 3.2 TL--has been the star of a national ad campaign since March and was scheduled to be introduced in July.

“If the tariff goes through, we may never see the car,” said Peter Michael, sales manager at South Coast Acura in Costa Mesa. “There is very little [dealers] can do,” however, except continue selling cars while they wait for the situation to be resolved, he said.

While the tariff took effect at 12:01 a.m. Saturday, President Clinton said he will wait until June 28 to order customs officials to collect it. The delay is intended as an incentive to push Japanese trade negotiators into agreeing with U.S. demands for Japan to open its markets wider to U.S. cars and auto parts.

At a Geneva news conference Monday, Brown brushed aside suggestions that immediate imposition of 100% tariffs on Japanese luxury cars was undermining the newly launched WTO and argued that the move is aimed at promoting free trade for all countries.

“Obviously, when the WTO makes its decisions, we will abide by them. . . . We are going to follow the rules and guidelines of the WTO,” he said.

Though not unanimous in their importing policies, the five import companies, all with their U.S. marketing arms headquartered in Los Angeles and Orange counties, have united in an effort to lobby Congress and the Administration. Top officials of all five--as well as the four Asian auto makers not affected by the tariffs--gathered in Washington on Sunday and Monday at the annual convention of the foreign car dealer trade group.

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The association hopes to convince politicians that the tariff would be a disaster that would wipe out the businesses of many of the 2,000 dealers who sell the targeted cars, take away the livelihoods of the 80,000 workers they employ and rob U.S. consumers of freedom of choice.

At the same time, however, both Acura and Nissan’s Infiniti division continue massive advertising campaigns promoting cars on the government’s hit list--Nissan reportedly is spending $30 million to promote its new Infiniti I30 model.

There have been reports from the San Francisco area of dealers using the tariff as a scare tactic to drum up sales, but Southern California dealers say they are not resorting to so-called fire sales, though some have said that if the tariffs are imposed they expect a run on their remaining models.

Still, Japanese luxury car dealers in Southern California say they are doing little to prepare for a doomsday scenario.

All of Acura’s Legend models, as well as the 3.2 TL, are on the government’s hit list, “but even if the tariff goes through, we have enough Legends on the lot and [in storage] at port to last through the end of the year,” said Michael, the South Coast Acura manager. In fact, his dealership is discounting Legend models to move as many as possible because Acura is replacing the line at the end of the year.

Dealers are not panicky about their own futures, some say, because there is a strong belief that the car companies won’t let them founder after they have spent $3 million to $6 million building and equipping their showrooms and service areas.

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For dealers with the smaller companies, the apparent lack of panic is easier to explain: The luxury cars just aren’t that big a chunk of their sales.

Al Richman, general manager at Westlake Mitsubishi in Thousand Oaks, said his dealership has nine Diamantes on the lot and another 11 on their way, enough to last about three months at current sales volume.

If the supply is interrupted, Richman said, his dealership will simply “show customers a Galant, which is the next model below [the Diamante], and hope they have some interest.”

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Times staff writer Greg Miller in Chatsworth and Times wire services contributed to this report.

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