U.S.-JAPAN TRADE SHOWDOWN : Impact of the Proposed Tariffs Remains Unclear : Auto Makers Gird for Rocky Road

Everyone agrees that Japanese luxury cars won’t immediately disappear from U.S. dealer showrooms if the Clinton Administration follows through this week on a threat to impose 100% tariffs intended to price the cars out of the American market.

But the possible long-term impact on Japanese auto makers and the availability of their popular luxury models in the United States is less clear.

Japanese car companies face widely differing repercussions from threatened sanctions, which are expected to go into effect Wednesday if U.S. Trade Representative Mickey Kantor and Japanese Minister of International Trade and Industry Ryutaro Hashimoto fail to hammer out an agreement during a last-ditch effort now under way in Geneva.

Washington is threatening to impose the stiff import taxes on 13 models unless agreement is reached on providing greater foreign access to the Japanese market for autos and auto parts. The tariffs would apply to any of the affected models imported to the United States after May 20.

Strategies adopted by the five affected Japanese manufacturers vary depending on their inventory situations in the United States, their financial strength and their plans for future model or production-line changes.

The most aggressive approach is being taken by financially strong Toyota Motor Corp., which has continued shipping its Lexus models to the United States despite the threat--and has pledged to dealers that it will bear the cost of tariffs if they are imposed.

About 7,000 cars potentially vulnerable to tariffs have been shipped to the United States since May 20, and production is also continuing, Toyota spokesman Eiji Hirabayashi said Monday. As of June 1, Lexus inventory in the United States stood at 12,900 vehicles, a 40-day supply, and thousands more have arrived since then, he said.

The promise to cover the cost of tariffs was made by Toyota Motor Sales U.S.A. President Shinji Sakai at a meeting last month of the American International Automobile Dealers Assn., and since then there has been no change of policy, Hirabayashi said.

“It is natural for the top of the sales arm to give some confidence to maintain the sales network,” he said.

However, Hirabayashi did not guarantee how long the policy will last. “It all depends” on the outcome of the current talks, he said.

Nissan Motor Co. suspended production of its Infiniti models effective June 1, but it has continued shipping Infinitis to the United States, Nissan spokeswoman Masako Fujita said.

Nissan now has a normal 60-day inventory of Infinitis in the United States, Fujita said. Cars imported after May 20 have not been sent to dealers, so Nissan has not yet needed to fully confront the issue of who would pay the tariffs on those vehicles, she added.

Honda Motor Co., like Toyota, has decided to shoulder the burden of tariffs, at least on those cars entering the United States between May 20 and Wednesday.

Honda stopped shipments briefly early this month, but after about 10 days decided to resume them, Honda spokesman Yasuhiro Wada said. Until the deadline passes, no one knows whether the tariffs will be imposed, so Honda will “not pass those tariffs to the dealers,” Wada said. “Beyond the 28th . . . we haven’t made a final decision yet, but it might be a different situation.”

Production has continued on Honda’s affected models, the Acura Legend and Acura 3.2 TL, Wada said. About 90 days’ worth of the two models is now in the United States, he said.

Mitsubishi Motors Corp. will be virtually untouched by sanctions no matter what happens. Its only affected model is the Diamante, and it still has about an eight-month U.S. inventory of vehicles imported before May 20, spokesman Shinichi Korechika said.

Also, even before the sanctions issue arose, Mitsubishi had decided to shift Diamante production to Australia starting next year, Korechika said. The U.S. sanctions are targeted only at vehicles made in Japan.

Japanese production of Diamantes for the U.S. market has been shut down at least until September, Korechika said. If sanctions are not imposed, the assembly line might be restarted this fall, but the number of vehicles involved is rather small, he said.

The current Diamante model for export to the United States is near the end of its run anyway, with U.S. sales dropping from a peak of 22,000 in 1992 to 15,000 last year and a projected 5,000 this year, Korechika said.

Mazda Motor Corp. built up large unsold stocks of its Mazda 929 and Millenia in the United States this spring when the U.S. auto market cooled.

As of June 1, Mazda had about a 90-day inventory of its luxury models in the United States, spokesman Tetsu Owari said.

Mazda said it has made no decisions about what to do if sanctions are imposed. The tariffs would apply only to new shipments, it noted.