Facing some intense competition for its long-held spot as the world's top automaker to Japan's Toyota, General Motors' (GM) top executive reiterated late on Friday the yen is still undervalued on world's currency markets.
"I think, in the next five or 10 years, the bias is for the dollar to weaken and all the basic economics suggest that it should," GM chairman and chief executive Richard Wagoner told reporters during an impromptu press conference after the financial markets had closed in the US.
US automakers have cranked up a major campaign focusing on the what they describe as the undervalued yen, Wagoner said.
From GM's perspective the yen at 114 is a lot better than the yen at 120, he said.
"That's good," Wagoner said, adding the yen's true value was somewhere in the range of 90 to 100 to the dollar.
"It would be a huge change in the competitiveness. I think my colleagues in Europe would agree as well," he said.
"It would dramatically level the competitive field if we saw the yen at 90 to 100 range," Wagoner said.
currency adjustments
"I think a couple of things could happen. If the yen strengthens, I think the dollar and the euro might be more stable. I think it would make the Europeans feel a lot better if we saw some adjustments from the Asian currencies particularly the yen."
Wagoner also said it could halt the flow of manufacturing and auto jobs out of the US.
"I think the US has become somewhat more competitive and as we look at the strategy of global architecture and integrating our capacity, it does offer some opportunities if we get our costs in line," he said.
Wagoner also said he was pleased the Federal Reserve Board had elected to cut rates since auto sales have been sluggish for the last several months.
"We're continuing to run below trend demand here at the retail level in the United States, but I'm not sure where we are today so I can give you a convincing case when that's going to come back," Wagoner said.
negative impact
However, Wagoner declined to say whether the recent disarray in the financial markets would have a negative impact on GM's ability to transfer its huge liabilities for employee healthcare to a new independent trust, clearing them off GM's own balance sheet.
The fallout from the credit crunch has hurt GM's own mortgage financing business, which is now operated with Cerberus, the New York-based private equity firm.
"We do have a very strong liquidity position," he said. "It's not the best time to go out a raise money," he said.
disruptive
"The liquidity has come in the last couple of days. The discount rate is done. It had gotten to the point where it was disruptive and [the Fed] reacted to that," he said.
"People won't buy even prime credit jumbo loans," he said. "It was hard to find people to buy high rated paper. I don't think that's unique to GM. That market has significantly closed down."
"That's highly unusual and not constructive to the economy when prime credit is not available for housing, which drives the whole economy. It feels like it's temporary situation," he said.
"Obviously people are retrenching and my sense is when these adjustments happen, people tend to overshoot on the downside," Wagoner said.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by