When Ottawa pushed Japan to slow down its auto exports

In 1982, Ottawa wanted Japanese automakers to switch to a lower gear, even though they were happy with the speed they were going.

When a pitch to put the brakes on Japan's exports failed, Canada took steps to slow exports down

Tension over Japanese exports

41 years ago
Duration 1:13
Ottawa wasn't able to convince Japan to export fewer cars to Canada in March of 1982.

Japanese automakers were being asked to switch to a lower gear, even though they were happy with the speed they were going in the Canadian market.

In March of 1982, International Trade Minister Ed Lumley travelled to Tokyo to try to convince Japan to embrace voluntary quotas on its auto exports, as well as to consider other concessions.

The push came at a time when Canada's domestic auto industry was slumping. And Ottawa clearly wanted to steer it in a more productive direction from a Canadian perspective.

Basically, Ottawa wanted to see more Canadian-made cars sold at home, a market where consumers were buying more and more Japanese products.

'Just one concession'

Trade Minister Ed Lumley is seen meeting with trade officials in Tokyo in 1982. (The National/CBC Archives)

"The Canadians presented sweeping proposals to further reduce the Japanese auto imports to Canada," the CBC's Don Murray reported on The National on March 19, 1982.

"And then they said they wanted the Japanese to agree to Canadian content rules — rules that would involve buying parts in Canada and building assembly lines in Canada."

Perhaps unsurprisingly, the pitch to have Japan voluntarily slow down its exports didn't get much traction — at least, not initially.

The CBC's Don Murray is seen reporting on the Canada-Japan tensions over auto exports. (The National/CBC Archives)

"In the end, the Japanese made just one concession," said Murray. "They would agree to limit their auto exports to Canada at the present level."

According to Murray's report, Lumley signalled that "Canada would consider unilateral restrictions, though he wouldn't give any details."

In other words, Ottawa was willing to rev up its opposition on the matter.

'Another chance' for Canada

Tensions rev down with Japan

41 years ago
Duration 2:06
Japan agrees to export fewer cars to Canada.

In August, The National was again reporting on the tensions between Japan and Canada on the auto file. Because at that time, there had been movement on the export issue.

"The Canadian car industry got another chance today — another chance to sell more of their cars in Canada," the CBC's Knowlton Nash told viewers. "That's because Japan has agreed to limit the number of cars it sells here."

Ed Lumley is seen speaking to reporters about the agreement on Japanese auto exports that was announced in August 1982. (The National/CBC Archives)

That change in position had come after Canada took measures to put the brakes on Japanese exports in the months that had followed Lumley's trip overseas.

"The federal government began a so-called 'border action' on the west coast," reporter Bill Casey explained in a report that aired on Aug. 11, 1982. 

"Using customs procedures, it slowed down the entry of Japanese cars, but speeded up discussions on a new ceiling for 1982."

Some of those "customs procedures" had previously been covered on The National, as they were unfolding — including in the May 28, 1982 report, shown below.

Canada stalls Japanese-made cars

40 years ago
Duration 2:03
In 1982, Canada began stalling the entry of Japanese-made cars into Canada.

And by the outcome that occurred in August, it would seem they had their desired effect.

More Canadian content

The Japanese automakers were capturing a larger share of the Canadian market at a time when their Canadian counterparts were struggling. (The National/CBC Archives)

Lumley said the agreement would see the Japanese share of the Canadian market top out around 21 per cent, a decrease from the market share those automakers had recently held.

The international trade minister said the most important part of what had transpired was a plan to discuss how to increase the Canadian content of the Japanese products.

Lumley told reporters that Canadian autoworkers should have a shot at making some of those products for Japanese automakers — and they would in the years to come.

Two years later, Honda would announce plans to open a factory in Alliston, Ont. A year later, Toyota would announce it would open its own plant in Cambridge, Ont.

In the three decades that have since passed, the Japanese automakers have continued to thrive in the Canadian market.

Statistics listed on the Japan Automobile Manufacturers Association of Canada website indicate that Japanese-brand auto manufacturers held a combined 36.9 per cent market share in Canada last year. More than two-thirds of those vehicles were made in North America.