Since the U.S.-Japan Agreement on Autos and Auto Parts was signed on August 23, 1995, the Interagency Enforcement Team created by the U.S. Trade Representative and the U.S. Department of Commerce has issued reports to President William J. Clinton every six months unilaterally monitoring Japanese Government actions related to the agreement. Reports were issued on April 12, 1996, October 21, 1996, and April 18, 1997.

The U.S. has made numerous, very positive assessments in each of these three reports, up to and including the most recent report released less than six months ago. Some of these positive statements are excerpted below. They are categorized by subject, with report dates and page numbers provided after the quotes.

1. Improving Access to Japan for Foreign Vehicles

1. "Sales in Japan of motor vehicles produced by the Big Three in North America increased by 34 percent in 1996, the first full year of the Agreement. This growth rate exceeds that recorded for imports from Europe (14 percent) and vehicle imports overall (10 percent). The Japanese market for vehicle sales grew by only 3 percent in 1996." 4/18/97, page 1.
2. "Progress to this point gives cause for both optimism and concern. Our assessment of progress as measured by the quantitative and qualitative objective criteria indicates that sales opportunities in Japan for U.S. and other foreign auto makers continue to improve under the Agreement." 4/18/97, page 27.
3. "Perhaps most significant is the resolution of all twenty-three outstanding standards and certification issues with the Government of Japan. This breakthrough was concluded with a Japanese delegation on March 29, 1996. As a result of agreement with the Japanese, the Ministry of Transportation will certify U.S. automotive laboratories for testing to meet Japanese auto safety standards. Further, MOT will also certify U.S. facilities to undertake tests for Japanese emission standards. Previously, U.S.manufactures had to conduct both of these sets of tests in Japan, delaying the introduction of new models for the Japanese market and significantly raising their costs. This component of the Agreement can potentially save the Big 3 hundreds of dollars per vehicle on each new model developed for the Japanese market. At a time when U.S. manufacturers are increasingly moving toward global standards, this breakthrough represents an important step in further opening the Japanese market to new U.S. models." 4/12/96, page 6.
4. "On October 18, 1995, the Ministry of International Trade and Industry (MITI) sent the letter called for in the Agreement to the 2,259 dealers who were members of the Japan Automobile Dealers Association. With its letters, MITI included copies of the specific sections of the JFTC's AMA guidelines, and also enclosed the full JFTC Guidelines on Distribution Systems and Business Practices. According to MITI, all eleven Japanese automobile producers have adopted AMA compliance programs. Each Japanese automaker has prepared manuals on complying with the Anti-Monopoly Act, designated officials and contact points for consultations on complying with the AMA, reviewed contracts and taken other internal measures to comply with the law. Information about AMA compliance has also been disseminated by company officials and managers at training sessions for newly hired personnel." 4/18/97, page 18.

2. Exports of U.S. Auto Parts to Japan

1. "Exports of U.S.-made automotive parts rose to $2.0 billion in 1996, an increase of 20 percent from 1995. Parts exports were double the level recorded in 1992." 4/18/97, page 1.
2. "Measured by parts purchasing data supplied by the Japanese Automobile Manufacturers Association, purchases of U.S.-made parts by the transplants rose by slightly over 6 percent in value in the first half of JFY 1996, to an annual rate of $18.4 billion. Taking into consideration a decline in transplant production, this rate represents a rebound from 1995 levels." 4/18/97, page 4.
3. "Johnson Matthey's Catalytic Systems Division of Wayne, Pennsylvania has received a contract with Mazda Motor Corporation adding to existing business with Honda, Mitsubishi, Suzuki, Subaru, and Toyota. Combined sales to Japanese domestic automakers and North American manufacturing centers increased 50% in 1996 from 1995 levels to over 2.0 million catalysts. Utilizing its $40 million Japan R&D center as a technical base, the company expects to make further business advances by 2000." 4/18/97, page 35.
4. "The Japanese automakers, who have generally met or exceeded their company plans issued in the past, appear to be achieving the objectives set out in their plans announced in June 1995, regarding the expansion of U.S. facilities. These actions are creating opportunities for U.S. parts suppliers. JAMA data indicate an average annual growth rate of parts purchases of U.S.-made parts for use in the United States from 1992 to 1996 was 13.2 percent. JAMA data show that Japanese vehicle producers purchased $18.4 billion U.S.-made parts in the United States in 1996, an increase of almost $750 million over 1995 levels. This increase was comparable to preceding years, on a per-unit basis, but slower in terms of overall growth because of a leveling in transplant vehicle production." 4/18/97, pages 41-42.
5. "This analysis of the qualitative and quantitative measures in the automotive parts section of the Agreement indicates that access to the Japanese market is improving and that sales of U.S.-made parts to Japanese automakers in the United States and Japan are increasing, although the rate of increase is slowing." 10/21/96, page 41.
6. "Qualitative measures indicate that U.S. automotive parts suppliers are being given more opportunity to sell in the Japanese market. Japanese automakers, who have generally met or exceeded their company plans issued in the past, appear to be well on their way to achieving the objectives set out in their plans announced in June. Anecdotal information gathered by the USG from the automotive parts industry, including results from the industry-sponsored data collection efforts, indicates that U.S. parts suppliers are already benefiting from the Agreement." 10/21/96, page 41.
7. "Numerous U.S. parts companies that were previously unsuccessful in Japan now report significant new contracts and sales opportunities. Tenneco Automotive, which has made significant efforts in Japan for 25 years, will for the first time sell Monroe shock absorbers as in Toyota's 1,400 dealer-affiliated repair shops and as replacement parts in more than 6,000 JOMO service stations. The Ohio-based Dana Corporation recently reached a contract with Toyota to be the first U.S. parts supplier to serve as the sole provider of auto frames to a Japanese firm. Dana will manufacture the auto frames for Toyota Tacoma pickup trucks in Stockton, California." 4/12/96, page 3.

3. JAMA Auto Production in U.S. and JAMA Exports from U.S.

1. "Japanese transplants in the United States are well on schedule to meet their global business plans announced in connection with the Agreement. Toyota, Honda, and Nissan have all announced substantial new investments in passenger car, light truck, and automotive parts production facilities in the United States. The net result is that more Japanese vehicles and parts will be produced in the United States rather than imported, creating more U.S. jobs." 10/21/96, pages 4-5.
2. "Toyota, Nissan, and Honda all announced substantial new investments in automotive production within the U.S., and reached record levels of exports of their vehicles to other countries. Included in these investments were a $700 million light truck manufacturing plant by Toyota in Indiana, a $80 million transmission and engine assembly plant in Tennessee by Nissan, and expansion of engine production capacity by Honda in Ohio. Toyota announced that in 1998, at least three-quarters of their vehicles sold in the U.S. would be made in North America. Honda announced plans to produce 100% of its Accords and Civics in the US by the end of 1996." 4/12/96, pages 3-4.
3. "New figures announced by the U.S. Department of Transportation indicate that the North American content of Japanese vehicles will be 14% greater in 1996 models than 1995 models. For the first time ever, Japanese transplant models built in the U.S. are on average more than 50% American content according to the Automobile labeling act. The combination of more vehicles produced in the U.S. and higher U.S. parts purchases will create thousands of American jobs." 4/12/96, page 5.

4. Japanese Regulations Affecting U.S. Auto Parts Sales in Japan

1. "On February 20, 1997, the Japanese Ministry of Transport (MOT) revised its regulations to allow the operation of Specialized Certified Garages and Special Designated Garages. If this deregulation is implemented as expected, it will facilitate competition and create new opportunities for U.S. parts producers. Specifically, the action will permit smaller independent facilities to undertake repairs or inspections previously limited to dealerships or other MOT certified/designated repair facilities which almost exclusively use Japanese automakers' original equipment replacement parts." 4/18/97, page 1.
2. "The Government of Japan has enacted those deregulatory measures specifically required in the Agreement. Most recently, the Ministry of Transport implemented new regulations on Specialized Certified and Special Designated garages, which will potentially increase competition in the repair market, and create sales opportunities for competitive U.S. and other foreign suppliers." 4/18/97, page 5
3. "Japan has made a number of important steps mandated by the agreement to eliminate regulations which previously hampered efforts by U.S. auto parts manufacturers to sell in Japan. For example, the Ministry of Transportation has eliminated four auto parts (shock absorbers, struts, trailer hitches and power steering systems) from the critical parts list. Previously, these parts could only be installed by "certified garages," operations which carried very few foreign auto parts." 4/12/96, page 4.
4. "The Ministry of Transportation has eliminated regulations requiring MOT inspection for most modifications to passenger vehicles. These regulations for inspection steered Japanese consumers toward dealer affiliated "certified garages" that carried only Japanese parts and away from independent garages that carried foreign parts." 4/12/96, page 4.
5. "The Government of Japan certified more than 730 new garages between July 1, 1995 and November 30, 1995. These mostly independent garages will carry a higher percentage of foreign auto parts." 4/12/96, page 4.
6. "The Japanese Ministry of Transportation completed deregulatory actions promised in the Agreement which will open up new markets for U.S. firms in Japan's $60 billion auto parts replacement market. Now, most modifications to autos and light trucks no longer have to be inspected, meaning that American products such as roof racks gain new access." 4/12/96, page 5.