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Chrysler joins Ford against Korean pact

Detroit Free Press | Nov. 9, 2010

Chrysler joins Ford against Korean pact


WASHINGTON – Chrysler today voiced its opposition – along with Ford – to passage of a free trade agreement between the U.S. and Korea as written in 2007.

In a statement, the Auburn Hills carmaker – which is owned by Italian automaker Fiat, the U.S. government, and a health benefit plan created by the company and the UAW – said while the company “has supported every free trade agreement” the government has negotiated it can’t support this one “in its current form.”

It comes as President Barack Obama visits Korea this week to renegotiate the deal.

Former President George W. Bush’s administration reached the agreement with the Korean government three years ago but it was never been passed by either nation’s legislators. With Republicans back in the majority in the U.S. House, however, it appears more likely now that an agreement between the nations could be approved next year.

Democratic opponents in the U.S. House had largely been responsible for holding it up, with automakers complaining that Korea still hadn’t done enough in the agreement to lower trade barriers.

Two days after last week’s U.S. elections split the chambers of Congress between Republican and Democratic majorities, Ford placed full-page ads in newspapers across the country. In them, the company alleged that the U.S. can export only one car into Korea for every 52 that country’s automakers ship into America.

While the agreement would lower tariffs, Ford maintains at its Web site that it leaves in place Korea’s ability to use “rules and regulations to continue limiting automotive imports into the Korean marketplace.” The company also accuses Korea of manipulating its currency to subsidize exports.

In its statement today, Chrysler said while it would like to see “an enforceable agreement that provides meaningful market access for imported autos in South Korea.”

General Motors, which took over some plants in South Korea when it acquired a stake in automaker Daewoo in 2002, has remained neutral on the trade agreement.

Korean officials took exception with Ford’s ad last week, saying sales of imported cars in Korea have been growing at a fast clip in recent years, though much of that growth has come from non-U.S. automakers with models that have smaller engines.

 source: DFP