Chrysler to Buy Japanese Auto Distributor
TOKYO (AP) _ Chrysler Corp. said today it had agreed to pay about $119 million for a Japanese auto sales firm in an effort to sell its cars directly to Japanese customers.
Chrysler officials said the deal would make the company the first major U.S. automaker to buy a Japanese dealer network outright.
Chrysler offered to buy all the outstanding shares of Seibu Motor Sales Co., and increase its equity in Chrysler Japan Sales Ltd., its sales unit in Japan, from 15 percent to 70 percent, said Chrysler Japan Sales spokesman Kazuo Ozawa.
Seibu stockholders were meeting later in the day and were expected to approve the deal.
Seibu’s Tokyo-based dealership network, capitalized at $28.45 million, has 21 sales and service outlets concentrated in the Tokyo area and in Yokohama to the southeast. It reported annual sales in the fiscal year ended March 31 of $269 million.
Ozawa said Chrysler currently markets its cars in Japan through 1,800 Honda Motor Co. dealerships, through Seibu’s network, and through contracts with about 120 regional dealerships.
He said Chrysler’s move is the first total buyout of a Japanese dealership network by a U.S. Big Three automaker.
However, Ford Motor Co. Japan Ltd. spokesman Hiroo Tanabe disputed that claim. ``If you want to go all the way back, Ford started directly distributing a knockdown of the Model T in Yokohama in 1925,″ Tanabe said.
Ford, the U.S. parent, owns 100 percent of Ford Japan, which in turn owns 41.5 percent of a distributorship, Autorama, which recently began selling Fords exclusively in Japan, he said. Mazda Motor Corp. owns another 41.5 percent of Autorama, and Ford Japan owns 25 percent of Mazda.
General Motors Corp. continues to rely primarily on an independent sales agent, Yanase, for its car marketing.
Access to Japanese car dealerships is a key U.S. demand in auto trade talks between the United States and Japan, with U.S. officials insisting that more Japanese dealerships should agree to sell American cars.
The Clinton administration has threatened to impose $5.9 billion in import duties on Japanese-made luxury cars if no agreement is reached in the trade talks by Wednesday.