Sumitomo Corp. of America complained it was the victim of Japan-bashing after the county buckled under political pressure and canceled a $122 million contract to build commuter rail cars.
"Our contract was canceled for non-business-related reasons," Sumitomo President Kenji Miyahara said after Wednesday's unanimous decision by the 11-member Los Angeles County Transportation Commission.The vote brought praise from autoworkers and those concerned that too many American jobs are going overseas.
After canceling the contract, the commission asked a subcommittee to study proposals that include building a plant locally to manufacture the cars. The commission asked for a report by Feb. 19, and bidding on the project could start over again sometime after that.
Miyahara said his company has not decided what its next step will be.
In a last-ditch effort to save the contract, Sumitomo had told the commission that it was willing to take on an American partner - General Electric Co. - in the rail-car project.
The contract was for 41 rail cars to be used on a 23-mile commuter line between the cities of El Segundo and Norwalk.
The commission, which awarded the contract to Sumitomo on Dec. 18, had come under increasing pressure in recent weeks to withdraw it, with critics complaining that too many jobs are leaving the United States.
Yoshio Sakurauchi, speaker of Japan's House of Representatives, set off a howl of criticism Monday when he was quoted as saying the reasons for the U.S. trade deficit are that "U.S. workers won't work hard" and a third are illiterate.
The contract's opponents said the reversal did not reflect anti-Japanese sentiments.
"This controversy is not about Japan-bashing," said City Councilman Joel Wachs, an opponent of the contract. "This is for American jobs. This is for local jobs."
Sumitomo was awarded the contract over Morrison-Knudson Corp. of Boise, Idaho. The American company bid $5 million less and said it would would give more jobs to U.S. workers than Sumitomo, but the commission said Sumitomo was better qualified.