The Yen Sale

By Dot Kessler. From MFGCalcs Magazine, Issue 1, November 2026, page 37.

On paper, the weak yen has kept Japan’s metal-cutting machines on sale in America for years. By 2025, as far as the import records show, American buyers were passing up the sale. Picture a Japanese machining center priced at 50 million yen, a price set for this story. On July 29 this year, the yen’s weakest day in the Federal Reserve daily rates MFG Calcs keeps, which begin in July 2021, it came to about $305,000 before duty, about $147,000 less than on the first day of those rates.

The import records do not show the currency a machine was quoted in, so they cannot say whether any American shop was offered the discount. They do show what buyers did. From Japan, imports of metal-cutting machine tools (the class that takes in machining centers, lathes and grinders) rose each year from 2020 to $1.52 billion in 2023, by the U.S. International Trade Commission’s count. Then, while the yen stayed far weaker than in 2022, they fell two years running, to $1.16 billion in 2025. The discount held. The buying did not.

Japan’s share of the metal-cutting imports slid, and Germany gained the most ground. So the question is why a currency that took about a third off Japan’s prices, on paper, won its builders no ground in America.

Perhaps the discount never reached the quote. A builder that kept its American prices in dollars gave none and collected more yen for each dollar. Makino Milling Machine, a Japanese builder, told investors in a January briefing on its results: “The forecast was revised upward due to cost-control and yen depreciation.” The slide does not say how Makino priced in America.

If builders priced in yen, the discount was real, and buyers still passed it up: counted in yen at each year’s average rate, American purchases of Japan’s metal-cutting machines fell about 11% from 2022 to 2025.

On those terms some of Japan’s slide in share is only arithmetic, since shares are counted in dollars. Reprice 2022’s purchases at 2025’s exchange rates, with Japan’s machines priced in yen, Germany’s in euros and the rest in dollars, and Japan would have held about 29% and Germany about 17%. Japan ended about 2 points below that, Germany about 5 above. However the quotes were written, Japan lost more ground than its currency explains.

Germany is the tell. A German machine priced in euros got dearer: the euro’s yearly average rose about 7% against the dollar from 2022 to 2025, and in 2025 alone estimated duties on German metal-cutting machines more than doubled. Germany’s share rose every year anyway: its sales went from less than half of Japan’s in 2022 to more than four-fifths by 2025.

Those on the record describe another shopping list. Greg Volovic, chief executive of Hurco, an Indianapolis builder, said in its June earnings release: “Customers are increasingly choosing our 5-axis and higher-performance vertical milling machines, reflecting the value of our investments in proprietary WinMax control technology, the Takumi platform, and automation.” A machinery manufacturer told the Dallas Fed’s Texas Manufacturing Outlook Survey in July: “We’re investing in new machines that will increase our production but overall reduce our cost of manufacturing. However, we will not reduce our labor force, but productivity will increase substantially.”

Neither mentions a currency: a weaker yen changes what a machine costs, not what it can do.

The commission’s figures by country stop at 2025, before this year’s weaker yen, and 2025 itself turned the test around. The yen offered no new discount, averaging slightly stronger than in 2024, and estimated duties on Japanese metal-cutting machines rose more than fivefold. Japan’s share ticked up anyway.

Live data from this story

• Yen per Dollar: Japanese yen per dollar
• Who Sells America Machine Tools: Metal-cutting machine tools: imports and duties

Read it in the magazine

• MFGCalcs Magazine, Issue 1, November 2026, page 37