Japanese Cars

1. Introduction
2. Starting Over
3. Mass Production
4. Lean Production
5. The Japanese Company System
6. Company Programs And Benefits
7. The Rise Of Toyota
8. What About The Future
9. What About Europe
10. Conclusion
11. Bibliography

I have always wondered how Japan has been able to conquer such a huge part of the automobile industry. Are they smarter? Or did they just get lucky? Hopefully by doing this report I will find these things out.

The devastation of world war II left Japan in ruins. Two atomic bombs wiped out approximately700,000 civilians. Eighty percent of the buildings were destroyed andattacks on the shipping industry cut Japan off from the rest of the world. There were shortages of labor and rawmaterials. Japan was economically in trouble. Not long after this a Japanese business man while visiting west Germany was embarrassed to find out that all his country was known for was the little paper umbrella that was in his ice cream dish. This gave the mandrive to make his own smallish company something more. That man's name was Akio Morita and his company is knownto us as the 5 billion dollar SonyCorporation.With the addition of the automobile industry Japanwas on it's way.

Mass production involves large plants and there are more employees than needed. There is to much inventory and garbage in the isles wich causes the workers to get to their stations late wichdelays production. There is no quality control on the assembly line and the work is unevenly distributed among the employees. There is a huge area for cars that are riddled with defects. It is very time consuming to fix parts buried under other parts and upholstery. There are many defects on the parts wich slows down production. Only a senior manager is allowed to stop the assembly line for any reason. Mass production plants close for months to change their inventory or tool up to build another product.

Lean production includes smaller plants and face to face communication among the employees.There is no garbage or debris in the aisles and there is very little inventory taking up space. Anydefective parts are sent immediately to the quality control area and replacement part is issued. Thedefective part is tested and the problem is solved right away so that it will never reoccur. Eachand every worker is permitted to stop the assembly line if any problem is found. The assembly line almost never stops because problems are solved in advance. There is almost no rework area or fix up area at all. Nearly every day a car is driven from the assembly line to a boat or truck that will be it to the buyers. The lean production plants are able to change there inventory in a few days to build a new vehicle or products.

There are many ways that Japanese companies encourage loyalty in their employees. They use a seniority system. They are willing to hire young inexperienced people unlike many western companies. The Japanese are willing to take the time and money to train a young person. In return this new employee will stay with the company until retirement. With this system all new employees start working for the same low wage. For the next 10-20 years this same group will get raises at the same time and move into higher positions as they were hired. This avoids feelings of envy among each other. It also makes sure that the people in higher authority are always older than the workers under them. This is very important to the Japanese because of their belief that they should respect the age and authority of older people. It would cause great discomfort for a young supervisor over look the age and authority of an older employee.

Programs and benefits also add to the success of a company. For example most companies employees wear uniforms to make them feel more like a team and give it their all. The work day is sometimes interrupted for company cheers or songs to generate enthusiasm. The Japanese place a great importance on working in harmony. Employees are given the chance to make suggestions on how to improve production methods for the company. If an idea is good enough to use the credit goes to everyone not the individual. This a rule in Japan: If an employee makes a mistakethe whole company makes a mistake. Employees in a company are expected to share the belief that the company comes first and the individual comes second.

Mr. Eiji Toyoda is credited with building the Toyota motor company into what it is today. With the help of his chief engineer Taichi Ohno (who pioneered the lean production system), they brought Toyota from small profits to huge profits. Their challenge began when Mr. Toyoda was approached by Toyotas American staff about launching a luxury model to compete with European+American luxury models such as Lincoln's and BMW's. Mr. Toyoda was tickled by theidea of taking the world on at their own game. This would be a daring move by a conservative company but he Knew he would not fail for lack of trying. The Toyota motor company had survived after the war by not wasting anything. The lean production system would be the key for their success.

Even though the Japanese have obviously been successful over the the past several years there is some indication (Diagram 3) that changes may be occurring. What the diagram shows is an increase until 1990. The next five years show a decrease. Reasons for this may be because of increased costs of shipping vehicles to other countries. Also, over the past several years of success, wages for Japanese workers have gone up wich would in turn raise the price of the car themselves. Buyers in the US or Europe were not able to afford the higher prices, therefore there was less pressure put on Japan to produce. Another reason for changes is that until recently Japanese workers have been happy with their lives and work. But the influence of the western world is becoming more noticeable. Rather than having to work long overtime hours, Japanese workers are expressing a desire for a shorter work week. They also are turning down the opportunity to live in low rent company owned buildings in favor of more privacy. This new situation in time could possibly change the company system and ruin the worker enthusiasm that has served it so well, although only time will tell.

American cars in spite of improvements over the past several years still don't measure up to the Japanese in cost, quality and technology. The high costs of the yen and the threat of American trade has temporarily helped the US auto industry compete with Japanese entry-level imports. European imports will sell well this year because of the high flying yen, but they have been hit hard by increased Japanese competition throughout all market segments. Even Mercedes Benz laid off 30,000 workers last year and Volkswagen shifted Golf and Fox production to Mexico and Brazil to beat high labor costs. Its not only high wages and Japanese competition that have cost jobs, one study shows that German luxury car makers are losing ground because of their inefficient and costly approach to quality. It seems that they have become lazy and forgotten to build quality into every step of the production process as do Japanese manufactures. At the end ofthe assembly line they waste time and money correcting mistakes that should have never happened in the first place. Volkswagen managed to do relatively well by offering most of its product line in the mid-price range, where Japanese imports are to pricy and American cars don't perform as well. BMW and Porche have also made a comeback because Japanese sporty coupes and luxury cars have been hit hard by the double whammy of a recession and a high yen.

This report was much fun but was very interesting. I know more about how Japan has become successful. The lean production works because there is no waste and the people that work for the company consider the success of the company their success. They feel pride in their work . I have learned that when you work hard you can achieve great things. I am very exited about my doing my report on the computer and having it on the internet.

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