Automobile Industry of Japan

Cars are necessities for daily transportation in a modern society. Cars have been part of almost everyone’s lives since the 1930s, when Henry Ford invented the Model T (History.com). Many people are accustomed to a lifestyle with cars. Without them, many cannot get anything done. Every day, cars are getting better and more affordable. Two of the many nations that mass produce cars are Japan and the United States. Both country’s cars have their own strengths and weaknesses. With that being said, Japanese cars are better than American cars because of their reliability, engineering, and price.

In addition, the internationalisation is the strategy to occupy the foreign market step by step. Also, the porter’s competitive advantages theory is to analysis the strategies of global business. They could divide to three strategies: over cost leading, diversity, and market focus strategy (Passemard& Calantone, 2000). The cost leading strategy focus on establish efficient scale production facility and minimize the research and advertising cost. The diversity strategy focus on introduce some unique product in whole industry. But, this strategy will with a high cost price. The focus strategy is attack of a particular customer group or specialist regional market, its purpose to design the service for a particular target. Consequently, the companies need to consider the internal and external factor condition, such as: factor condition, demand condition, related and supporting industries condition, and firm strategy and rivalry. They are called diamond system. This dynamic system gives the company a standard to measure theirs advantage and disadvantage before they enter foreign market. Moreover, the specific advantage in Internationalisation of Production is give companies a new choose for exhausted market (Strange,S. 1992). In an international environment, the companies will face more uncertain and unequal condition than home market, therefore the companies need keep the attention of more factors:

America had a global competition as it was not the only country who had the industry. China, South Korea, Japan and India were also procuring automobiles. In 1995 America and Japan made an agreement on having more outlets in each countries, to be able to sell their products. This agreement created job opportunity and made their cars and parts available in both countries. This agreement also invented computation. Japan was producing good quality and affordable automobile such as Toyota, Nissan, Mitsubishi and more. Japan’s automobile became well known all over the world.

create even more jobs for parts suppliers and service shops that cateur to japanese cars.

Japanese car culture is very popular among the world of automotive enthusiast, it is the way people dress and modify their cars with certain concepts and themes which was born and first found in Japan. Japanese Domestic Market or JDM is a global language of saying Japanese car culture, it is famous since the birth of many legendary automotive brands. Japanese cars are well known around the automotive world for their performance and well balanced all-around vehicle specifications, completing the essences of being an impressive car which can cover up all of the important vehicle elements such as fuel consumption, power to weight ratio, safety precautions, which determines the quality of each cars.

After the United States defeated Japan in World War II, Japan was left with devastating casualties and reparations to be done. The United States wanted to secure Japan and wanted to influence them, that way Japan would not turn to Soviet communism during the Cold War. In order to make proper reparations, General Douglas A. MacArthur was in charge of the restoration of Japan. MacArthur proposed a reconstruction program which included military, political, economic, and social reforms. So the United States could be able to impose the reconstruction program in Japan, the Allied powers wanted to disarm Japan, deal with colonies, stabilize the economy, and prevent remilitarization. General MacArthur began to work on the reconstruction of Japan in September, 1945 and divided the reconstruction was to be divided into three phases. The three phases were to reform Japan, revive the economy, and a formal peace treaty and alliance with the United States.

Combining imported technology with their domestic innovation was translated in the inception of the Japanese low-cost mass productions system. Technological improvements such as the one mentioned above played a huge role in the country’s economic growth, as improvement of technology in one industry often influenced the growth of other industries. For instance, Japan’s steel industry was successful in improving the quality of steel used in manufacturing automobiles, due to the technological process in the casing of parts; the automobile industry too benefited and hence could reach a level where it could compete with its international

Rudi Volti’s Cars and Culture: The Life Story of a Technology (Greenwood Press, 2004) examines the evolution of the automobile, starting from 1765, with Nicholas Cugnot’s steam-powered vehicles, to the present day. The goal of the book, as stated by Volti in the introduction, is to “pay particular attention to the automobile’s technical evolution while at the same time delineating the cultural, social, and political context in which that evolution has taken place” (xi). Thus, Volti also demonstrates the cultural and societal effects that resulted from the emergence and mass production of automobiles. Volti divides the history of automobiles into seven time periods, each a separate chapter that achieves his goal. He accomplishes his objectives by stating the technological advances and societal context under different headings, occasionally linking the two topics together.

Automobile industry of japan witnessed an awesome accomplishment with the growth of Toyota. It became the biggest maker in the worldwide business. Toyoda kiichiro was hesitant to invest in automobile sector. In the year 1933 the company started its production. In order to have cost efficiency they adopted the mass production technology.

Japanese industry and infrastructure, which were virtually destroyed during World War II, were systematically rebuilt to transform the country into a global economic leader by the mid-1960s. Post-World War II, the seven-year U.S. occupation of Japan proved to be a blessing in disguise as the Japanese received $2 billion in aid from the U.S. in the form of food, fertilizers, petroleum products and industrial materials.

Since the end of World War II, Japan's economic strategy for growth was based on exports, that allowed the development of its powerful industrial sector. During the 1980s, Japanese automakers in particular were enjoying an unprecedented and largely unexpected period of prosperity. They managed to establish a successful domestic automobile industry and to gradually sell their products abroad. Thanks to their competitive advantage in producing cars with respect to foreign competitors, due to labor differences, technical efficiencies (lighter and fuel-efficient cars), better designs, and of

In the article “The Competitive Advantage of Nations” Michael Porter describes a diamond shaped relationship of forces that define a country’s potential for being competitive in a specified industry. The four points on the diamond representing the different forces are: factor conditions; demand conditions; firm strategy, structure and rivalry; and related and supporting industries. According to Porter, the four points apply pressure to each other resulting in a national

ASSESSING THE POWER OF PORTER'S DIAMOND MODEL IN THE AUTOMOBILE INDUSTRY IN MEXICO AFTER TEN YEARS OF NAFTA

America did not alone invent automobile, but America had been the leader in the automobile technology and manufacturing for several decades. During that time, American automobiles shared their technology and know-how with Japanese and German manufacturers. And, American companies did not pay a great attention to what Japanese and German manufacturers have learned from their American counterparts. During 1940s,

These factors can be set into five categories: Physical, HR, Knowledge, Infrastructure and Capital Resources (Karkkainen V., 2008). There are two types of factors consist of: basic factors and advanced factors. Basic factors contain labour, basic educational system, raw material and national resources. Advanced factors contain skilled labour, modern infrastructure and highly education. Example about how factor condition influences the global competitiveness of a country; Egypt government develop infrastructure in the last three years such as transport systems, communication, payment system, post and system used to transfer money. Egyptian telecom companies illustrate the diamond. It has a relatively high number of communication engineers per