Nissan Zama's Closure: Accident or Example ?

March 1995. For the first time since the second world war, a Japanese car assembly plant has been closed down. This is an important event since most experts still believe that Japanese car makers have a substantial competitive advantage over their American and European competitors.

Who could have seriously foreseen such plant closures in the Japanese automotive industry ? Completely deceived by the MIT's peremptory statements, analysts as well as industrialist were still convinced that its performances were outstandind avoiding carefully to scan under the surface in order to identify potential structural problems.

After all, this is Nissan and not Toyota or Honda which is the first Japanese car maker to suffer so much from the increasingly tough worldwide competition showing clearly that it has large production overcapacity and some unproductive plants. It is the Zama plant, near Tokyo, which was presented as one of Nissan's star assembly line. More than 11 millions of vehicules have been produced over 30 years at Zama. 2 500 jobs have been lost but, according to Nissan's historic workforce management policy, nobody has been fired. Most workers found jobs either in other Nissan's assembly lines (Southern Kyushu or Mount Fuji) or in component makers in Tokyo area.

Everybody knows that Nissan has always been - and still is - far less efficient that some of its competitors. It is suffering not only from global factors such as the yen's rise and low cost imports in Japan but also from various specific handicaps related to its own strategy: a less appealing range of models, a weaker commitment to total quality and cost reduction, a larger internationalisation, etc.

But Nissan's current difficulties leads to the insistent question of the comparative competitiveness of various final assembly plants, and thus of their effective productivity level. For many years, Zama was presented as a very efficient assembly plant compared to most american and european assembly plants as far as direct labour productivity was concerned. And today, this plant is closing down while Volvo is on its way to re-open its Uddevalla plant in Sweden ! And while the German car makers' old assembly plants are still very efficient despite very high wage costs and a decreasing working time.

One more time, this is the proof that superficial evaluation lead to the over-estimation of productivity. Managerial economics, industrial economics and management sciences are questionned about more efficient productivity measurement methods.

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