Trends in production and product development in the Japanese automotive industry

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The Japanese automotive industry has been profoundly influential in shaping thinking about Operations Management. However, Japan’s auto industry has been suffering during the recession that has afflicted Japan since 1991. Nissan, Japan’s second largest car maker, merged with Renault in 1999 and Ford has substantial control of Mazda. Such developments have led some commentators to write-off Japan’s business model, and to assert the triumph of the Western (US) model. This paper concludes that this may be premature. The paper is based on interviews with 14 Japanese component makers and three Japanese car makers which examined how operations had changed between 1994 and 1999. The findings indicate continuing efficiency gains in Japan, and little fundamental change in the structure of buyer-supplier relations. However, there were clear differences between the supply chains of different car makers, and in the future increasing foreign ownership of the Japanese auto industry may heighten these differences. © 2001 Inderscience Enterprises Ltd.