Japan-US Joint Auto Ventures: Prolific or Pesky?
The relations between the United State and Japan are quite delicate. However, we do see a lot of joint ventures between the two leading countries in the global automotive industry. Is that a good measure? Should we keep engaging in such joint ventures, or is it better to hold back a little? We will discuss all of that on this blog.
The Joint Ventures
There have been more than a few collaborations between the automotive giants of Japan and those of the US. Some major joint ventures include Chrysler-Mitsubishi, GM- Fujitsu Funac, and GM-Toyota. This sure seems to be a prolific step on the way forward, but certainly, detailed examinations have revealed a different case, at least for us.
Unfortunately, the United States has not been looking beyond the lines and into a long-term while the counterpart nation has. If you come to look at the case, American automakers tend to collaborate in search of cheaper labor. This may keep the initial costs on the ground but is not among the best strategies going forward.
Japan, on the other hand, is looking for the long-term benefit of these partnerships. It was to add value to their jobs and acquire as much of the production processing skills as possible so it could make the most of the expertise in the future.
Bright Side
Both the countries have been investing in each other to supplement domestic supplies. These joint ventures began back in 1984 when General Motors established NUMMI. This was the beginning of the American automaker’s partnership with Toyota. GM studied the ways of Toyota’s assembly methods and vice versa.
The collaboration between Ford and Mazda was another joint venture resulting in the production of some of the most successful automobiles like the Ford Explorer. In other words, these joint ventures aren’t all negative. There are upsides to them as well.
Today’s Circumstance
The modern automotive industry is on the verge of a much larger collaboration that removes national boundaries from the picture. Automakers from around the world have come to realize that the future of this industry is based on technology. Several major auto manufacturers from around the world have joined hands with tech giants to look forward to an innovative future.
On the downside, where companies are joining hands, many joint partnerships have also closed doors as a consequence of corporate restructuring. Last year, NUMMI rolled out the last Corolla as Toyota backed out. A similar incidence took place as the production of Mazda 6 was halted by Mazda. The car was being produced at the AutoAlliance plant.
Several breakups have been seen in the otherwise prolific US-Japan auto partnerships. However, this does not mean that the joint ventures between the automotive giants of the two countries are on the brink of extension. Tesla Motors and Toyota have recently started working together, and so have Mazda and Ford.
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Sources
http://www.asiamattersforamerica.org/japan/us-japan-auto-industry-part-2
https://hbr.org/1986/03/joint-ventures-with-japan-give-away-our-future
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