If U.S. Auto Execs Want to Know Why Their Cars Don't Sell in Japan . . .

January 12, 1992|By BRIAN SULLAM

If the U.S. automobile moguls traveling with President Bush wanted to find out why their companies don't sell very many cars in Japan, they should have paid a visit to the car dealership located next to the Miyako Inn Hotel in Tokyo.

Despite having shiny new Ford sedans, station wagons and vans along with Jeep Cherokees in the showroom, this car dealership never seemed to have a customer kicking tires, slamming doors or taking test drives during the week I was in Tokyo this past summer.

Japanese consumers -- who are obsessed about cars -- probably ignored this dealership not because of the supposed poor quality of American cars. Their lack of interest had to do with something more fundamental. All of the steering wheels in the cars were on the left-hand side. As in Great Britain, Japanese motorists drive on roads requiring cars equipped with steering wheels on the right side.

Somehow the Japanese carmakers understood the necessity of putting the steering wheel on the appropriate side when they started selling their cars in the United States two and a half decades ago. The Honda Accord would not be the best selling model car in the United States if Honda Motor Co. shipped only cars with right-handed steering. When Honda sends its American-made models to Japan, it seems to know enough to put the switch the steering wheel to the appropriate side.

One can't help but wonder how serious American car makers really are about selling more cars in Japan. While it is true that the Japanese have erected a number of non-tariff barriers, such as unrealistic inspection and certification requirements for foreign-made cars, U.S. automobile makers have little basis for their complaints if they insist on selling cars that are inappropriate for the Japanese market. On Tokyo's streets, you could occasionally see a Jaguar, BMW or Mercedes with a right-hand steering, which probably explains why the Europeans car makers outsold their American competitors.

This past week, Ford Motor Co. announced it will be making cars with right-hand drive for the Japanese market. But with re-engineering and retooling, it will take nearly two years before the first cars begin arriving in Japan. GM and Chrysler have made similar commitments, but it all may be for naught. If these American car markers were serious about selling cars in Japan, they should have done this years ago. The Japanese car buying habits have been set, and it will be hard for these manufacturers to break them.

But it is not just in Japan where U.S. car makers are missing the boat. In Thailand, which has one of the fastest growing economies in Asia, there was nary an American-made car, truck or bus in the gigantic traffic jam that clogs the streets of Bangkok from early morning to late at night. Instead, there are Toyotas, Nissans, Mazdas, Subarus and Hino trucks. As for the motorbikes, motorcycles and the three-wheeled "tuk-tuks" that dart around the bottleneck of cars and trucks, they are all made by non-American manufacturers.

A decade ago, the market in Thailand for cars and trucks may have been small, but the Japanese seem to have recognized that it was potentially a boom market ripe for opportunity. In the northwest corner of Thailand inside the Golden Triangle, I toured a Hmong village that was so poor all of the houses had dirt floors and lacked indoor plumbing, but there were Toyota pickups parked outside of half of them. They could have easily been Chevy pickups, but I didn't notice any effort on the part of GM to sell its trucks in Thailand.

In other Southeast Asian countries such as Malaysia, Indonesia and Singapore, where economies are booming, the Japanese are selling their vehicles while the American carmakers sit on the sidelines bellyaching about unfair competition.

China is the one Asian country where a U.S. automaker -- Chrysler -- has very visible presence. Jeeps, which are made by Chrysler, are manufactured in China in a joint venture factory. The Chinese Jeeps are assembled from parts that are made in America. On the surface, this seems like a wonderful arrangement for Chrysler. But it isn't. China may be a country with 1.3 billion people, but with a per capita income of less than $450 a year, there just aren't too many customers for the Jeep Cherokees coming off the assembly line.

Before I left for Asia, I had the opportunity to speak before a group of about 60 Japanese businessmen who were visiting Honolulu. It was very interesting to hear them talk about their companies and their approaches to business. When there are problems in their businesses, these executives said, they tend to blame themselves. Unlike the Japanese, Americans -- as exemplified by the three U.S. auto executive that accompanied President Bush to Japan -- tend to blame everyone else.

If the U.S. automakers really want to sell more cars in Japan and Asia, they should save the energy they spend on finger-pointing and use it to ensure they sell cars with the steering wheels on the appropriate side.

Brian Sullam is a reporter for The Sun. Last year, he was a Gannett Foundation Fellow at the University of Hawaii and spent six weeks traveling in Asia.

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