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Japan's Auto Industry Questions the Need for Bilateral Auto Negotiations

30 September 1999

Internationalization of Japan's Auto Industry and Market Questions the Need for Bilateral Auto Negotiations

    WASHINGTON, Sept. 29 -- U.S. and European investment and
management in Japan's automobile industry is increasing as Japan's auto
companies develop new relationships with their overseas counterparts,
according to Japan Auto Trends, Japan Automobile Manufacturers Association
(JAMA) newsletter released today.
    Ford Motor Company now has a controlling 33.4 percent interest in Mazda
whose current President is American.  Renault purchased a 36.8 percent share
of Nissan, Japan's second largest company, which now has a Brazilian born
Chief Operating Officer. General Motors is now considering producing cars in
Japan.  Meanwhile, import share of Japan's large car maker reached 32.7
percent in the first six months of 1999.
    The newsletter features Carlos Ghosn, Chief Operating Officer, for Nissan.
Ghosn and other senior Nissan executives are working to develop a
revitalization plan to be announced in mid-October. The article explores Mr.
Ghosn's market objectives not only in the U.S., but also throughout the world.
Mr. Ghosn also believes that the future of the auto industry probably lies in
more consolidation.
    "As a result of natural economic forces and competition, Japan's auto
market is now international and multinational. This includes imports, capital
participation and foreign management," said William C. Duncan, General
Director, JAMA USA.
    Duncan added "In short 'going global' overseas also means 'becoming
global' domestically.  Clearly, if this is the case, there is no room for
bilateral U.S.-Japan negotiations to achieve the same objectives."
    On the high technology front, Japan's auto companies are forging a lead
over the rest of the industrialized world in the use of "Intelligent
Transportation Systems" (ITS) to ease traffic congestion and improve safety.
    The most popular product in a growing line-up of commercially available
ITS technologies is the satellite-based onboard navigational system, which
guides users around even minor roads.  Behind the ITS push are five Japanese
Government ministries, academia and private companies whose focus is on
developing four major ITS systems:  Vehicle Information Centers (VICS);
Electronic Toll Collection (ETC) Systems; Automated Highway Systems (AHS); and
Advanced Safety Vehicles (ASV).
    Taken together, these technologies will have an annual market value of
about $500 billion by the end of 2015. Japan Auto Trends articles explore the
next-generation navigation devices, new automatic breaking systems and
electric vehicle tests in selected Japanese cities.
    Japan Auto Trends is a quarterly publication examining developments in
Japan's auto market. The publication, including all back issues, is available
on JAMA's web site http://www.japanauto.com.
    JAMA, headquartered in Tokyo, has offices in Brussels, Singapore and
Washington, D.C.