This research examines the entry of an American automobile company, General Motors' Saturn, into Japan. The plan of the research will be to set forth the economic context and background for Saturn's entry into a key foreign market and then to cite factors of that entry that may help forecast future lines of market development for the brand there.
The economically depressed situation of the major American automobile manufacturers in the mid-1980s owed much to the strength of competition from Japanese automobile manufacturers. By 1985 American auto manufacturing plants had an antique quality about them, being plagued by assembly line labor disputes and compared unfavorably to the robotics-driven assembly lines of Japanese automobile makers. By 1985, foreign auto-makers controlled approximately 30 per cent of the American car market, and consumer confidence in the quality of American automobiles was low (Jones, 1985; Flint, 1985). It was at about that time that General Motors was developing its response: the Saturn car, designed to be manufactured by an "integrated" rather than "assembly-line" method, i.e., the Japanese rather than traditional American method (Smith, 1985).
Designed specifically as a small car, Saturn had success with American consumers and auto-industry organizations when it was introduced in 1989. Beginning in 1992 and continuing for five years afterward, the industry evaluation organization J.D. Power & Associates named Saturn number one in overall satisfaction with consumers. The company first turned a profit in the early 1990s. In 1996, the company announced that a right-hand-drive (RHD) model of Saturn would begin being sold in Japan in 1997 (Saturn, 2000).
The Saturn company appears to have gone about its entry into Japan in a systematic, if not careful, way. The first six dealerships that sold Saturns in Japan were nonexclusive, also selling such brands as Nissan, Daihatsu, Volvo, and Honda (Cox, 1996). D...