Automobile Manufacturing Strategies

The United States government, at the urging of the American automobile manufacturers, has initiated several efforts to protect the industry from foreign competition. In turn, foreign automobile manufacturers, again, the Japanese in particular, have adopted a variety of strategies, including voluntary cooperation in efforts to limit the number of Japanesemanufactured automobiles exported to the United States, to cope with the American automobile manufacturer instigated efforts of the United States government.

1M. Leach, "Auto & Truck Industry," Value Line Investment Survey (21 September 1990): 102.

The efforts of the American government to protect the domestic automobile manfacturers have been but partially effective. A major reason underlying the limited effectiveness of the government's efforts is the growing perception among American consumers that foreign manufactured automobilesparticu larly those manufactured in Japanare of a significantly

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ximately the year 2000. Data pertaining to total hours provide some additional insights into the Japanese output increases. The Japanese have recorded significant increases in total hours worked, as well as increases in the productivity of those hours. The combin ation of the two factors has had highly positive impacts on total output. By contrast, total hours of input in the United States decreased significantly subsequent to 1979. This phenomenon is easily explained in the recession years of 1982 and 1983. It is not easily explained in the recovery years since that time. America's lower output per hour gains (compared to those of Japan) and its reduction in input hours (while Japan's were increasing) enabled Japan to narrow significantly the output gap between the two countries. American manufacturers must invest in more productivity facilities and equipment, and American workers must be willing to extend themselves to a 7greater degree, for this situation to be corrected. Each of these factors pose problems for JapaneseAmerican joint venture operations. Compensation per hour data indicate that, since 1977, compensation levels in the United States have increased far more rapidly than have those in Japan
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Approximate Word count = 2860
Approximate Pages = 11 (250 words per page)

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