Impact of Japanese Cars Japanese Cars and American Decline

Product Quality Versus Trade Practices

From the time that Japanese imported cars first became highly visible on American roads, the inroads of the Japanese have been accompanied by an increasingly heated debate over whether the success of the Japanese imports was based on genuine competitive advantages, or at least in part by unfair trade practices on the part of the Japanese. On the one hand, the Japanese automobile makers were widely accused of "dumping" their products on the American market--that is, pricing their products below their real production cost as part of a strategy to absorb losses in the short run in order to capture a dominant market share in the long run. On the other hand, Japan was accused of using a variety of restrictive trade practices to eliminate foreign competition in their own domestic market, even for those models, such as larger luxury cars, for which the Japanese industry offered no

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d" at smaller loss, or no direct loss, while still effectively underpricing and undercutting domestic American competitors. The Small-Truck Gimmick In a more direct evasion of the quota restrictions, Japanese automobile makers also responded in part by introducing and importing large numbers of small pickup trucks. These vehicles, too small in size and carrying capacity to function as practical trucks, were for all practical purposes sold and used as equivalents to cars, rather than for any of the uses traditional associated with pickup trucks. Technically, however, they were trucks, and therefore did not count against the quota limits. Made in the USA--Designed in Japan Finally, the Japanese began to sidestep the import question, as such, entirely. Japanese automobile makers established factories in the United States, thus producing cars that could not by any strict measure be regarded as imports. They also entered into co-production arrangements with American carmakers; by the late 1980s, some models sold as "American" and "Japanese" cars differed only in the nameplate affixed to the vehicle. Detroit's Response Management and Quality With respect to the American domestic market, Detroit has gradually come to t
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Approximate Word count = 4819
Approximate Pages = 19 (250 words per page)

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