Paper short abstract:

This paper investigates quality inspection/improvement efforts of foreign-affiliated car importers in Japan and challenges concerning the growing electric car and IoT market. These findings will help to better understand the global value chains and future implications in one of Japan's key markets.

Paper long abstract:

Over the decades, car importers in Japan have been playing an important role in the internationalization of Japanese trading by acting as intermediaries between the business and consumer needs of Japanese and foreign interests. This market has been growing, and Japan imported over 300,000 cars in 2017 for the first time in two decades. While foreign cars have been typically regarded as more expensive and premium than their domestic counterparts and therefore have been targeting the wealthy, companies have started attracting more medium-income earners and providing new-generation models including electric and hybrid vehicles with a broadened model lineup to meet the diversifying lifestyles and needs of Japanese customers.

In the past decades, the proper deployment of quality inspection and improvement activities have been crucial for importers to compete with Japanese brands, which have achieved worldwide reputation for the production of vehicles with high reliability, initial quality, and long-term durability, with Toyota being the leader in total quality management. However, the industry-wide trend to gradually switch from combustion to electric vehicles as well as the accelerating digitalization and interconnectedness (IoT) of products and services poses new challenges for future quality inspection and improvement needs that go beyond assuring legal conformity and reliability of cars.

The purpose of this study is to investigate how import OEMs in Japan perform quality inspection and improvement to meet customer expectations and what future challenges they are facing in light of the adoption of more electric cars as well as the digitalization and integration of products, components and services.

This paper presents findings from semi-structured one-on-one interviews with five major car import OEMs in Japan. The interviewees were senior managers in Customer Service, Retail Operations and Technical Service who play a key role in quality assurance of products and services. Findings from this study will help to better understand the global value chains and implications of future trends in one of Japan's key markets.

Paper short abstract:

The aircraft manufacturing strategies of Mitsubishi Heavy Industries and Honda throughout the 2000s show a good contrast of failure and success. Obtaining type certification in the United States was crucial for developing the aircraft. Honda succeeded it by developing its business jet in the US.

Paper long abstract:

The aircraft manufacturing strategies of Honda and Mitsubishi Heavy Industries (MHI) throughout the 2000s show a good contrast of success and failure. Obtaining type certification in the United States was crucial for aircraft product development. Honda successfully obtained the type certification by developing its business jet in the United States. Operations management in manufacturing must meet the conditions for ensuring safety under the institutional regulations. Both MHI and Honda are Japan's leading manufacturers, and both companies launched a new business of aircraft manufacturing after the 2000s. MHI developed a 70-seater and 90-seater regional jet in Japan, but was unable to obtain the type certification in the United States and postponed deliveries several times. In October 2020, MHI announced that it would postpone the development of regional jets due to the economic downturn caused by the spread of COVID-19 infection. Honda has developed an eight-seater business jet in North Carolina, USA. Honda recorded the highest sales in the world on the business jet segment in 2019. The aircraft manufacturing strategies require institutional perspectives. Analyzing the causes of the failure of MHI, we found three reasons; MHI designed and manufactured aircraft in Japan without emphasizing the institutional regulations of obtaining type certification in the United States. MHI thus disregarded the importance of the sales market regulations for aircraft. MHI changed the president of an aircraft manufacturing subsidiary every several years. The alliance strategy of MHI with Bombardier has brought about conflicts in the organization of MHI. Honda has taken the lead in obtaining type certification in the United States, and the president, who has long-term responsibility of more than 15 years, has led the organization. Honda has been developing jet engine technology through an alliance with GE. Given the manufacturing competence of MHI and Honda are highly esteemed, either the success of Honda or the failure of MHI is not attributed to the dynamic capability of internal resources. Two cases show the importance of emphasizing the institutional environment in which multinational companies operate.