Global Strategy and Global Sourcing in the World Auto Industry and Japanese Presence. with Some Case Study of Mitsubishi Motors and Nippon Denso

With the coming of the " Mega Competition " era, the world auto industry is entering the wave of globalization. Companies are approaching the 21 century, and they are realizing that global thinking and management are critical for the survival of the auto industry. The contents of global strategy of auto industry consist of global car production and allocation strategy, global sourcing strategy, and global product development strategy. Managing globalization is also one of the key issue from the view point of making strategic decision. On the other hand managing globalization is closely related with managing localization. Pursuing global strategy, all of the auto companies have to solve this problem: how they can coordinate and connect their global strategy with their strategy of localization. The historical tendency of most of the world auto enterprises was consolidated organization of local companies such as U.S. Big 3 and some Europeans. Their local subsidiaries developed their differentiated local product by themselves and purchased local parts by their own way. Since 1986, Japanese car makers set up local transplants by different ways in Western countries. In early steps of this process, Japanese car manufacturers tended to transfer their production and part procurement systems and their products with some local modifications. In 1990s, they were confronted with higher Yen' appreciation and the rationalization of their production. During this term their strategy has been changed gradually from local oriented one to more global oriented one. They tried to build a local production network linked to the international division of labour. The local production network tended to produce international products which can be exported to the world and finally to go to the global network. These network global strategies were pursued not only by car assemblers but also by part suppliers. Japanese part suppliers supported car assembler' localization and later their global networking because they were also entering globalization. After 1990, this globalization has been more accelerated. Within the context of the Japanese auto makers' plan for establishing a global network, western auto