COLUMN ONE : Detroiters Warm Up to Japanese : Thousands of newcomers came with Tokyo’s ‘invasion’ of the auto industry. Business realities are paving the way to their assimilation.
While Americans are miffed over Japan’s reluctant support during the Persian Gulf War, Lee A. Iacocca was telling President Bush, why not seize the moment to limit the number of cars Japan may sell in the United States?
“The timing will never be better. The American public is upset . . . ,” the chairman of Chrysler Corp. told Bush in a letter attacking the way Japan does business.
As the letter was being made public last month, Chrysler’s vice chairman, Robert S. Miller Jr., was a prominent figure at a new social event here: the first of what is to be an annual dinner of the Greater Detroit and Windsor (Canada) Japan-America Society.
Chrysler, long portrayed as a sort of junkyard dog in the Japan-bashing kennel, has taken the leading corporate role in the society, recently formed by civic leaders to acknowledge the slightly awkward fact that Japanese companies and managers have arrived in Detroit in a big way.
Iacocca’s plea for protection from the Japanese even as the community celebrated the new Japanese investors highlights the industrial schizophrenia afflicting Detroit as it confronts this collision of culture and self-interest. Nearly 300 Japanese firms have set up shop in the Detroit area, not merely to build cars and auto components, but to design and engineer them. They employ at least 20,000 people, most of them Americans.
The vagaries of global economics have brought up to 5,000 Japanese nationals into a community that many of them, accustomed to news reports of crime, poverty and hostility toward the Japanese, dreaded from afar.
What the newcomers are finding, however, is a typically troubled urban area in which most people don’t work for the auto industry. The suburban schools make room for their children, houses are cheap and colleges offer a welcome outlet to wives unaccustomed to the freedoms American women have. Anti-Asian sentiment seems about average here, and crime is a whisper from neighborhoods they’ll never see.
“Is downtown Detroit as dangerous as I heard?” asked the young wife of a Mazda executive happily resettled in the college town of Ann Arbor.
Yet Detroiters and the Japanese visitors remain at arm’s length from each other in what remains an industrial fight for survival. Japan’s rapid expansion here offers a disheartening contrast to the shrinking old Detroit whose automobiles gave shape to the 20th Century.
The latest jolt came early this year, with the disclosure that Toyota might build a big research-and-development complex and test-driving track on 1,000 acres northwest of the city. The word leaked out as General Motors Corp. was announcing that it would eliminate 15,000 white-collar jobs--the most recent evidence of retrenchment and financial woes in the domestic auto industry here.
Toyota’s Detroit-area R & D operation doubtless would have a big role in the development of its long-rumored challenge to that quintessentially American vehicle, the full-sized pickup truck. And what better place than Detroit to find the engineers for a big pickup?
Many people here feel that this phenomenon has its good points. They say the growing Japanese presence reinforces Michigan’s place as the scientific and engineering center of an increasingly global auto industry.
David Cole, head of the University of Michigan’s Center for the Study of Automotive Transportation, said: “Detroit is now the (automotive) intellectual center of the world. The Japanese are almost afraid not to be here. It is very good for the region.”
Or is that just whistling past the auto salvage yard? Japan’s rapid invasion of Detroit’s home turf also underscores Japanese successes in competition with the domestic industry. For fatalists it conjures up images of a kind of industrial end-game for the nation’s bellwether manufacturing industry, seemingly supplanted in its own back yard.
While General Motors and Ford remain strong, American Motors has already disappeared and Chrysler’s survival in the long term is far from certain. Meanwhile, more than half the Japanese parts makers here are winning contracts--not only from Japanese auto makers in this country, but from GM, Ford and Chrysler--at the expense of veteran Detroit-based suppliers.
“There’s a down side to this,” said Frank Smith, president of the Greater Detroit Chamber of Commerce, which has been criticized for its pursuit of Japanese investment. “A lot of the old-line auto suppliers haven’t survived. We’ve lost members over this. One guy called and said he was going to come down and put a Japanese flag on top of our building.”
The reality underlying the conflict is that the domestic car industry is shrinking and the Japanese, to the extent that anyone is, are filling the gap. In the Detroit area their growing presence is an economic tonic. For all the protesting about Japanese trade policies, many here embrace the influx because it means jobs and customers. They range from the 100,000 applicants for 3,000 jobs at the new Mazda assembly plant in nearby Flat Rock to Northwest Airlines, the dominant air carrier in the region, which calls its four-year-old Detroit-Tokyo route a “star performer.” Northwest recently coughed up $22,000 in door prizes for the Japan-America Society dinner.
Local banks and law and accounting firms are hungrily signing up Japanese clients. The Detroit motorist now is twice as likely to buy a Japanese-brand car as a decade ago. Japanese financing is behind the sole construction project in Detroit’s struggling downtown district.
And the country clubs are getting a fresh infusion of golfers.
To be sure, no Japanese has joined the exclusive Bloomfield Hills Country Club, whose membership includes the chairmen of the Big Three U.S. auto firms. Racial issues aside, most of the Japanese executives here are “middle management fellas” unsuited to that club’s rarefied air, one member said.
Other clubs are easier to crack. The Grosse Isle Country Club has nine Japanese members, including steel executives, the manager of the new Flat Rock branch of a Tokyo sushi restaurant and Mazda’s Masahiro Uchida, the ranking Japanese executive in the Detroit area.
“The club loves them,” one American member said. “They play a lot, spend a lot of money, do a lot of entertaining.” Uchida has pronounced Grosse Isle a “very good course.”
The invasion of America’s heartland by Japanese auto producers in the 1980s is well known. Seven Japanese-owned assembly plants and dozens of sister component plants have transformed the landscapes and economies of Ohio, Kentucky, Tennessee, Indiana and Illinois.
The Japanese arrival at Detroit’s own door has drawn less notice.
For one thing, it was unexpected.
There was a time when the Japanese would have felt it undiplomatic to swagger into the hometown of the U.S. auto industry. In the 1970s, American advisers to Japanese auto firms found it difficult to persuade executives from Tokyo even to make public appearances here.
Increasingly, Detroit was viewed from Tokyo as a kind of hell because of perceptions about its crime rate, poverty and strong unions. The Japanese avoided all that by building their auto factories in the American hinterlands.
Some Japanese literally feared for their lives, especially after Vincent Chin, a Chinese-American resident of Detroit, was slain in 1982 by a laid-off auto worker who mistook him for a Japanese. (A few days after the killing, the No. 2 Japanese executive at Nissan’s Los Angeles headquarters canceled a trip to Detroit, lest he be murdered, too.)
Japanese businesses, like many others, have largely avoided Detroit itself and set up shop in the growing, prosperous suburbs. Even that represents progress, state officials say, since the first requirement of Japanese executives contemplating moving to Michigan used to be a location at least 100 miles from Detroit.
“When you say Detroit they shudder,” said Noby Tamada, a Detroit booster and native of Japan who is marketing vice president for the automotive division of Cleveland-based TRW Inc. in Southfield, a Detroit suburb. “Getting assigned to Detroit is the end of the world.”
The landscape has been shifting, however. Detroit auto makers enjoyed economic recovery in the mid-1980s, and there was less urgency to the corporate, union and congressional complaints about trade policy. More importantly, the Japanese, under political pressure and facing labor shortages, did something that undercut their critics: They came to this country to build their cars with American labor.
The Detroit area even got an assembly plant of its own, thanks to Mazda partner Ford Motor Co., which pressured the Japanese firm to build here. In 1987, the opening of the Mazda plant in Flat Rock seemed to legitimize the Detroit area for many Japanese.
Lately, the Japanese have entered an important new phase: the start-up of major U.S. research and development ventures by the likes of Toyota, Honda, Nissan and Mazda. Most of this work is based in the outlying areas of Detroit.
“The more we buy from here, the more development is necessary here,” said Uchida, president of Mazda Motor Manufacturing Corp.
Some 150,000 American scientists and engineers are said to inhabit southeastern Michigan, many of them drawn to the globalization of manufacturing. They specialize in fields such as robotics, manufacturing technology and materials engineering, as well as automotive design and engineering. The region also is home to an army of skilled trades people employed by some 8,000 manufacturing companies.
Intense competition has placed a premium on such talent. The Japanese are raiding local American companies for their engineers and establishing ties with engineering colleges in the area.
A symbolic measure of the new reality is Nissan’s sponsorship of students at GMI, formerly General Motors Institute, a well-regarded cooperative engineering college in Flint that was 100% owned by GM until the company got into financial trouble and spun it off several years ago.
At an industrial park in suburban Northville, nearly 400 engineers are jammed into the temporary offices of Nissan Research & Development Inc. About 300 of them are Americans, most hired away from one of the Big Three, and Nissan expects to hire at least 100 more.
Soon they will move into the $85-million headquarters being built in nearby Farmington Hills. Their first task: to engineer a minivan for a joint venture of Nissan and Ford, to be built at a Ford assembly plant in Ohio.
“The Midwest is where most of the automotive engineers are,” said Takeshi Tanuma, president and chief executive officer of Nissan research and development. “If you are going to hire automotive engineers this is as good as it gets.”
To Douglas Mathieson, president of the Engineering Society of Detroit, this is the opposite of a brain drain: “Ultimately, some of these people will come back to the American companies anyway. It’s probably good for everybody.”
Increasingly, the world view of car makers renders meaningless the idea of national origin. Hiromichi Kamimura, Toyota group manager of purchasing in the Detroit area, is responsible for developing North American sources of parts for Toyota vehicles. He sees no difference if a supplier is Japanese, American or German-owned. Many parts suppliers, in fact, are Japanese subsidiaries.
“The world is becoming a borderless society,” said Kamimura, a leading figure in the Japanese Society of Detroit, a company-dominated group with more than 2,000 members that runs the local Japanese school. “Borders and regulations just hamper the smooth flow of business.”
That view leaves little room for the blue-collar, metal-bending history and politics of Detroit. The community, on the other hand, has accommodated a Detroit-Tokyo connection throughout much of the political and industrial history of the United States and Japan.
Toshi Shimoura, a native of Fremont, Calif., came to Detroit after her release from a World War II interment camp. She married James Shimoura, a Detroit native and the son of a true automotive pioneer who ventured from Tokyo to Dearborn, Mich., in 1911 to work for the father of mass production, Henry Ford.
At the Detroit Institute of Art, she points out, there is a sole Asian face among the workers depicted in a famous mural--a paean to the American factory worker of the 1930s painted by the Mexican artist Diego Rivera.
“That’s Mr. Hirata, James Hirata,” she said. “He was a tool-and-die man.”
She explained that Hirata came from Japan and spent his entire career at Ford, including a wartime stint--under FBI surveillance--at the Willow Run, Mich., plant that built the B-24 “Liberator” bomber.
There were still so few Japanese here in 1960 that when a delegation from Japan’s fledgling auto industry came to tour assembly plants, Detroit officials had to go to Chicago to find a translator.
The rest is a familiar story. The Japanese applied American know-how in performing the miracle that has now brought them back to economic might, improving their manufacturing and engineering skills in local factories and labs and driving U.S. auto makers--among other industries--to the wall.
As Iacocca’s letter to President Bush shows, the recession and war in the Persian Gulf have given a harder edge to this historic industrial transition. Now, with Detroit hurting again as auto sales slump, and with Michigan’s unemployment rate again the nation’s highest, some Japanese-Americans in the area are feeling edgy.
“I have never been more conscious of being Japanese,” said Rikuma Ito, a longtime Detroit academic and business executive who came to the United States in 1950.
The region has a distinctive attitude toward Asians, said James Shimoura--a Detroit attorney, a Japanese-American activist and a son of Toshi Shimoura.
The area’s major role in defense production during World War II--when the auto industry converted its factories to build planes, guns and tanks--created a broad and deep base for anti-Japanese sentiment, he said.
The wars in the Persian Gulf and in the automobile marketplace continue the theme. A local Oldsmobile dealer, dressed in military garb, airs a television commercial that shows an Army tank crushing a row of imported cars. “Sayonara to imports,” he says. “Tanks, but no tanks, to imports.”
Shimoura says that leaders of the Big Three and the United Auto Workers--institutions that still determine the political tenor of Detroit--have legitimized a portrait “of Asiatics as these inscrutable people trying to undermine the domestic auto industry.”
Smith, of the Chamber of Commerce, said: “Detroit is still a long ways from stepping up to the realization that we are pegged to the international community. The blue-collar mentality of Detroit is what stands in the way. A lot of people lost their jobs and they feel they lost (them) because of the Japanese success. So if your new neighbor is Japanese, I don’t think you’re going to run next door to shake hands.”
If the visiting Japanese are outsiders, they nonetheless have established comfortable lives in suburban Detroit. They uniformly report being pleasantly surprised by the surroundings. Instructed by their employers to avoid setting up residential enclaves, they have settled throughout the area.
Toyota’s Kamimura, citing the local schools’ accommodation of Japanese youngsters, is “impressed by the assimilative power of this society.” Tom J. Satoh, a vice president at Nissan research and development, said: “People say Detroit is very dangerous, but everyone who comes is surprised to find a very traditional Midwest atmosphere.”
Some Japanese-Americans here also strongly defend the community. They reject its image as a hotbed of anti-Japanese sentiment, but declare bluntly that Japanese corporations are inviting resentment with their seeming indifference to Detroit’s problems and institutions. Japanese executives say they are trying to fix that.
“I don’t see any visible signs of active involvement in civic affairs. Just making contributions isn’t enough,” Ito said. “I see a tight Japanese community developing. . . . I hope this does not get ugly, in terms of Japan-bashing and the Japanese not becoming involved in the local community. I am quite worried about it. In the 1950s, you know, Americans abroad were called ‘ugly Americans.’ Let’s not become known as ‘ugly Japanese.’ ”
TRW’s Tamada called it a testimony to Detroit that anti-Japanese sentiment isn’t greater: “I think, given the situation, this community has shown an incredible amount of tolerance. If this was happening in Toyota City, Americans would feel in danger walking down the street.”
Eventually, the Japanese may become part of the landscape. Neal Shine, publisher of the Detroit Free Press, braced for trouble from readers when his newspaper enlisted Mazda to help underwrite the Free Press marathon last October. The race was in danger of folding for lack of funds.
The Big Three, among others, refused to support the event, but Mazda even entered a runner, an employee from Hiroshima who finished second.
“I have yet to get letter one from the ‘remember-Pearl-Harbor’ folks,” Shine said. “It says something about assimilation. I mean, Mazda is building Fords down there. People are starting to accept this as part of the way America does business.”
