Richard D. Recchia : Ex-Chrysler Exec Makes the Case for Japanese Cars
Richard D. Recchia--a former Chrysler Corp. executive--long has been a critic of the U.S. auto industry. Recently, however, the executive vice president and chief operating officer of Cypress-based Mitsubishi Motor Sales of America has become something of an unofficial spokesman for Japanese importers.
In the last few weeks, both trade groups and the national audience delivered by “60 Minutes” have heard him challenge the Big Three U.S. auto makers for focusing on profits over the last decade instead of investing in the world market.
Recchia talked to free-lance writer Ted Johnson about the “Buy American” movement and why calls for protectionism, in his view, are futile in an international marketplace.
Q: Since your appearance on “60 Minutes,” you’ve become sort of a spokesman for the Japanese import industry. Are you reluctant to have this role?
A: We don’t have anyone in the domestic import industry who has the popularity or the news-worthiness of a (Chrysler Chairman Lee) Iacocca or a (General Motors Chairman Robert) Stempel. So it’s a great opportunity for anyone, who happens to be me this week, to be able to speak for the import industry. So from that perspective I’m real happy. I don’t know how long it will last. But as long as it does last, I think it’s an opportunity to get the other side of the argument that we’ve been hearing for months.
Q: Do you find it ironic that it is you who have been speaking out, given that Mitsubishi is fifth in market share among importers in the United States?
A: It was an unusual set of circumstances that got me in this position. On the other hand, maybe it makes me less vulnerable, because I don’t have anything to gain. I’m not trying to protect a great share of the market. Maybe it makes me more credible to the journalists and the people who are listening that someone from one of the smaller companies is voicing such a strong opinion.
Q: Should Americans be angry over a Japanese politician’s comment that American workers are “lazy”?
A: I think they should be upset because it was not correct. It was an improper thing to say and it was wrong, and it was in some regards misleading. I don’t think there’s anything wrong with the average American worker. If you put him in the proper atmosphere to work, he’s going to create quality that is world class. We’re doing it in our assembly plants. Toyota is doing it in their assembly plants. Everybody is doing it. But the process has to be world class. You could take a Japanese worker, move him over here and put him in some of the operations in the United States that are building cars that are a lousy quality, and they will still be a lousy quality. The worker can’t change the process that builds a lousy car. He can only do his part of whatever function he is responsible for.
Q: One of your major criticisms of the U.S. auto industry has been that it failed to take advantage of new international markets over the past decade--that it raised prices and focused on maximizing short-term profits. Do you see any indication that its attitude is changing?
A: The positive signs are few, but you see some things like new assembly operations for Chrysler or for Saturn, which are more flexible and more efficient. The negative sides are probably more overpowering. . . . The biggest weakness . . . is that to this day, I don’t think anybody in any of the Big Three has done any really serious planning at all to determine what kind of vehicle they would build in an assembly plant in North America to export to world markets. And that’s what it’s going to take.
Q: Do you think the American public will be swayed by calls for protectionism?
A: Americans in general buy with their minds and their wallets. They make an intelligent choice and they buy the best value. And that is the way they should. In fact, I was very pleased that . . . Bob Stempel came out and said exactly that. People should be able to make their choice based on value, quality and what they want in a product. I think if they do that, protectionism isn’t necessarily a key factor. There may be some people--as there are today and will be next next year and as there (were) 10 years ago--that are going to buy because they want an American car. But they may not be buying what they really thought. They may not be buying a car made in America. (Domestic auto makers) will buy engines from Japan and parts from Korea and components from Mexico and assembly operations in Canada.
Q: But those who are calling for protectionism will argue that while you are investing in America, the net profits ultimately go back to Japan.
A: That’s just not true. We are the smallest of the five major companies in the United States, and so far we have invested $400 million in our company, in our employees and our facilities. We have built an American organization here. We don’t look at ourselves as being a Japanese company doing business in America. Every single dime and then some, more than what we have earned, has been put into trying to create jobs for Americans. . . . We feel we are Americans. The fact that we are owned by Japanese isn’t any more significant in our mind than the insignificance that the domestic (industry) seems to put on the fact that a Dodge Caravan is built in Canada. I think the two are sort of analogous.
Q: What advice would you give to say, a Chrysler, to turn things around?
A: You (have) got to look at what your basic products are and develop a strong sales effort through your existing dealers around that. And then you (have) got to start looking at your plant and production facilities, as well as your own product plans, and determine what you can build in a given plant to be sold in more than just the North American market. You (have) got to have products that are designed that way. You don’t just say, ‘Well, I’ve got this product that’s really nice. I’d like to sell it (in) Japan even though the engine is too big and it has left-hand drive.’ That’s the approach that the domestics currently have taken. . . . You (have) got to develop a market for the needs of the marketplace, just like the Japanese did here. They came in and they said, ‘OK, We’re going to sell cars in America, we’ve got to have left-hand drive cars. We’ve got to have them styled to American needs.’ They stumbled for a number of years and had some pretty crappy products when they first started coming in in the late ‘50s and early ‘60s. But now they have products that are very competitive and suit the needs of the American consumer. You have got to do the same thing if you are going to go Japan or Taiwan or Yugoslavia.
