Global Fastener News

1987 FIN – IFI & U.S. Domestic Fastener Producers Make Bold Bid for Japanese and German Transplant Auto Business

June 30
00:00 2009

1987 FIN – IFI & U.S. Domestic Fastener Producers Make Bold Bid for Japanese and German Transplant Auto Business

September 9, 1987 FIN – U.S. fastener manufacturers, in a bid to get a bigger share of the U.S.-based Japanese and German automakers’ business, will demonstrate the quality of domestic fastener products and services at a seminar sponsored by the Industrial Fasteners Institute on October 13, 1987, in Columbus, OH.

Representatives of Japanese and German automakers, including management, engineering, purchasing and quality assurance, and their first and second tier suppliers have been invited to the seminar, which will address fastener making machinery, materials, tooling and bolting technology.
Representatives from these supplier industries will discuss their respective roles in the “teamwork approach” to design, production and quality control of fastening components.

There will be 25 U.S. and Canadian IFI-member companies on hand for one-on-one dialogues: Anchor Bolt & Screw Co.; ATF Inc.; Bristol Locknut Co.; Elastic Stop Nut Division of Harvard Industries; Elco Industries Inc.; the Everlock Chicago and Everlock Detroit units of Microdot; Federal Screw Works; Fischer Special Mfg. Co.; Gesipa Fasteners USA Inc.; Gripco Fastener Division; Ingersoll Fasteners Division of Ivaco Inc.; MacLean-Fogg Co.; Mellowes Co., division of Charter Mfg. Co. Inc.; Mid-American Threaded Fasteners division of Tennessee Bolt & Screw Co.; Mid-West Fabricating Co.; Nylok Fastener Corp.; RB&W Corp.; Ring Screw Works; Robbins Mfg. Co. Inc.; Rockford Products Corp.; Semblex Corp.; Southern Fastening Systems division of Farley Metals Inc.; SPS Technologies; Stelco Fastener & Forging Co.; Cherry and Townsend divisions of Textron Inc.; Towne Robinson Fastener Co.; and Wrought Washer Mfg. Inc.

The seminar, according to the IFI, represents a positive response to Dr. Shoichiro Toyoda, president of Toyota Motor Corp. and current chairman of the Japan Automobile Manufacturers Association. At a meeting earlier this year, Toyoda challenged American auto parts suppliers “to do a better job” in presenting and selling products to U.S.-base Japanese automakers.

What, in effect, the IFI and its member companies are doing is picking up the gauntlet that Dr. Toyoda has thrown down. At Columbus, the Japanese will have the opportunity to see what the U.S. companies have to offer.
After this show they will no longer be able to say they have not been made fully aware of the American fastener makers’ capabilities.
For the domestic producers of automotive fasteners, the stakes in getting more business from fast growing Japanese share of autos (and some trucks) made in North America are enormous.
The auto industry is the number one market for fasteners in the U.S. – accounting for about 25% of the total fastener market.
The way things are going, the domestic fastener producers increasingly are being shut out of a large segment of that market as the Japanese hike their percentage of total car and truck production in North America. Only a handful of U.S. fastener producers are now doing any appreciable business with the Japanese plants here.

Forgetting for now the Japanese 2.3 million cars now being imported into the U.S. each year, which don’t use any U.S. made fasteners, you’re looking at approximately a 2 million vehicle market of Japanese cars assembled in North America in 1990.

The first Japanese car production plant in the U.S. was established in Marysville, Ohio, in 1978.
By 1990, nine of the 13 major automakers will have plants in the U.S. and Canada.
The list includes Japan’s big three: Toyota, Nissan and Honda; and five smaller second division companies – Mazda, Mitsuibishi, Suzuki, Subaru (Fuji) and Isuzu.

All of these companies now have plants (including joint ventures) already built or being constructed, or ready to start building in North America.
Another automaker, Daihatsu, until recently has been negotiating with Bombardier of Canada to have its autos and cross country utility vehicles built in one of Bombardier’s plants. That idea has been abandoned and Daihatsu may or may not have a plant on stream in1990.

The changing face of the U.S. vehicle market by source is provided by a projection recently made by the Automotive Parts & Accessories Association:

1985: 7.5 million (68%) domestic; 2.8 million direct import (26%); 330,000 (3%) transplant; 220,000 (2%) captive (autos assembled offshore by either a foreign-based or U.S.-based manufacturer with a U.S. name (e.g. GM Sprint); and joint venture 110,000 (1%).
1986: 6.4 million (56%) domestic; 6.4 million (56%) domestic; 2.6 million direct import (23%); 1.04 million (9%) transplant; 1.04 million (9%), captive; and 345,000 (3%) joint venture.
An example of joint ventures is the Toyota/GM NUMNI, which produces Chevrolet Novas.

According to the AAPA, the origin of the auto parts – including fasteners – for vehicles sold in the U.S. by 1989 will be less domestic than foreign.
In 1980 the ratio was 70% domestic auto parts and 6% other foreign auto parts. The prediction for 1989 is 42% domestic auto parts, 50% Japanese and 8% other foreign auto parts.

The transplanted auto production in the U.S. is now estimated to be about 20% American content (and in most cases this figure includes labor).

According to another study by Jordine Fleming, an Anglo-Asian stockbroking firm, Japanese parts makers are likely to increase sales to carmakers in America by 18% a year over the next five years – from $19 billion in 1987 to $44 billion by 1992.

A large part of this Japanese content in cars built in the U.S. will be attributable to the number of Japanese auto supplier companies that already have and will continue to follow the Japanese automakers to North America.

It’s been estimated that some 300 Japanese auto parts makers will be operating facilities in the U.S. by 1988, according to a U.S. Department of Commerce study.
That estimate is probably high, since according to a more recent study by Cleveland State University, there are less than half that number here now.
The plants now are in 11 states, with Ohio at 30 having the most; followed by 18 in Michigan; California, 17; Kentucky 12; and 8 each for Illinois and Tennessee. The Japanese, criticized by U.S. governmental agencies and industry groups for failure to use more U.S. made auto parts, both here and in Japan, claim that Japanese auto manufacturers and their U.S. companies upped purchases from U.S. suppliers from $1.7 billion in 1985 to $2.5 billion in 1986. ©1987/2009 Fastener Industry News.
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