International Business: JAPAN
ROADBLOCKS, ROADBLOCKS EVERYWHERE
Motoh Katsumata, 51, has waited nearly all his life to sell Fords. His grandfather started selling them in 1924. His father switched to Toyota in 1962 and built the largest privately held dealer network in Japan. But Motoh still dreamed of selling Fords. Last year, his dream came true. Now Mustangs gleam alongside Toyotas in his suburban Tokyo showrooms.
Unfortunately for Ford Motor Co., very few of its 126 dealers in Japan are as strong as Katsumata, president of Katusmata Group. With access to dealerships one of the main points of dispute in the current brawl between Washington and Tokyo, his efforts illustrate the huge obstacles Detroit faces in Japan. "The market's open tariff-wise," he says with a sigh, "but behind the tariffs, it's very difficult."
REPAIR RUNAROUND. Most dealers are under intense pressure from Japanese auto makers to keep American cars out. It took Katsumata two years of negotiations just to get Fords into the showroom. His clout helped him persuade Toyota Motor Corp. "Ford's lucky," says a Toyota spokesman. "He's a powerful businessman and that should give [Ford] every chance to succeed."
Once Katsumata started importing Fords, he had the daunting task of assembling a sales team from scratch, since Toyota wouldn't allow salespeople to hawk its cars and Fords at the same time. Moreover, government regulations make it hard for him to open a dealership with a repair shop, meaning that Katsumata's Ford customers often can't get the service support they need.
Still, having a high-profile dealer such as Katsumata is a coup for Ford. The most aggressive of the Big Three in Japan, Ford hopes that Katsumata's gamble will pave the way for others. "His involvement means a lot to the other dealers," says Konen Suzuki, president of Ford Motor Co. (Japan). "Everyone knows his business will set the pace."
But so far, that pace has been very slow. Of the 75,000 cars Katsumata sells a year, 360 are Fords. And he expects to be selling only 1,200 Fords a year by the end of the decade.
Then why bother? There's more to Katsumata's strategy than simple nostalgia. If he can get the reputation for selling foreign cars, Katsumata argues, he'll be well-positioned when they become more popular. That's starting to happen, he says. The market for Fords, while a niche, is growing as the company lowers prices. The base Mustang coupe runs about $27,000 these days, compared with $49,000 10 years ago. "A lot of guys in their 50s longed for a Mustang when they were young but couldn't afford one," says Yasuo Sudo, one of Katsumata's dealers.
Despite talk of U.S. cars not appealing to the Japanese, Katsumata's dealers say that customers are impressed by the safety features and low cost of Ford cars. Toyota's Caldina wagon, starting at $22,400, is less than a similar Ford Mondeo at $23,800. But the dual air bags and antilock brakes, standard on the Ford, will tack $1,550 on the Caldina.
TRUE BLUE. To get the message across, Katsumata has started advertising, spending about $50,000 on direct mail, as well as newspaper and radio ads. Ford is spending millions more. "It takes a while to sink into customers' minds," says Sudo, who spreads the word by driving a Taurus.
Katsumata, a former salesman for Toyota, has little patience for some of Ford's marketing strategies. The company, he says, doesn't offer enough right-hand-drive models. Moreover, it makes what he regards as petty demands: The showrooms, for instance, must be a uniform Ford blue to promote corporate identity. "It's meaningless," Katsumata gripes. "Toyota wants just one thing: a sign." Worse, Ford doesn't take replacement orders often enough. "A once-a-year order system is nonsense," he says.
Similarly, Katsumata finds fault with both sides in the trade fight. Tokyo won't deregulate the inspection and repair-shop rules that favor domestic producers. And Americans, he says, are all bluster. "U.S. carmakers don't research anything. Nobody comes to our offices to see what we do," he says. But Katsumata shouldn't feel ignored. As his efforts to sell Fords continue, industry officials from both sides of the Pacific will have their eyes on his dealers.
MOTOH KATSUMATA'S BIG GAMBLE
BACKGROUND President of largest privately held auto dealer in Japan, selling 75,000 Toyotas a year
STRATEGY Introduce more Fords into his Toyota showrooms, expanding from current five showrooms to 20 within 10 years
GOAL Sell 1,200 Fords a year by end of the decadeBy Edith Updike in Tokyo