Mutual adaptation: Japanese automobile transplants in North America and the restructuring of buyer-supplier relations

This paper examines how the arrival and expansion of Japanese automotive assemblers in North America during the 1980s and 1990s, has been characterized by a complex process of mutual adaptation by both the transplant assemblers and North American suppliers. It argues that despite the arguments that globalization is necessarily associated with a convergence in supply-management practices, Japanese assemblers generally remain more committed to long-term supplier development and technical assistance and are less price focused than their North American counterparts. Nonetheless, I argue that a hybrid system is emerging in which the Japanese have modified some of their strategies to the more adversarial and price oriented systems which characterize North America. The second half of the paper examines Canadian-based supplier relations with the transplants and concludes that despite the emergence of a core of large R&D intensive Canadian suppliers, most remain smaller and more specialized in lower value added components than their US counterparts.