The purpose of this paper is to elucidate one aspect of competition between firms in the post-war Japanese automobile industry, using the development competition surrounding the rotary engine as a case study. This paper examines the evolution of development competition, while focusing on the factors underlying Toyo Kogyo’s success in achieving practical application of the rotary engine, and the reasons why competing firms participated in the development of rotary engines. The late 1960s was a time when Toyota and Nissan increased their shares of the Japanese market, establishing an oligopolistic system dominated by two companies. Toyota increased its market share by outsourcing some assembly and development to itaku firms, and realizing a full-line strategy. Toyo Kogyo, on the other hand, successfully developed the world’s first practical rotary engine in 1967, and executed a differentiation strategy of supplying automobiles equipped with rotary engines. Toyo Kogyo believed that new expressways and road networks would increase demand for rotary engine automobiles with superior acceleration performance. Key factors which enabled Toyo Kogyo to achieve the technical innovation of a practical rotary engine were their outstanding technical capabilities, based on their high rate of in-house production, and the existence of a dealer network which learned the special maintenance techniques needed for rotary engines. For competing firms, the rotary engine was one possible technology for complying with emission regulations. Taking the new emission regulations as an opportunity, GM, Ford, Toyota, and Nissan participated in rotary engine development, which had thus far been led by Toyo Kogyo, thus resulting in broader development competition. This was a competition to find environmental technology, and involved firms from the U.S. as well as Japan. Therefore, when fuel prices rose due to the oil crisis, and practical three-way catalysts meeting emissions standards were developed, the competing companies withdrew from rotary engine development.
This paper examines the constitution of JNR Workplace Committee and its administration from the prewar to the wartime periods and analyzes the process and the reality of JNR labor movement that subsumed into the Familism. The Workplace Committee attempted to internalize the labor movement by letting the laborers display their dissatisfaction as well as the demand as a part of adaptation mechanism within the internal organization, sometimes offering the opportunities for fringe benefits and promotion. This was the reality of the labormanagement relations that subsumed into the JNR’s Familism. Even though the Workplace Committee functioned as the passage to obtain better working environment during the 1920s, in the 1930s, it became to be a defensive mechanism that dealt with delayed follow-ups for the issues brought up by the pay raise and the promotion. In the background of such transformation, there was the existence of the antagonistic labor union that pressured the authorities to consider the demand of the Workplace Committee, as well as the JNR’s economic foundation that enabled its realization. The adaptation of the Workplace Committee to the JNR system deepened in the 1930s and it transformed into ‘the Service Society’ during the wartime period. The price of “service” was the improvement of labor treatment and the stability of livelihood. The postwar JNR labor-management relations began on the basis of these factors.