The Japanese automobile market in pre-war had been dominated by Japan Ford and Japan GM. So, the aim of automobile industrial policy was to protect the market against foreign companies, to foster domestic manufacturers and finally to control the industry. Specially the army had intended to eliminate the foreign companies after the 1931 Manchurian incident.
After the army occupied Manchuria in 1931, heavy-industrialization policy had been executed by Japan there. Aircraft and automobile industries as the war industries had been thought important. Army had intended to protect the automobile market and to foster the automobile industry in Manchuria.
The goal of the 1936 Automobile Manufacturing Business Law was to permit the automobile manufacturing business and to eliminate the foreign companies. Furthermore, the law was to protect the automobile market against foreign companies in Manchuria. Substantially it had been prohibited for foreign companies to make inroads into Manchurian market.
In fostering the automobile industry in Japan and Manchuria, Manchurian market was very important in these two points :
1. As the market of Japanese automobiles.
2. In fostering the auto business in Manchuria.
Therefore in order to foster the automobile industry, the operation of foreign companies in Manchuria had never been permitted.
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