US know-how aids Japan aircraft industry
Seattle — Japan intends to rival the United States as a major supplier of civilian airplanes, aided by 30 years of experience and assistance from the US government in production of military airplanes.
This new warning was sounded recently in a report issued by the General Accounting Office (GAO) and picked up by some congressmen worried that Japan is in a position to challenge one of the remaining citadels of American technology.
It is an issue that would have caused little concern a few years ago, and perhaps would even have been applauded as a way of helping out a friend and ally.
Now it is viewed with alarm as a development that could affect the future competitiveness of a vital US industry.
Civilian aviation is one of the high-technology areas that has been targeted by the Japanese government as part of its overall industrial strategy, the report says.
Currently, Japan is producing the McDonnell Douglas F-15 fighter and the Lockheed P-3C patrol plane under licenses from the US government.
This arrangement allows the Japanese to build their airplanes themselves rather than buy them off American assembly lines, even though it costs more to build limited numbers of planes than to import them.
Besides building military aircraft, Japanese companies are helping produce the new Boeing 767 through a private arrangement with the Boeing Company. Three Japanese companies are building fuselages for the advanced jetliner.
Much of the technology and production base acquired by Japan through cooperation with the US military can be applied to civilian production. Indeed, GAO investigators reported they saw F-15 parts and civilian parts being built on the same production line.
The Japanese strategy for developing civilian aircraft production will include industry consortiums, direct government aid, and joint ventures with foreign airplane companies, the study said.
While there are no Japanese aircraft companies comparable to the American giants, many large industrial firms have airplane-making subsidiaries. They pool their efforts through consortiums organized with the assistance of the Ministry of International Trade and Industry (MITI).
One such consortium, the Civil Transport Development Corporation, made up of Mitsubishi, Kawasaki, and Fuji Heavy Industries, was formed to participate in the Boeing joint venture.
When necessary, the Japanese government has assisted with direct financial aid. Its policy is to provide 75 percent of the development costs repayable only if the project makes a profit.
''Many US government and industry representatives believe Japan can and eventually will become a serious competitor in the world's civil aircraft market ,'' the report says. ''The remaining questions are when and how much Japan's share will be. This will depend at least as much on the vitality of US industry as on Japanese actions.''
The issue is surfacing at a time when the US aero-space industry is reeling from the effects of a national recession.
In Seattle, the Boeing Company faces special problems. It has developed and introduced, at great expense, two jetliners just when airline customers are cutting back purchases.
At the roll-out of the new 767 nearly a year ago, when the company's fortunes seemed brighter, senior vice-president E. H. (Tex) Boullioun was asked if he worried about nurturing a Japanese aerospace industry that might one day challenge the Boeing Company.
He replied it would take 20 to 40 years under the best of circumstances for Japan to get equivalent production capability in big planes like the 767.
At that time, Boeing seemed cool to the idea of joining with Japan in another venture to produce a 150-seat jetliner. Recently, however, this project seems to be taking on more urgency, with several meetings in past months between Boeing and Fuji Heavy Industries.
Also, the Japanese are having difficulties developing a large aerospace industry. MITI, despite its heavy involvement, is having to cut back on its expenditures because of budget deficits.
In addition, Japan has only about 20,000 aerospace workers, fewer than the number employed by the commercial aviation division of Boeing. However, Rep. Les Aspin (D) of Wisconsin recently said that Japan rapidly is pulling workers out of declining industries such as shipbuilding to retrain them as aerospace workers.
While the GAO report sounds an alarm, its recommendations are relatively mild. They amount to little more than a call for greater coordination between the Defense Department and other government agencies for military programs with economic implications.