Japan: one size doesn't fit all; matching models to markets is key global strategy.

TOKYO - Global engineering has been a natural fit for Japanese automotive designers and engineers. After all, they are firm believers in matching models to markets. Because tastes, policies and regulations

vary, they feel one-size-fits-all "world cars" are limited in appeal and saleability. Consequently, all major Japanese automakers have established research and development centers in the U.S. and Europe as well as Japan.

"We design vehicles differently for our three main markets," explains Yoshikazu Hanawa, executive vice president of product planning and development for Nissan Motor Co. Ltd.

As an example, the Primera was developed primarily for Europe with more conservative packaging and responsive performance. Nikan opts for softer suspensions and advanced styling in the U.S. where the J30 is popular. Yet this model does not sell well in Japan because it's considered too small for the price.

"Size is very important in Japan," says Mr. Hanawa. "A roomy interior is more important than a larger engine. And styling is more boxy."

The bolder design of Nissan's last-generation Bluebird (Altima in the U.S.) alienated faithful fans here, so a more conservative look marks the new Bluebird introduced in January for sale in Japan only. A new Altima will have to be designed for the U.S. marketplace.

New-model development is costly, so Japanese producers make as few platforms as practical and go from there with derivatives. The main elements in designing for different markets - aside from steering-wheel placement - are engine type and size, emission controls and other electronics, trim levels and body types.

Toyota Motor Corp.'s Scepter, built in Georgetown, KY, for Japan, is a twin of the Camry wagon, but differs in emission controls and safety features. The Corolla and Prizm, both made at New United Motor Manufacturing Inc. (NUMMI) in Fremont, CA, share the same platform but are skinned differently. The Kentucky-built Avalon sits on a longer, wider version of the Camry platform.

Mr. Hanawa says that "Parts commonality is increasingly important, and Japanese, European and U.S. parts are as interchangeable as possible." He points out that the Nissan Quest minivan (and Mercury Villager twin) was designed in Japan and is manufactured by Ford Motor Co. in Ohio with 75% local content.

Honda Motor Co. Ltd. operates an R&D center in Bangkok as well as Europe and the U.S. The mission of each, says Executive Chief Engineer Tomoyuki Sugiyama, is "to design and develop cars that match regional needs."

Consequently, Honda's two "world" models, the Civic and Accord, have been tailored to local tastes while the Domani, a Civic derivative, is made to satisfy Japanese requirements.

In Japan, Accord buyers can choose from four different engines and seven trim levels - and the U.S.-made wagon is the best seller. The U.S. Accord comes with only a 2.2L engine and three trim levels, and the sedan sells best. In Europe, because of Honda's previous affiliation with Rover, only the name is the same, and only a sedan is offered.

Suspension settings differ by market as well: they're softer in comfort-conscious Japan and the U.S., sportier in Europe. For Australia and Saudi Arabia, suspensions are stiffer and road clearance is 15 mm higher to cope with bad roads.

Because all major automakers today get feedback from dealers, salesmen and customers, Honda goes an extra mile at the design-in stage. Development teams visit key markets, talk with a variety of people and later even seek their opinions of prototypes.

"Honda could not be as daring as Ford. Our designs are considered conservative, and this is not a bad thing. People are not surprised and feel comfortable with them," says Mr. Sugiyama.

Honda's R&D budget is 5% of total sales, and the company is getting more bounce for its bucks these days by rationalizing development and "commonizing" parts. Start-up cost of the current Accord was around $1.8 billion (200 billion[yen]), only half that of the previous model.

Several Japanese automakers - Honda-Isuzu, Mazda-Suzuki and Mazda-Nissan - are now saving design and development costs by sharing and re-badging each other's models.

There is no engineer shortage in Japan, says Honda's Mr. Sugiyama, but automakers must train and transform them into automaking specialists.

Foreign input is critical, more so perhaps for Honda than others. More than 50 U.S. engineers now are stationed in Japan on three-year assignments. And suggestions from other U.S. engineers who came to Japan from Ohio to assist in developing the Accord helped shave production costs back in Marysville, OH, where Honda makes Accord and Civic.

Mr. Sugiyama emphasizes that the Accord is made in nine countries with 100% parts compatibility. Honda policy is to procure locally instead of centrally for several good reasons, including minimizing foreign exchange risks. For example, the rate was 135[yen]/$1 when Accord planning began and 100[yen]/$1 when the new model was released.

The special "Asia cars" now being sold or prepared for market here are all derivatives modified to fit perceived needs in area markets, and one - the Ford-Mazda offering - is a truck.

They follow a path pioneered by the Toyota Utility Vehicle (TUV), originally a pickup truck and later a multi-purpose vehicle, built and sold in Indonesia, Taiwan and the Phillppines, most as commercial vehicles to avoid taxes before conversion into "family vehicles."

The exchange of techniques and technology crosses international borders as well.

* Mitsubishi Motors Corp. was present at the creation of the Pony, Hyundai Motor Co.'s first car, and continues to provide essential engineering support. The Proton, Malaysia's "people's car," is basically an older-generation Mitsubishi for which the Japanese still provide vital help.

* Daihatsu Motor Co. provides the same kind of help for Malaysia's new, smaller "people's car."

* The platform and engine of Kia Motor Co.'s best-selling Pride in South Korea were designed by Mazda Motor Corp., which continues to supply critical parts and components as well as KD kits - 300,000 in 1994 - for Kia models.

* Nissan startled competitors by agreeing to support the new automaking venture of Samsung, one of South Korea's biggest conglomerates, in return for royalties.

* The Ford Escort and Mazda Familia are built on a platform engineered by Mazda, and mass production permitted installation of Electronically Controlled Automatic Transmissions (ECATs), a first in this class car.

* A top-of-the-line Mazda 1.8L 16-valve engine is in the Escort, and air-bag systems from Ford suppliers are installed in Mazda cars.

* General Motors Corp. is tapping the know-how of its affiliate, Isuzu Motors Ltd., in developing right-hand-drive Cadillacs and Saturns for Japan.

To be successful here, foreign automakers must cater to local regulations and conditions.

Before the Toyota Cavalier built in Lordstown, OH, by GM was introduced in Japan this January, almost 100 changes had to be made in the Chevrolet original, including moving the accelerator pedal 20mm to accommodate shorter Japanese legs, installing an interior switch to fold side mirrors back when drivers encounter extra-narrow streets, and adding an independent air circulation switch permitting drivers in traffic jams to choose between outside and recirculated air.

The cooling systems of imported Opels have been beefed up because so much driving in Japan is stop and go. And virtually all Rover models sold in Japan have air conditioning and automatic transmissions.

"We sell the Rover 100, which is right above the Mini with leather and wood on the inside. We have nothing like this model anywhere else in the world," says Peter Woods, president of Rover Japan Ltd. In the future give-and-take of global engineering, Japan is not likely to take a back seat tb any competitor.