TOKYO - Eiji Iwakuni didn't have to wait long for the inevitable.
The president of Ford Sales Japan Ltd. had just finished his speech at the Japan launch of the Ford Ka. He had talked about the car's styling, its success in Europe and its importance to Ford Japan's sales hopes.
The company is counting on sales of 5,000 Ka units in 1999, which would be a large step toward Ford's full-year target of 14,500, up 120 percent from the mere 6,565 imported cars that Ford sold in Japan in 1998.
The Japanese reporters, though, ignored all of that. Instead, a Japanese reporter zeroed in on the Ka's most glaring weakness with his second question: 'Why is there no automatic transmission?'
Good question.
Japan is overwhelmingly an automatic-transmission market. In 1997, 87.2 percent of all passenger cars sold in Japan had an automatic. Taxi fleets and a few performance sports cars account for virtually the only models with manuals.
'We are fully aware of the constraints associated with not having an automatic transmission,' Iwakuni replied.
Nonetheless, he said, Ford believes the manual-only Ka is still capable of meeting its sales targets.
Iwakuni is probably right. Nonetheless, to understand the sales task Ford Japan has cut out for it with the Ka, it helps to remember Ford Japan's own initial opposition to offering only a manual transmission, and to know how Ford convinced itself to set aside that opposition.
Ka delayed 2 years
For two years, Ford Japan held off on launching the Ka here so that Ford of Europe engineers could add an automatic. The subcompact originally was engineered only for a manual transmission. Ford Japan stuck to that position even though the delay clearly cost Ford Japan in lost sales.
Because of the delay, Ford lost the advantage of the Ka's radical styling. It also left Ford Japan bragging about European awards given the Ka two years ago, in a market where car sales typically sag after four months due a new model's turning stale.
In addition, the delay gave the competition time to catch up.
Asked which models would be Ka's rivals, Iwakuni cited only one Japanese car, the Toyota Vitz, to be known as the Yaris in Europe. Toyota launched the Vitz only a month before the Ka on the Japan market, and priced it starting below ¥1 million, or $8,850 at current exchange rates. The Ka is priced at $13,275, and is offered in only one trim level.
Adding an automatic transmission would have pushed the Ka's price well above that level. Ford Japan insiders hint that the price tag would have ballooned to around $15,930, which would have made sales of 5,000 a year nearly impossible.
Iwakuni had tried to talk Ford Chairman Jac Nasser into swallowing the cost of offering an automatic transmission on the Japan-market Ka. But once the Ford Japan boss realized he wasn't going to succeed, he moved quickly.
The decision to go ahead with a manual-only launch came in November. By the end of January, Iwakuni was unveiling the car to the Japanese press.
That seems fast, but most of the spadework had been done. The Ka had been undergoing trials on Japanese roads since April 1998. It already had gone on sale in Singapore, offering real-world feedback to engineers on how the air-conditioning worked in a high-humidity climate similar to Japan's.
Good response in clinics
In addition, Ford Japan had begun consumer clinics in Japan. What they found there convinced them that a manual Ka would still sell.
'In the clinics, owners of manual transmission Rover Minis were saying, `Hey, this is my next car!'' said Akiko Larson, assistant general manager of the marketing division.
Rover Minis enjoy a special cult status in Japan, which is the British car's largest single market worldwide.
Tatsuya Okabe, Ford Japan's top Ka marketer, checked out another concern: Would potential buyers even be able to handle a manual? After all, in the United States an increasing number of drivers have never learned how to use a clutch.
In Japan, moreover, persons going in for their driver's license test behind the wheel can choose to take the test only on an automatic, and thus get an 'automatic-only' driver's license.
What he discovered was reassuring.
Given a choice, 70 percent of driver's-education students in Japan still choose to learn to drive a manual.
Based on its research, then, Ford Japan's marketing department feels confident it can sell 5,000 Kas a year. After all, that is a low enough volume practically to qualify as a cult car. Toyota sold 4,351 Vitzes in January alone, the car's first full month on the market.
Just to be sure, though, Ford is rolling out an aggressive marketing campaign centered around a hot Japanese music producer and the group Globe. Pictures of the Ford Ka began appearing on subway ads hyping Globe's upcoming concert tour back in November.
