Current location:opinions >>
EDITORIAL: Nissan rebuke shows preying on suppliers still exists in Japan
opinions4People have gathered around
IntroductionNissan Motor Co. has been unilaterally reducing its payments to numerous subcontractors in the illeg ...
Nissan Motor Co. has been unilaterally reducing its payments to numerous subcontractors in the illegal squeezing of suppliers.
The auto giant has been committing this exploitative act for many years. Such a business practice of exploitation by large companies leveraging their strong positions as contractors to impose their will on subcontractors is inexcusable.
Nissan must clarify the responsibility of its management for the violation and rid itself of “subcontractor bullying.”
Last week, the Fair Trade Commission issued a cautionary notice to Nissan calling on the company to take steps to prevent a recurrence. Nissan was found to have violated the subcontract law for unilaterally reducing the payment amounts from the originally agreed prices under the guise of “rebates.”
According to the antitrust watchdog, over a period of about two years until last spring, Nissan reduced the amounts due to 36 subcontractors, including makers of aluminum wheels, by more than 3 billion yen ($20.3 million).
This is the largest case of the kind uncovered by the FTC. This practice of coercive price-cutting to meet Nissan’s cost reduction targets has been ongoing since at least the 1990s.
As a major automaker, Nissan stands at the apex of a pyramid-like subcontracting structure, generating enormous profits as the beneficiary of this setup. It is responsible for ensuring that costs are fairly reflected in prices within its supply chain.
If the company unjustly siphoned profits from its small and midsize suppliers, that was an utterly indefensible act.
Nissan President Makoto Uchida apologized at a March 13 news conference for his company’s violation of the subcontract law. Nissan should review its past and current transactions with subcontractors to identify instances of forced price reductions and clarify responsibility.
It is true that the competitive strength of Japan’s automotive industry has been supported by relentless cost-cutting efforts by both car manufacturers and their suppliers.
However, such efforts must be based on an equitable relationship between automakers and their subcontractors and the benefits should be shared fairly according to the contributions.
Nissan’s exploitation of subcontractors is clearly unacceptable. However, subcontractors are generally in weak positions because they risk massive damage if they lose business dealings with key customers and find it difficult to resist demands for cost reductions from these major clients.
Therefore, businesses placing orders with suppliers have a duty to continually confirm the fairness of their transactions. Nissan’s chief executive should demonstrate the company’s solid commitment to this principle both internally and externally.
The government’s guidelines concerning the issues published last year also call on chief executives to clearly pledge to allow subcontractors to pass along higher costs in the prices.
Shifting burdens onto subcontractors has been one of the factors inhibiting wage increases among small and midsize enterprises.
The goal of realizing the virtuous economic cycle of rising prices and wage hikes, the principal focus of this year’s “shunto” spring labor negotiations, remains elusive without the widespread adoption of fair cost pass-throughs.
Profit generation through cost-cutting has been the primary corporate mantra in Japan for years as the nation’s economy was trapped in deflationary doldrums, but sustainable growth is unattainable if burdens are pushed onto subcontractors and workers.
Alongside wage increases and proactive investments, it is urgent to ensure compliance with laws and improve business practices. The FTC, for its part, must also intensify its monitoring to eradicate the unfair and abusive practice of squeezing subcontractors.
--The Asahi Shimbun, March 14
Tags:
Reprint:Friends are welcome to share on the Internet, but please indicate the source of the article when reprinting it.“Culture Chronicles news portal”。http://norway.unhasdecoradas.org/news-57d799871.html
Related articles
What a blast to work at NASA. Space agency is sky
opinionsWASHINGTON (AP) — Exploring the cosmos makes for happy employees, federal workers like to work from ...
【opinions】
Read moreCultural and Natural Heritage Day Celebrated Across China
opinionsContact Us HomeNewsHighlightACWF NewsSocietyWom ...
【opinions】
Read moreBeijing Rolls out Measures to Boost Consumption
opinionsContact Us HomeNewsHighlightACWF NewsSocietyWom ...
【opinions】
Read more
Popular articles
- Celebrity birthdays for the week of May 26
- Record 12 Mln Sit for China's Annual College Entrance Exam
- Villagers Perform Water Drum Dance in Jianhe County, SW China
- Professional ski instructor from New Zealand provides ski training in China
- OpenAI pauses ChatGPT voice after Scarlett Johansson comparisons
- China's Sci
Latest articles
Burglar hurled stolen mobile phones at police from the top of 60ft high roof during nine
Fuzhou Promotes Community
Digital Economy Provides Enormous Opportunities for Women
China Sees Wider High School Education Coverage
Adams, Reyna, Turner, Ream are US concerns ahead of Copa America
Record 12 Mln Sit for China's Annual College Entrance Exam
LINKS
- Alabama lawmakers advance bill to strengthen state's weak open records law
- Proposal would assure schools that cooperate fully in NCAA investigations avoid postseason ban
- Deion Sanders' sons Shilo and Shedeur take on some recruiting duties for Colorado
- Group condemns 'humiliating searches' by security at Barcelona stadium
- Nebraska lawmakers end session, leaving taxes for later
- Brazil's president creates two new Indigenous territories, bringing total in his term to 10
- Gordon Ramsay is slated for tiny portion of duck on £260
- The 49ers are slated to pick in the 1st round for the 1st time since 2021
- Alabama lawmakers advance bill to strengthen state's weak open records law
- Rural Texas towns report cyberattacks that caused one water system to overflow