Founding Brazil Special Ceramics: the first overseas plug production (1959)

A standardized part is what made local production thinkable

To read this move as simply an overseas expansion that came too early is unsatisfying. In 1959, Japanese parts makers rarely built their own plants abroad, and Brazil — with inflation at 180% — was hardly a gentle place to invest. What made the step possible, it appears, was that a spark plug is a standardized part that fits any car in the world. Had it been a component whose demand was held by one particular automaker, the decision to enter an unfamiliar market on a wholly owned basis would have been far harder to take. The nature of the product — a standard good — was what pushed a heavy choice like local manufacture forward.

That said, the step did not bear large fruit immediately. In an environment of 180% inflation the business took years to take root, and a decade after entry Brazil was still, it seems, not on a scale that lifted earnings back home. Even so, owning a factory abroad, hiring locally and producing there gave the company something that continued exporting never could. Looking at the spread of local production that followed — the United States in 1966, Southeast Asia in the 1970s, Europe and America in the 1990s — that first step taken in Brazil can be seen as the groundwork for everything after it.