A U.S. subsidiary — and refusing to withdraw under a strong yen (1979)

The cost of staying, and the fruit of having stayed

The 1979 entry into the United States was in itself a natural next step in sequence: a company that had begun exporting put a base where it sold. What makes the decision stand out, one might say, is rather that it did not fold the operation when the subsequent strong yen pushed it into loss. Withdrawing would have stopped the current period’s losses, but the partners willing to handle an unknown brand, and the time accumulated on the ground, cannot be bought a second time. Enduring at the very moment when other firms pulled back became the difference later, when North America turned into its largest market.

As a result of staying, however, the company deepened its dependence on North America. In the year to February 2025 the United States accounted for more than half of consolidated sales, leaving results tightly coupled to one country’s economy — housing starts, infrastructure spending. The experience after the Lehman shock, when sales shrank to nearly a quarter of their peak, is the reverse side of that. A base that survived by enduring the strong yen went on to pose a different problem: concentration in a single market. The 1979 decision appears to have been the beginning of both.