What a difference a decade has made in the professional life of Firestone Tire & Rubber Corp. Chairman John J. Nevin.
During his tenure as president and chairman of Zenith Electronics Corp. in the 1970s, no one fought harder to protect an endangered domestic market from the Japanese.
As he watched the Japanese gobble up an increasing share of the U.S. market for color televisions, Nevin went on a personal and political crusade in Washington to prove that unpoliced and lax U.S. trade laws allowed the Japanese to "dump" their products on the U.S. market, thus underselling U.S. producers and creating havoc in the color television business.
So passionate was Nevin about his case that some points were argued all the way to the Supreme Court. The battle took a toll on him personally as he faced the layoff of thousands of Zenith workers. In 1979, he was hospitalized for exhaustion.
Though it is now a different day and a different company, Nevin, 61, known for his quixotic and mercurial temperament, ironically turned to the Japanese when Firestone began looking for a joint venture partner to take on what has been its main line of business since 1900 -- tire-making.
After a major and painful restructuring of its tire business over the last eight years, Firestone last week announced that Bridgestone Corp., Japan's largest tire maker, would acquire a 75 percent stake in the business, paying about $1.25 billion to Firestone -- the price of admission to the U.S. market.
Under the proposed agreement, Firestone keeps a 25 percent equity interest in the venture, assuring itself of a voice on the board and a supply of Firestone tires for its 1,500 car-repair outlets.
"We concluded there was no probable way that Firestone using its own resources could create enough capital in the world equal to this joint venture," Nevin said. "How many billions of dollars do you have?"
Nevin, like some of the analysts who have applauded the sale to Bridgestone, sees no inconsistency in helping a Japanese competitor get a major toehold in the U.S. market.
"At Zenith it was the perception of unfair trade practices, not a fight with the Japanese," said Nevin. "Without arguing that dumping was a problem, it clearly has not been a problem in the tire or auto markets of the U.S.
"I would assert that I never attacked Japan or the Japanese, but U.S. trade policy that tolerated dumping," he said, adding that "it was no means a comfortable time" for him.
In fact, as long ago as 1981, when Nevin decided that Firestone did not have the resources to stay in the radial truck-tire market, he thought of Bridgestone as a buyer and asked Sony Chairman Akio Morita to smooth the way for a meeting with Bridgestone.
The result was the sale of its Nashville truck tire plant to Bridgestone for $52 million. "They had no manufacturing facility here, and we had a plant running at 50 percent of capacity," Nevin said.
By 1984, as it became clear that the tire industry was becoming more international in nature, Nevin had board approval to look for a joint venture partner. "The first contact I made was with Bridgestone," Nevin said, adding that other companies -- which he did not identify -- were also approached.
Though a rumor that Italian tire maker Pirelli SpA was negotiating a $1 billion buyout of the tire division may have prompted Bridgestone to sign with Firestone, Nevin said a number of other factors converged in the last few months to pique Bridgestone's interest.
First, an increasing number of foreign investors have decided to take advantage of the cheaper dollar and build or buy facilities in the United States. The change in the dollar-yen relationship also has made exporting less feasible.
Bridgestone faced the real possibility of dwindling acquisition prospects as consolidations, buyouts and restructurings swept the stagnant and highly competitive tire industry.
"There wasn't much left to buy," said Donald DeScenza, an auto and tire analyst with Nomura Securities International.
Nevin also noted that Bridgestone was watching major Japanese car manufacturers move production facilities to the United States, a market it could not reach without a significant manufacturing base here.
But most importantly, the joint venture gives Bridgestone -- with Firestone's five plants in North America and its foreign facilities -- an instant expanded product line and a ready-made distribution system.
The question of whether the Firestone deal opens the door for yet another foreign investor to take a bite out of the U.S. industrial base is eclipsed, analysts said, by how Nevin has performed as a chief executive -- both at Firestone and at Zenith.
At Zenith, Nevin thought the obstacle to growth in profits for shareholders was unfair Japanese competition. He attacked the problem on that front, albeit with little success.
"They utilized virtually every single channel available," said David Yoffie, an assistant professor at Harvard Business School who wrote a case study titled "Zenith and the Color Television Fight."
At Firestone, the mission again was to maximize shareholder value, a goal Nevin has reached as Firestone's stock went from a low of $6.12 1/2 in 1980 -- when the company lost $123 million -- to a high of $50 in the fourth quarter of last year, when sales hit $3.9 billion.
For his effort, Nevin received a $5.6 million bonus.
Nevin said he had no qualms about turning over the reins of Firestone's tire-making operation to a foreign company, since some 40 percent of the company's own operating profits came from international operations.
"It would be provincial in the extreme to say we ought to have had the right to invest in production overseas, but it would be evil if Asians or Europeans put money in the U.S. for the same reasons," Nevin said.
Experts on international joint ventures such as Edward Zajac, an assistant professor at Northwestern's J.L. Kellogg Graduate School of Management, noted that going the joint venture route dampens some of the concerns that often arise from the outright sale of U.S. assets to foreigners, particularly the Japanese.
"This resembles a partial acquisition," Zajac said. "But we should see it for what it is: Firestone pulling out of the tire manufacturing business."
During Nevin's tenure at Firestone, there has been constant speculation over whether the company was committed to its core business. A work force of 100,000 was cut in half. Twelve North American plants have been closed since 1980. The types of passenger and light-truck tires produced was pared from 5,050 in 1980 to fewer than 1,500 last year.
But analysts argue that much of the surgery was necessary because the company Nevin inherited was a sick one, badly damaged by a nationwide recall of its Firestone 500 tires, huge levels of debt and plants that were generating negative cash flows.
Nevin pared the company's corporate debt dramatically, shielded it against takeovers with aggressive stock buybacks, and got the tire business in better shape by capturing contracts to supply 22 percent of the tires used by car manufacturers in North America -- including the new Toyota plant in Kentucky and a new Mazda facility in Michigan.
"Our tire business today, by any standard of measurement, is a significantly stronger business than anytime in the last decade," Nevin said. "But it didn't lead us to believe we should go it alone."
Heading the new Firestone -- largely a service and consumer-oriented operation that repairs and rents cars -- will be a different kind of challenge for Nevin, who has spent his career in the rough and tumble of the manufacturing world, dating to his days with Ford Motor Co.
He expects that the pared-down Firestone, with about $1.8 billion in sales, has "very considerable growth prospects and the possibility of growth in other areas."
Whether the transformation of Firestone will work in the long run is another corporate tale, one that may take another 10 years to judge.
But like his stand at Zenith, which he said he does not want to justify or apologize for, Nevin knows there is only one way for him to make decisions.
"You have to do what you think is right at the time. You don't have 10 years to think about it," he said.