THE JOINT VENTURE between General Motors and Toyota, to assemble cars in a former GM assembly plant in Fremont, Calif., is a symbol of how much the rules of business have changed in the past several years. Among other things, the joint venturers were reluctant to honor the contract with the United Auto Workers or to hire in order of seniority the UAW members who used to work for GM at the Fremont plant. One of the reasons GM sought the joint venture was to learn about Japanese manufacturing methods, including labor procedures. No longer does a major American company assume it knows or can learn by itself everything worth knowing about putting cars together and getting the best out of its employees. And no longer does a major American union assume it can impose all the gains it has won in collective bargaining.
The GM-Toyota joint venture also shows how the fate of American business, and particularly of the auto industry, over the past several years has changed our view of the antitrust laws. Not so long ago it would have been taken for granted that any combination, even a temporary and limited one like this joint venture, between the largest U.S. manufacturer and the largest importer was illegal. Practical businesses would probably not have sent this particular flag up the pole because they would have been sure no one would salute. But today we're not so sure. Ford and Chrysler are arguing that it violates the antitrust laws, and they obviously don't want to see big competitors like GM and Toyota--now No. 1 and No. 3 in world auto sales --get together. Some members of the Federal Trade Commission, which is considering whether there is an antitrust violation here, think there is.
But others reportedly don't. Historically, joint ventures between companies that might otherwise be competitors have been allowed when they seem to be the only way a particular enterprise can be financed or when the technology is beyond the capacity of any one company alone to develop. But the technology of assembling autos is not mysterious; what GM wants to learn is better ways to organize manufacturing and deal with its labor force. That these can plausibly be seen as things American auto companies cannot learn by themselves is strong testimony of the weakness and complacency of this industry over past decades. (Toyota's motives are almost entirely commercial: to produce more cars for the U.S. market than Congress and the administration would otherwise permit, without the investment of buying or building a plant here.)
The scuttlebutt is that the FTC is divided on this issue 2-2, with the deciding vote held by a member whose term expires Sept. 25 and who is unlikely to be reappointed. That may or may not be true; rumors abound in these matters, and on difficult issues of this sort commissioners can reasonably change their minds. The Reagan administration has generally been ready to condone practices other administrations would have labeled antitrust violations. It is important to understand, even if the GM-Toyota joint venture ends up being upheld by the votes of Reagan appointees, that such a decision would result not simply from a difference in administration philosophy. There is a recognition that American businesses are competing in a world and not simply a U.S. market, and it is the ramifications this joint venture has for competition in the world market that merit the closest concern.