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Yokohama Cost Management System

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Submitted By ahad42
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Harvard Business School

9-195-108

rP os t

October 14, 1994

Yokohama Corporation, Ltd. (B):
Cost Management System

op yo Yokohama Corporation, Ltd., was created as a joint venture between a Japanese automobile manufacturer and the Japanese government. Yokohama was founded in July 1939 and began production in late 1942. The objective of the firm was to manufacture hydraulic systems for automobiles and trucks and associated equipment under license from a German firm. The venture was successful and within a few years had diversified into other automotive products, including fuel pumps and transmission systems.

tC

Manufacturing inside Japan was undertaken at five facilities: Ranzan, Ibaraki, Chiba,
Hiroshima, and Maebashi. The original production facility, the Ranzan plant, was opened in 1940 to produce hydraulic products. In 1992, it manufactured four major product lines, including electronic fuel-injection control systems, in-line injection pumps, automatic timing devices, and fuel-injection nozzles. It produced products for the injection pump and hydraulic & pneumatics divisions. The
Ibaraki plant was built in 1965 to manufacture injection nozzle holders for the injection pump division.
The Chiba plant was built in 1970 to manufacture air-conditioning equipment for the air-conditioning division. The Hiroshima plant was built in 1982 and manufactured injection nozzles for the injection pump division. Finally, the Maebashi plant was built in 1990 and was responsible for the manufacture of electronic and hydraulic systems for the firm’s hydronics business area or division. The hydronics division manufactured and sold products for both the hydraulics & pneumatics and new products areas.
The Hydronics Division

Do

No

Yokohama’s hydronics division was founded in 1987 and was headquartered at the firm’s
Ranzan plant. The division had grown fairly rapidly since its

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