Japan: Bluebirds on Wheels

From a standing start less than 15 years ago, postwar Japan has squeezed into international traffic and passed many flashier rivals to become the world's fourth largest automaker. Last year Japanese production rose 26%, to 1,700,000 cars and trucks, ranking Japan after the U.S., West Germany and Britain, and this year the total is expected to hit 2,000,000.

The trouble is that too many Japanese auto companies—14 in all—are struggling for a share of this market. Plagued by Japan's current recession and bothered by the threat of competition from foreign cars, the...