Brunswick (Mercury Marine) Collaboration with Yamaha

[jimh]

I recently came across an excellent article that lays out in detail the initial cooperation that took place between Brunswick (often referred to by their outboard engine brand name "Mercury") and Yamaha in the joint production of outboard engines. The excerpt below comes from the Yamaha point of view and is told in a chapter on the history of the Yamaha Motor Company website. The author is Chikara Yasukawa, who at the time of writing (1993) was the former president of Sanshin Industries Company, Ltd., an adjunct of the Yamaha Motor Company that manufactured outboard engines. Mr. Yasukawa was previously an engineer who was promoted to an executive position and was involved with the development and engineering of Yamaha outboard engines, See:

Days Gone By Stories from the Trailblazing Years of Yamaha Motor
https://global.yamaha-motor.com/stories ... aysgoneby/

Here I will excerpt a few sections of his memoir of his work with Yamaha.

--begin excerpt---

Part III Together with Outboards
(From https://global.yamaha-motor.com/stories/history/daysgoneby/008/ and subsequent chapters )

7 Negotiations with the Mighty Brunswick Corporation
To turn back the clock a bit, in late 1971 American conglomerate Brunswick Corporation approached us regarding a business tie-up. In addition to owning Mercury Marine, one of the largest producers of outboards, they were also involved in numerous other ventures, from bowling and the defense industry to synthetic materials. Yamaha’s outboard division at the time was still far below the world level in both its technical and production capabilities.

Brunswick asked us to first come and see their Mercury operations. So Managing Executive Officer Ono—he headed our technology arm—led a group of eight consisting of Executive Officer Sugiyama, Executive Officer Nemoto, myself and Department Manager Fukuda from Yamaha, and Executive Officer Ito, Department Manager Ito and Department Manager Toshio Suzuki from Sanshin Industries. We set off for Oshkosh in Wisconsin to tour Mercury’s outboard factory.

The Yamaha Motor and Sanshin Industries team visiting Mercury.

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The team riding in boats powered by Mercury outboards (author in the passenger seat of the middle boat).

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We spent roughly a week there inspecting just about all of their facilities, from the factory to their test site. Compared with Yamaha’s outboard division, it was a world of difference; we were left profoundly impressed over and over again. For example, the factory was well over ten times larger than Sanshin Industries, and had a whopping 40 die-casting machines—including some in the large 1,600-ton class—and 20 or so Gleason gear cutters lined up on the floor. At the time, Yamaha didn’t even have one die-casting machine and Sanshin didn’t have a single Gleason.

A bird’s-eye-view of the Brunswick factory.

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Mercury’s dedicated testing facility at Lake X.

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I later learned that when it came to die-casting technology and manufacturing, Mercury was No. 3 in the world after auto-giants General Motors and Ford. Mercury also had three test sites, with the main one being a large lake they owned in central Florida that they called “Lake X.” The facility covered 11,000 acres and there was a 6-mile test course built within its 19-mile circumference. An airfield was also located on the grounds and a company aircraft was used for travel between the test site and the headquarters in Wisconsin.

At the time, Mercury had 4,700 employees, hundreds of whom worked in development and testing. The company’s yearly product development expenses were equivalent to a couple billion yen, their product line included everything from small 2 hp models to massive six-cylinder offerings, and the company produced some 230,000 outboards per year. There was absolutely no way we could compete with such a company.

After the trip, we all had reached the same conclusion: It’ll be next to impossible for us get our outboards on par with the world’s best if we try to do everything on our own. In order to grow our lineup and start competing on the world’s markets as quickly as possible, the best course of action would be to make the most of this opportunity, and learn from Mercury’s history, technical know-how and experience.

Making our report to President Kawakami, we told him that we wanted to consider setting up a business relationship with Brunswick that would allow us to still retain control over our sales and management. Brunswick wanted to use Yamaha’s small-engine technology and productivity to enhance its lineup of smaller outboards, and form a sales network with two different brands in the same way OMC had been successful with its two brands.

Yamaha on the other hand was looking to acquire Mercury’s technology for outboards aimed at the recreational market—especially for big horsepower models—with the hopes of establishing a foothold for the business in international markets, and saw the possibility of a tie-up with Brunswick as a great opportunity for that. So our two companies both had something to gain by working together, but as negotiations proceeded it eventually became clear that Brunswick was really seeking a joint venture agreement. And while President Kawakami was in favor of technical cooperation, he was dead set against a joint venture. It was shortly after this that negotiations ground to a halt.

Brunswick wanted a joint venture with a Japanese outboard maker and their first choice was Yamaha, but if that didn’t work out they could just as easily approach Suzuki, Tohatsu or any other outboard manufacturer in the country. What course of action to take was carefully deliberated by Yamaha management. When considering the future of our outboard operations, working with Brunswick would offer significant merits. However, the big decision that had to be made at the time was whether or not the sacrifices required of a joint venture would be worth it in the end.

In the end, President Kawakami agreed to the joint venture, a decision that determined the future direction Yamaha outboard motors would take.

At the signing of the joint venture agreement.

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8 A Joint Venture with Mercury
Both companies reached an agreement of intent to form a joint venture in October 1972, about a year after Brunswick first approached Yamaha about forming a business partnership. Specifically, Sanshin Industries would be reestablished as a joint venture company run by Yamaha Motor and Brunswick. Although there were still many decisions to make and details to iron out for the contract to be finalized, the agreement was in place so we got to work.

In November, we visited Mercury and held our first technical meeting. This was to discuss product planning for after the joint venture was complete. The following six items were agreed upon:

1. Product Character
   Yamaha and Mercury’s jointly produced products will start with those currently produced by Yamaha, and will be of high quality and globally competitive in all respects.
2. Product Lineup
   The initial product lineup for the U.S. market will be composed of models ranging from 2 hp to 75 hp. All will use Mercury’s Jet-Prop thru-hub exhaust propeller and be equipped with a capacitor discharge ignition (CDI) system.
3. Product Development Structure
   Mercury will be responsible for making design changes and/or improvements to the above models to suit the U.S. market.
4. Development Period for U.S. Market Products
   Complete the lineup of models from 2 hp to 50 hp by 1974.
5. Large Outboard Model Development
   The 75 hp model will be a 3-cylinder version of the 50 hp model.
6. Establish Sanshin Technical Division
   Create a product development division at Sanshin Industries as soon as possible in line with available financial resources. This will be the point of contact with Mercury for technical communications.

In accordance with this agreement, Yamaha Motor’s 3rd Engineering Division (outboard development division) would establish a branch office at Sanshin Industries after one year and begin operations. In the year after that, the 3rd Engineering Division would be moved from Yamaha Motor to Sanshin Industries and formally begin operations as the Sanshin Industries Engineering Division.

As you can see from the content of these meetings, Brunswick was making an across-the-board effort to fully cooperate with the project. The recreational outboard market was centered on the U.S., and Mercury was clearly out front when it came to product development and engineering for such models. The products produced by the joint venture would be based on their technology.

Sanshin Industries in Hamamatsu, Shizuoka Prefecture became the center for Yamaha outboard motor development and manufacturing.

Sanshin Industries in Hamamatsu, Shizuoka Prefecture became the center for Yamaha outboard motor development and manufacturing.

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[jimh]

9 Same Bed Different Dreams

At the start of the year, five engineers from Yamaha were stationed at Mercury and they began working on product development together with Mercury’s engineers. Their first tasks were to design a 50 hp model and to modify the 25 hp model to use Jet-Props.

Meanwhile, lawyers from both companies were busy reviewing the wording, stipulations and details of the joint venture contract. After many twists and turns, the contract was made official in May 1973—about six months after having our first technical meeting—and the main contents were as follows:

1. Mercury will invest in Sanshin Industries by purchasing new shares equivalent in value to Yamaha’s investment in the company. Accordingly, Sanshin Industries will be reestablished as a new joint venture company operated by Yamaha and Mercury.
   
2. The joint venture contract is valid for ten years.
   
3. Sanshin Industries’ products will be marketed in Japan by Yamaha under the Yamaha brand name, and sales in North America and Australia will be marketed by Mercury under the Mariner brand name. In other regions, each company is free to market the products under their own brand.

However, two big problems arose.

One was because the contract was limited to ten years. The other was regarding marketing; Mercury had exclusive marketing rights for North America and Australia while Yamaha had exclusive rights for sales in Japan.

It’s incredibly rare for a joint venture to have a time limit, but this point in particular demonstrated Yamaha’s apprehension to being contractually bound forever. So the quid pro quo was to grant Mercury exclusive marketing rights for North America and Australia. Unlike most joint ventures, this time limit became the main reason neither company could fully disclose their technologies to each other. This meant that both companies had to constantly behave in their own best interests in anticipation of what would happen when the contract expired.

Mercury knew that Yamaha would become a powerful competitor when the contract expired after ten years. And if Yamaha had access to their technology and know-how, they simply wouldn’t be able to compete on even ground. As a result, the full technical collaboration Mercury initially had when the joint venture was agreed upon quickly changed to a stance where no key technologies were shared after the official contract was signed.

The liquid-cooled 2-cylinder 760cc 55A model sold in 1974 was the first big outboard motor developed together with Brunswick.

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10 A Market Valuing Fairness & Freedom

In 1978, five years after forming the joint venture, the Federal Trade Commission (FTC) issued a complaint against the joint venture. The charges were based on the contract clause which gave Brunswick exclusive sales and distribution rights of products produced by Sanshin Industries for the U.S. under the Mariner brand.

The FTC’s complaint was that the purpose of that clause was to specifically prevent Japanese manufacturer Yamaha from entering and selling outboards in the U.S. market. This was unfair as it limited the freedom of choice of U.S. consumers. This may seem hard to believe given the current problem [a reference to c.2003 at the time of writing when Brunswick sought protection from the International Trade Commission against importation of outboard engines made in Japan] problem of trade friction between Japan and the U.S., but it’s even more surprising when one realizes that this occurred only fifteen years ago, and also that the basic stance of U.S. policy was originally free trade and consumer rights.

Four years after the complaint was first filed, a U.S. court ruled in favor of the FTC. With one year remaining on the original ten-year joint venture contract between Yamaha and Brunswick, the contract was abrogated in 1982.

Ironically, it was only two or three years later that U.S. public opinion turned against Japan for its exports to America. After the events that led to the joint venture being nullified, Yamaha bought back the shares of Sanshin Industries held by Brunswick, and the company was once again a Yamaha Motor subsidiary.

11 Fruits of the Joint Venture

Reflecting on the results of the joint venture, Brunswick expanded their lineup of small outboards, began selling them under the Mariner brand, and did very well on the market. Brunswick had established the two-brand sales network they wanted, so they’d achieved their original goal. For Yamaha and Sanshin, we’d acquired some technologies—though only a modest amount—along the way.

However, in retrospect, I think what we most gained from the joint venture was an actual feel for the scale and workings of one of the world’s leading outboard motor companies. I feel it’s thanks to this that we were able to establish concrete goals for ourselves. We recognized anew how important it was to clearly define the goals we wanted to strive for.

Yamaha’s products following the joint venture began taking on a much stronger recreational focus with the U.S. market in mind. Compared to our earlier engines designed for fishing and commercial use, recreational engines needed to be lightweight and compact, and there are natural limits that come into play when trying to build a single engine with performance suitable for both commercial and recreational applications. But if we were to ignore that and build an outboard for any and every purpose, the result would likely be a confusing plethora of models. After much thought, we decided to try and keep our offerings as orderly as possible and opted to build a two-prong product lineup: one recreational and one commercial. The amount of work this entailed was huge but we threw everything into getting it done.

Yamaha was the first manufacturer in the outboard motor industry to offer two application-specific model lineups. This meant that Yamaha had double the number of models of other manufacturers, but our products had clearly defined characters and the greater number of models also boosted our overall production volume. Luckily, the Japanese economy was also in the middle of its boom years and this further bolstered the results of this policy, which is in place to this day regarding outboard product development.

After seven or eight years, OMC followed in Yamaha’s footsteps and began to produce commercial-use models. We learned a lot from the joint venture and there were a lot of difficulties we faced in entering the world’s leading outboard market, but on the other hand, the increased exports to developing markets and Mercury selling outboards built by Sanshin Industries under the Mariner brand resulted in yearly production at Sanshin reaching almost 200,000 units.

Total production of Yamaha outboard motors reached the one million mark in 1978 and Yamaha underlined the achievement at the 17th Tokyo International Boat Show that year.

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Yamaha outboard motors awaiting shipment at the Hamamatsu factory.

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[jimh]

Switching now to a much later era in Yamaha outboard manufacturing, the memoir talks about the long development by Yamaha of their own higher-powered two-stroke-power-cycle outboard engines, and how they first brought them to the U.S.market under their own branding. This is a very interesting account of their goal to produce outboard engines of very high durability, a feature which would eventually propel Yamaha to the pinnacle of outboard engine manufacturing.

This segment of the story begins as Yamaha can see that their joint venture with Mercury will come to an end.

--begin excerpt---

11 Fruits of the Joint Venture
https://global.yamaha-motor.com/stories/history/daysgoneby/009/#sec11

Reflecting on the results of the joint venture, Brunswick expanded their lineup of small outboards, began selling them under the Mariner brand, and did very well on the market. Brunswick had established the two-brand sales network they wanted, so they’d achieved their original goal. For Yamaha and Sanshin, we’d acquired some technologies—though only a modest amount—along the way.

However, in retrospect, I think what we most gained from the joint venture was an actual feel for the scale and workings of one of the world’s leading outboard motor companies. I feel it’s thanks to this that we were able to establish concrete goals for ourselves. We recognized anew how important it was to clearly define the goals we wanted to strive for.

Yamaha’s products following the joint venture began taking on a much stronger recreational focus with the U.S. market in mind. Compared to our earlier engines designed for fishing and commercial use, recreational engines needed to be lightweight and compact, and there are natural limits that come into play when trying to build a single engine with performance suitable for both commercial and recreational applications. But if we were to ignore that and build an outboard for any and every purpose, the result would likely be a confusing plethora of models. After much thought, we decided to try and keep our offerings as orderly as possible and opted to build a two-prong product lineup: one recreational and one commercial. The amount of work this entailed was huge but we threw everything into getting it done.

Yamaha was the first manufacturer in the outboard motor industry to offer two application-specific model lineups. This meant that Yamaha had double the number of models of other manufacturers, but our products had clearly defined characters and the greater number of models also boosted our overall production volume. Luckily, the Japanese economy was also in the middle of its boom years and this further bolstered the results of this policy, which is in place to this day regarding outboard product development.

After seven or eight years, OMC followed in Yamaha’s footsteps and began to produce commercial-use models. We learned a lot from the joint venture and there were a lot of difficulties we faced in entering the world’s leading outboard market, but on the other hand, the increased exports to developing markets and Mercury selling outboards built by Sanshin Industries under the Mariner brand resulted in yearly production at Sanshin reaching almost 200,000 units.

Total production of Yamaha outboard motors reached the one million mark in 1978 and Yamaha underlined the achievement at the 17th Tokyo International Boat Show that year.

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Yamaha outboard motors awaiting shipment at the Hamamatsu factory.

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12 By the President’s Order: Plan N

Our next task was to increase yearly production to 300,000 units and was assigned to us by President Koike himself. Our product lineup still had no models above 60 hp, and looking at our sales network, assigning us such a lofty target seemed unthinkable at the time. However, with such a clear goal to aim for, once we got to work and had each department devise plans for what would be necessary to achieve it, what needed to be done became obvious—peculiarly so.

“Alright, let’s do it!” was our rallying cry and everyone at the company strove to meet the goal. The engineering division would do everything they could to beef up the lineup and marketing would work to reorganize and streamline our sales network. But the factory was going to be particularly hard; we’d have to make a major investment and set up a new facility. In simple terms, we needed to construct a new outboard assembly factory. But we actually had no open land on which to build it, so our only alternative was to renovate the single-floor Building No. 2 into a two-story building and make additional lines for painting and assembly.

The catch was that if we were to do this, construction of the new floor would need to be done without interrupting Building No. 2’s operations! Build a whole new second-story floor of a factory without ceasing production on the first floor? Talk about a serious challenge! We consulted with Tobishima Corporation and they agreed to take on what we all knew was an unreasonable project; it ended up being a very difficult job.

The construction project was called “Plan N” and the work was separated into Stage 1 and Stage 2. Stage 1 was implemented in 1979 and Stage 2 in 1981. While there were a few disruptions to production during those periods, in 1982 the new two-story Building No. 2 went into full operation with all the various manufacturing equipment in place.

Building No. 2 before Plan N.

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Building No. 2 after Plan N.

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Yamaha’s outboard motor factory was the first of its kind in the world to employ overhead conveyors.

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We also had a maintenance building erected next to Yamaha’s marina on Lake Hamana, our base for testing outboards mounted on boats. All these new buildings and bigger facilities were going up before our eyes, making the employees feel that their company was really growing and spurring an ambition that was reflected in their work.

The result of all this investment was sales beyond what we predicted and we were able to massively increase our production numbers. We now offered big outboards in the 85 hp to 115 hp range, yearly production was up to 230,000 units, and the average horsepower class of outboards we had on the lines was higher. In only four years, we’d achieved our goal of 300,000 units in annual production (with an average outboard horsepower of 25).

Back when Plan N was first set in motion, the company made massive investments which significantly exceeded the scope of our sales and profits, knowing full well that it was money going toward the business’ future. However, these investments actually became the source of Sanshin Industries’ later profits. In a strange twist of fate, the year we completed Plan N and reached two million outboards in cumulative production was the same year the joint venture was dissolved.

[Excerpt continues below]

[jimh]

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13 Off to America at Last: The Market We’d Always Dreamed Of

The next task we faced after Plan N was to launch Yamaha outboards in the U.S. In the words of President Koike at the time, America was “the market Yamaha outboards had saved for last.” The U.S. was the most significant market for outboards in the world and if an outboard was highly rated there, that meant it was undoubtedly a first-class product. Accomplishing exactly that was our dream for many years.

To turn the clock back a bit, at official board meetings while Sanshin was still a joint venture company with Brunswick, no development of any large outboard was ever approved. However, with the American market being our ultimate goal, large outboard models—especially ones with V6 engines—would be absolutely essential and I knew we needed to develop them as soon as possible.

However, it would be a tall order without cooperation from Mercury and we lacked the confidence to tackle such an undertaking. If we were going to do it ourselves, our only option was to first build a prototype and use it as a basis for study, and that would inevitably consume considerable time.

I determined that we had no choice but to get started immediately, and in August 1976, I assigned two of my most hardworking and talented engineers—Yamamoto-san and Matsumoto-san—to handle the R&D for the project. This was three years after the joint venture was formed and before we’d started production on our new 40 hp model. I personally made the decision to start the project and we kept it a secret even from Yamaha’s board of directors.

We decided to build our own 150 hp, 1,800cc V6 engine and got to work on the prototype using the V6 engines from Mercury and OMC as references. One year later in mid-1977, we managed to complete a prototype V6 outboard. Though it was far from perfect, it turned out reasonably well for a first attempt.

When we began running the prototype on the dynamometer for performance testing, it revealed all kinds of problems. We addressed them as they appeared while running further tests over and over. At some point, we somehow reached the performance targets we had set. Gazing at the first V6 outboard engine we ever built on our own, we slowly began to realize that we could in fact build one without technical assistance from Mercury.

I drew up and proposed a development plan for a line of new outboard V-engines. Getting approval from Yamaha Motor’s board of directors this time, we started developing new V4 and V6 outboards aimed at the U.S. market. Of course, this was all done without approval from joint venture Sanshin’s board of directors. This was all back in early 1978.

14 Developing Our First V-Engines

Not long after that, the Federal Trade Commission issued their complaint against the joint venture. Seeing that the joint venture might be dissolved, this accelerated our work on the V-engine project. Our aim with developing the V4 and V6 engines was naturally to offer more performance than those made by OMC and Mercury, so we determined the specifications for our engines based on extensive comparisons with their engines.

he production of big 2-stroke V-engines like these would obviously be a first for Sanshin, but even Yamaha Motor had never done this before. The equipment required for full-scale production of such engines would also be extensive. After much study, it was decided to develop the V4 and V6 as a series, considering the development efficiency and production problems we were facing. For their specs, both engines would share the same bore and stroke, with the V6 simply getting two more cylinders. This meant that both engines could use exactly the same pistons, connecting rods, etc. The styling and design would be uniform for the series, meaning that the bottom cowling, upper casing, lower unit, brackets and controls would all be the same.

Developing the V4 and V6 as a series rather than as separate models was beneficial in many ways. The required investments in molds and equipment were easier to clarify, production problems could be quickly addressed and we could also efficiently relay feedback to the engineers. This facilitated common solutions to development problems for both engines.

At the time, the investment needed to develop a new 120 hp outboard—including all the dies, equipment and jigs—was several hundred million yen. For the V-engine series development project, while the investment for the V4 (the first model in the series) was nearly twice that, the V6 only cost around 40% of what it took to build the V4. So even when totaling the investments for both the V4 and V6, it stayed under three times the cost of developing a new 120 hp outboard. I’m sure that it would’ve been much costlier had the engines been developed separately rather than in series.

Large-displacement engines like these required a different approach to design than what we had for mid- and small-class outboards. After studying the V6 engines from OMC and Mercury, we realized that many of the parts were made small, with only minimal margins for component strength and similar factors. When building outboards based on our own engineering experience, our engines always ended up larger and heavier than the V-engines from OMC and Mercury, two massive disadvantages when it came to an outboard’s competitiveness as a product. This fact all but forced us to design our engines with small parts and component strengths similar to OMC and Mercury.

15 Superiority through Durability

When you move from design to actually building a prototype, unsolved problems become much more conspicuous. The crankshaft in particular gave us a lot of trouble. After machining our one-piece cranks from a single rod of steel, we then carburized and quenched them. But all our work to ensure dimensional precision during the machining stage was for naught; the carburizing/quenching process would cause the crankshafts to deform, and each to a different amount. Only after repeated modifications to correct this did the crankshafts become acceptable for use.

After that it was the engine block. The cylinder block for our V-engines used Schnüerle loop scavenging for the best performance, but just to create its technical drawings was a very complex task and it required considerable time to comprehend its construction three-dimensionally. It took an immense amount of time and effort to create the wooden casting mold and complete a trial casting. In comparison, the OMC and Mercury V-engines used a simpler cross-flow scavenging design.

V6 outboard engine block and its shell casting molds.

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After the prototype was finally completed, testing started immediately and parts everywhere either broke or seized. This was a rude awakening for us, demonstrating how naïve we were to think that we could just up and build a prototype and somehow manage to successfully develop our own V-engine in one go. This marked the start of day after day of trial and error, and the slow pace meant it took considerable time until we had the engine ready for production.

With the bearings for example, they would quickly fail during testing despite meeting existing standards. So we went to the bearing manufacturer to find out what was wrong. “There’s no way a bearing of this size will hold up under those conditions. You need the next size bigger,” they said.

But going one size bigger meant that the engine itself had to be made a size bigger, which would make it larger and heavier than the OMC and Mercury engines. So we somewhat selfishly asked the bearing manufacturer the impossible: “Can you somehow make something the same size that will work?” They tried using different materials, changing the crowning and clearance for the needle rollers, tried various different heat treatments, etc. As these various small improvements grew in number, the durability of the bearings steadily improved in turn.

Just as we’d suspected, when we tested the OMC and Mercury V-engines, it became clear that they also had some durability problems. This convinced us that we could build an engine just as good—if not better—than theirs. So we went to work, meticulously improving all kinds of parts in the same way we upgraded the bearings.

16 Light Weight and Compactness Are Paramount

In June 1981, we were finally able to begin production of our 115 hp V4 engine. It took three and a half years after product planning began, and it had been five years after we first started working on a V-engine prototype. However, these five years were pivotal in establishing Yamaha’s large-outboard engine technology. It was all because we had no choice but to venture into realms of technology far removed from what we had for small and mid-size outboards.

This 1981 advertisement introduces Yamaha’s big-horsepower V4 outboard that utilized a combination of cutting-edge technologies.

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Taking Yamaha’s 2.6-liter, 225 hp V6 outboard as an example, the engine alone weighs 94 kg, giving it a power-to-weight ratio of 1 hp per 0.42 kg. Our existing small and mid-size outboards had a ratio of approximately 1 hp per 1 kg. Compared to the 1 hp per 1.2 kg of a DOHC, 2- to 3-liter car engine, this is an incredibly lightweight and compact engine.

Further, while the maximum rev limit is a relatively low 5,600 rpm since it’s a marine engine, it still produces an output of 87 hp per liter as well as very high torque with 1.2 kg•m per liter. And unlike engines used on land, marine engines are often operated at full throttle for extended periods, meaning that proper measures must be in place to ensure durability and to combat corrosion from seawater.

In that sense, it’s no stretch to say this V6 is the lightest and most compact mass-produced engine in the world, and on top of that, it can also withstand some incredibly hard use. When the late Dr. Kiyoshi Tomizuka—Japan’s foremost authority on 2-stroke engines—visited Yamaha and I showed and explained the engine to him, I remember how fascinated he was with it and him saying, “I had no idea such a fantastic 2-stroke engine existed in the world today.”

Light weight and compactness are the two most important traits of an outboard. It was our ability to realize both that also made what was once unthinkable a reality—commercially available outboard engines producing more than 200 hp. One can almost go so far as to say that you can compromise on durability and reliability to a certain extent; I believe lightness and compactness are features holding even greater importance.

Yamaha’s 220 hp V6 outboard had the world’s lightest mass-production engine in its class when it was released.

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[jimh]

[Excerpt continues]

17 Skills and Technology Nobody Else Can Copy

In the aforementioned process of building Yamaha’s first V-engine outboards and the wide-ranging and repeated trial and error that entailed, we came to a conclusion. We used to think of the entire outboard as a rigid structure when in fact the exact opposite was the case. When the engine is running, many of its parts and components change shape. Even the lower part of the outboard bears the weight of the engine, causing it to twist and deform. Once we started looking at outboards like this, we quickly began to understand the roots of many problematic areas.

For example, we went to Gleason Corporation and studied their method for machining beveled lower unit transmission gears, but even when we designed and machined the gears according to Gleason’s standards (the same as for automobiles), the gear teeth would break after running the engine for only a few hours. The reason was that engine torque would cause the lower unit to deform when the outboard ran through the water, thus ruining the way the gear teeth would mesh. We solved this by machining the gears so that the teeth would mesh correctly even when the lower unit deformed. This meant we would machine our gears to have slightly offset mating surfaces.

The large and small ends of the connecting rods also had to be specially machined to have as large a mating surface as possible for when the crankcase deformed as the engine ran. The approach was exactly the same for the crowning of the various bearings as well. Only with such extensive trial and error did we hammer out the details and decide on the shapes and dimensions for our outboard parts.

The necessities of complex machining work and finding the right way to boost precision made us realize that we had to solve things in a different way than before. We also had much smaller margins for engineering tolerances, which narrowed down the range for what constituted optimal machine settings, and parts had to be machined with greater precision and with less variation. We learned that accumulating and applying this technical knowledge was what made our outboards more reliable than our competitors, even if the concept of the models were the same.

It’s also thanks to this that Yamaha’s large outboards today enjoy a better reputation on the world’s markets than the competition. While I still personally don’t think of them as perfect, little by little I’m beginning to see the direction to go down for building such knowledge.

Bringing Yamaha large outboards to market as a competitive product was a technical challenge unlike any we’d faced before, to offer the same durability and reliability in a smaller package. This was just one example of our experience as engineers, but if you can acquire a technology that can take the performance of any product a step further than the rest, you will without fail be able to maintain a level of superiority over competing companies.

I have heard that there are many small to medium-sized companies in Japan whose products account for more than 60–70% of worldwide market share. These companies do things big corporations do not and are located in more rural areas of the country instead of the cities. Their products are mostly individual parts and are not seen as being particularly “high-tech,” but I understand it’s the wealth of specialized expertise these companies have regarding those very parts that keeps their products in such high demand.

Though I do think it’s necessary to enter what are commonly called “high-tech” fields, if any company can easily replicate another company’s “high-tech” product or do so with sufficient investment, it isn’t a truly “high-tech” product. If your company is the only one in the industry manufacturing a product requiring not only cutting-edge technology, but also skills only acquirable with years of experience, then—by my definition—your company is undoubtedly “high-tech.” In that sense, one could say that the true task of any engineer is to make your company different from the rest through technologies you’ve created that solve problems like nobody else can.

18 The Finishing Touches: Our U.S. Market Debut

My story got somewhat sidetracked, but around the time that the V4 prototype was completed, I thought we should begin gathering information on the U.S. market, so we hired an American market research and consulting firm to look into the country’s outboard market trends. In addition, I had several members of our engineering department visit the International Marine Trades Exposition and Convention (IMTEC) in Chicago every year to investigate product trends. Based on the information and data we got, we gradually firmed up ideas for our U.S. market product lineup. The results were generally as follows:

1. As a general rule, use our existing models for marketing smaller outboards of 30 hp or less.
2. Develop a new series of 3-cylinder engines for models between 40 and 90 hp (Yamaha was the first in the world to build a 3-cylinder 40 hp outboard).
3. Our big outboard offerings will be the new V4 and V6 developed as a series.
4. All models in the lineup with 40 hp or more will feature oil injection systems as standard equipment (Yamaha was the first in the world to offer this feature).
5. The 220 hp V6 outboard will use a computer-controlled engine (the first outboard of its kind in the world) combining Yamaha’s best technologies and be equipped with an array of attractive features.
6. Prepare all-new colors and graphics specifically for the U.S. market.

From the FTC complaint, the dissolution of the joint venture was becoming more and more likely by early 1981, so this plan was put in motion. By 1982, the courts had ruled in favor of the FTC, the joint venture was dissolved and we at long last had our chance to formally enter the U.S. market. The order was finally given to work toward officially announcing Yamaha’s entry into the U.S. outboard market in Chicago at IMTEC in the fall of 1983.

Despite having begun preparations well ahead of time, there was still a massive amount of work to do. We threw ourselves into product development and that made things just as hectic on the production side. As I mentioned earlier, the new V4 and V6 engines were so unlike anything we had built before that extensive preparations were needed to produce them. There were a whopping 12 new models in all, ranging from 40 hp to 220 hp, and we had to get the production infrastructure up and running all at once.

Everyone in the company poured tremendous energy into this project. As shown in the table, from June 1981 to October 1983—less than three years—we managed to go from development to production of 12 new models for the U.S. market. Never before had we accomplished such a colossal volume of work in such a short time.

The development and production schedule for 12 outboard models in 3 years.

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19 Chicago and IMTEC in 1983
Yamaha made a stunning debut in the fall of 1983 at IMTEC in Chicago, displaying a full lineup of 20 outboard models ranging in output from 2 hp to 220 hp.

At a press day prior to the show’s opening, I made a short speech saying, “It has always been our dream to enter the U.S. market, the home of outboard motors. That dream has now come true and I invite you all to have a good look at our outboards.” I was full of emotion and extremely happy that our dream of many years was being fulfilled. The many difficulties and hardships we’d overcome made our joy all the greater; it was the kind of exhilarating satisfaction you can only feel after accomplishing something incredible.

There was a crowd of people at the Yamaha booth that year. Our V6 engine equipped with a microcomputer and our oil injection system both drew a lot of attention and praise. One U.S. industry magazine featured a cover photo with a boat mounting dual 175 hp Yamaha V6 outboards, and the September magazine of the well-known magazine, Boating included a three-page article introducing Yamaha outboards titled “More Japanese Products Arrive.” Inside, the article said, “Yamaha’s entry into the U.S. marine industry provides a needed stimulation and will, over the long term, significantly benefit users and the industry.”

Yamaha’s V6 outboard was the first in the world to employ a microcomputer for controlling the ignition system, garnering significant coverage and acclaim at the Yamaha booth.

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A 1983 article for marine dealers in Japan telling of the big response overseas to the new series of V6 outboards.

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Yamaha Motor Corporation, U.S.A. (YMUS) also worked very hard to get Yamaha outboard sales off the ground in the U.S. I have to mention Sylvan “Ham” Hamberger in particular. He was in charge of outboards at YMUS at the time and an expert on the industry. I’ll never forget how he went all over the country to get our outboards selling, and without his help, our entry into the U.S. market would never have gone so smoothly.

But while our American debut was spectacular, it was the work that followed that was tough. I remember how everyone at YMUS—Japanese personnel included—was on edge because they knew they had to secure results that would live up to the public interest and expectations we’d generated.

The author at the first U.S. marine dealer meeting in 1983

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20 Our American Baptism by Fire

We began selling our outboards in the U.S. the year following our debut at IMTEC in Chicago. Soon after and just as we’d expected, OMC filed a patent infringement suit with the International Trade Commission (ITC).

Three years prior to our debut in the U.S., our work turned toward checking existing patents and everyone in the engineering division thoroughly investigated the outboard motor patents held by American manufacturers. I believe there were around 750 of them. We also had the few patents we had some doubts about checked by American patent attorneys, so we were confident that we were in the clear; there was no way we were infringing on any patents.

The suit documents filed by OMC made four claims of patent infringement, but all four of them were among what we had previously investigated and we thought this all to be quite foolish. However, because the suit had already been filed, we would lose our ability to do business in the U.S. until things were resolved. OMC were insistent that our actions were damaging their business. Having decided that we would prevail if things went to trial, we began to contest the suit.

Yamaha Motor and Sanshin Industries formed a legal team consisting of three top American lawyers and two Japanese lawyers, and we began examining specific countermeasures. However, as things progressed the materials we needed to prepare for the case grew to enormous proportions, and the number of man-hours just to create them increased dramatically.

Yamaha Motor and Sanshin Industries organized a project team of more than 10 members to prepare the documents. But the more they worked, the more bogged down they became and the more difficult it became to find a winning solution. As the dispute dragged on, we began to realize that the reasoning behind this suit wasn’t simply about whether a patent had been infringed upon or not, but more about trade friction. Put bluntly, the patent infringement claim turned into more of an argument about how Americans were the first to build outboard motors and that Yamaha outboards were clearly similar to them. Furthermore, because the trial would be decided by a jury, we knew that the feelings of the American jurors would undoubtedly play a major role in any decision. We were also paying huge monthly fees to the lawyers.

For three months, each side argued their case but to no avail. I’m sure OMC must have also been paying enormous legal fees. It was then that talk of a settlement emerged. In the end, we agreed to pay a settlement to OMC and the case was over, but I think had the dispute continued, the time and fees involved would have become excessive. In retrospect, we were fortunate that all this occurred early on, because patent disputes with American manufacturers will likely increase in number and become more contentious in the future. I think it’s safe to say we’re now in an era where formulating patent strategies is no longer feasible armed solely with logical arguments.

[Excerpt continues below]

[jimh]

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21 What We Learned in the Land of Recreation

Although I thought we had properly prepared for our entry into the U.S., when we finally did enter the market, we ended up facing several unforeseen problems, especially with our large outboards.

One example was overheating engines. When installing outboards on their boats, most users in America mounted their outboards higher up on the transom than normal to get higher speeds. This brought the inlet for cooling water near the water’s surface, meaning that it would sometimes even break above the surface when the boat was run. This resulted in inadequate circulation of cooling water and caused the engines to overheat.

Also, we learned that mounting the engines higher than normal caused the submerged lower unit and its torpedo-like shape to become improperly oriented. These were fatal flaws for big outboards as their focus was on delivering high-speed performance. A team of engineers flew to the U.S., investigated the problem and I put the entire engineering division to work on creating emergency countermeasures. These countermeasures were drastic and resulted in us even having to alter the die casting molds.

We had designed the shape of the propellers for an emphasis on performance, but turning the boat under certain conditions could cause cavitation, reducing propulsion power. When we looked into this, we discovered that propellers popular in the U.S. were all cupped, a downward curve machined into the inside trailing edge of the blade tips. In this way, big outboards marketed in the U.S. were built using various ideas and know-how based on how they were actually used.

These are all just a few examples, but after entering the U.S. market and becoming more aware of how our outboards were actually being used, we knew that we had to devise a number of revisions for our products. In the process of solving these all these small problems, we came to the conclusion that we really needed a test site in the U.S. This was partly because we couldn’t perform the kind of high-speed testing required back in Japan, and partly because we needed feedback from Americans who really knew how to have fun with boats, which meant that the cooperation of an American boatbuilder would be indispensable.

With the assistance of the American staff at YMUS, we began making detailed plans for building a test site, and in 1985, our high-speed test site was complete. The site is in Louisiana, set up along a diversion canal for the Mississippi River with testing taking place in the canal. The passage we can use is 70–80 meters wide, 2 km long, and the water is very calm, making it an ideal test course. And because this waterway is connected to a nearby lake, we’re able to perform various other tests as well. This test site plays an important role in improving the performance of Yamaha’s large outboards in the U.S.

A bird’s-eye view of our outboard testing facility built in Louisiana.

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The waterway we use for high-speed tests in Louisiana.

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22 Success in the Market We’d Dreamed Of

Customers in the U.S. market often come up with creative ways of using their outboards to yield more performance, and small boatbuilders also have many interesting ideas that stimulate engine makers to come up with products in response. Factors like these energize the market to a significant degree—that’s the kind of market America is. It’s about always keeping a finger on the pulse of the market, grasping the trends and then reflecting them in your products. If you build products based solely on the ideas of your engineers, you will simply be left behind by the competition. In that sense, the U.S. is a wonderful market for outboards.

When we entered the U.S. market in 1984, the U.S. boatbuilding industry was just entering a boom that eventually lasted for five years, ending in 1989. These years were of extremely good fortune for Yamaha outboards as well. The high performance of Yamaha outboards became widely recognized, production numbers at Sanshin Industries increased and our lineup gained more large outboard models. Of course, sales and added value also increased significantly, as did company earnings. The U.S. had become one of the most important markets for Yamaha outboards, and our continued successes there eventually turned the Yamaha outboard business at Sanshin into a global leader in the industry.

Yamaha outboards presently occupy the number one spot for customer satisfaction in the U.S. In terms of outboard production volume as well, Yamaha is now part of a global triumvirate, standing alongside OMC and Mercury. And in March 1991, we reached a milestone four million Yamaha outboards in cumulative production since the company first began production in 1960. The road we took aiming to transform our third-rate products into first-rate ones, desperately striving to quickly catch up to OMC and Mercury, was long and arduous. But we had finally joined their ranks as one of the world’s leading outboard manufacturers.

Yamaha outboards reached four million units in cumulative production in March 1991.

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A long line of Yamaha outboards in the U.S.

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Looking back on the growth of Yamaha’s outboard operations, there were three major eras of development: the first was the joint venture with Brunswick, next was Plan N for building up the company’s annual production capacity to 300,000 outboards, and then Yamaha’s entry into the U.S. market.

The company president during each of these eras explained the goals that every employee should strive for in a specific, but clear and easy-to-understand manner. It was because everyone gave their all towards those goals that each was achieved. When one goal was reached, the next was shown in a way that anyone could understand, but more than that, it was presented in ways that inspired everyone to work towards the goal with great enthusiasm. I’m often acutely reminded of how important it is for directives to draw people in and drive their enthusiasm. Now, Yamaha’s outboard operations are turning to their next goal and once again the time has come for the company to muster its best to achieve it.

[Mambo Minnow]

My late Uncle, Sam Sarra worked for Karl Kiekafer in Fond Du Lac during this timeframe. He related to me the story of the Japanese coming to the factory and taking pictures throughout the facility.