What's in a Name? The Change From Datsun to Nissan
By Daniel Banks

An abbreviated version of this article originally appeared in the January 2002 issue of the Z Car Club of Northern Virginia Newsletter. This article has also been updated based on conversations between the author and Mr. K at the 15th Annual Z.C.C.A. Convention in San Antonio, June 17 – 21, 2002.

Every Z car enthusiast immediately recognizes the name “Datsun” and many can even come up with the fact that “D.A.T.” of Datsun stood for the initials of the last names of… well, at that point things get a bit fuzzy. But we know where the significance lies and the details are merely a quick review away in the Z.C.C.A.’s Mr. K. book. What may be more interesting is that so many Americans old enough to have been driving a decade or so probably retain enough brand awareness to remember that “Datsun” was once a Japanese car. Probably most remember that Datsuns were what we bought in the good old days and now call Nissans. Thanks to Mr. K., the brand name “Datsun” retains recognition in America right up there with “TWA” and “Coca Cola.”
A few decades back, beginning with an announcement in fall of 1981, Datsun’s parent Nissan Motor Company, Ltd. decided to change the name on cars sold in the United States and Canada from Datsun to Nissan. Actually, getting to either the name “Datsun” or “Nissan” from a standing start is a story filled with history. It begins in the first decades of the 20th century with Japan’s earliest automobile builders, includes the effects of the great Kanto Earthquake of September 1, 1923 and of course WWII. For this article, however, let’s stick to the script and save the full history behind these names for another time.
The name change campaign had a variety of rationales. On the surface, it appears solely business oriented in justification, while other more provocative reasons may exist, especially within the Datsun-centric Z car community. Chapter 3, “Brand Awareness,” of David A. Aaker’s 1991 book: “MANAGING BRAND EQUITY; Capitalizing on the Value of a Brand Name” begins with “The Datsun-Becomes-Nissan Story.” Aaker presents interesting business world facts as to why Nissan made this change. Ultimately, he supports a conclusion that the name change campaign over a 3-year period from 1982 to 1984 cost Nissan in excess of $500 million dollars. Wow! For Z enthusiasts unfamiliar with this little bit of Datsun/Nissan history, here goes.

First up, an examination of why Nissan probably chose to retain the name “Datsun” when they committed to the United States market in 1960. Aaker suggests that the reason involves Japan and WWII. This perspective says the corporate choice favored “Datsun” to distance the parent factory Nissan’s association by Americans with Japanese WWII military manufacture. Even as the first passenger car rolled off the assembly line at their Yokohama plant on April 11, 1935, Nissan had only a few years before all manufacturing shifted to military needs. By 1939 Nissan had moved to Manchuria where its founder and President, Yoshisuke Ayukawa, established the Manchurian Motor Company to manufacture military trucks. Identified by David Halberstam in “The Reckoning” as a well connected, aggressive risk taker, Ayukawa also made himself a principal partner of the Japanese Colonial Government of Manchukuo. Ultimately, Nissan Heavy Industries emerged near the end of WWII as an important player in Japan’s war machinery. When WWII ended, Russia seized and carted off all of Nissan’s Manchuria operations, while the Occupation Forces made use of over 50% of the Yokohama plant. General MacArthur had Ayukawa imprisoned for 21 months as a war criminal. After release he was forbidden from returning to any corporate or public office until 1951. He was never allowed back into Nissan, which returned to passenger car manufacture in 1947 and to its original name of Nissan Motor Company, Ltd. in 1949.

It seems supportable that Americans bought Datsuns instead of Nissans to isolate Datsun from its parent’s WWII history in American memory. American service personnel in their teens or early 20s during WWII would be in prime car-buying age by 1960, if only to find an economical, small second car for their growing family needs. Mr. K would have had his personal WWII history in mind supporting the name Datsun. It is known that Mr. K. was sent to Nissan’s Manchuria truck factory in 1939. Conditions he saw there, briefly described on page 71 of the ZCCA Mr. K. book, were bad enough that he walked away from it. Again in 1945, near the end of WWII, Mr. K. was ordered to return to the Manchurian plant and simply refused. His motto “Love Cars, Love Life, Love People” long predates his work for Datsun in America. For one whose spirit desired to build and sell passenger cars to people using them in peaceful pursuit, it was the name Datsun that survived WWII with its purity intact. So discouraged was Mr. K. about his prospects and goings on at Nissan that he was reportedly on the verge of resigning when Datsun’s 1958 Australian Mobilgas victories vaunted him, as leader of the winning Datsun teams, to national prominence in a Japan intent on regaining status in the world. Then Mr. K came to America. Suffice that as long as Mr. K had any say in matters as West Coast Vice President from 1960 – 1965 and then President of Nissan Motor Company – USA from 1965 to 1975, the cars would be sold as Datsuns.

By the time Nissan began its campaign to change their name, “Datsun” had huge recognition in the American market. Datsun had become solidly entrenched in our automotive vocabulary. Aaker states that in 1981 “the awareness level of Nissan in the U.S. was only 2% as compared to 85% for the Datsun name.”

 At this point we can read what probably constituted a long held “official” company bias against use of the name “Datsun” from an early 1970s interview of parent Nissan Motor Company, Ltd., Japan President Katsuji Kawamata. This appears in the April 7, 1973 issue of Business Week magazine in a cover story article covering Nissan President Katsuji Kawamata plans for handling competition from Toyota and the dollar devaluation of the early 1970s. At the time, Kawamata was a 26-year veteran of Nissan and in his final year as President. His rise to its leadership position occurred in 1957 in part because of his handling of the critical Nissan worker’s strike that began May 25, 1953 and ran for 100 days. The 5-page Business Week article also includes statements from Mr. K and a vintage photograph of him standing among his beloved Datsuns in a dealer showroom. Regarding the name “Datsun,” the representative paragraph quoted below is from page 69. Again, remember this was April 1973.

“Kawamata regrets that his company did not imprint its corporate name on cars, the way Toyota does. ‘Looking back, we wish we had started using Nissan on all of our cars,’ he says. ‘But Datsun was a pet name for the cars when we started exporting.’ ” Business Week goes on to state that the ‘DAT’ in Datsun comes from the last names of Nissan’s founders - Den, Aoyama, and Takeuchi.

Goertz, “Suitcases,” and the Datsun 240Z.

From his own perspective Mr. K. is having none of this from Goertz, or anyone else intent on suing Nissan. Neither Goertz as the source of inspiration for the 240Z or the way Nissan quietly settled the Goertz matter out of court appeals to him. As reported in numerous sources, one of Mr. K.’s disappointments during his time in America (1960 – 1975) was the inevitable fact of American lawsuits. “Keep the suitcases away from me!” he would instruct those around him as he ran NMC, USA. Neither was Mr. K. pleased with corporate Nissan’s unwillingness to challenge back when sued. One conjectures that the strict Confucian upbringing by his paternal grandfather presented a strong alternative to the legalistic approach towards how we all get along with each other in the West.

As he related to me in San Antonio during the June 2002 Annual Z.C.C.A. Convention, the origins of the 240Z as a car for the American market were his. “Get the idea, the image, of the Jaguar with its long nose and short deck in mind but don’t copy it,” Mr. K. told me were his instructions to Tokyo at the time. It was Mr. K in America promoting Datsun and its cars, especially the 240Z.

Consider the following if you want to connect Goertz and the Datsun 240Z. By the early 1960s, Albrecht Goertz was viewed as an eccentric but established “master” industrial stylist with significant accomplishments and at the height of his career. He provided Nissan with insight and automotive styling lessons of value during his brief tenure. He predominantly worked in Hamamatsu at Yamaha for 2 or 3 days at a time 2 or 3 months apart during the 1963 – 1965 period, while continuing work from his studio in Manhattan. He strongly promoted the idea of doing a two-seat coupe and the first Silvia and a prototype A550X sports car, both on the Datsun Fairlady frame, resulted. I believe that claiming credit beyond the ideas that became that first A550X, (or Nissan 2000GT prototype), is flawed media promotion when applied to the final product, the Datsun 240Z. Goertz has been an avante garde and well connected one man show throughout his life. It is not in the cards that he would act to dispel a media generated aura surrounding him. Few such persons ever do and this seems the crux of the matter regarding the Goertz Myth and the 240Z.

Voluntary Export Restrictions and Nissan’s Decision to Build a Factory in America

A review of political factors at play in the domestic automobile industry when the badging was changed from Datsun to Nissan provides further insight why Nissan may have taken this decision. That history brought the Japanese to the decision of building factories in America and has been detailed in academic treatise. Washington University economics professor Arthur T. Denzau wrote one such piece entitled “The Japanese Automobile Cartel” published in the Volume 12, Number 1, 1988 issue of The Cato Institute’s quarterly journal “Regulation.” In his article Denzau details how in 1979 OPEC tripled the price of a barrel of crude. This resulted in a gallon of gas rocketing to $1.40. Lee Iacocca orchestrated a Federal-backed bailout to rescue Chrysler, in de facto bankruptcy. Americans were flocking to foreign car dealers to buy smaller fuel-efficient cars and the Big Three began to lobby for import controls. The Big Three specifically desired some impediment to Japan’s growing domestic market penetration, if only to allow them time to catch up in quality small car design. 1980 saw record loses in the Big Three of $4 billion dollars and the laying off of 210,000 U.S. autoworkers. Ronald Reagan was elected President and calls were growing in political circles to address Detroit’s serious concerns. Senators John Danforth and Lloyd Bentsen announced their intention of promoting legislation mandating restrictions on Japanese automobile imports. Reagan Administration Commerce Secretary Malcolm Baldrige announced he was planning meetings with Japanese government officials to broach the issue of voluntary limits on their automobile imports. This policy came to be called “VER” or Voluntary Export Restrictions, widely perceived to be a more flexible and rapid fix for growing Japanese market share than actual legislation if the Japanese could be convinced to make the commitment. Finally, Reagan Administration Transportation Secretary Drew Lewis announced he would form a taskforce to facilitate VER restraint from the Japanese.

Here is the chain of events elaborated by Professor Denzau. On April 21, 1981 the powerful Japanese Ministry of International Trade and Industry (MITI) announced they would voluntarily enact export quota restrictions. On April 30, 1981 both the Japanese and the American governments announced that the Japanese VER would quickly be placed into effect. MITI announced the actual quota restrictions on June 10, 1981 for the 6 largest Japanese automobile companies (and, in Denzau’s view, thereby set up much of their automobile industry as a cartel with controlled production and profit, immune to anti-trust action in American courts). The VER reduced Japanese imports overall by as much as 500,000 cars a year. On June 24, 1981 a similar VER was enacted between Japan and West Germany. The short story detailing the results is clear in retrospect. Japanese investors knew a good thing when they saw it. The Japanese auto manufacturers saw almost $1 billion added to their stock market capitalization in a few short months. VER not only inoculated the Japanese against anti-trust, it pointed them in the direction of more expensive, luxurious, well-designed and competitive models for their top end. Acura, Infiniti, and Lexus directly grew out of this. Our Z car community’s reigning (pre-350Z) marvel of engineering we know as the Nissan 300ZX Twin Turbo was produced using powerful design technologies acquired by Nissan in the 1980s. The cost of all cars went up, including American, and the Big Three returned to great profitability. On March 28, 1985 the Reagan Administration announced it would no longer ask for an extension of VER quotas and Chrysler was able to pay off its federally backed loans early.

So that’s an interesting story. Its applicability here lays in being a motivation for the Japanese decision to begin transplant construction. Building in America was a way of growing market share, answering further calls for limitations on import production volume, and securing position and national acceptance by employing a whole lot of Americans. Nissan and Toyota followed Honda’s earlier construction of a factory in Marysville, Ohio and broke ground to build their first American factories during this time period in Smyrna, Tennessee and Georgetown, Kentucky. Now we need to look at the history surrounding Nissan’s first American factory, the point to which the lengthy examination above leads.

Driving Datsuns in Smyrna, Tennessee

Nissan had been searching out possible locations for an American automobile manufacturing plant, especially in the southern tier of American states, since well before their early 1980 announcement of the fact. For these economically struggling states the prospect of a Japanese automobile factory with its promise of thousands of good paying secure jobs was a goal to be aggressively pursued. Such a factory meant the ability to keep families local and build a middle class in areas that used to see their sons and daughters depart for employment opportunities unavailable nearby. 24 State Governors bid for the site after Nissan announced their intent to build in America. Tennessee Republican Governor Lamar Alexander assembled a 30-person task force to do whatever it would take to get Nissan to build in Tennessee. Success came with an announcement by Nissan on October 30, 1980 that Smyrna, Tennessee had won. What happened at groundbreaking represents some of the most colorful and provocative history of this era in the automobile industry.

Nissan Project Director at Smyrna, Masahiko Zaitsu, clearly stated Nissan intent to find and hire an American who would build an American factory for Nissan staffed almost entirely with American management and American workers. Nissan, in marked contrast to Honda or Toyota, clearly stated their anti-union bias right from the start. The person they found to ramrod the whole thing firmly embraced their views. Nissan’s man was Marvin Runyon, only just retired from a career with Ford Motor Company that began in 1943. Over the next 7 years, until President Reagan appointed Runyon to head the Tennessee Valley Authority (he then went on to the position of Postmaster General, becoming known as “Carvin’ Marvin”), Runyon managed to get designed, built, and up and running one of the most advanced automotive factories in the world. The events at the February 3, 1981 groundbreaking drove home what kind of fight Nissan would be in to defend its non-union bias. Here is the story of what happened that day in February 1981.

The Smyrna plant was designed as the “sister plant” to Nissan’s Zama plant in Japan. Runyon had selected a non-union firm, the Daniel Construction Company of Greenville, South Carolina, to build it. On the day of groundbreaking, a publicly open event, several hundred union construction workers were present and intent on disruption. The scene is recorded on pages 38 and 39 of the book “Nissan in Tennessee” which Runyon had published to commemorate the entire period of construction. The basic theme was summed up in the phrase “Boycott Datsun.” Men carried signs reading “Quality Projects with Skilled UNION Craftsmen. Boycott Datsun.” More “Boycott Datsun” bumper stickers had been plastered over the driver’s windshield on the Datsun pickup which, equipped with a snowplow, was to make the ceremonial first groundbreaking. In case the point was lost on anyone, the truck’s tires had been slashed and there were shouts of “Japs Go Home” from the union protestors. An infamous photograph appears on page 38 of “Nissan in Tennessee.” Mitsuya Goto, who was General Manager of Public Affairs, International Division, Nissan Motor Company, Ltd., had been assigned to drive the truck and make the ceremonial groundbreaking cut. Wading through a crowd of union construction workers much larger than he, one of them thrust a Boycott Datsun placard in his hands. He is shown smiling widely and holding the placard.

More than ugliness with the name Datsun attached was afoot at Smyrna that day. It was also in the air as a plane appeared overhead towing a banner that read: “Boycott Datsun. Put America Back to Work.” Marvin Runyon, a man of no small ego or lack of courage, fought his way to the truck, started it, and made the ceremonial cut. Nissan had been given clear warning that its decision to build automobiles in America in a non-union labor environment would be challenged.

These photographs were taken on February 3, 1981 at groundbreaking
ceremonies for Nissan’s new factory in Smyrna, Tennessee and appear in the book “Nissan in Tennessee” commissioned by Marvin Runyon to commemorate Nissan’s new factory.