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Along with the success of 3,000 units per month, there were many failures. Production of transistor radios requires precision and accuracy. The easy-going employees of the beautiful farming country around Shannon did not have much experience in manufacturing electronic products, and they often traded positions on the production line without authorization. Locally available parts were often substandard. The six or seven Japanese managers overseeing and training the local staff were obviously concerned about the low yield, but did not know what to do about it.
Another unexpected hindrance was the strikes that often occurred in Ireland. Parts from Japan were often delayed due to strikes at the docks or other stages of delivery.
Other problems also occurred. The Shannon staff would not place more than two or three overseas telephone calls a year to the Japan-based International Division because of high long-distance rates. And the telex lines to Japan were so busy that they would not be available until late into the night. Returning to Japan without a permit was out of the question. It was almost impossible to send for help and guidance to Japan and, even if the message did get through, no one in Japan had any experience in manufacturing abroad so there was no advice to be given. The 50,000 pounds were spent before effective countermeasures could be implemented, and the Shannon plant sank deeper into debt.
Debates about a solution raged on. What had gone wrong? Did Sony launch the plant prematurely, without conducting sufficient research on the feasibility of production in Ireland? Or was the target market wrong? There was a sense of crisis pervading the Shannon operation. Kazuya Miyatake and Mitsuru Nishina left Japan for Ireland to support the local team. They spent years considering ways to increase productivity and yield. They wanted the Shannon plant to survive.
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Ibuka (at right) visiting the Shannon plant |
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Despite all efforts, in January 1965, five years after its establishment, a decision was made to temporarily halt production at the Shannon plant. The number of employees at the office and plant was reduced by half. For approximately a year the plant continued to fill orders received while providing repairs and customer services. They refused to give up on the hope of returning to full-scale operation, but finally, after all possible solutions had been tried, an order to close the plant was handed down on January 20, 1966. Within days all employees were informed, and the Shannon plant officially closed on January 31. One after another, the Japanese staff was sent home. In April 1966, an overseas affiliated company closure report was filed with the Foreign Countries Section of the Bank of Japan, and the closing of the Shannon plant was finalized.
This attempt at overseas production faced a great number of difficulties. Why did it fail? Had the decision to go forward with the plant been premature? The lessons learned through this attempt later became the foundations of the successful launch of the San Diego and Bridgend plants while enabling the establishment of more plants outside Japan.
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