factured by IHI. Collaboration took similar forms on several military turboprop and helicopter programs. GE also has a long-standing relationship with IHI in aero-derivative marine and industrial engines. The IHI connection has provided GE entree to the Japanese Marine Self Defense Force (MSDF), helping it to fundamentally displace Rolls Royce over the years.

As for activities in commercial jet engines, it is important to remember that GE did not emerge as a true force in the commercial business until the 1970s. GE's first sales to Japan were to Japan Air Lines (JAL) in the mid-1960s, with the CJ805 engine on the Convair 880. This engine was a derivative of the J79, had a number of in-service problems, and did not live up to its technical expectations. At that point, GE exited the commercial market for a time, reentering in 1971 with the next generation of high-bypass technology with the CF6-6 and CF6-50 engines for the DC10-10 and the DC10-30. This was followed by the introduction of the CF6-50 engine on the 747 and the Airbus A300 in 1973. GE learned several lessons that it put to work over the next several decades. As a result of the CJ805 experience, GE built an excellent customer support organization. Specific to Japan, GE learned that it is important to completely fulfill the expectations of Japanese customers. GE did not make another commercial sale in Japan until it reentered the commercial engine business in the late 1970s and did not make a sale to JAL until the mid-1980s, when JAL selected the CF6-80C2 for their 747-400s.

The opportunity to reenter Japan came when All Nippon Airways (ANA) decided to upgrade and expand its fleet with the latest generation of wide-body aircraft. The initial opportunity with ANA led to a tremendous fleet of follow-on sales for 747s, 767s, and A320s. Japan Air Systems is also a major customer (see Figure C-2). The big competitive issue today involves engine selection for the 777s that JAL has already ordered. As the Japanese airlines have expanded their fleets to accommodate more traffic growth, GE's market share has increased. This has recently been augmented by the sale of CFM56-powered Air-bus aircraft in Japan. One interesting characteristic of the Japanese airlines is that they generally do not want to be the first to buy a major new aircraft or engine. They desire the company of at least one other major airline to ensure that the needed support will be available if there is a problem. The manufacturer's product support infrastructure is a major consideration in the selection of the engine.

GE has focused its engine collaboration in Japan with IHI. The major collaborative programs relevant to this study are the GE90 and the F110 engine for the FS-X. In addition to GE, IHI collaborates with Pratt & Whitney, Rolls Royce, and others. This contrasts to GE's European partner, France's Snecma, which has limited itself to GE. GE does not consider this a problem, because IHI has not involved itself in technical development programs for competitive engines, even though its involvement with programs such as the PW4000 or the Rolls Royce Trent may be large in terms of manufacturing work share. Further, GE's collaboration with IHI in developing a commercial engine is fairly recent,



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