Fender Japan

INDEX

CLONE WARS: THE LAWSUIT ERA

During the late ‘70s, Fender (and other big American brands, like Gibson and Martin) saw its business increasingly affected by the countless copies and clones of its instruments manufactured in Japan. Fender was suffering increasing costs, especially in manufacturing, and the Japanese makers had become serious competitors.
The early copies weren’t very good, so Fender wasn't too concerned, but gradually the Japanese makers improved the quality of their guitars, making an important impact on the global guitar market. These guitars often literally copied Stratocasters while costing less — production cost in Japan in the early 1980s was much lower than in the U.S.A.
Ibanez was one of the earliest Japanese brands to hit the market in the USA and Europe. Greco and Fernandes were other brands of quality copies. But there was one Japanese brand in particular that concerned Fender: Tokai.

Tokai’s Stratocaster copy was called the Springy Sound model. With this guitar, launched in 1977, Tokai overtly replicated the appearance, construction, and playability of the golden-era Stratocasters. It was a finely crafted guitar with meticulous attention to detail. For example, the font that Tokai used for the logo on the vintage-style headstock of the Springy Sound was designed to resemble the classic Fender Spaghetti logo, while the small writing “WHITH SYNCHRONIZED TREMOLO” was replaced with “THIS IS THE EXACT REPLICA OF THE GOOD OLD STRAT,” and “ORIGINAL Contour Body” became “Oldies BUT Goldies.”
And this is not all: a year earlier, Tokai already launched a Les Paul copy with the “Tokai” logo on the headstock.

The headstock of the Spring Sound

With this 1985 advertisement, Tokai wanted to highlight how close their replicas were to the guitars of the past

It wasn’t merely this audacity that so enraged Fender and Gibson: the guitars were genuinely impressive. While Fender was preoccupied with the financial pressures and profit-focused goals of being part of the CBS conglomerate, Tokai was meticulously studying the original models, carefully disassembling, measuring, and capturing hundreds of photographs, all with a keen eye for detail.
Though the guitars were originally aimed at the domestic market, by the early ‘80s Tokai was exporting worldwide. In the UK, Blue Suede Music started importing Tokais in October 1981 with their eye-catching ‘Tokai is coming’ ad featuring a naked girl cavorting with a Springy Sound (the model was the girlfriend of Blue Suede’s owner).

Eric Dixon designed and published that ad announcing the launch of Tokai in the UK. This was one of the most provocative guitar ads ever created. It wasn’t just the nudity that made it controversial, but also the fact that it triggered a fierce backlash from CBS-Arbiter and led to at least a year of legal troubles for Tokai in the UK

This 1983 Tokai ad for the USA stated: "It's high time - The premier guitars of Europe and Japan available now in the USA. The serious choice for serious players… a select group of vintage and contemporary styles from $375.00"

Obviously, Tokai irritated the executives at Fender. Dan Smith said: “Regardless of how bad the originators might be at making a product, that doesn’t give anybody else license to copy it. […] That used to irritate me no end. To copy us wholesale, down to the last screw, still irritates me.”
Fender pursued legal measures, authorizing US Customs to seize imports of guitars that featured Fender’s headstock designs and to cut off their headcaps.
But it was not enough. Fender needed to find something else if they wanted to survive.
Bill Schultz and Dan Smith were aware that Japanese makers earned their highest profits in Japan, where they charged relatively high prices, compared to the lower prices they set in the USA and Europe to enhance their competitive edge and expand their market share.
Therefore, they understood that the solution was to sell Japanese-manufactured Fender-branded instruments in Japan at prices lower than those of their Japanese competitors. This would force Tokai and other Japanese brands to lower their prices at home to stay competitive while increasing their prices abroad to remain profitable.

FENDER JAPAN

Dan Smith, Bill Schultz, and Roger Balmer (Fender’s then head of Marketing and Sales) started discussing how to begin producing Fender guitars in Japan in December 1981.
Fender already had a Japanese distributor since 1963, Yamano Music, but as they sell only in their own sales offices in Tokyo, Osaka, Nagoya, and Fukuoka, Fender sought an additional distributor with a wider scope. After discussing with several candidates, Schultz and Balmer ultimately chose Kanda Shokai.
Tokai was suggested as one possible factory, but the executives of FMIC hated Tokai. So, they chose FujiGen Gakki, in Matsumoto, about 200 km north of Tokyo. Fuji Gen Gakki Seizou Kabushikigaisha (which translates as the Fujigen Stringed Instrument Manufacturing Corporation) was known because it produced Kanda’s house brand, Greco, as well as Ibanez and other quality instruments. When Fujigen made Greco copies, they first acquired a real vintage Fender to work from in order to make the Greco instruments precisely.

After a meeting with Chitoshi Kojima from Kanda Shokai and Mike Yamano from Yamano Music, the joint venture Fender Japan Co. Ltd. was officially established at the Grand Palace Hotel, Kudanshita, Tokyo, on 11 March 1982.
The agreement provided that Fender guitars made in Japan would be manufactured by Fujigen under Fender license, while their distribution on the Japanese domestic market would be assumed by both Kanda and Yamano, and Yamano would also continue to sell imported US-made Fenders.

Left to right: Masamitsu Yamano, Bill Schultz, Chitoshi Kojima (Kanda Shokai) and Roger Balmer

It’s often mistakenly said that Fujigen was merely the factory chosen by Fender Japan to supply instruments. This is incorrect. Fujigen was an equal partner in the business, owning a significant share of Fender Japan, just like Fender USA. Fujigen had substantial stock ownership in Fender Japan and an equal voice in all board meetings and company decisions. They didn’t just follow orders; they actively participated in creating them with an equal voice.

This was made possible by Ace Nakata, who negotiated these terms into the founding document of Fender Japan. Ace, the long-time vice president of Fujigen, was the primary negotiator for the company during the meetings that established the foundation of Fender Japan. Every major decision made by Fujigen was his idea, and Fender Japan became his crown jewel. Ace provided input that benefited not just Fujigen, but everyone involved, especially Fender USA.

Roger Balmer with wife and Ace Nakata at the establishment of Fender Japan in 1982

In addition to producing guitars for export to the United States and Europe, Fujigen also manufactured instruments specifically for the Japanese domestic market. The instruments Fender Japan offered domestically often differed from those available in Western markets, as Fender Japan had the freedom to decide which models to produce and sell to meet the specific demands of Japanese customers.

The birth of Fender Japan was a huge success for the FMIC. It was a blow to all copies made in Japan. Even Tokai, known for producing excellent Fender replicas, suffered from the competition posed by the new MIJ Fenders, as Paul Colbert, the first journalist to review the new instruments, reported: “Tokai are as detailed in their replicas but, psychological or not, having that Fender logo at the top of the headstock puts heritage in your hands, even if given an Eastern interpretation.”

The first advertisement for Fender guitars made in Japan, published in the USA, stated: “An international team of guitar designers and craftsman gave these new Squier guitars the same light touch and brilliant tone that made the originals the world's most sought-after electric guitars,” without any mention of where the guitars were built.
This led many to believe that American workers might have reacted negatively due to longstanding animosities from World War II. However, at the Fullerton factory, there was no racial hatred towards the Japanese. Nearly 80 percent of the 1,000 workers were Latino, not white, and there were no racial issues with the Japanese. While some individuals were concerned that the Japanese project might threaten their jobs, these concerns were not rooted in racial hatred.

The Japanese Custom Edition Team

In the second half of the ‘80s, Makoto “Nick” Sugimoto established a small Custom Edition Team, a sort of Japanese Custom Shop. The Custom Edition Team was composed of highly skilled craftsmen who extensively studied and analyzed Fender guitars and basses. They maintained active relations with Fender USA, used only selected materials, and accommodated special orders from guitarists and bassists.
Makoto was a luthier with twenty-three years of experience in R&D, custom guitar building, and engineering at the Fujigen factory. His designs shaped Fujigen’s manufacturing for all its clients, including Ibanez, Greco, Epiphone, Yamaha, and, of course, Fender.
He also made the first sample that Fujigen sent to Fender headquarters in the USA to demonstrate their capability to manufacture Fender guitars in Japan. Thus, the first sample was not a Greco, as is often reported.
Makoto then left Fujigen in 2001 and, in 2002, began manufacturing guitars and basses under the original brand Sugi Guitars, in partnership with his uncle.

Dan Smith, Makoto Nick Sugimoto and Michael Stevens with Fujigen’s R&D employees in 1988

From Left to Right, Standing: Ace Nakata (Fujigen VP), Mr. Nakamura (Dept Foreman), Dan Smith, Makoto Sugimoto, Michael Stevens, Mr.Shimoda (Ensenada Paint Dept.), Mr.Hirabayashi (Guitar R&D and Regular Guitar Making). From Left to Right, Kneeling: Johnny Saitoh (Musician, He built the first Squier guitars), Mr.Takayama (Senior Factory Production Manager), Yoshimochi Kamijo (Fujigen President), Suzuki (Senior R&D Masterbuilder). 1988. Courtesy of M. N. Sugimoto

MADE IN JAPAN VS CRAFTED IN JAPAN

In the second half of the 1990s, Sam Sekihara, Managing Director of Fender Japan, approached Fujigen with the idea of replacing the ‘Made in Japan’ decal with ‘Crafted in Japan.’ The goal was to enhance the image of their instruments and distinguish them from other Japanese-made instruments.
At that time, Fender was increasing their orders to Fujigen, leading to delays. Fujigen Vice President Ace Nakata suggested involving Dyna Gakki (Chino, Nagano Prefecture), the former manufacturer of Greco. This coincided almost exactly with Fender Japan's decision to change the ‘Made in Japan’ decal. Not by plan or design, but purely by chance. For a while, both Fujigen and Dyna Gakki produced the very first ‘Crafted in Japan’ Fender guitars together.
Then Fujigen decided to end its relationship with Fender, and production was gradually shifted to Dyna. The last Fender instruments made by Fujigen were produced in 1997.
Initially, Dyna couldn’t immediately produce 5,000 instruments a month like Fujigen, so Fender USA agreed to let Tokai make a very limited number of instruments, exclusively for sale in Japan. Once Dyna was able to match Fujigen’s monthly production, Tokai ceased all work with Fender Japan. Therefore, Tokai was involved for only a few months.

Nick Sugimoto and Sam Sekihara (Courtesy of Mr. Sugimoto)

The Dyna Gakki

It’s important to note that Fujigen, like all Japanese manufacturers, relied on a network of subcontractors to produce guitars. These were not large factories; typically, a subcontractor was a small, often one-man operation. However, there were exceptions, such as Atlansia, which made some necks for Fujigen for a time. Atlansia was eventually dismissed because their building techniques were not approved by Fender and caused truss rod problems.
Subcontractors were responsible for making bodies, necks, fingerboards, pickguards, and wiring, as well as sanding, painting, and assembling guitars. However, they did not handle tasks that Fujigen could not perform. Typically, subcontractors were engaged to complete tasks more cost-effectively or to assist when Fujigen’s own workers were too busy, thereby helping to streamline production.

THE FMC jAPAN

FMIC made several changes to the original 1982 Fender-Japan agreement, leading to the creation of other joint ventures, such as K.K. Fender Promotion (2000) and Dyna Boeky (2005). Kanda Shokai and Yamano continued as Fender's Japanese distributors, each handling different sections of the product range, as noted in a Fender prospectus from their abandoned IPO filed on March 8, 2012: “Following the termination of a joint venture in Japan with two of our greater than 5% stockholders and their affiliates, Kanda Shokai Co., Ltd. and Yamano Music Co., Ltd., we entered into distribution agreements with each of these entities.”
The agreements with these distributors were set to terminate on December 31, 2012, but they would be automatically renewed for successive three-year terms “if Kanda Shokai meets certain minimum purchase thresholds” and “unless either we [FMIC] or Yamano fails to comply with certain specified conditions.” However, these conditions were not met, and on April 1, 2015, Fender assumed direct control of the distribution of instruments manufactured in Japan.
At the same time, the Made in Japan Exclusive Series was introduced.
In 2017, master builder Chris Fleming was invited to Japan to monitor the production of the new Made in Japan Traditional Series, which was launched on September 13, 2017, to commemorate the thirty-fifth anniversary of Fender Japan.

OBSERVATIONS AND REMARKS

There is a lot of confusion surrounding Japanese guitars: some consider them exceptional instruments, while others find them overrated. The truth is that Fender Japan produced a diverse range of guitars, including expensive, high-quality models crafted by skilled luthiers, as well as more budget-friendly instruments.
Guitars made in Japan played a crucial role in supporting Fender during the challenging years following the CBS era, particularly when Fender lacked a factory in the USA.
So, what happened next? As Japanese manufacturers demonstrated their ability to produce high-quality instruments, the prices of Japanese electric guitars began to rise. However, the market was too competitive to sustain these higher prices, leading to a loss of market share for Japanese guitars.
Unfortunately, in the '90s, Mexican Fender guitars, which had taken over the market share previously held by Fender Japan, did not seem to match the quality of their Japanese counterparts.