After Japan's defeat in World War II the company had to close down since production and research of aircraft was prohibited by the Supreme Commander for the Allied Powers. This had a severe impact on Nakajima because it was one of the two largest aircraft manufacturers, together with Mitsubishi Heavy Industries (MHI). Unlike MHI though, it was not diversified into shipbuilding and general machinery, and so had to dissolve into a number of spin-off companies set up by former managers, engineers, and workers. As a result, leading aeronautical engineers from NAC, such as Ryoichi Nakagawa, helped transform Japan's automobile industry.