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Japan / Korea Trip Presentation:

ToyotaAaron Fyke Yuki Wada

Gary Mi Grace WebberTony Palumbo

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Agenda

Headline facts: Toyota

Global auto industry trends

Japanese auto industry history Toyota company background

Company history

Production history

Business segments The Toyota Production System

Toyotas strategy

Our questions for Toyota

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Headline Facts: Toyota

Toyota has annual sales of $120 Billion

Produces ~5.5 million vehicles per year

From 56 manufacturing plants across6 continents

Employs ~200,000 people

3rdlargest automotive manufacturer

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1998 Production Comparison Chart

GM

Ford

T

O

Y

O

T

A

VWDaimlerChrysler

Fiat NissanPSA

HondaRenault

0

1,000

2,000

3,000

4,000

5,0006,000

7,000

8,000

9,000

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Global auto industry trends

Overcapacity

Economic downturn

Shifting consumer demands

European trade barrier reductions

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Company History

Established in 1937 out of Sakichi Toyodas

weaving machine company

Launched first car (SA Model) in 1947 Toyota Production System formed in 1950

based on Just-In-Time principle

First global expansion in 1959 at Brazil In 1972, cumulative production >10M units

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Production History

0

1000

2000

3000

4000

5000

6000

1935 1936 1937 1940 1957 1960 1972 1980 1982 1988 1996 1999

Domestic Production Total ProductionUNITS (thousands)

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Business segments

Automotive

Design, manufacture and sales of

passenger cars, recreational vehicles,SUVs and related parts

Financial services

Provisions of loans to car buyersand car dealers

Others

Industrial vehicles (forklifts,etc.

)

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The Toyota Production System

Revolutionized manufacturing industry

At its core is lean

a relentless drive to improve efficiency andeliminate waste

Beginnings of TPS were born out of

necessity due to lack of resources inpost-war Japan.

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Toyota Production System

Key Main Concepts SMED

Single Minute Exchange of Dies

Promoted flexibility of production runs

JIT

Just In Time manufacturing

Small batches which reduced inventorycosts, tightened relationship with suppliersand improved quality control

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5 Whys Quality

Asking Why? 5 times to locate source of

problems Stopping the production line whenever

there are quality problems to ensure theyare not repeated

Low cost supplier

Long term supplier relationships

Toyota Production System

Key Main Concepts

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Toyotas Strategy

Increase competitive strength throughadvanced technology

Environmental technology fuel consumption, emission, recoverability

Hybrid vehicles and next generation fuelcells

Cost-reduction efforts discontinuation, integration of older models

Increased emphasis on financial servicesand information communication system

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Our questions for Toyota

Current competitive landscape

Local and global competition (Korea,

Daimler-Chrysler, Ford, GM etc.) Future of automobiles

Development of fuel-cells, integration of

Internet applications and other trends

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Japanese auto industry history

From follower to leader

From domestic producer to exporter

Interventionist government