Toyota Production System

at

TOYOTA KIRLOSKAR MOTOR PRIVATE LIMITED

1 Introduction to Toyota

2 Profile of Toyota Kirloskar motor.

3 Toyota Production System practices in TKM.

4 Overview of TKM Logistics.• Just In Time

• Kaizen- (Continuous Improvement in logistics)

5 Future “Supply Chain” Direction.

CONTENTS:

TOYOTA MOTOR CORPORATION

• Established in 1937 in Japan

• 160 Countries - 5400 Dealers.

• 26 Countries - 46 Plants

• Sales of 15.1 trillion Yen in March 2002

• 247,000 employees worldwide.

• Manufacture of all types of Vehicles including Luxury & Small Cars.

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GM Ford Toyota VW Daimler

Chrysler

P S A Honda Nissan Renault Fiat

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Automakers ranking worldwide based on vehicle sales

Toyota is 3rd Largest Auto Maker in the World

2003 First quarter Result Toyota – No. 2

TKM is the 14TKM is the 14thth & almost the last automobile manufacturer & almost the last automobile manufacturer to enter in Indian automobile industryto enter in Indian automobile industry

TOYOTA KIRLOSKAR MOTOR PRIVATE LTD

Establishment : 6th October 1997

Location : Bidadi near Bangalore in Karnataka State

Start of Production : Dec 1999

Production Model : Multi Purpose Vehicle Passenger car

Production Capacity : 50,000 Units/year

Investment : US$ 170 Million (Phase I)

No. of Employees : 2300

PRODUCTION / SALES

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Corolla 1383 9000

Qualis 21086 28509 28989 34000

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Crossed1Lakh cars in Sept 03

COMPLETE VIEW OF TKM PLANT

In-house facilities at TKMPress Shop Weld Shop Paint Shop

Assembly Shop Inspection Area

ISO 14001 WITHIN THE FIRST YEAR

TPS AT TOYOTA

KIRLOSKAR MOTORS

IMPLEMENTATION OF TPS IN TKMVEHICLE QUALITY TRENDVEHICLE QUALITY TREND

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MAINTENANCE

IMPROVEMENT

REFORM

TKM

GLOBAL TOYOTA LEVEL

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GLOBAL YIELD RATIO COMPARISON

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MODELS

IMPROVEMENT IN YEILD AS ON AUG-01 6.00% 3.42%0.56% 0.00% 0.00% 0.50% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 2.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1.26%0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.85% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1.48% 0.00% 0.00% 0.00% 0.00%

DATA COLLECTED DURING LINE-OFF OF QUALIS 64.10% 64.10%69.20% 69.70% 68.90% 68.40%68.80% 68.40% 68.20%68.10% 68.00%67.99%67.90% 67.65% 67.27% 67.20% 64.80%66.50% 66.50%66.27% 66.10%66.00%65.80% 65.50%65.40% 65.30% 63.70%64.90% 64.80% 64.80% 64.80%64.70% 64.60% 64.20% 64.20%64.16% 64.10% 64.10% 63.70%63.59% 62.50% 63.10%63.00%62.80% 62.80%62.60% 62.60% 62.57% 62.50%62.50% 60.70%62.00%61.50%60.86%59.70%

133W133W140N 797T 209T 430T 351T 143N 440T 350T 231T 076W 325N 316T 040W 390T 415T404T 395T 065W 210T 186N 465N 450T 153T 391T 970T 081N 652T 651T 630T 702T 525T 828T 191N095N 133W971T 609T 108T 051N 701T 541T 860T 540T 250T 085N 908T 890T 477T 870T 185T 780T 277N 781T

This da ta exc ludes 15 .474 kg /veh o f

mater ia l saved by sending o f fa l s to

suppl ier parts l ike NTTF, STANZEN &

This i s the average

yield ratio of all the

supp l i er s I . e . STTI ,

QUALIS BASIC YEILD RATIO

TPS

Just In Time Heijunka Visual Control Board Built in Quality

Team Work

KaizenJidokaGenchi GenbutsuM-I-R

Standardized Work Challenge

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START OF VOLUME PRODUCTION

START OF SECOND SHIFT

START OF TAKT UP (10’ - 8’)

TAKT DOWN(8’ - 9.25)

TAKT UP (9.25’ - 8’)

TAKT DOWN (8’ - 9.25’)

TAKT UP (9.25’ - 8’)

Units/Month

TAKT UP (7.5’ - 7’) &

TAKT DOWN (7’ - 8’)TAKT UP

(12’ - 9.25’)TAKT DOWN

(8’ - 10’)

TAKT DOWN (9.25’ - 12’)

TAKT UP (8’ - 7.5’)

OVERVIEW OF

LOGISTIC OPERATIONS

• Just - in - time supply

• Small lot - high frequency delivery

• Palletised cargo

• Standardized packaging

TKM’S Logistics concept

TKM SUPPLY CHAIN

P

W

T

A

Insp.

DEALER

CBU LOGISTIC

CUSTOMER

Material

Information Information

Parts

TMC &Overseas Plants -

CKD Parts

Parts

Information

OrderInformation

OrderFeed Back

P Press shopW Weld shopT Paint shopA Assembly shopInsp Inspection

Steel Maker

Material Supplier

SteelCenter

PartsSupplier

Delhi Transit Dock (2600 Kms)North Area - 19 Suppliers

Pune Transit Dock (900KMS)West Area - 13 suppliers

Chennai Transit Dock (370 KMS)18 Suppliers

Bangalore PlantSouth Area - 28 Suppliers

SINGAPORE(TRANSHIPMENT)

THAILAND

JAPAN

PHILIPPINES

INDONESIA

TMC

TAIWAN

TAP

TAM

STM

TKM

TKM LOGISTICS OVERVIEW

KUOZUI

LOCAL SUPPLIERS DISTRIBUTION

Delhi Cross Dock

North Area - 19 Suppliers

Pune Cross Dock

West Area - 13 Suppliers

Chennai Cross Dock

18 Suppliers

Bangalore Plant

South Area - 28 Suppliers

Kanban suppliers- 40

(74% parts)

JUST- IN-TIME

JUST IN TIME

MAKING MATERIAL AVAILABLE TO NEXT PROCESS

• WHAT IS NEEDED The right part

• WHEN IT IS NEEDED At the right time

• IN JUST THE AMOUNT NEEDED.

JUST IN TIME

Procurement Methods for local parts

• Scheduled ordering for far of suppliers with cross dock.

• Kanban based ordering for nearby suppliers without cross dock

• Jumbiki ordering

Supported by

In-house Logistics systems

• Welding (Chorukyu system)

• Assembly (Sequential supply system)

Logistic System - Milk run system

T P S

Conventional System

SUPPLIER-A

SUPPLIER-B

SUPPLIER-C

TKM System

TKMSUPPLIER-B

SUPPLIER-A

SUPPLIER-C

LOW FREQUENCY

BIG LOT

HIGH INVENTORY

HIGH FREQUENCY

SMALL LOT

LOW INVENTORY

TKM

Cross dock operation for Milk run system

1

2

3Cross Dock

Sub Route 1Sub Route 3

Sub Route 2

S1

S2

S3S4

S1

S2

S3

S4

S1

S2

S3

Delhi Cross Dock

Main Route

Chennai Cross Dock

Pune Cross Dock

Main Route Main Route

TKM

Cross dock operation for Milk run system

Optimum Route Planning

122cmt

cmt kg route cmt kg type cmt kg %CS011 CHEN W 15.744 5535 1-2 CS01 37 8976 HCV 32 9000 115%CS012 CHEN B 0.131 45JG CHEN B(JG) 1.500 1770CS013 CHEN I 19.500 1627CS021 CHEN BT 9.608 516 1-1 CS02 17.688 1768 LCV 24 4000 74%CS022 CHEN R 8.079 1251CC011 CHEN A 52.722 6571 1-1 CS03 52.722 6571 LDV 55 6800 96%RM CHEN H 0.800 200 - - 0.800 200.0 - - - -RM CHEN A 0.100 20 - - 0.100 20.0 - - - -RM CHEN N 0.100 20 - - 0.100 20.0 - - - -

truck specdayCycroute area supplier

trip

Standardized Truck Timetable

ROUTE NO.

TRUCK TYPE

Place Dist Time T/T

29.Apr 7:3029.Apr 9:00

6km 0.15hrs29.Apr 9:1529.Apr 10:15

1km 0.10hrs29.Apr 10:2529.Apr 10:55

28km 0.40hrs29.Apr 11:3529.Apr 12:35

35km 1.30hrs

HCV

CS01

Cross Dock

4 5 6 7 8

Sup-A 1.00hrs

Sup-B 0.30hrs

Sup-C 1.00hrs

12 13 14 159 10 11

Logistics on fixed time / variable qty basis

High Frequency Delivery

FDelhi & West : 1 times a day

FChennai, South India : 4 times a day

FBangalore : 4 - 16 times a day

Supplier A

Supplier B Supplier C

Supplier D

TKM

LOGISTIC CONTROL IMAGE

TKM

Short-Route

TKM LOGISTICPROVIDER

Volume CalculationReceiving Plan

Central Operation Control

Long-Route

Suppliers

Cross-Dock TKM

Suppliers TKM

TRANSYSTEM

Joint venture between

Mitsui corp. (Japan)

&

TCI (India)

Truck Status Control

FProcedure

Long-Route : Driving-Members call from predefined points

Local-Route : Controlled by Radio-Receiver up to 60km

FVisual Control (Status-Board)

Detect En-route Problems = Never stop the line

Special Design Fleet

Long Deck Sliding Door : 16 (50cmt)

HCV Sliding Door : 10 (32cmt)

LCV Sliding Door : 4 (24cmt)

HCV Gull-Wing : 5 (32cmt)

LCV Gull-Wing : 3 (24cmt)

Side Loading Method

FWing type truck

FSliding door type

FSwing door type

Inventory of far off supplier with Cross dock operations – Delhi & Pune

TKM - Inventory Status

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ConventionalSystem

SVP TKM Current TMC TKM Future

Stoc

k in

Day

s

-Milkrun pick up of parts.- Transhipment of parts

to Main truck- Truck status control.- Daily arrival of parts

- Frequency increase through Mix Logistics with TKM

Suppliers.- Lot Size reduction

- Double cross docking (Delhi Suppliers)Daily arrival 1 Day

(16 hrs)

Daily arrival 4 Hrs (0.25 days)

Safety Stock 1 Day (16 Hrs )

Safety Stock 6 Hrs (0.3 days)

-Supplier Delivery & Quality

improvement

( Y 2003 ) ( Max 2 Hrs ) (Y 2004 –Oct )( Dec ‘ 99 )

KANBAN SYSTEM

JUST IN TIME

APL STTI TGK DNKI NTTF

KANBAN SORTING ROOM

TKML SUPPLIER

CHECK SHEETAPL 1-2-2KBN NO. QTY111 2222 1333 4XXX Y

1

KANBANPOST

3

6

TIME LOC1LOC2LOC3LOC4

TRUCK1

TRUCK2

TRUCK3

INCOMING KANBAN

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9

CHECK SHEETAPL 1-2-2KBN NO. QTY111 2222 1333 4XXX Y

KBN 222

KBN 222

2

EMPTY BOX

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4 7

KBN 222

KBN 222

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1 1

11

11

KBN 111

LINESIDE

GRN IN SYS

SUPPLIER LINE SIDE

10

CHECK SHEETAPL 1-2-2K

KBN 222

9

KANBAN OPERATION OVERVIEW

PURA/C

PAYABLE

LOCAL PARTS KANBAN SAMPLE

TKMPART DETAILS :

GLOVE COMPARTMENT

SUPPLIER INFORMATION :TG KIRLOSKAR

T004-A

PROCESS CODE : ASSEMBLY

55581- 0B010- 00QTY/BOX

10

PACKING CODE : PB10123

DOCK 01

LOCATION CODE :T2R-2

516 SEQ NO1

KEY CODE :1234567890

(BANGALORE SUPPLIER CASE OPERATING WITHOUT CROSS DOCK)

PARTS READY FOR DESPATCH AT SUPPLIER SIDE

LOADING / UNLOADING USING FORK LIFT

LABELS FACING OUTSIDEPARTS PALLETISED

Parts stacking at PC Zone ready for in-house logistics:

•Parts are stored at PC Zone at predefined locations Line wise orprocess wise.

Inventory of Bangalore supplier ( No Cross dock operations)

TKM - Inventory Status

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Conventional System TKM Current TMC

Stoc

k in

Day

s

Kanban System-1~ 16 delivery / day

- Truck status control by wireless – Time

control- Frequency increase with Mix logistics of

TKM SuppliersSafety Stock Avg 6 Hrs (0.3 days)

Safety Stock Avg4 Hrs (0.25 days )

( Y 2003 )

Avg 2 Hrs

JUMBIKI SYSTEM

( Sequential Procurement )

JUST IN TIME

JUST IN TIMEJumbiki System

• System to supply Parts directly from supplier to Assembly line according to sequence of production.

• Suitable for bulky Parts with more variants & supplied by nearby supplier

e.g- Seats, Door Trims, Carpets (Araco)

• System for total elimination of Inventory.

CENTRAL CONTROL ROOM (CCR)

JUMBIKI SYSTEM

Line In - Based on Production Leveling

ASSEMBLY LINE

Information to CCR

Fax to Supplier

Preparation at Supplier & Transport to TKM

Assembly

Receiving andSupply to Line

Pre defined Time Scale based on tact time

CONVENTIONAL SYSTEM

A1

A2

A3 A3

A2 A2

A3

A1 A1 B1

B2

B3 B3

B2 B2

B3

B1 B1 C1

C2

C3 C3

C2 C2

C3

C1 C1

Stock of each set

For Model A

AssemblyLine

For Model B For Model C

Model A Model CModel B

AssemblyLine

Seats received from supplier in sequence of Production Plan

TPS

JUMBIKI

Model A Model CModel B

B3

B2

B1

A2

A3

A1

JUMBIKI SYSTEM

JUMBIKI PARTS RECEIVED

JUMBIKI SEAT AT LINE SIDE

IN-HOUSE

LOGISTICS

JUST IN TIME

JUST IN TIME

WELDING SHOP

INHOUSE LOGISTICS (Chorukyu System)

CONVENTION SYSTEM TKM SYSTEM

A1

ManufacturingManufacturing

TPS

A2 A3 A4

A5 A6 A7 A8

A5

A1 A2 A3 A4

A6 A7 A8

(SMALL LOT SUPPLY)INHOUSE LOGISTICS

SEQUENTIAL SUPPLY SYSTEMINHOUSE LOGISTICS – ASSEMBLY SHOP

SEQUENTIAL SUPPLY SYSTEM

INHOUSE LOGISTICS – ASSEMBLY SHOP

SUPER FLEXIBLE ASSEMBLY LINESUPER FLEXIBLE ASSEMBLY LINE

TKM IS CHALLENGING NEW CONCEPT OF SUPER FLEXIBLE LINE TKM IS CHALLENGING NEW CONCEPT OF SUPER FLEXIBLE LINE

THAT IS MIXED PRODUCTION OF MPV (frame model) AND THAT IS MIXED PRODUCTION OF MPV (frame model) AND PASSENGER CAR (monocock model) ON SINGLE PRODUCTION LINE, PASSENGER CAR (monocock model) ON SINGLE PRODUCTION LINE,

BY QUICK LAUNCHING OF NEXT MODEL ON THE EXISTING BY QUICK LAUNCHING OF NEXT MODEL ON THE EXISTING PRODUCTION LINE. PRODUCTION LINE.

KAIZEN

(CONTINUOUS IMPROVEMENT)

Kaizen based on practice of manufacturingKaizen based on practice of manufacturing

Before After

•FIFO not followed•Mikara not established•Unsafe movement of F/L

•FIFO achieved •Mikara established• F/L movement standardized

Shooter system to maintain perfect FIFOShooter system to maintain perfect FIFO

Pallet, Dolly, Flow rack to reduce handlingPallet, Dolly, Flow rack to reduce handling

•Double handling of Parts•Generates waiting time•Fatigue while parts picking

•Direct supply of parts•zero waiting time•Workability improved•Space reduced (210 Sq.mt)

Before After

Kaizen based on practice of manufacturingKaizen based on practice of manufacturing

Combined LogisticsCombined LogisticsKaizen based on practice of manufacturingKaizen based on practice of manufacturing

Kaizen based on practice of manufacturingKaizen based on practice of manufacturing

Collapsible - Returnable packing

The space saved by this kind of packing is used to transport service parts to dealers

on the return journey

1 Plastic Caps of hoseflexible eliminated

2

Achieved 99%returnable packaging

Kaizen based on practice of manufacturingKaizen based on practice of manufacturingKaizen in packing areas

FUTURE DIRECTION

TKM in-house operations

PC ZONE

W

P

T

A

Kanban Room

S8

S9

S10

S11

S12

S1

S2

S3

S4

S5

In-house Bar Coded

Kanban

Store Cards

Receive Material

Insert cards

Store Parts

TKM e Kanban information to

Suppliers/ Cross Dock

S8 S9 S10

S11

S12

S1 S2 S3

S4 S5

CROSS DOCK

Download Kanban data

Cross Dock operations

S8 S9 S10

S11

S12

S1 S2 S3 S4 S5

SUPPLIER

Download Kanban

data

Supplier operations

SERVICE PROVIDE

R

SERVICE PROVIDE

RCROSS DOCK

CROSS DOCK

E E -- KanbanKanban

Increase frequency

Reduce lot size

Mixed Logistics Concept

Purpose:

1) Share logistics between TKM & Supplier.

2) Reduce lot, increase delivery frequency and finally reduce inventory.

3) Reduce transportation cost.

4) Mutual development and benefit between TKM & supplier.

Mixed Logistics1st Step

Mixed Logistics Image

TKM - TKAP Mixed Logistics

Example

We live in an age of constant change

‘Today's perfection is tomorrows ‘Today's perfection is tomorrows mediocritymediocrity’’

We need to realise & improve

Closing wordClosing word

THANK YOU FOR YOUR ATTENTION