Toyota Accelerates Strengthening of Toyota Group for 'Once-in-a-Century Transformational Period'

Toyota City, Japan, June 1, 2018―Toyota Motor Corporation (Toyota) announces today that it has reached agreements with Denso Corporation (Denso) and Toyota Tsusho Corporation (Toyota Tsusho) aimed at further strengthening the competitiveness of the Toyota Group. The agreement with Denso outlines that the core electronic component operations of both Toyota and Denso will be consolidated within Denso. The agreement with Toyota Tsusho outlines that Toyota and Toyota Tsusho will consider the transfer of all Toyota sales & marketing operations in the African market to Toyota Tsusho. (For details, please see the links to related releases.)

https://global.toyota/en/newsroom/corporate/22764086.html

https://global.toyota/en/newsroom/corporate/22764053.html

The automotive industry is entering a new phase of cooperation and competition, one that is witnessing the evolution of technologies in such fields as electrification, automated driving, and connectivity, as well as entry by entities from other industries. At the same time, further expansion of the global automobile market is expected, centered on Africa and other emerging countries and regions.

To survive in this era of profound transformation, Toyota is accelerating its efforts to enhance the competitiveness of the overall Toyota Group by further strengthening coordination for the effective application of the group's limited resources.

Comment by Toyota President Akio Toyoda

Facing this once-in-a-century transformational period, and at a time in which annual global vehicle sales of the Toyota Group now surpass 10 million units while maintaining and further developing our current operations, we are now being called on to take up the challenge of transforming into a mobility company. In such an environment, how effectively we can apply our limited resources and the degree to which we can enhance the competitiveness of the entire Toyota Group will become ever more important.

Such entails reconstructing the operations of the overall Toyota Group from the perspective of, as I like to say, "home & away." "Home" refers to operations and regions in which we can use genchi genbutsu (on-site learning and problem-solving) to self-create added value and in which we are ahead in terms of competitive strength compared to our rivals. On the other hand, "away" refers to operations and regions in which other companies have many more advantages than we do in terms of expertise.

Even if an operation is positioned as an "away" operation when viewed on a Toyota stand-alone basis, from the perspective of the Toyota Group in which a member considers that operation to be one of its strengths, such an operation can be a "home" operation. In this way, by re-examining the operations of the Toyota Group from a "home & away" perspective and consolidating operations within "home" companies, we will be able to increase productivity and strengthen the competitiveness of the entire Toyota Group. Furthermore, I believe that conducting work through genchi genbutsu at companies that have greater expertise will also contribute to cultivating each member of our human resources.

It goes without saying that our competitiveness stems from the quality of our human resources. I believe that nothing is more important than creating environments in which working people can experience growth through their daily tasks and in which they can work with dynamism.

We are currently surrounded by changes of unprecedented speed and scale, and the situation is truly one of now or never, in which not even a moment can be spared. To survive this era, those of us who manage a business must always be initiating change. I strongly believe that this is precisely why I, myself, must stand at the front, in alignment with the sensitivities of our employees and each and every person at the genba (workplace) who must face such changes, and make Toyota into a company whose people can experience a solid sense of the growth of the Toyota Group and of the growth of the individual.

Going forward, with the hearts and minds of all people in the Toyota Group united and postured for speed and openness, we intend to take up challenges for doing that which we deem good. For this, we humbly ask for your understanding and support.

For reference

Major actions to strengthen the Toyota Group^* from 2016 to present