From 0 to 60 to World Domination

Arroyo · Feb 22, 2007

A real eye-opening article. No wonder the domestic auto companies are having such a hard time.

From 0 to 60 to World Domination
By JON GERTNER
New York Times

1. Here Comes the Tundra
By any measure, Toyota's performance last year, in a tepid market for car sales, was so striking, so outsize, that there seem to be few analogs, at least in the manufacturing world. A baseball team that wins 150 out of 162 games? Maybe. By late December, Toyota's global projections for 2007 â€” the production of 9.34 million cars and trucks â€” indicated that it would soon pass G.M. as the world's largest car company. For auto analysts, one of the more useful measures of consumer appeal is the "retail turn rate" â€” that is, the number of days a car sits on a dealer's lot before it is turned over to a customer. As of November 2006, according to the Power Information Network, a division of J.D. Power & Associates that tracks such sales data, Toyota's cars in the U.S. (including its Lexus and Scion brands) had an average turn rate of 27 days. BMW was second at 31; Honda was third at 32. Ford was at 82 and G.M. at 83. And Daimler-Chrysler was at 107. The financial markets reflected these contrasts. By year's end, Toyota would record an annual net profit of $11.6 billion, and its market capitalization (the value of all its shares) would reach nearly $240 billion â€” greater than that of G.M., Ford, Daimler-Chrysler, Honda and Nissan combined.

. . .

2. Kaizen Means Never Being Satisfied

One of the Toyota executives attending the Tundra's debut was Jim Press. A tall, lean Midwesterner, Press is the president of Toyota Motor North America, making him the company's highest-ranking American. Toyota is governed by a large corporate board, which is made up of top executives in Japan and senior managing directors spread around the globe; Press is one of 49 managing officers of the company just below that level. For most of his career, Press worked on the West Coast, at Toyota's North American sales headquarters in Torrance, Calif. More than half of Toyota's profits now come from the U.S.; its success here, and its success globally, are so closely related as to be indistinguishable. In the view of one longtime Toyota watcher, Press's high standing reflects the fact that, more than any single manager, he delivered the American market to Toyota. His efforts helped make the Camry the best-selling car and the Lexus the most popular luxury brand in the U.S.

. . .

3. The Engineers Open the Window on the Big World Out There
The idea of actually situating a parts supplier inside an assembly plant is wholly novel. But the methods of low inventory â€” or what's known as "just in time" production â€” are hardly unique to Toyota; these have been emulated with great success by other automakers. The same goes for other processes at the San Antonio plant: the line stoppages and quality checks, the time spent by workers discussing hand and body movements in the hope of shaving a crucial half-second from their work. Over the years, Toyota has assisted competitors, especially G.M., in helping to adopt its system, believing it to be in its interest to share practices, especially in exchange for insights into a rival's methods. Toyota's true technological advances, however, are another matter. In San Antonio, for instance, recent innovations in the paint shop that significantly cut production time were considered proprietary and off-limits to journalists.

. . .

4. The Long Road From Rural Japan to California and Beyond
Over the past few years, in an effort to amass a physical record of its business experience in the United States, Toyota has been tracking down and collecting automobiles it has sold here since the late 1950s. The Toyota USA Automobile Museum, as it's known, is located in an unmarked white-brick building on a side street in Torrance, Calif., a few blocks from Toyota's corporate sales campus. When I visited in early December, I took a leisurely stroll through the museum's main room, a spacious, high-ceilinged garage filled with Toyotas, Lexuses and Scions, all in immaculate condition, all parked aslant on a concrete floor. The museum is open only by appointment; there were no other visitors. Time was compressed into a few strides. I passed a Toyota Corona (1966), a Corolla built in California (the first Toyota made in the U.S., 1986), a Camry from Kentucky (1989), an early Prius (2000) and an early Tundra (2003). To walk along the rows undermines any notion that Toyota's success has been sudden; the progression of cars â€” in styling, popularity and increasing Americanization â€” was methodical and incremental. "We don't move in an unpredictable manner," Jim Press told me a few weeks before my visit to the museum. "We move jojo, a Japanese term, meaning step by step."

. . .

5. Toyota Has It Made in America
Toyota expects that some buyers will be moving up from its smaller truck, the Tacoma; others will be trading in their weaker, older Tundra for the new model. Still other buyers may be families that view pickup trucks with big back seats (so-called double cabs) as an alternative to an S.U.V.'s But building a new factory in the U.S. for the truck, locating the plant in the heart of Texas pickup country and then flying the Texas flag outside all speak to the company's focus on severing truck owners' blood ties to Ford and G.M. These loyal owners are the hardest to woo. Indeed, they may be beyond reach. Just as G.M. and Ford may have lost a generation of car buyers, Toyota may have put off a generation of full-size truck buyers with the T100 and the first Tundra.

. . .

6. Getting the Carbon Out of Cars
What I found within Toyota is that its engineers and executives all take environmental issues seriously, but on their own terms. For many consumers, of course, Toyota's hybrid innovations established a green halo over the company. Yet the environmental community is more wary of the company's lauded progressivism than you might expect. Many environmental advocates are dismayed by Toyota's participation (as a member of the Alliance of Automobile Manufacturers) in a suit to block California's new laws curtailing greenhouse-gas emissions. And some view Toyota's strenuous efforts, especially in the U.S., to sell gas-guzzling trucks and S.U.V.'s as counterproductive. "I think the reality is that Toyota's focus on the truck market has been to make them look as American as possible, rather than be the global environmental leaders they are on the car side," Jason Mark, the former head of the vehicle program at the Union of Concerned Scientists, told me. As Mark sees it, Toyota's activities matter more than any other automaker's. "First, they'll be the biggest car company very soon," he says. "Second, they've demonstrated a knack for innovation with the Prius. And third, they've demonstrated a commitment for stewardship that I don't think one could attribute to the domestic automakers."[/b]
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http://www.nytimes.com/2007/02/18/magazine...nyt&emc=rss

TonyPSchaefer · Feb 22, 2007

This is a very interesting article. Long, but well worth the time.

hycamguy07 · Feb 22, 2007

<div class='quotetop'>QUOTE(TonyPSchaefer @ Feb 22 2007, 09:18 AM) [snapback]394463[/snapback]</div>

This is a very interesting article. Long, but well worth the time.
[/b]
Click to expand...

True~

Also keep in mind Toyota & honda build quality, dependable & reliable vehicles. Alot can be said for that and it shows through sales.....

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