Toyota is world number one again

Toyota, under threat from its own perceptions and also from giants like General Motors and the Volkswagen Group, just failed to become the first car maker in the history of the automobile to cross the 10-million unit mark in a year.

The Japanese numero uno retained its top spot in the global automotive pecking order yet again last year, with sales of 9.98 million units.

Also, Toyota has gone on record to state boldly that it does intend to become the first in the world to surpass the 10-million unit mark in a calendar year, and 2014 is when it intends to sell 10.32 million units, a 4%  increase over 2013’s milestone.

 Toyota’s tally includes sales from its eponymous brand plus also its Scion & Lexus specialist brands , along with wholly owned subsidiaries like Daihatsu mini-cars (biggest rival to Suzuki in small cars) and Hino range of commercial vehicles.

It has been a fine comeback by Toyota, which was rocked by the earthquake-tsunami combo that knocked manufacturing in Japan in 2011. Adding to it the brake issues (which was almost immediately condemned as a non-issue) in the US dealt production and sales a body blow then, enabling GM to reclaim its perch.

GM had led the world numero uno position for near close to 80 years until it lost out to Toyota in 2008 before retaining it for a solitary year in 2011. It was, however, business as usual in 2012 when Toyota reclaimed its leadership by the scant margin of 451,000 units.

All this has been brought up on the back of a changed stratagem by its president Akio Toyoda who has changed the perspective formed by his predecessors of going all out for volumes in the short
term.

He has mandated that a change to quality focused automobiles where making top-notch automobiles with far better manufacturing processes would help both sales and profits.

Akio Toyoda has often said that this is the kind of offensive he wants his company to embark on, targeting hearts and not volumes. He was quoted by Automotive News saying, “Going on the offensive means making ever-better cars and changing the way in which we produce cars.”

In 2007 the VW Group had stated its Mach 18 vision -- to make more than 10 million units per year by 2018 and also to go top of the pops in every other term.

While profitability and market capitalisation will need to be seen and addressed by bean counters, the fact is that VW could go past the 10-million mark in 2014 at the earliest or 2015 at the latest, which is a good 3 to 4 years ahead of its targeted mission. And with the German car maker having taken the new approach on the manufacturing front with its embracing of not just automotive technology for the masses but also very lean yet robust manufacturing processes—the MQB matrix being a case in point, it has been a lesson which Toyota has now also picked up.

Toyota which gave the world its unique and highly acclaimed TPS (Toyota Production System) is now adding to that with its TNGA, or Toyota New Global Architecture.

This will underpin a whole new modular concept in designing and developing a completely new range of cars from the next year all in a bid to manufacture newer and better cars in a more cost effective manner using shared aggregates and on the same manufacturing lines, while yet encompassing different characteristics to define the models differently.

This new approach with commonised designs under the skin is what the VW Group has thrived on and Toyota is now repaying the compliment by embracing this vital change in its thought process.

Now if only it can do something here in India where Akio Toyoda’s words to make meaningful automobiles much better and more cost-effective is just waiting to be be put into action.