Toyota president serious about cutting costs

[FarCenter]

http://www.yomiuri.co.jp/dy/business/20080526TDY07301.htm

Tamaki Aikyo and Hiroyuki Kato / Yomiuri Shimbun Staff Writers

Toyota Motor Corp. is considering how to reduce its costs in response to the recent sharp rise in raw material prices, company President Katsuaki Watanabe told The Yomiuri Shimbun in a recent interview. It is the first time Toyota has resorted to emergency cost-cutting efforts since 1993, after the economic bubble burst. In the interview, Watanabe also set out the company's strategy for tackling environmental issues, including the introduction of next-generation plug-in hybrid electric vehicles, which people can recharge simply by plugging in at home.

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The Yomiuri Shimbun: What will Toyota do to cut costs?

Katsuaki Watanabe: We've started what we call "emergency value analysis activities." We've formed teams to review every single part and component over the next six months to determine how to improve designs to reduce production costs further. Some employees still lack awareness of these activities, but we plan to work on developing our human resources in tandem with this effort.

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How do you see the current market environment?

In developed countries, it isn't good. The U.S. market for new automobiles will shrink to about 15 million cars this year, down about 1 million from last year. However, the markets in emerging economies and resource-rich nations look solid. It's expected that about 10 million cars will be sold in China this year and the market there will continue expanding next year, I believe. But the growth in China's exports to the United States seems to be slowing, so we have to be careful about assuming that current trends will continue.

Do you have any plan to increase production in emerging economies?

It'll be necessary to raise production in China in future because we expect our sales there to increase by 700,000 cars this year. It likely will be necessary to beef up production capacity in India and Brazil, too. In Russia, we have to raise our current production capacity of 20,000 cars per year to 50,000 cars as quickly as possible.

Can you explain Toyota's strategies for tackling environmental issues?

Toyota has been regarded as strong in environmental technologies due to its hybrid vehicles. But hybrid vehicles are increasingly seen as commonplace. So we have to develop more advanced products and introduce them to consumers. We want to realize our goal to halve the size and cost of hybrid drive systems as soon as possible. Toyota plans to release a plug-in hybrid electric vehicle with lithium-ion batteries some time in the 2010s. As a full-range auto maker , Toyota won't be able to cater to the market in each country without developing vehicles that can use a variety of fuels, such as gasoline, diesel fuel, hydrogen and electricity.

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[Arctic Dave]

1. A forward looking corporation

This guy would never make it the good ol USA.

[Larkspur]

2. I think its long past time that we outsource our CEO's and other exec VP's to Japan

our businesses would be better run if the Japanese Toyota style of management ran them.

[madrchsod]

3. they better worry about the quality of the camry first

then worry about the rest...