Item 3. TMC Expands Into North America Independently: TMM ...

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• > Item 3. TMC Expands into North America Independently: TMM, TMMC Established

Section 3. Local Production Starts in North America

Item 3. TMC Expands into North America Independently: TMM, TMMC Established

TMC established the North America Production Study Team within the Overseas Operation Department in February 1985. The purpose of the team was to investigate in detail the feasibility and potential of all aspects of local operations from production to sales. At the time that NUMMI was starting production, executives within TMC frequently discussed production in North America in parallel with NUMMI's start-up operations.

At that time, sales of Toyota vehicles in North America reached 1 million units, and the belief that TMC should contribute to the local economy in terms of employment by establishing a wholly owned manufacturing company gained momentum. The effects of the voluntary export restraints were causing supply shortages, and as a result, expanding supply by setting up independent operations became a priority issue. It was based on these considerations that an extraordinary meeting of the TMC Board of Directors decided and formally announced in July 1985 that TMC would establish its own plants in the United States and Canada. TMC planned to produce about 200,000 passenger cars with 2,000 cc-class engines in the United States annually and about 50,000 passenger cars with 1,600 cc-class engines in Canada annually, both with target production start dates in 1988.

In August 1985, the North America Production Study Team was made independent of the Oversees Operation Department and became the North America Business Preparation Office. At the same time, the North America Project Committee was established as the supervisory body of the North America Business Preparation Office with Executive Vice President Gentaro Tsuji as its chairman and seven executives as members. A decision was made to solicit proposals for production sites in the United States and Canada, and selecting a site became the first major task. Shortly after the plan was announced, offers from 29 states in the United States and eight provinces in Canada were received.

The North America Business Preparation Office prepared screening materials by analyzing and assessing various factors such as parts procurement, logistics, electric power availability, work force, public safety, and incentives from state and provincial governments based on the materials received from each state and province. Between them, the executives visited all the candidate sites to confirm the various conditions. As a result of this process, sites in the suburbs of Georgetown in Scott County, Kentucky, in the United States and Cambridge, Ontario, in Canada were selected in December 1985. Chairman Eiji Toyoda and President Shoichiro Toyoda, respectively, made announcements at the sites. President Toyoda made the following statement to more than 200 members of the media at the Kentucky press conference.

Selecting the plant sites was one of the most difficult choices in the history of Toyota. Taking into consideration all of the factors, we decided that Kentucky is the optimal site. We are grateful to everyone who submitted proposals. Today's decision on a plant construction site is one of the most auspicious moments in Toyota's history since the creation of our No. 1 prototype vehicle in 1935.

Twenty-five years after TMC began exporting cars to the United States in 1957, we have taken a major step towards realizing our dream of 'building complete partnerships with all of you in America.' We will make every effort to contribute to employment and economic growth while creating new relationships that will be useful to you.

President Toyoda received many messages of welcome from the guests at the announcement, including from Kentucky Governor Martha Collins, who engaged in active lobbying activities including visiting the TMC head office.

Aerial view of TMM plant TMM administration building

Toyota Motor Manufacturing, U.S.A., Inc. (TMM; now Toyota Motor Manufacturing, Kentucky Inc.; TMMK) and Toyota Motor Manufacturing Canada Inc. (TMMC) were established in January 1986 as American and Canadian subsidiaries, respectively. TMC Vice President Kaneyoshi Kusunoki, who had been in charge of the Production division and the North America Business operation Group and was involved in production preparations by NUMMI, was appointed president of both companies. TMM was owned 80 percent by Toyota Motor Sales, U.S.A., Inc. and 20 percent by TMC, and TMMC was wholly owned by TMC. The experience gained from NUMMI was put to good use when constructing the plants in areas including labor-management relations, human resource development, introduction and operation of facilities, creation of logistics systems, and contributions to local communities. NUMMI employees, however, were former GM personnel, while all TMM employees were newly hired. Full consideration was given to selecting a diverse workforce through a fair process. In addition, since this was Kentucky's first auto plant, there were no available experienced employees with the exception of executives, so various innovations to the content of training had to be made, including an emphasis on the basics of auto manufacturing. The mother plant system was adopted, with the Tsutsumi Plant serving as the mother plant for TMM, which was to produce the Camry, and the Takaoka Plant designated the mother plant for TMMC, which was to produce the Corolla.

• Part 1. Taking on the Automotive Business
  • Chapter 1. From Textiles to Automobiles
    • Section 1. The Inventions and Ideas of Sakichi Toyoda
      • Item 1. Sakichi Toyoda
      • Item 2. Overview of Sakichi Toyoda's Inventions
      • Item 3. Expansion into Nagoya
      • Item 4. The Birth of Jidoka
      • Item 5. Invention of the Circular Loom and Circular Single Flow Motor
      • Item 6. Support for Development and Invention of Electricity Storage Devices
    • Section 2. The Businesses of Sakichi Toyoda
      • Item 1. Setbacks at Toyoda Loom Company
      • Item 2. Establishment of Toyoda Boshoku Corporation
      • Item 3. Establishment of Toyoda Boshoku Sho and Other Companies
    • Section 3. Kiichiro Toyoda Invents the Automatic Loom
      • Item 1. Kiichiro Toyoda Starts Working for Toyoda Boshoku
      • Item 2. Creating the first automatic loom prototype
      • Item 3. Toyoda Boshoku's manufacture of the Type G Automatic Loom
    • Section 4. Establishment of Toyoda Automatic Loom Works, Ltd.
      • Item 1. Toyoda Automatic Loom Works Established
      • Item 2. Patent Transfer Agreement with Platt
      • Item 3. Downturn in the Cotton Industry and Diversification and Streamlining
      • Item 4. Ring Spinning Frame Development and Automobile Research Starts
  • Chapter 2. Establishment of the Automotive Business
    • Section 1. The Japanese Automotive Market
      • Item 1. The Great Kanto Earthquake and Rapid Increase in U.S. Vehicle Imports
      • Item 2. Assembly Production by Ford and General Motors
      • Item 3. Domestic Automotive Production-the Demise of Kwaishinsha and Hakuyosha
      • Item 4. Building a Chukyo Detroit-Development of the Atsuta Passenger Car
    • Section 2. Automobile Prototypes
      • Item 1. Establishment of an Automotive Production Division
      • Item 2. Construction of Prototype Plant and Steelworks
      • Item 3. Prototypes of the A Engine and Model A1 Passenger Car
      • Item 4. Model G1 Truck
      • Item 5. Sales Systems Established
      • Item 6. Model AA Passenger Car and Model GA Truck Launched
      • Item 7. Toyoda Automatic Loom Works Designates a Licensed Company under the Automotive Manufacturing Industries Law
    • Section 3. Research and Development of Basic Technology
      • Item 1. Establishment of a Research Laboratory
      • Item 2. Researching Casting Technology
      • Item 3. Specialty Steel Research and Development and Forging Technology Research
      • Item 4. Research and Development of Machining Methods and Machine Tools
      • Item 5. Electrical Components Research and Development
      • Item 6. Rubber Product Research and Development
    • Section 4. Construction of the Automotive Department Assembly Plant and Koromo Plant
      • Item 1. Construction of the Automotive Department Assembly Plant: Staged Expansion of Production Capacity
      • Item 2. Selection of the Koromo Plant Site and Development of the Construction Plan
      • Item 3. Establishment of Toyota Motor Co., Ltd. and Construction of the Koromo Plant
      • Item 4. Description of the Koromo Plant
      • Item 5. The Origins of Just-in-Time
      • Item 6. Goguchi Production Control System Adopted
      • Item 7. Reforming and Improving Vehicle Quality
      • Item 8. Model B Engine, Model GB Truck Developed
      • Item 9. Introduction of the Metric System
    • Section 5. Wartime Research and Production
      • Item 1. Establishment of the Storage Battery Research Center and the Toyoda Physical and Chemical Research Institute
      • Item 2. Diesel Engine Research
      • Item 3. Research on Alternative Fuels
      • Item 4. Research on Forge Processing Technology
      • Item 5. Research on Alternative Steel
      • Item 6. Truck Production and the Steel Shortage
      • Item 7. Production outside Japan
      • Item 8. Prototype Production of a Range of Vehicles
      • Item 9. Aircraft Development and Production
      • Item 10. The Automotive Industry Under a Controlled Economy
      • Item 11. Breakup and Consolidation of Companies
    • Section 6. Postwar Arrangements and Labor Disputes
      • Item 1. Searching for New Business
      • Item 2. Company Reconstruction
      • Item 3. Converting to Meet Civilian Demand and Dealing with Post-war Reforms
      • Item 4. Three New Company Spin-Offs in Association with Business Reconstruction
      • Item 5. U.S. Army Vehicle Repair Operations and Compact Car Development
      • Item 6. Labor Disputes and President Kiichiro's Resignation
    • Section 7. Modernization of Facilities
      • Item 1. Training at the Ford Motor Company and Observation of American Machinery Manufacturers
      • Item 2. Special Demand Caused by Korean War
      • Item 3. Facility Modernization Five-year Plan-Towards a System for Producing 3,000 Vehicles per Month
      • Item 4. Supermarket Method
      • Item 5. Introduction of Transfer Machines
      • Item 6. Efforts for Quality Control
      • Item 7. Introduction of computers
    • Section 8. Debut of the Toyopet Crown, a Full-Fledged Passenger Car
      • Item 1. Development of Compact Car Equipped with the S Engine
      • Item 2. Development of Large Trucks, Four-wheel-drive Vehicles, and Diesel Engines
      • Item 3. Development of a Full-fledged Passenger Car, the Toyopet Crown
      • Item 4. Changes in the Automotive Market
    • Section 9. Preparations for Mass Production and Mass Sales
      • Item 1. Expanding Sales Structures
      • Item 2. Automobile Exports and APA Special Demand
      • Item 3. Expansion into Latin America
      • Item 4. Toyota Expands into Asian Countries
      • Item 5. Toyota's Entry into the United States
      • Item 6. Production Capacity Increase with the Goal of Reaching 10,000 Vehicles/Month
      • Item 7. Establishment of the Toyota Technical Center
• Part 2. Entering the Automotive Business
  • Chapter 1. Mass Production and Continual Development of New Models
    • Section 1. Construction of Motomachi Plant and Introduction of TQC
      • Item 1. Construction of Motomachi Plant for Passenger Vehicles
      • Item 2. Production and Sale of the Corona Model PT20
      • Item 3. Production and Sale of the Mass-market Publica and Crown RS40
      • Item 4. Production and Sale of the Corona Model RT40
      • Item 5. Introduction of TQC
      • Item 6. Clarifying Company Policy
      • Item 7. Toyota Awarded the Deming Prize
      • Item 8. Signing of Joint Declaration of Labor and Management
    • Section 2. Motorization and Liberalization of Trade and Capital
      • Item 1. The High Rate of Economic Growth and Motorization
      • Item 2. Liberalization of Car Imports
      • Item 3. Capital Liberalization and Automotive Industry Reorganization
      • Item 4. Alliance with Hino Motors
      • Item 5. Alliance with Daihatsu Motor
    • Section 3. Development and Sales of New Models-Promotion of Comprehensive Product Lineup
      • Item 1. Corolla
      • Item 2. Development of Sports Cars
      • Item 3. The Sprinter, Mark II, and Others
      • Item 4. Celica and Carina
      • Item 5. Development of New Trucks
    • Section 4. Plant Construction and Expansion
      • Item 1. Monthly Production Increased to 50,000 Units-Motomachi Plant Expanded and Kamigo Plant Constructed
      • Item 2. Aiming for Monthly Production of 100,000 Units
      • Item 3. Moving Up to Annual Production of 2 Million Units: Construction of Tsutsumi Plant and Expansion of Existing Plants
      • Item 4. Development and Deployment of the Toyota Production System
    • Section 5. Expansion of Sales Systems in Japan and Development of Markets in Other Countries
      • Item 1. Publica Dealerships (now Toyota Corolla Dealerships) Start Operations
      • Item 2. Toyota Auto Dealerships (now Netz Toyota Dealerships) Start Operations
      • Item 3. The Advance of Knockdown Exports
      • Item 4. Exports of Completely-built Vehicles
      • Item 5. Exports to the United States
  • Chapter 2. Satisfying Public Needs
    • Section 1. Response to Recall Problems
      • Item 1. Recall Problems Emerge
      • Item 2. A Swift Response
      • Item 3. New Initiatives for Quality Improvement
      • Item 4. Creation of the Toyota Quality Control Award
    • Section 2. Response to Increase in Traffic Accidents
      • Item 1. Road Safety Issues and Toyota Traffic Environment Committee Initiatives
      • Item 2. Tightening of Vehicle Safety Standards in Japan and Overseas
      • Item 3. Development of Vehicle Safety Technologies
      • Item 4. Development of the Toyota ESV
      • Item 5. Research and Development of a Comprehensive Automobile Traffic Control System
      • Item 6. To Toyota Motor Employees
    • Section 3. Responding to Emissions Controls
      • Item 1. Issue of Emissions Arises
      • Item 2. Measures to Reduce Emissions
      • Item 3. Emissions Regulations Tightened
      • Item 4. All Possibilities Pursued
      • Item 5. Responses to 1975 Regulations and the Two-year Postponement of 1976 Regulations
      • Item 6. Compliance with Fiscal 1978 Regulations and Repercussions
    • Section 4. Responding to the Oil Crisis
      • Item 1. Response to the First Oil Crisis
      • Item 2. Resource-Saving and Energy-Saving Programs
      • Item 3. Improvement of Corporate Structures and the Second Oil Crisis
      • Item 4. Development of Fuel Efficiency Technologies
      • Item 5. Development of Front-Wheel Drive Vehicles
      • Item 6. Development of LASRE Engines
    • Section 5. Production and Sales Systems Reinforced
      • Item 1. Front-Wheel Drive Vehicle Production Facilities Expanded
      • Item 2. Construction of the Tahara Plant
      • Item 3. Reinforcement of Sales Systems in Japan
      • Item 4. Expansion of Sales Networks in the United States
      • Item 5. Reinforcement of Sales Networks in Europe and the Middle East
      • Item 6. Reinforcement of Local Assembly Systems
• Part3. Leaping Forward as a Global Corporation
  • Chapter 1. New Start for Post-merger Toyota & First Full-scale Production Outside of Japan
    • Section 1. Voluntary Restraints Imposed on Exports to U.S.
      • Item 1. Japan, U.S. Agree on Voluntary Restraints on Exports
      • Item 2. Repercussions Reach Canada and EC
      • Item 3. U.S. Sales Structure Strengthened amid Voluntary Restraints
    • Section 2. Toyota Motor Co., Ltd., Toyota Motor Sales Co., Ltd. to Form Toyota Motor Corporation
      • Item 1. Background to Merger Decision
      • Item 2. A New Toyota is Born
      • Item 3. Aiming for Annual Domestic Sales of 2 Million Vehicles
      • Item 4. Driving Forward Quality Control Activities
      • Item 5. Increasing Efficiency in Logistics
    • Section 3. Local Production Starts in North America
      • Item 1. Negotiations with Ford
      • Item 2. Joint Venture with GM
      • Item 3. TMC Expands into North America Independently: TMM, TMMC Established
      • Item 4. Plant Operations Establish Local Roots
    • Section 4. Overseas Business Expands Globally
      • Item 1. Taiwan
      • Item 2. Australia
      • Item 3. Southeast Asia and Western Asia
      • Item 4. Europe
      • Item 5. China
      • Item 6. Latin America, Middle East, and Africa
    • Section 5. New Developments in Japan-U.S. Trade Issues
      • Item 1. International Cooperation Program Based on Increasing Imports
      • Item 2. Japan-U.S. Structural Impediments Initiative Talks: Rising Trade Friction Between Japan and U.S. Concerning Autos
      • Item 3. Japan-U.S. Framework Talks and New International Business Plan
  • Chapter 2. Growth of the Japanese Economy and Enhancement of Toyota's Management
    • Section 1. Development of Diverse Vehicle Lineup and Expansion of Domestic Sales
      • Item 1. Maturation and Diversification of Market
      • Item 2. New Technologies and Expansion of R&D Bases
      • Item 3. Expansion of Production Network and Establishment of Multi-kind, Small-lot Production
      • Item 4. Building a Platform for 2 Million Vehicles
    • Section 2. 50th Anniversary and Coping with the Strong Yen
      • Item 1. Surging Yen
      • Item 2. Comprehensive Cost Reduction Activities
      • Item 3. Organizational and Personnel System Reform
    • Section 3. Rapid Growth of the Japanese Market and Development of the Lexus
      • Item 1. Achievement of Sales of 2.5 Million Vehicles in Japan
      • Item 2. Reaffirmation of the Customer First Philosophy
      • Item 3. Building Plants in Kyushu, Hokkaido, and Tohoku
      • Item 4. Enhancing Efficiency and Organizational Structure of New-car Development
      • Item 5. Developing the Lexus
    • Section 4. New Business Enterprises
      • Item 1. Development of New Business Enterprises
      • Item 2. Initiatives in the Housing Business
      • Item 3. Entry into the Communications Field
      • Item 4. Initiatives in Marine and Aerospace Businesses
      • Item 5. Initiatives in Biotechnology & Afforestation Businesses
  • Chapter 3. Applying a New Corporate Philosophy
    • Section 1. The Post-bubble Japanese Economy and Domestic Market
      • Item 1. The Domestic Economy After the Collapse of the Bubble Economy
      • Item 2. Recreational Vehicles and Compact Cars Take the Lead
      • Item 3. Taking a Leadership Role in the Economic Field
    • Section 2. Response to Environmental and Safety Issues
      • Item 1. Company-wide Action on Environmental Problems
      • Item 2. Greenhouse Gas Reduction and Measures on Substances of Concern
      • Item 3. Making Efficient Use of Limited Resources
      • Item 4. Approach to Vehicle Safety
    • Section 3. Promotion of Internal Reforms
      • Item 1. Establishment of the Guiding Principles at Toyota
      • Item 2. Reinventing Toyota's Business Approach
      • Item 3. Expanding Reforms
  • Chapter 4. Rapid Expansion of Globalization
    • Section 1. Heightened Presence in the North American Market
      • Item 1. Increasing Presence in the North American Market
      • Item 2. Expansion of Lineup
      • Item 3. Expansion of Production Bases
      • Item 4. Advance of Localization
    • Section 2. European Operations Become Autonomous
      • Item 1. Sales Bolstered as Markets Stagnate
      • Item 2. Introduction of Products Tailored to European Tastes
      • Item 3. Expansion of Production Bases
      • Item 4. Coordinating Structures and Localization
    • Section 3. Expansion of Asian Markets and Developments in Oceania
      • Item 1. From Stagnation to Growth
      • Item 2. Expansion of Production Sites
      • Item 3. Intra-Regional Support Systems Developed
    • Section 4. Expanding Business in China through Joint Ventures
      • Item 1. Production Sites Expanded
      • Item 2. Responses to Rapid Increases in Automobile Production
    • Section 5. Latin America, Africa, and Middle East
      • Item 1. Responding to Market Growth and Expansion
      • Item 2. Production Site Expansion
    • Section 6. Strengthening Development and Sales Efforts in the Japanese Market
      • Item 1. Structural Changes in the Japanese Automotive Market
      • Item 2. Challenging the Market with New Brands and New Genres
      • Item 3. Reassessing Product Strategy
      • Item 4. Sales Policies
    • Section 7. The Functions that Supported Globalization
      • Item 1. A Wave of Restructuring and a Push for Change in Awareness
      • Item 2. Reducing Cost and Ensuring Quality
      • Item 3. Further Improvement of Monozukuri
      • Item 4. Human Resources Development
      • Item 5. Global Initiatives in Management Groups
      • Item 6. Helping Build a Sustainable Society
    • Section 8. Integrating IT and Exploring New Energy Sources
      • Item 1. Development of Prius and Hybrid Strategy
      • Item 2. Responding to the Energy Problem
      • Item 3. ITS Initiatives
      • Item 4. Actions for Assisting Mobility
  • Chapter 5. Restart
    • Section 1. Global Financial Crisis
      • Item 1. Rapid Growth
      • Item 2. On the Eve of the Financial Crisis
      • Item 3. Financial Losses
    • Section 2. Launch of New Management Systems
      • Item 1. Making "Ever-Better Cars"
      • Item 2. Implementation of New Policies and Difficult Decisions
    • Section 3. Recommitment to Quality
      • Item 1. Expansion of Recalls
      • Item 2. Restoring Confidence
      • Item 3. Creation of New Quality Assurance Systems
    • Section 4. Global Vision
      • Item 1. Announcement of the Global Vision
      • Item 2. Reform of Management Systems
    • Section 5. Repeated Difficulties and Trials
      • Item 1. The Great East Japan Earthquake
      • Item 2. Ordeals Continue
    • Section 6. New Growth Goal
      • Item 1. Resumption of Investment outside Japan
      • Item 2. Further Expansion of Environmental Technologies
      • Item 3. Product Appeal Enhancement
      • Item 4. Toward New Beginnings

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