Toyota resets, Mexico is important part of global plan

By Michael Hissam

Toyota’s rebound continues from tough times the auto giant encountered globally earlier in the decade.

For Mexico, the higher level of Toyota activity means scheduled increases in production as well as greater potential for Mexican participation in the supply chain leading to final assembly.

Jun Umemura, Vice President, Toyota Motor Engineering & Manufacturing
North America Inc. also reported that the concept of Kaizen or continuous improvement remains at the top of the automaker’s “To Do” list: 

Post tsunami, what about the recovery of Toyota overall? What are you seeing in that globally?

Right after President Akio Toyoda, assumed the president’s position we had a very difficult time: There was the recall issue in Washington, and after that, tsunami and then the Thailand flood. At that time many plants were destroyed but after that recovery in 2011, 2012, 2013. 

Last year was very good for the company but still we had some problem in the island and we could not reach 10 million production. This past year we expect to reach about 10 million vehicles production. Recovery is very good, as well as profitability. The profit is maybe twenty billion more this period, very good recovery.

Here in Mexico, Toyota is relatively a newcomer. Tell us what you have in Mexico and what they are or plan on producing.

Actually in Mexico, Toyota’s manufacturing presence is not very big; we have a very small presence. So now in Mexico we have a Baja plant producing the Tacoma. We expanded the Baja operation a little bit from 50,000 to 63,000 units. We have some joint activity with Mazda in the Salamanca plant scheduled for 2015. Mazda’s joint activity will result in their providing 50,000 vehicles to Toyota through the investment at the Mazda Salamanca plant. 

Let’s look at quality. Customers have become so demanding on quality. What can you tell us about Toyota quality out of Mexico?

We are always asking high quality, just in time and competitive cost from our supplier people. In Mexico our experience in Baja shows very high quality people working in Mexico. Their attitude is very good. We are seeing a very, very high potential from Mexico.

You have two operations here in Mexico, for the supply chain that has important implications. What can you tell us about the amount you are purchasing from Mexico for building in Mexico?

We are buying for North America vehicles almost US$1.5 billion value, buying from Mexico plus more for the Baja production. That’s a (significant) number, but still we are looking for more support from Mexican suppliers.

You are looking for additional production value chain support. If I were a Mexican national supplier and I wanted to do business with you, what are you going to demand of me in order that I can qualify to supply you, Toyota?

We would expect the same thing as we are always looking for from the suppliers: Very high quality and just in time delivery, competitive cost. That is what we are always looking to obtain. We are putting some representation here in Mexico in order to look seriously for more suppliers.

Explain the support that you could offer to that supplier to make sure the supplier delivers everything you want, when you want it.

We have a group that can offer support. We have a team in Erlanger, Kentucky, near Cincinnati, Ohio, that supports suppliers that we want. If something happens or something is needed, or some supplier wants support we can send some people.

Near three decades ago an important Japanese word entered the language of the automotive industry: Kaizen. As we discuss Mexico and Toyota today, how does Kaizen fit today?

Looking at Kaizen, Akio Toyoda always says that we like to make better cars. Better cars means that we need to (do) better than before. That’s continuous improvement or Kaizen. That’s our basic principle. We must do always better than yesterday; better than yesterday and not fixing today’s quality or whatever product issue.

Here we go with 2014. Let’ take a look 10 years from now. What is your vision for Toyota in Mexico?

We always work to make our cars better. That’s for the customer. That’s our objective now and that will be the objective 10 years from now.