Toyota has reorganised its vehicle development system in order to speed decision making, cut costs and better appeal to car buyers worldwide.
According to the Wall Street Journal, the changes to core engineering and design programmes increase the authority of the company’s chief engineers, consolidate research and development into three groups based on geographical regions and limit final design decisions to smaller teams. Toyota calls the effort its new “global architecture”.
“We are gradually starting to see the results of our reform efforts,” President Akio Toyoda told the WSJ during a news conference at company headquarters in Toyota City, citing as examples the recent launches of the new Prius C hybrid hatchback and remodeled Camry midsize sedan in the US and Japan, plus the Etios subcompact in India.
Toyota said the R&D changes are expected to improve the company’s competitiveness compared with global rivals because costs are reduced through more parts standardisation and sales are increased by improvements to the vehicle lineup’s design and functionality.
“In order to build better cars, we are remaking the way we develop them,” said Takeshi Uchiyamada, Toyota’s executive vice president in charge of R&D.
Uchiyamada said a major challenge for Toyota is cutting costs while improving product design, a seeming contradiction that he aims to resolve by using more common parts and working more closely with key suppliers.
“We won’t feel we’ve succeeded until we raise the use of standardised parts to about 50% among similar-size vehicles in our lineup,” Uchiyamada said. He added that it would likely take “several years” to achieve that goal.
Toyota has shrunk the number of regional managers for the Toyota brand to three groups: North America and China; Japan and Europe; and Australia, Russia and emerging markets. Consumers in these geographical categories tend to buy the same type of vehicles, Toyota officials told the WSJ.
The company said organising development according to the three regional groups is likely to promote parts sharing across similar vehicles and help streamline procurement of components from global suppliers. For example, Toyota has worked to cut the variety of radiators it buys to just 21 specifications, down from over 100 previously, Shinichi Sasaki, another Toyota executive vice president, said.
The changes, which were implemented starting last year, also allow Toyota’s chief engineers to report directly to top product planning executives instead of intermediary development centre chiefs, as had been the case previously.
Toyota said that will eliminate bureaucracy and allow new vehicles to get to market faster than before though the company didn’t detail any specific development time frames.
Final decisions about vehicle styling will be limited to smaller teams of executives and designers newly empowered to approve more ambitious designs but who also will be held more accountable for flops, Toyota officials told the Wall Street Journal.
Toyoda said that shift will help avoid the pitfalls of a “too democratic process” which he blamed for uninspiring vehicles and an overly lengthy approval system for new cars.