Toyota Motor Corporation and its wholly-owned subsidiary Daihatsu Motor will establish an internal company responsible for compact vehicles for emerging markets on 1 January 2017. The new division is the Emerging-Market Compact Car Company. The internal company’s objective is to establish work processes “untethered by conventional practices and rules” to introduce cars based on Daihatsu’s approach to manufacturing affordable small cars. Daihatsu President Masanori Mitsui will be appointed chairman and Toyota Managing Officer Shinya Kotera will be president of the new company.
Toyota is under intense competitive pressure from global automakers and is experimenting with a different organizational approach to getting mini cars to market. Honda, Maruti and Tata, among others come to mind here. However, this – potentially – could also change Toyota’s approach and cost basis to compact vehicles in established markets.
The move follows the announcement in October that Toyota and Daihatsu would work toward establishing the internal company. (Daihatsu Takes Lead from Toyota in Emerging Markets) It will be based on Daihatsu’s approach to manufacturing affordable vehicles for emerging markets where the potential for growth is high, but also where competition and regulations are intensifying. Daihatsu’s expertise heretofore is in mini-vehicles – so-called kei cars – not larger compacts, so it’s an expansion for Japanese automaker.
Internal Mission Statement
- With the utmost priority placed on emerging markets, the new internal company’s objective is to establish work processes untethered by conventional practices and rules and to introduce competitive ever-better cars based on Daihatsu’s approach to manufacturing affordable, high-quality products.
- The new internal company is to consist of three divisions: The Emerging-market Compact Car Product & Business Planning Division, the Emerging-market Compact Car Product Planning Division and the Emerging-market Compact Car Quality Planning Division. Furthermore, Toyota Motor Asia Pacific Engineering and Manufacturing Co., Ltd. (TMAP-EM) is to be renamed Toyota Daihatsu Engineering and Manufacturing Co., Ltd. (TDEM) and become an entity under the new internal company.
- The Emerging-market Compact Car Product & Business Planning Division, which is to span both Toyota and Daihatsu, is to conduct overall planning for products and business operations, including making proposals for the Toyota-brand vehicle product lineup for emerging markets and for overall strategy.
- Although Daihatsu will basically have responsibility for product development for emerging-market compact cars, the new internal company’s Emerging-market Compact Car Product Planning Division and Emerging-market Compact Car Quality Planning Division will be responsible for final product development and quality for Toyota-brand vehicles.
- With the establishment of the new company, TMAP-EM, which has hitherto specialized in providing Toyota development, logistics and production preparation support for locally produced vehicle models, is to also be responsible for supporting the production of Daihatsu-centered compact vehicles for emerging markets.
Toyota: “It was announced today that the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) revoked the model certifications of three vehicles produced by Daihatsu Motor Co., Ltd. (Daihatsu). The affected models are the Toyota TOWN ACE TRUCK (models: 5BF-S403U, 5BF-S413U), Daihatsu Gran Max, and Mazda BONGO. The TOWN ACE TRUCK, which Daihatsu produces for Toyota, is a vehicle that has been used for daily transportation and can be customized to suit the customer’s needs and preferences, such as by arranging the truck bed, making it a one-of-a-kind vehicle that has been well received.
“We would like to express our sincere apologies for the inconvenience and concern this revocation will cause to all stakeholders, including customers who have been waiting for customization, suppliers, and dealers.” 26 January 2024
Toyota on Daihatsu Motor False and Illegal Certifications
Toyota City, Japan, 16 January 2024: ―Toyota Motor Corporation (Toyota) would like to take this opportunity to once again express its sincere apologies to all stakeholders, including customers, suppliers, and dealers, for the inconvenience and concern that it has caused as a result of the procedural irregularities committed by Daihatsu Motor Co., Ltd. (Daihatsu).
Daihatsu received a rectification order regarding procedural irregularities from the Ministry of Land, Infrastructure, Transport and Tourism today. Toyota will fully support Daihatsu not only in reviewing its certification operations but also in making fundamental changes in its corporate culture and management so that Daihatsu can once again be trusted and chosen as a company of choice.
Going forward, we will work with Daihatsu to carefully respond to the concerns of our customers, suppliers, and dealers in a courteous and polite manner. In addition, we will report on measures for revitalization and transformation to prevent recurrence and on the rectification order in about one month.
Background
Toyota City, Japan, 30 December 2023―Today, Daihatsu Motor Co., Ltd. (Daihatsu) received the investigation results of the Independent Third-Party Committee (chaired by Makoto Kaiami) commissioned by Daihatsu regarding procedural irregularities, which it reported to Toyota Motor Corporation (Toyota) in turn. The investigation found new irregularities in 174 items within 25 test categories, in addition to the door lining irregularity in April and the side collision test irregularity in May. These encompassed a total of 64 models and 3 engines of vehicles (total of models currently being produced, developed, or ceased in production), including 22 models and 1 engine being sold by Toyota.
We would like to express our sincere apologies for the inconvenience and concern this has caused to all stakeholders, including customers.
In response to these findings, Daihatsu decided today to temporarily suspend shipments of all Daihatsu-developed models currently in production, both in Japan and overseas. Toyota has also decided to temporarily suspend shipments of the affected models.
Over the course of the investigation by the Independent Third-Party Committee, Daihatsu received some information regarding models that may have been involved in the procedural irregularities. In response, Daihatsu has been conducting one-by-one in-house technical verifications and actual vehicle testing for these vehicles to ensure that their safety and environmental performance meet legal standards.
In the final stage of the investigation, it was discovered that a different airbag control unit (ECU) than the mass-production model was used for the airbag tests for Daihatsu Move / SUBARU Stella, Daihatsu Cast / Toyota Pixis Joy, Daihatsu Gran Max / Toyota Town Ace / Mazda Bongo. Although technical verification confirmed that the airbag met standards of occupant protection performance, in the course of testing, it was found that the “Safety Performance Standard for Occupant Evacuation (Unlocking)” in the side collision test of Daihatsu Cast / Toyota Pixis Joy may not comply with the law. At this time, we are not aware of any accident information related to this matter, but we are conducting thorough technical verification and investigating the cause to take necessary measures as soon as possible.
For other cases, we have confirmed that the performance standards specified by the regulations are met, and the validity of the verification results and process has also been confirmed by TUV Rheinland Japan (TRJ), a third-party certification organization.
Certification consists of having the national authorities inspect and confirm that vehicles meet various standards so that customers can drive their vehicles with peace of mind. We consider certification to be a major prerequisite for doing business as an automobile manufacturer. We recognize the extreme gravity of the fact that Daihatsu’s neglect of the certification process has shaken the very foundations of the company as an automobile manufacturer.
Since 2013, Toyota has been increasing the number of OEM models it receives from other companies, mainly compact vehicles. We deeply regret that the development of these vehicles may have been a burden on Daihatsu and that we were not aware of the situation with the company’s certification operations.
Daihatsu has informed us that, going forward, it will clarify the situation with the authorities and take appropriate action under their guidance. It will also thoroughly investigate whether there have been any other similar cases to ensure customer safety first and foremost. We at Toyota will also fully cooperate with this investigation.
We believe in order to prevent recurrence, in addition to a review of certification operations, a fundamental reform is needed to revitalize Daihatsu as a company. This will be an extremely significant task that cannot be accomplished overnight. It will require not only a review of management and business operations but also a review of the organization and structure, as well as a change in human resource development and awareness of each and every employee. Toyota will provide our full support to Daihatsu’s revitalization so that it can return to its roots as the “compact mobility company” that Toyota and Daihatsu are striving for it to be, as well as regain the trust of all stakeholders.
List of models in which irregularities were committed (Toyota models)
“Daihatsu Motor Co., Ltd.’s wrongdoing is a matter that concerns safety, which is the most important aspect of vehicles. We consider this an absolutely unacceptable act that betrays the trust of our customers. We would like to sincerely apologize to our customers around the world and all related parties for the inconvenience and concern this has caused.
“Since this problem occurred with a Toyota brand passenger car, we believe that the problem is not limited to Daihatsu. We will begin by conducting a detailed investigation and thoroughly collecting facts to understand the situation, determine the true cause, and work diligently to prevent a recurrence. We will also inform the public in a timely manner regarding the facts we learn through our investigations.
“I personally promised our customers that Toyota would not run away, lie, or distort the truth during the recall crisis in 2009. Nevertheless, we find it to be a serious matter that such a problem has occurred at one of our group companies.
“As the top executive officer, President Sato will take responsibility for improving the car manufacturing operations of Toyota and the group companies, while I, as the Chairman of the Board and with my recall issue experience, will lead initiatives for governance and compliance. The Toyota Group as a whole will do its utmost to regain the trust of our customers as soon as possible,” Akio Toyota.
– Akio Toyoda is Chairman of the Board of Toyota. Daihatsu is a wholly owned subsidiary. – editor.