Asia Biz News - Asian Business News and Tenders
Toyota Announces Major Strategic Shift Starting in April 2019
November 3, 2018
Toyota Motor Corporation confirmed more plans of a 'once-in-a-century' restructuring of the company, with highlights including refocusing on regional mobility services, car-sharing, and a major move into non-automotive businesses.
To shift from a nationwide focus to a focus on creating "best-in-town" sales outlets, and, thereby, being better able to address regional needs, Toyota replaced its channel-based sales operations structure and work style with a region-based structure and work style in January this year. To further promote this effort and to prepare for a society of mobility, Toyota intends to make, in principle and over a transition period from 2022 to 2025, all vehicle models available through all sales outlets in Japan, enabling such outlets to respond to the needs of all customers in each region of the country.
Additionally, Toyota will establish a new car-sharing business. With the use of car-sharing expected to increase in the future, Toyota sales companies, based on a new focus on mobility, will provide services coordinated with non-automotive businesses, local governments, and other entities, and aim to be companies that increase the prosperity of regional societies.
These initiatives will begin in April 2019 with the integration of Toyota's four directly owned sales companies in Tokyo to form Toyota Mobility Tokyo, Inc. While Toyota's system of multiple sales channels will continue to exist nationwide, such a system will be replaced in Tokyo by the new company, which, as "one Toyota," will be the first in Japan to begin sales of all vehicle models through all sales outlets, and will take up the challenge of providing new mobility services.
Outline of specific activities
1. Product strategy
- Maintain annual sales of 1.5 million vehicles by offering well-selected and highly competitive products, and fully utilizing the distribution network.- For the purpose of rolling out mobility services that can respond to a wide range of regional customer needs at all outlets in Japan, make--over a transition period from 2022 to 2025--all vehicle models available through all outlets nationwide.- Although there will be common availability of products (vehicle models) among outlets in Japan, the current sales channels, which are in themselves brands that have been built up over long periods by sales companies and their customers, will remain (except among Toyota's directly owned sales companies in Tokyo, which are to integrate into one).
2. Launch of mobility services
- Toyota will develop and provide systems and devices(Notes) necessary for the car-sharing business to its sales companies in Japan.Notes:(1) Japan version of car-sharing mobile app already being used in Hawaii; (2) Denso-made data-transmission driving recorder for acquiring vehicle information; and (3) Toyota Finance Corporation payment system.- Based on the aforementioned systems and devices, a car-sharing business will be established using test-drive vehicles from Toyota sales company outlets and test-drive vehicles from Toyota - - Rent-a-Lease outlets. Sales companies will be encouraged to participate.In addition to Toyota preparing its sales network, each sales company in Japan will take the lead in actively rolling out mobility-service activities that meet the needs of each region.In addition to an abundant vehicle-model lineup and safety equipment, both of which are befitting of a car maker, Toyota aims to develop services that give points and more to customers based on car use information and driving.- Trials in Tokyo are anticipated to begin within 2018. Regions in which services will be available are to be gradually increased, with a full-scale rollout targeted for within 2019.
3. "Tokyo ReBORN"
- A new company is to be established in April 2019. The system of multiple sales channels will be abolished, and the globally used Toyota brand logo will gradually be adopted in signage and other areas to unify the new directly owned sales company in Tokyo into "one Toyota."- Simultaneously with the above, outlets of the new company will be the first in Japan to begin sales of all Toyota vehicle models.- A trial car-sharing service will begin in Nakano Ward in December 2018, with rollout slated for February 2019 to cover all of Tokyo by using approximately 20 outlets of Toyota's directly owned sales companies in Tokyo.- "KINTO," a monthly set-price service for private customers that packages tax and insurance payments, along with procedures such as those related to vehicle maintenance, will be introduced on a trial basis at the beginning of 2019. With the integration of Toyota's four directly owned sales companies in Tokyo, improvement activities will be carried out to enhance the productivity and quality of sales company operations.
A "TPS Kaizen Promotion Division" will be established in the new company to cultivate the human resources necessary for making improvements, and work-style innovation will be pursued.
For a more-prosperous and more-enjoyable future society of mobility, Toyota is aiming to transform itself from a company that makes automobiles into a mobility company that provides a diverse variety of mobility-related services. Transformation of its sales network in Japan is a key component in Toyota's transformation into a mobility company.
Toyota President Akio Toyoda made the following comment today to the representatives of Toyota sales outlets from across Japan:
"Tomorrow's cars will become a part of the societal system, by using information to connect to communities and to various services that support the way people live. As mobility changes, and amid vast changes in how people live and how communities exist, the concepts of 'region' and 'hometown' will become important.
"The strength of Toyota's sales network lies in business operators being 'local capital.' By this, I mean that they love their hometowns and that our network represents a gathering of people who earnestly and sincerely hope for the development of their regions. How to put smiles on the faces of people who live in their own towns. It is the people who comprise our sales companies who know best how to do this. All outlets (in Japan) being able to offer all vehicle models will make the birth of community-based services unlike any before possible. If the strength of being local is fully utilized, and if new, locally rooted mobility services are developed and provided for each region, Toyota's sales network will become an irreplaceable entity for such regions, and I believe this would become an advantage for the Toyota Group. Bringing about change for the future. And having that change make communities and how people live more prosperous. With such aspirations at heart, I want to move forward on the path toward the future society of mobility together with all of you."