Toyota has established production facilities in North America, with a total of 10 in the United States, 3 in Canada, and one in Mexico. Beginning in 1984, Toyota partnered with General Motors Corp to enhance customer service by locating manufacturing and production sites nearby. This collaboration resulted in a notable boost in sales and the successful operation of profitable production facilities for Toyota throughout North America.
The company's philosophy has led to successful expansion of their production facilities. They started with one plant, called "Nummi," located in Fremont, California in the U.S. This plant produced 375,000 automobiles and closed down in 2010. Another profitable plant, named "TMMI," was established in Indiana in 1996 and has a production capacity of approximately 150,000 vehicles. Kentucky is also home to a significant plant that opened in 1996 with a production capacity o
...f about 500,000 vehicles. Furthermore, the company inaugurated its third plant in Canada back in 1984. Currently, they have three plants operating in Canada and manufacture around "500,000 cars annually" (History and Milestones, n.d.).
The 2008 J. D. Power and Associates Vehicle Dependability StudySM (VDS) has recognized Toyota's thirteen manufacturing plants in North America for their exceptional quality. These plants manufacture a total of 11 Toyota and Lexus models and have received an impressive 11 segment awards out of a possible 19. This achievement signifies that Toyota has surpassed all other manufacturers in this aspect for the third consecutive year (Toyota in North America, n. d.).
Analyzing Toyota's Production Facilities
Toyota's goal was to increase its global presence by targeting the North American market. The company believed that setting up production
facilities in the same location where vehicles are sold, instead of outsourcing parts assembly, would ensure compliance with specific geographic requirements. Toyota reasoned that manufacturing cars locally would allow for customization based on regional conditions; for example, vehicles in Ontario could be optimized to perform well in extremely cold weather.
Toyota enforces the Toyota Production System (TPS) in all its production facilities to guarantee that every car meets the particular demands of its target market. This strategy has propelled them to become the third-largest car manufacturer worldwide. Each facility adheres to TPS, which focuses on ongoing enhancement and integrates principles like Total Quality Management and "Kaizen." The goal is to eradicate defects and reduce inventory waste.
The Toyota Production System (TPS) utilizes the idea of "Jidoka" to minimize the impact of one product flaw on others. TPS emphasizes fast and accurate production while upholding ethical and safety standards. By following the principles of "lean manufacturing," TPS has been successful and efficient in Toyota's production plants. Moreover, TPS encourages employee empowerment by involving them in decision-making.
Toyota is always looking for the next major innovation or advancement, driven by the creative ideas proposed by their employees. These suggestions go through a thorough process, fostering loyalty among the employees. The implementation of these ideas improves employee productivity and guarantees optimum efficiency at every facility. Toyota remains committed to continuous improvement and promptly stops production in case any issues arise until they are resolved.
Toyota Motor Corporation (2010) adopts a decentralized management approach whereby facility managers are granted autonomy as long as their decisions are in line with the company's strategies and mission. This decentralization
has been instrumental in Toyota's ability to provide customers with high-quality products. However, there has been an increase in quality issues that have necessitated full recalls in recent times. Hence, it is imperative to propose recommendations for resolving this matter.
According to Reuters (2010), Toyota has globally recalled more than 8.5 million vehicles due to multiple issues including sticky accelerators, loose floor mats leading to acceleration problems, and brake glitches in their hybrid models. This has had significant repercussions for the company's customers and its previously excellent reputation within the automotive industry. Despite its past achievements, it seems that Toyota has strayed from prioritizing safety and responsible recall choices. Ultimately, the authority for decision-making rests with Japan.
As a result of Toyota's centralized decision-making, their North American partners were left out, causing delays in resolving defects and recalls for specific makes and models. Consequently, Toyota's reputation was negatively affected, leading to a decline in their worldwide sales.
My suggestion is for Toyota to include U.S production managers and external consultants in the decision-making process, particularly regarding safety. It would be advantageous for Toyota to invite outside engineering teams to examine their models and ensure they meet safety standards. Instead of taking responsibility when a customer encountered brake issues, Toyota opted to shift the blame onto the customer (‘Factbox: What has Toyota pledged to change," 2010). This type of inadequate service goes against Toyota's values, which focus on satisfying customers and making positive contributions to communities and the company.
As a part of our dedication to North American Vision, Toyota will provide top-quality innovative products and exceptional customer service. It is essential
for all employees at every location and facility to understand the organization's culture and strategy fully. They must also be capable of delivering excellent customer service. Retraining is necessary for each employee to effectively handle complaints and turn negative experiences into positive ones. Failure to address these incidents will not only damage Toyota's reputation but also lead to a loss of customer loyalty.
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