How Toyota Started, Grew And Became Successful
In 1937, Sakiichi Toyoda established the Toyota Motor Corporation, popularly known as Toyota.
Toyoda is a Japanese multinational vehicle manufacturer and second largest vehicle manufacturer
in the world.
How It All Began
Toyota started as a division of Toyoda Automatic Loom.
Sakiichi Toyoda created Toyoda Automatic Loom in 1933.
He built the company on the premise of making textile looming easier and more productive.
This proved successful and after getting a patent for his Looming machine, Sakiich began
earning enough money to be able to concentrate on other ventures.
After spending time researching and experimenting with car engines, Kiichiro Toyoda collected
1 million yen from his father, Sakiichi to begin a spin-off division of his father's
Looming Company.
Rather than textiles, this division would only manufacture automobiles.
Kiichiro achieved success with the creation of his first prototype model AA in 1932.
The first production cars rolled out in 1935, resembling Chevrolet and Dodge Power Wagon.
In September 1936, the new division ran a public competition to create a new logo.
Out of the 27,000 entries, the winning entry chosen was the one with the three Japanese
katakana letters for "Toyoda" in a circle.
The family name "Toyoda" was a kanji word meaning fertile rice paddies.
It changed to Toyota, a katakana word, which was written with eight brush strokes because
the number eight was a lucky number signifying wealth and fortune in East Asian culture and
to prevent the company from being associated with old-fashioned farming.
The company was then registered as Toyota Motor Company in 1937.
During World War II, Toyota focused solely on the production of simple military trucks
at the request of the Imperial Japanese Army due to severe shortages of military vehicles
at the time.
In response to this there was to be a scheduled bombing of the Toyota factories in Aichi but
fortunately for the company, the war ended before it could happen.
After the end of World War II in 1949, the Japanese economy underwent serious depression,
which pushed Toyota to the brink of bankruptcy, but they were saved by loans from an array
of banks whose conditions for the loans were the establishment of independent sales operations
and the weeding out of excess labor force.
By June 1950, the company was on the verge of shutting down and as per the agreement
with the banks; the management issued an order for the elimination of excess workforce.
Toyota workers went on strike due to the layoffs and reduction in wages.
This strike continued for two months.
It was eventually resolved by an agreement that consisted of layoffs, reduced wages and
the resignation of Kiichiro, the president at the time.
Taizo Ishida took over from Kiichiro as the Chief Executive of the company.
During this period, the Korean War ensued and the company was revived by an order of
5000 vehicles from the United States military.
Ishida was credited for his concentration on investment in equipment such as the construction
of the Motomachi Plant in 1959 that granted the Toyota Company a definitive lead over
Nissan.
It was also at this point that only 300 trucks were sold in the west because Toyota engineers
had those cars built for Japanese roads instead of American roads.
This led to the development of Toyota's QC Quality Control where they refined the process
that led to the defects in a car instead of patching and fixing those defects.
Later that year, a separate sales company, Toyota Motor Sales Co. was launched.
How Toyota Grew
In 1957, Toyota entered the American market with Toyopet Crown.
Americans did not accept the name Toyopet due to its resemblance to toys and pets and
in 1964, a 25% tax was placed on imported light trucks.
In response to this, Toyota Motor Company, Nissan Motors Co and Honda Motors Co began
building outlets in the United States.
The Toyota Company continued to expand and in the early 1960s with the establishment
of a research and development facility, Toyota launched a base in Thailand.
It was also at this time that Toyota first collaborated with Hino Motors and Daihatsu.
In 1963, the very first Toyota was built outside of Japan in Melbourne, Australia and between
1963 until 1965; Australia remained Toyota's biggest export market.
In 1966, Toyota released their cars on a global stage and established a worldwide presence.
It was at this time that the popular Toyota Corolla was released.
The Toyota Corolla became one of the most popular and best-selling cars in the world
by 1980 when the company had exported its one-millionth unit.
In 1973 oil crisis from US involvement in the Yom Kippur War propelled the need for
small cars rather than bigger cars.
An opportunity that Toyota seized before other companies could realize resulting in Toyota
overtaking them all not just in size, but also in the superiority of achieving better
fuel efficiency and quality for its vehicles.
Toyota Motor Company and Toyota Motor Sales merged in 1982 to become Toyota Motor Corporation.
Two years later, Toyota entered a joint venture with General Motors called New United Motor
Manufacturing Inc. with an automobile manufacturing plant in Fremont, California.
It is presently the site of Tesla Inc.
Toyota launched the Lexus in 1989.
In October 1989, Toyota introduced a new worldwide logo to celebrate the 50th year anniversary
of the company, and differentiate it from the newly released Lexus brand.
The logo was first used on the 1989 Toyota Celsior and quickly gained worldwide recognition.
The three ovals in the new logo combined to form the letter "T", which stood for Toyota.
The overlapping of the two ovals inside the larger oval represented the mutually beneficial
relationship and trust between the customer and the company while the larger oval surrounding
both of these inner ovals represented the "global expansion of Toyota's technology and
unlimited potential for the future".
Due to the success of Toyota Team Europe, Toyota Motor Europe Marketing and Manufacturing
was established to help market the vehicles in the continent.
Two years later, TMUK launched in the United Kingdom as Toyota cars were getting more popular
among British drivers.
In 2002, after producing in France for two years, Toyota entered a joint venture with
Peugeot and Citroen.
By 2003, a youth-oriented type of car; the Scion was launched.
In 2007, the Tundra was named "truck of the year" and the 2007 Toyota Camry was named
"car of the year" by Motor Trend.
In 2012, Toyota produced its 200 millionth vehicle and as of July 2014, Toyota was the
largest listed company in Japan by market capitalization.
On February 10, 2014, it was announced that manufacturing would end in Australia in 2017
due to the fluctuations in the Australian dollar that made export impossible and because
of high competition in a small local market.
The head offices in Melbourne and Altona were to be retained and used for other purposes.
As a result, the staff in Australia reduced from 3,900 to 1,300.
In March 2015, Toyota announced that $1 billion would be invested in artificial intelligence
and robotics and on August 27, 2018, it was announced that Toyota invested $500 million
in Uber.
WHERE THEY ARE NOW
By 2017, 80 years after its inception, Toyota's workforce had increased to consist of 364,445
employees worldwide.
Toyota is now the world's second-largest automotive manufacturer and is the first automobile manufacturer
to produce more than 10 million vehicles per year since 2012.
Presently, Toyota is the sixth-largest company in the world by revenue.
Toyota operates with its headquarters in Toyota city, Aichi, Japan, and Akio Toyoda is the
current president.
As at 2018, Toyota worth $236 billion and is one of the most successful companies in
the world.
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