Toyota SA will host an international conference in Durban next month on increasing the local content of Toyota vehicles manufactured outside Japan.
Toyota SA will host an international conference in Durban on increasing the local content of Toyota vehicles manufactured outside Japan. The conference takes place from February 18 to 20.
According to Toyota SA spokesman Mzi Edom, attendees include 50 directors and senior managers from Toyota Motor Corporation (TMC) in Japan. In addition, representatives from Toyota’s manufacturers and distributors in Thailand, Indonesia, Australia, India, Taiwan, Brazil, Pakistan, Philippines, Singapore, Malaysia and South Africa will attend. Kazuo Okamoto, a managing director of TMC, will chair the meeting.
TMC established the committee for increased localisation (CIL) two years ago and selected five countries where Toyota vehicles were manufactured “to actively increase the local content in the units they produce”, Edom said. The objective was to make these companies less reliant on imported parts, especially those sourced from Japan. The five countries that are the major players in this programme are South Africa, Australia, Taiwan, Malaysia and Thailand, he added.
This will be the third meeting of the CIL for the Asia-Oceania-South Africa-South America region. The focus at the upcoming Durban meeting will be to “encourage the stabilisation of vehicles costs within each of the countries by increasing local content, thereby removing cost fluctuations caused by exchange rate changes”. The second objective of the meeting was the team to be encouraged to develop “yen free” sourcing of their imported components to counter the high cost of vehicle parts produced in Japan.
“Yen free” means sourcing from any country other than Japan, and the countries involved in the CIL project already produce and supply a wide range of components made in their respective countries, with many of them being specialist suppliers of a particular components, such as engines, steering racks and transmissions.
CARtoday.com reported recently that Toyota SA had became a significant player in this global supply network with the establishment of a facility to manufacture catalytic converter in a joint venture between Toyota SA, TMC and Cataler Corporation.
The initial annual output will be a million units a year, with the majority of the converters being exported. Toyota SA has managed to increase the local content on one of its volume models – the Corolla – from 47 to 60 per cent in two years with the assistance of this committee.
This translates into foreign currency savings of approximately R300-million per annum, Toyota SA said. The company has also achieved a “Yen free” content of 74 compared to the previous level of 49 per cent. The programme is a proven method of reducing costs without sacrificing quality, as all Toyota components have to comply with prescribed quality standards.
