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Auto Suppliers Souring on Toyota, Honda

But relationship with GM, Chrysler markedly improved.

by on May.14, 2012

A good relationship with suppliers can have a strong impact on how things go on the assembly plant floor.

Long the go-to customers for automotive partsmakers, Toyota and Honda have seen a sharp slide in the tenor of their relationship with industry suppliers, according to a new study, while things are markedly improving when it comes to General Motors and Chrysler.

The relationship between supplies and Original Equipment Manufacturers, or OEMs, can have a significant impact on an automaker’s business, especially at a time when U.S. car sales are growing faster than anticipated and partsmakers are struggling to keep up with demand, cautioned John Henke, the president of Panning Perspectives, a suburban Detroit research firm.

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“There’s enough business suppliers don’t have to take nonsense” from a manufacturer, said Henke, who today released his 12th annual survey on supplier/OEM relations.


Independent Panel Recommends Fixes for Toyota Quality, Safety Problems

Led by former Transpo Sec. Slater, group calls for more global flexibility.

by on May.23, 2011

Former U.S. Transportation Secretary Rodney Slater delivers some harsh recommendations to Toyota.

An independent panel led by former U.S. Transportation Secretary Rodney Slater has issued some far-reaching recommendations aimed at helping Toyota avoid the sort of quality and safety problems that have been plaguing the maker – resulting in the recall of over 10 million vehicles, damage to the once-lofty Japanese brand’s image and a slew of potentially costly lawsuits.

Perhaps the most far-reaching conclusion is that Toyota needs to shift from a highly centralized global structure to one that gives more autonomy to regional operations, notably in North America.  The panel’s report, titled “A Road Forward,” also stresses that Toyota needs to be more willing to listen to concerns raised about its quality and safety by outside sources.

The panel was initially created during the so-called “unintended acceleration” crisis that was kicked off by a huge October 2009 recall.  A second recall, three months later resulted in the maker temporarily halting sales and production while it dealt with potentially sticky accelerator pedals.  But a variety of other quality and safety issues have since cropped up, resulting in the callback of millions of additional vehicles.  That led the panel to conduct a “much broader” review, according to a summary of its findings.

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“It has been said that a good company takes a problem and solves it, but a great company takes a problem and learns from it,” said former Sec. Slater.  “Toyota appears to be committed to applying what it has learned to make important changes to improve its quality and safety processes, but there is more to be done.  We hope this report helps Toyota in that endeavor.”


Toyota Output Down 542 Thousand in March

Japanese makers reporting huge production losses after March 11 disaster.

by on Apr.25, 2011

Toyota is building Prius again - but at a reduced rate.

The devastating disaster that struck Japan last month has a calamitous impact on the world’s largest automaker, Toyota Motor Co. today reporting its global output fell by nearly a third in March — and with the company unlikely to resume normal production levels until the very end of 2011, Toyota seems all but certain to lose its position as industry sales leader.

But Toyota is by no means unique among Japanese makers.  The Asian nation’s powerful auto industry has been humbled by the combination of a 9.0-magnitude earthquake, tsunami and nuclear power crisis that continues to wreak havoc on Japan’s manufacturing capabilities.

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Toyota has been especially hard hit because it depends more on Japanese assembly lines than other major Japanese makers, like Nissan and Honda, who have steadily shifted more and more of their production abroad.  But even those makers are struggling because of their continuing dependence on Japanese-made parts shipped to so-called “transplant” assembly lines in North America, Europe and other parts of the world.

Toyota’s Japanese-based plants were all but shut down in the wake of the March 11 disaster, vehicle output for the month plunging to just 129,491, a 63% decline.  Of that number, 107,751 were exported, a 33% drop from year-earlier levels.


Scion Indefinitely Delaying iQ Minicar Launch

Toyota division blames parts shortages.

by on Apr.21, 2011

The Scion iQ, first shown at the 2010 NY Auto Show, has been delayed due to the ongoing Japanese parts shortages.

Scion has put an indefinite hold on plans to launch the new iQ minicar, putting the blame on the ongoing shortage of Japanese-made parts.

The iQ, sold in Europe under the Toyota brand, will be one of the smallest products on U.S. roads once it finally reaches production.  The Scion brand had hoped it would be able to take advantage of mounting concerns about rising fuel prices – but the launch was caught up by another major event that has shaken the global auto industry.

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Toyota’s home market plants lost a full month of production – equivalent to more than 250,000 vehicles — after the March 11 earthquake and tsunami that devastated Japan and the subsequent nuclear crisis.  Meanwhile, with a number of key suppliers still out of action, the maker and its various divisions have only been able to resume production in Japan at half speed.  And until June 3rd, North American plants will operate at barely a third of their capacity.

So, acknowledged Scion General Manager Jack Hollis, “The iQ launch will be later than we originally planned.”


Toyota Raising Prices – Cutting Incentives

Will others follow – or could it backfire?

by on Apr.01, 2011

Dealers have been tacking on as much as $3,000 extra for the Toyota Prius, lately. Now the maker will raise its prices, as well, by more than 2%.

Toyota plans to raise prices on almost its entire line-up on May 1st, a move many observers had anticipated in light of the Japanese auto meltdown that has cost the maker hundreds of thousands of units in lost production.

Dealers have already begun raising prices, according to various reports, hoping to take advantage of the supply shortage, which is expected to grow worse in the coming weeks, and analysts say the giant Japanese maker is hoping to get its share of the potential bonanza.

But in light of the maker’s worse-than-expected 5.7% decline in sales during March, some observers warn that Toyota may be setting itself up for further setbacks.

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The increases average about 2.2%, though they vary by model and brand, with some slower selling models, like the Scion xD, seeing prices rise by as little as 0.4%.

“It’s Business 101,” says analyst Jim Hall, of 2953 Analytics.  “It’s supply-and-demand and they’re trying to make up the revenue they’re losing with the rolling blackouts in Japan cutting production.”