GS69

Toyota to Save $2.7 Billion Annually
Toyota has announced that it expects to save $2.7 billion annually by accelerating its cost-cutting efforts. Toyota has been working on a new cost saving strategy — called VI for Value Innovation — since 2005. The plan calls for multiple car components to be lumped into modules or systems. Volkswagen recently announced a similar plan for its vehicles.

"We would expect to exceed what we've done under the previous plan," Toyota president Katsuaki Watanabe told Reuters.

Toyota's previous plan — Construction of Cost Competitiveness in the 21st Century or CCC21 for short — cut the price of individual parts, saving the company $9 billion over the past five years. Toyota hasn't released all of the details of its VI plan, but says its impact will be even faster and bigger than the CCC21 plan.

The VI plan will be incorporated into every new Toyota model beginning next year, which should help the Japanese automaker to achieve its goal of a 10% operating profit margin.

Toyota plans to sell 10.4 million vehicles by 2009.

Koma

iTrader: (3)

Pass the savings onto your customer base or invest it into some fun/sports cars.
Or invest it into getting your "growing pain" troubles down to a minimum.

rominl

iTrader: (4)

wow that's quite a bit of savings

Stormwind

In another words, Toyota buyers are expected to pay an extra $2.7 Billion in repairs and warranty.

jracerlmn

they could spend at least 1/5 of that into build materials for new cars or fixing some quality issues

mex lex

iTrader: (4)

Could it mean that most toyotas will be the same except for different exterior skin? Possibly even same/similar interiors?

PhilipMSPT

iTrader: (5)

My only request if this is for real:

DO NOT SKIMP ON THE ENGINEERING!!!

You can skimp on material quality, labor costs, and even marketing. BUT DON'T SKIMP ON THE ENGINEERING!!!

Koma

iTrader: (3)

They've been doing this kinda thing for a few years now, you won't see such a drastic thing like that. You'll see cars using the same basic platform, interior and engines:
Yaris echelon of vehicles, xB, xD, xA
Corolla, tC, Matrix/Vibe
etc.
But I wouldn't say they are the same car with exterior changes.

kit cat

iTrader: (6)

"hi, my window switch broke, how much is it to replace that?"
"you'll have to replace the entire door panel"

mmarshall

Better yet, put it into some decent interior materials. The trim and hardware on many new Toyotas has been a joke. (Fortunately, the new Highlander is an exception).

Lexmex

Better paint.

mmarshall

I don't know about the Mexican-market Toyotas, but the ones sold in the U.S. have what are arguably the best paint jobs in the buisness. For all its other problems with hardware, trim, and sheet metal, paint is still something that Toyota does superbly.....from $13,000 entry-level Scions to the $70,000 Lexus LS.

spwolf

what they mean is use same electronics for window switches for example... right now most cars use different modules even though as they function the same.

now do 500 parts like that per car and it amounts to signifcant savings. It really has nothing to do with platforms or interiors and things like that.

mmarshall

There's no question that you will have greater simplicity of production and cost savings at the factory level......no one is disputing that. But Coco-bun has a good point when he points out that some normally simple and inexpensive repairs could turn out to be not-so-inexpensive. Even with some labor savings, you will ultimately be dealing with larger, more expensive replacement parts at the dealer service and repair level.......particularly when the warranty runs out.

Lexmex

I am probably biased since that is about all I see. When I went out to Jamaica back in March for a business trip, the ones I saw there (both Toyotas and Lexuses) seemed to have their paint in good shape and a guy at a shop where I bought my Harrier emblem remarked that he was surprised given the salty air.

I think in Mexico City, as I remarked before, the environment takes its toll. My company accountant has a Corolla and she is always complaining about the fading, chipping paint. However, most of the 4Runners and Siennas I see, seem to hold up better.