Interview with Toyota President

Very interesting interview with Katsuaki Watanabe – Toyota President seeks growth without major quality problems:

For the North American-exclusive models, we would like to localize as much as possible the r&d activities, like factory, production engineering and production preparation. We need to improve the engineering capabilities in those functions so that we will be able to localize more of those activities. So in that sense, they have to increase and enhance the operations at TMMA. We are likely to increase the size of TMMA.

However, it’s not just because we have more plants. Instead, the driver for this enhancement is that we want to localize r&d, production engineering and production preparation functions. Our desire is to do all the designing and production preparation for upper-body parts for North American-exclusive models, like Tundra, in America.

The whole interview just has a different feel to me that most CEO interviews. The focus seems to be on how to manage the organization better. The financial details will flow from managing most effectively. But it is hard for me to tell whether it is just my good feelings toward Toyota coloring my opinion of the interview.

Thanks to our customers, we’re very happy because our sales have been much stronger than we had originally expected. But top management cannot assume strong growth will continue forever. It has to consider the potential risks also.

As you said, we already have capacity increases under way at Canada and SIA, on top of Texas and Mexico. So if you add up all those additions, by mid-2008 we will have capacity to build 2 million vehicles a year in North America.

But of course, we have recognized that we have to prepare ourselves for beyond that. So we have just started a study as to what move has to be made next.

Is human activity a significant cause of global warming?

“Human activity” covers a lot of ground. But vehicles’ emissions — CO2, NOx and hydrocarbons, as well as particulate matter from diesel engines — those are real. Those are the downside of automotive technology. We in the automotive industry have to feel responsibility for that. One of the most important missions as the top management of this company, for me, is to “zero-nize” those downsides of automobiles.

When you say that more analysis needs to be done, are you saying global warming is or is not an established scientific fact?

This is just my personal feeling, because I am not an expert in these issues. But I think maybe it is the case that global warming is a scientific fact.

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