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Cars, jobs, and a cleaner environment

Toyota invests into smart and green manufacturing

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A locally-assembled Innova goes through a final quality check.

In its over 30-year history, Toyota Motor Philippines (TMP) has grown to be the largest automotive manufacturer and distributor in the country with a product line-up of 21 Toyota and 18 Lexus models. They also enjoy a total market share of 38.1 percent, with 71 dealer outlets nationwide to date. Employment in TMP’s value chain has reached over 55,000 employees, encompassing white and blue collar jobs.

In a recent visit to Toyota Motor Philippines’ manufacturing plant in Sta. Rosa, TMP shared how the company’s P5.38 Billion in investments from the Comprehensive Automotive Resurgence Strategy (CARS) project enhanced not only the company’s local production capabilities, but ultimately added value to revitalize vehicle and parts manufacturing in the country.

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An engine is checked and prepared to be fitted to a vehicle shell.

Smart manufacturing

Toyota Motor Philippines’ investments in the CARS program include the local parts production of the Toyota Vios at the Resin Injection Molding Facility for bumpers and instrument panels, Roller-Hemming Robots at the welding line, and the newly-inaugurated A0 Press Line for stamping of side member panels. Through these investments, TMP has integrated high-tech equipment in the Toyota Production System, using robots to automate repetitive tasks and making production processes more efficient as a result. To handle new production technologies, TMP has also invested heavily in manpower training for the acquisition of new skills.

Aside from acquiring new production technologies, TMP continuously supports its local suppliers in developing technical know-how, upgrading their manpower skills, and in addressing technical gaps through Technical Assistance Agreements (TAA) with Toyota’s network of suppliers in the Asia Pacific region. Among the CARS-enrolled suppliers having TAA include Valerie Products Manufacturing (with Ogihara Thailand Co. Ltd.) and Manly Plastics (with Toyoda Gosei Thailand Co. Ltd).

Through these strong partnerships, TMP and its suppliers were able to produce the Toyota Vios with greater local content, specifically for big body shell and large plastic parts that have a very complex nature of production, resulting in a localization ratio of 58 percent for each car.

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A 1-MW solar array fitted to the roofs of the factory buildings.

Greener technologies

With several goals in place for a more sustainable future, Toyota has started equipping its manufacturing operations with greener technologies, including a 1-MW solar array that supplies about four percent of the manufacturing plant’s annual energy requirements, reducing 790 tons in CO2 emissions. Likewise, several karakuri projects in the production line have been started to further reduce electricity consumption, such as the use of mechanical equipment which optimize a gravity-balance system. These initiatives are well aligned with the objectives of the Toyota Environmental Challenge 2050 – to lessen their carbon footprint in every stage of business operations and add more value to society.

Toyota’s six-step challenge, culminating in the year 2050, begins with increasing Toyota’s Hybrid and Electric Vehicle (HEV) lineup available in the market, with the objective of eventually eliminating all carbon emissions. The second challenge involves reducing the collective carbon footprint of the Toyota value chain, which involves the supplier network, logistics operations, and the dealer network. The third challenge is to utilize 100 percent renewable energy in the manufacturing plant in Sta. Rosa. Challenge four is minimizing and optimizing water usage in the plant by implementing rainwater harvesting and other methods of water recycling. The fifth challenge is to establish improved recycling methods, such as HEV battery collection and disposal schemes, establishing bumper recycling systems at Toyota dealerships, and reducing TMP’s overall waste generation. Finally, Challenge 6 is to establish a future society in harmony with nature through an 11-hectare Toyota Forest inside the Toyota Special Economic Zone, and a 10-hectare Makiling Botanical Garden Reforestation project under the Toyota Adopt-a-Forest program.

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TMP executives, with members of the media, stand beside the locally-assembled Innova and Vios.

Contributions to the economy and society

The demand for locally-produced vehicles has enabled Toyota to expand its production operations in the country, contributing more to the Philippine economy in terms of investments, taxes, employment and technology transfer.

From 1989 to 2018, the Toyota Group has invested approximately PhP 62-Billion, with PhP 342-Billion in taxes paid. TMP has procured approximately PhP 198-Billion from local suppliers, with 43 direct suppliers and 96 member companies comprising the Toyota Suppliers Club. Since 1997, Toyota Group Auto Parts Exports have amounted to USD 14.5-Billion, accounting for 27 percent of total auto parts exports in the country. Approximately 55,000 people are employed by Toyota Motor Philippines, Toyota Suppliers, and their dealer network. Further contributions to society include the Toyota Motor Philippines Foundation, which comprises various scholarships, Gawad Kalinga villages, and annual medical, dental, and outreach programs. In addition, the Toyota Motor Philippines School of Technology or TMP Tech, aims to be the school of choice for technical education in the country. Current programs of the school include General Job Automotive Servicing, Auto Body Repairing, and Auto Body Painting and Finishing. As of September 2019, TMP Tech has had a total of 1,130 graduates, with 274 graduated scholars since 2013.

Having a high multiplier effect, the auto industry’s growth in the country has paved the way in expanding auto parts manufacturing, bringing in more investments and new technological skills and know-how.

By Chris Van Hoven

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