Strengthening Stamping Capability for Competitiveness in a ...

Strengthening Stamping Capability for
Competitiveness in a Global Marketplace

Brian Krinock

Vice President, Production Engineering
Toyota Motor Engineering & Manufacturing North America, Inc.

Presentation Agenda

I. Toyota Global Operations
II. Toyota North American Operations
III. Stamping Supply Base for Toyota in NA
IV. Competitiveness of Global Stamping

Operations
V. Expectations of a Supplier
VI. Internal Methods for Competitiveness
VII. Example of Supply Base Improvement
VIII. Q&A

Toyota’s Global Operations

ƒ 65 manufacturing companies Region Mfg. Companies
ƒ 27 countries and regions ƒ North America 11
ƒ 299,394 Toyota employees worldwide ƒ Latin America 5
ƒ Europe 8
ƒ Africa 2
ƒ Asia (including Japan) 37
ƒ Oceania 1
ƒ Middle East 1

North American Manufactured Vehicles

Venza RAV 4 Highlander Prius
2008 2008 2009 2010

12 NA Manufactured models in 2008; 14 by 2010

15 North American Manufacturing plants
5 Design / Research & Development locations

North American Operations

Direct Employment: 43,858
Direct, Supplier and Indirect Employment: 386,300*
Direct Investment: $21.8 billion
Toyota, Lexus & Scion Dealers: 1,745
2007 Vehicle Production: 1,671,009
2007 Vehicle Sales: 2,922,821

* 2005 CAR Study

State of Toyota 1980-1989 1990-1999 2000-2007

As our Sales continue 2,922,821 Vehicles Sold
to grow in North 2.9% increase from 2006
America… 2 million

…our Investment 1 million
increases…
14 $21.8 billion Invested
…our Jobs are
increasing… No. of Plants 9 13 $ 15 b In 2010,
8 12 Toyota will
11
10

open its 15th

$ 10 b NA plant in

5 7 Blue Springs,
Mississippi

34 $5b
12

43,858 Team Members

30,000
20,000

5,000

…and our Production 1,671,009 NA Produced
continues to grow…
2.2 million (2010 capacity)
…Suppliers are our
biggest contributor 1.5 million Projected
1 million Capacity
500,000 in 2010

Suppliers in North America

Annual Buy - $30B „ Marketing
„ Advertising
„ Direct Parts & Materials „ Facilities Maintenance
„ Construction, Machinery & Equipment „ Other
„ Logistics
„ R&D

Suppliers in North America

• More than 500 suppliers
in NA

• 700 locations

• $30+ billion in
annual purchases

9

Toyota Purchasing Principles

„ Open Door Policy/Fair Competition

„ Mutual Trust/Benefit &
Long Term Relationships

„ Contribution to Local Economy

Toyota’s Expectations of Suppliers

1. Safety
2. Quality
3. Delivery & Production
4. Cost
5. Technical Capability
6. Be Competitive

Prevent “The Seven Mudas”

1. Safety Philosophy:

Eiji Toyoda Safety First

“Safety is the starting point
for everything”

Akio Toyoda Sustainable
Cost Growth
Volume
Quality
Safety

2. Quality

Philosophy:

Build Quality into Process

Sakichi Toyoda Toyoda G-type automatic loom
The loom stops
if a broken thread is detected

Jidoka

3. Delivery & Production

Philosophy:

Toyota Production System (TPS)

Taiichi Ohno
"what is needed,
when it is needed, and
in the amount needed."

Just in Time

4. Cost

Philosophy:

Highest Customer Value at Lowest Cost

Value Function
Cost

5. Technical Capability

Philosophy:

Innovative, Competitive, Technology

Prius Tundra
- Hybrid Technology - Tailgate Lift Assist

6. Be Competitive:
Prevent “The Seven Mudas”

A. Overproduction
B. Excess Inventory
C. Unnecessary Conveyance
D. Overprocessing
E. Waiting
F. Unnecessary Movement
G. Defects

A. Overproduction

B. Excess Inventory

C. Unnecessary Conveyance

THE SEVEN MUDAS

D. Overprocessing

E. Waiting

F. Unnecessary Movement

G. Defects

Result = Reward

Positioning Ourselves to be Competitive

„ TPS focuses on high quality at low cost
„ Removes Muda from the system
„ Muda = non-value added activity

Toyota Stamping Supplier
Supply Base Overview

Toyota Global Stamping Supply Base

EUROPE

JAPAN N .A M ERICA

A SIA A USTRA LIA S.A M ERICA
A FRICA
: Toyota Plant
● : Toyota Affiliate

Supplier(s)
■ : Non- Affiliate

Supplier(s)

Toyota Stamping Supply Base Map

TMMC-1&2 TMMC-1&2
TMMK
NUMMI TMMK
TABC TMMTX
NUMMI TMMI
NA 1990 TA BC

NUMMI TMMTX
TA BC
TMMBC NA 2000

TMMC-1&2

SIA

TMMWV

TMMK

TMMI

TMMAL

TMMMS

TMMTX

NA Today

How to be a Competitive Stamping Supplier

Material:
Usage / Blank Layout

Productivity
SPM, Die Change Time, Downtime

Direct & Indirect Labor
Usage & Rate

Tooling Cost
Minimize Processes/Stations, Specification

Logistics Cost
Distance, Packaging

Global Competitive Analysis: GSPH

GSPH Performance by Region (Estimate)

5-10% Gap

GSPH

JPN Best EU Best NA Best CHN Best

Labor, technology and Process are contributing factors

NA Competitive Analysis: SPM

SPM Global v Local Suppliers: North American Production

~30% Gap

SPM

Global Affiliate Supplier NA Local Supplier
(Avg)

NA Competitive Analysis: Die Change

Die Change Time (Transfer Die in Minutes)

~ 4x longer

NA Local Supplier Global Affiliate Supplier
(Avg)

How does Toyota
Remain Competitive?

Toyota’s Industry Postion: Harbour data

History of Stamping Hours Per Unit (HPU)

6.3

3.71 Average Die Changeover Time (Minutes)
3.57
2.95 51.5
2.61
2.40 2004 2005 2006 3.29 37.9
2.98
2003 2.46 25.6
2.35 19.6
1.64 12.7
8.4
2007 7.8
2007
24.9 2004 2005 2006
22.9

13.2
8.6

2003

Toyota’s Industry Postion: Harbour data

Operating Hours Per Die Change (Die Change Frequency)

10.7

7.5 7.3 Parts Per Hour
7.3
5.7 828
2.1 5.6
1.9 2004 2005 2006 750
2.2 736
2003 2.0
1.7 695
2007 694

668 671
664 659
646

636

2003 2004 2005 2006 2007

Toyota Worldwide Press Operations

Europe

North America

Asia Toyota Motor
Corporation

(TMC)

South America

In the
Beginning,
Operations
Led from
Japan by TMC

Toyota In-House NA Press Expansion

1980’s 1990’s 2000’s

TABC TABC TABC
NUMMI NUMMI + Exp. NUMMI + Exp.
TMMK TMMK + Exp. TMMK + Exp.
TMMC TMMC + Exp. TMMC + Exp.
TMMI + Exp.
TMMI
TMMTX
Growth & Capability Increasing SIA

Individual Plants Individual Plants TMMC #2
Limited Benchmarking TMMMS (Future)

Connected & Aligned
Strong Communication

Friendly Competition
Share Resources
& Best Practices

Toyota Internal Competition Never Give Up

1988 --L--aB-r-g-ae-r-G-ak-p-e--e-p--s--r-a--i-s-i-n--g------- - 2008 Gap is Smaller
-
-- - - - ---
CONTINUOUS
TMC IMPROVEMENTNAMCTMCNAMC

Productivity
Start-Up Key Activities Capability Future
inreasing

Always find ways Bench Marking * Continue to
to “re-think” and Strengthen
Best Practice Application * Toyota Way
“re-invent” Jishuken / Yoketen * Thinking

Training / Skill Improvement

Technology Advancements *

Innovative Thinking
Standardization

Toyota Internal Benchmarking

& Best Practice = Safety

1. As a group (All NAM) we compare each Example
NAMC to each other as well as TMC
• Safety Concern at NAMC triggered
2. Identify Leader activity to bench mark each NAMC to
find best practice
3. Investigate the lead plant activity
and roll out as Best Practice to all • Each plant investigated their own
other NAMC current activity

• At the all NAM meeting each
NAMC presented their activity

• Best Practices from each NAMC
were combined to make a North
American wide standard that would
be used at all NAMC’s

New Standard

Utilize each New
NAMC resources / Standard
with all
skill for the NAMC
benefit of all buy-in!

Jishuken Activity / Yokoten

1. Each NAMC sends 2. Team focus on 3. Team uses Toyota problem solving 4. Roll out
member(s) to participate issue at the NAMC methods (TBP) develop countermeasure or to all NAMC
in the Jishuken Activity as a Group suggestions to NAMC. NAMC implements (Yokoten)
at alternating NAMC’s changes and documents results

TMMC TMMI Report

TEMA Introduce to all
other NAMC
NUMMI Alternating (Yokoten)
TABC NAMC
Productivity (GSPH)
TMMK Common
Problem or

Theme

SIA Results

TMMTX Safety 10% Yokoten
TMMC #2 Quality Up to Other
Productivity NAMC
TMMMS P
After PP D
P
A CC D

D
Pre- A C

Etc…. P APD rodP.

Come together as a TEAM AC D

to Solve Common Problem C
AC
-T/M Development Before
- Solving Critical Problems

Future Technology & Trends

Die Related Equipment Related

Multiple Part Production (1 Stroke) Increased Focus on Machine Accuracy (key point
• Double Dies of Die Repeatability)
• Baby Part
Adopt Servo Press technologies with High Speed
Die Design Standards: Interchangeability from Automation for increased productivity
Line to Line / Plant to Plant
Increase common equipment and part usage for
Process Reductions (4 Dies to 3 Dies to 2 Dies) spare parts reduction and sharing
amongst NAMC

Increased focus on Die Repeatability Reduction in plant size with streamlined layout
and less inventory
Increased use of digital development tools (FEA,
FEM) and measurement for more Increased focus on reducing Die Change Time
accurate initial die build (less and methods to aid as a method to
modifications after first hit) achieve reduced lot sizes

Material Changes
• Coatings
• High Strength Materials

Balance Technology & Investment Take advantage of
New Technology to
improve productivity,
reduce lead times

& cost

Supplier Competition

How can you increase your abilities
and, at the same time,

share your capability with others
in the same industry?

Example: Toyota Based Stamping Forum

Supplier Forum: “Co-opetition”

Competitors Cooperation = Co-opetition

+ (Technical Forum)

Toyota Competition to
strengthen
each other...

But not to
reveal trade
or product
secrets

Supplier Forum Example: GSPH/SPM

What Does Competition Do? Changes your
Environment & Challenges

Ex: 600 Ton Press Line

Co-opetition

SPM
SPM
? Share

A BC A B CD

Internal Benchmark Know How Through Competition
- - Why is there a Gap in SPM? - - See Others
- - What are others doing? - - Change Ceiling
- - What are your limitations? - - All Benefit
- - Keep for Knowledge, but set more

Supplier Forum Example: Die Change Time

1200 Ton Transfer Line Supplier A,B,C,D
New Targets
Supplier A, B
Minutes Great Reduction
17

Break Through
12 By Co-opetition

AB Suppliers 7
4

CD

Supplier Example:

Metalsa: Fagor Improvement Activity

Rear Side Rail

Full Frame

Metalsa: Initial Condition

Fagor 3600 GSPM

Struggle to Meet Targets
Fagor 3600 Changeover

Metalsa: Kaizen Events

20%

Minutes 10%