Training at the Ford
Motor Company and Observation of American Machinery Manufacturers
Toyota Motor Co., Ltd. ended a two-month labor dispute on
June 10, 1950. The company announced a new employment system, and measures
designed to effect a reorganization-such as labor-management negotiations on a
new labor agreement and revision of the salary system-were started. It was
under these circumstances that Toyota Motor Sales Co., Ltd. President Shotaro
Kamiya and Kanto Auto Works, Ltd. President Hidejiro Okuda1 departed for the
United States on June 23.
Eiji Toyoda, President Kamiya of Toyota Motor Sales Co.,
Ltd. (left) and President Okuda of Kanto Auto Works, Ltd. (right) with Mr.
White (rear) of Ford at Ford Motor Company
The purposes of their trip were to observe the American
automobile industry and to negotiate a technical tie-up agreement with Ford
Motor Company (Ford). Managing Director Eiji Toyoda, who also travelled to the
U.S. about a half month later on July 11, recalled, "Kamiya of Toyota
Motor Sales Co., Ltd. traveled to America as an advance team to negotiate basic
technical guidance so that when I traveled to America, I could sign the
agreement."2 The negotiations proceeded smoothly right up to just before
the signing, but the entire process returned to the beginning as a result of
effects from the Korean War, which had broken out on June 25. President Kamiya
and President Okuda concluded the negotiations and returned to Japan, leaving
Managing Director Eiji behind, on September 30.
The contract signed with Ford included the dispatch of three
engineers3, and a technical tie-up suitable for Toyota Motor Co., Ltd.'s
production scale was anticipated. With the outbreak of the Korean War, however,
the American government prohibited overseas investment and issued an order
requiring confinement of key engineers, making implementation of the agreement
impossible. In response to these developments, Ford agreed to accept trainees
from Toyota Motor Co., Ltd. in place of sending engineers.
Managing Director Eiji became the first trainee at Ford. He
spent approximately one and a half months from July 20 to September 8 observing
the River Rouge Plant, Highland Park Plant, Mound Road Plant, Ypsilanti Plant,
Dearborn Plant, Canton Plant and other sites, and was instructed by various
Ford personnel.4 He also visited Chrysler Corporation, the Budd Company, Timken
Detroit Axle Company, Muskegon Piston Ring Company, Bauer Roller Bearing
Company, and others.
In addition, Managing Director Eiji visited 21 machine tool
companies from August 7 to September 29 and observed the latest machine tools.
Of these companies, Toyota Motor Co., Ltd. had installed machine tools from 15
of them at the time of its foundation, and Managing Director Eiji was able to
confirm directly the advances in performance of machine tools by observing the
equipment and to acquire useful information regarding future equipment updates.
Following Managing Director Eiji, Managing Director Shoichi
Saito traveled to the United States on October 3 and underwent training at the
Ford River Rouge Plant for about one and a half months. Following his return to
Japan, Managing Director Saito introduced a suggestion system based on Ford's
suggestion system in order to gather ideas from a wide range of employees. The
system, which went into operation in May 1951, was the Creative Idea Suggestion
System. Over time, the system has been improved and expanded.
One thing that both Managing Director Eiji and Managing
Director Saito mentioned after their time in the U.S. was the surprising
quality of the materials used in America. Managing Director Eiji stated in
response to a request for information from the Society of Automotive Engineers
of Japan, "Japan's automobile industry facilities and engineers are good,
but our machine tools and materials are inferior. If we can solve this problem,
we can manufacture good and economic vehicles that are equal to America's. This
is the conclusion that I drew during my recent travels."5 When Kiichiro
Toyoda entered the automobile business, he decided to produce steel and machine
tools internally because the materials and machine tools available in Japan at
that time were inadequate. Even in 1950, fully 17 years later, the company was
still facing the same problem.
Later, when recalling his training at Ford, Eiji made the
following statement.
I felt that I was being honest in saying: “Ford’s not doing
anything we don’t already know”. But at the same time I was certainly not
presumptuously downplaying Ford’s tremendous lead. After all, their daily
output was 8,000 units; ours was a piddling 40. You might as well compare a pebble
with a boulder. In terms of corporate size, we were in very different leagues.
Yet, I didn’t think that there was such a large gap in technology. The
difference lay mainly in the scale of production. I felt that if the size of
Toyota’s operations grew large enough, we’d be fully able to handle an American-type
production system.
Special Demand Caused
by Korean War
On June 25, 1950, the Army of the Democratic People's
Republic of Korea (North Korea) crossed the 38th Parallel and invaded the
Republic of Korea (South Korea). This was the start of the Korean War.
Model BMV cargo truck
supplied under special demand
To rapidly supply equipment to the South Korean Army,
industrial capacity in Japan-which was the closest country to the
battlefront-was used, and as early as July 10, an inquiry concerning trucks was
received from the procurement division of the Eighth United States Army. Toyota
received an order for 1,000 Model BM trucks, and Toyota Motor Co., Ltd. and
Toyota Motor Sales Co., Ltd. jointly entered into an agreement for their supply
on July 31. The agreement called for 200 trucks to be delivered in August and
400 each in September and October. Toyota later received an order for 2,329
trucks on August 29 and an order for an additional 1,350 trucks on March 1,
1951, for a total of 4,679 Model BM trucks. The total value of these orders was
3.66 billion yen.
In response to this special demand, Toyota Motor Co., Ltd.
increased its monthly production plan from 650 units to 1,000 units. The
increase in production was implemented by having current employees work two
hours overtime each day, and the planned shift from the Model BM truck to the
Model MX truck was postponed until after the delivery of all BM trucks.
Toyota Motor Co., Ltd.'s business performance improved
rapidly as a result of the Korean War special procurement demand. The situation
was explained as follows in the 22nd Business Report (covering April to
September 1950) as follows:
Although prices for materials, parts, tires, and so on
repeatedly rose after the outbreak of the Korean War due to automobile sale
pricing controls-which in the past were a major restraint on operations-were
eliminated in the middle of April, we have been able to maintain profitability
by adjusting automobile sales prices, and since the resolution of the labor
dispute, results have been improving every month as production increases in
response to demand.
Toyota Motor Co., Ltd. fell into a condition of management
crisis as a result of the effects from the Dodge Line and it was necessary to
reduce personnel, but following the outbreak of the Korean War, business
performance recovered and the company was able to take new steps forward.
Machinery repair work
at a machinery plant
President Kiichiro Toyoda served as director of the
Temporary Reconstruction Office from April 1946 to March 1947 and encouraged
the restoration of machine tools that had been overused during the war. The
repairs, however, did not go beyond minimal emergency measures. Systematic
restoration work began in 1948, but restoration of machine tools in use at
plants required replacement and supplementary units, so there was a limit to
what could be done.
In January 1951, approval was received for temporary use of
government-owned and some privately-owned equipment formerly designated for
reparations, and the situation changed. By using such equipment, restoration of
general-purpose machine tools was expected to proceed according to plan.
According to a survey conducted by the machining plant-which
was responsible for the restoration of equipment-at the end of 19501, Toyota
Motor Co., Ltd. had approximately 2,700 machine tools and approximately 2,000
industrial machines including presses and forges for a total of approximately
4,700 machines. Of these, 47 percent were in use for less than 10 years, and 53
percent were in use for 10 to 20 years. Also, 69 percent of the machines were
manufactured in Japan and 31 percent were imported.
When categorized by precision and functionality, facilities
and machinery was divided as follows.
1)1,556 machines (33 percent) had good or generally good
precision and functionality.
2)2,262 (48 percent) machines had somewhat poor precision
and functionality.
3)888 (19 percent) machines had substantially poor or nearly
unusable precision and functionality.
The machines in category (3) required immediate restoration,
while those in category (2) needed a systematic restoration in stages.
Restoration was implemented based on the survey, and
restoration of the machines in substantially poor condition2 was completed in
1952 while outdated belt-driven lathes and milling machines were improved until
they could be discarded. In addition to restoring precision and functionality,
active efforts were made to modernize refurbished equipment and changes were
made from flat belt drives to V-belt or gear drives, necessary functions were
automated or semi-automated, and automated specialized equipment using idle
power units was introduced.
Facility
Modernization Five-year Plan-Towards a System for Producing 3,000 Vehicles per
Month
While equipment and machinery was restored, automation of
machine tools was also implemented. Specific automation measures included the
introduction of automatic delivery equipment using plate cams and automatic
shut-down devices using micro-switches. This was technology developed as a
result of observations made in the United States.
The automation of equipment was an essential condition for
putting one employee in charge of several machines, an idea proposed by Koromo
Plant Machining Plant General Manager Taiichi Ono.
General Manager Ono had been an engineer at Toyoda Boshoku
Corporation where he observed a single worker operating up to 20 automatic
looms. He believed that it was inefficient for each worker to operate only one
machine.
The engine plant and powertrain plant under the machining
division of Koromo Plant had been separate organizations, but they were
integrated in August 1949 to establish a single machinery plant. At that time,
investigations of having one worker operate several machines began with General
Manager Ono playing a central role.
Having one worker operate multiple machines was premised on
the automation of machine tools, for example, in the use of automatic shut off
and automatic parts feeds. It would be possible if processes could consist of
automatic multi-cut lathes, automatic special-purpose machines using various
types of power units, and so on. However, the costs required for automation
were considerable, and the necessary returns could not be guaranteed with
small-scale production.
Equipment was converted into simple automatic machinery by
installing simple cam-feed mechanisms and micro-switches and giving the
equipment automatic feed and automatic shutdown functions. By introducing this
type of automation, it became possible for a single worker to operate multiple
machines, dramatically raising work efficiency.
When one worker was responsible for multiple machines, there
was no time for the workers to sharpen the machinery tools (cutting tools), and
it became necessary to specialize tool sharpening. As a result, a centralized
sharpening system was introduced at all machine plants in November 1951, and
the Central Tool Department performed tool collection, sharpening, and
delivery.
Source: Toyota Motor Co. Ltd
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