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Toyota's Headquarters Announces Electronic Commerce Strategies

2 September 1999

Toyota's North American Manufacturing Headquarters Announces Electronic Commerce Strategies to Assist Communication with Suppliers

    DETROIT, Sept. 1 -- Toyota Motor Manufacturing North America
(TMMNA) announced here today that it will begin evaluation of the Automotive
Network eXchange(R) (ANX) in order to strengthen efficiencies with suppliers
and gain improvements in the new vehicle development cycle.  ANX(R) is a
multi-provider, business-to-business electronic commerce network that allows
for data communications among trading partners.
    During a presentation to suppliers at AutoTech '99, Jim Bolte, TMMNA's
general manager of information systems, said that there was a clear business
need for a supplier network in Toyota's ongoing efforts to reduce the new
vehicle development cycle and the related cost impact.
    "Electronic Commerce provides opportunities to do both," Bolte said.
"After weighing the benefits of ANX(R) vs. a Toyota specific network, the
company decided to investigate ANX(R), which is already in use by
DaimlerChrysler, Ford and GM.  Many trading partners have successfully
developed internal networks, but have met with limited success in extending
these networks to include external trading partners."
    The ANX(R) Network endeavors to provide automotive trading partners with a
single, secure network for electronic commerce and data transfer -- replacing
the complex, redundant, and costly multiple connections that currently exist
throughout the automotive supply chain.
    According to Gene Tabor, general manager of purchasing for TMMNA, "A key
priority for our North American manufacturing office is to streamline our
processes and render our supplier relationships more efficient and effective.
It is important that our suppliers be aware of our plans, and that we involve
them in making these changes  - - they are very key to our success."
    Tabor added that TMMNA and its North American parts and material suppliers
already share some information electronically, but that the real opportunity
is still being developed. "We know we need to embrace electronic commerce to
be competitive, especially in the areas of engineering and purchasing
transactions.  Our primary goals for this technology are to improve processes,
eliminate waste and reduce costs, in addition to reducing the overall vehicle
development and the 'time to market' for new vehicles."
    Toyota will conduct a pilot study to evaluate the ANX(R) Network after the
new year, and will continue through the third quarter of 2000.  If all goes
well, a "roll out" plan will then be implemented.
    Toyota currently manufactures seven different vehicle models and related
parts and components at nine North American plants.  Meanwhile Toyota's
purchases from about 500 North American suppliers has grown steadily in recent
years, and now tops $8.65 billion per year.  Purchasing is one of the core
functions at TMMNA, Toyota's North American manufacturing headquarters,
located near Cincinnati, Ohio, in Erlanger, Kentucky.
    Toyota is America's fourth largest auto maker, employing more than 25,000
people throughout the U.S. and Canada and producing more than one million cars
and trucks annually.  Toyota has been selling cars in the U.S. since 1957 and
manufacturing vehicles here since 1986.  It has more than 1,400 Toyota, Lexus,
and Toyota Industrial Equipment dealers.