Business Activities

Business Activities

Business Structure

P36–41P42

As a market leader with an extensive knowledge of global logistics needs, Toyota Industries provides
a range of materials handling equipment, mainly lift trucks, and logistics solutions to customers.

Toyota Industries’ Materials Handling Equipment Business
is operated under a two-organization structure: Toyota
Material Handling Group (TMHG) responsible for the Lift
Truck Business and Toyota Advanced Logistics Group(TALG) engaging in the Logistics Solutions Business. TMHG
and TALG collaborate with each other to achieve overall
growth of the Materials Handling Equipment Business while
reinforcing individual businesses.

Strengths

Toyota Material Handling Group (TMHG)(Vehicle / Engine / Car Air-Conditioning Compressor / Car Electronics)

Textile Machinery

Materials Handling Equipment*1: Survey by Toyota Industries Corporation

Opportunities• An expansion of global logistics volume in line with an increase in the world population and economic growth• Rising need for higher logistics efficiencies prompted mainly by soaring labor costs and labor shortages• Expanding business domains mainly facilitated by a growth in e-commerce transactions• Growing need for products with high energy savings and low environmental impact, driven by a rise in ecoconsciousness and stricter environmental regulations

Risks• Restrained capital investment due to a slowing economy• Lower sales prices caused by intensifying competition• Change in business environment triggered by an expanding market of low- to mid-priced lift trucks

FY2018FY20191,466.6 billion¥1,283.0 billion¥

FY2018Operating
Profit¥104.9 billion

Following an expansion of the e-commerce market,
providing solutions to diverse and complex logistics issues
for distribution centers has become a pressing task, andneeds for logistics solutions have been growing globally.
Amid this environment, we go a step beyond justproviding a broad range of materials handling equipment
and associated software programs and are reinforcing our
Logistics Solutions Business to more meticulously satisfy
each customer’s varying needs by leveraging our logistics
improvement know-how accumulated to date.
Under the TALG management structure, the Logistics
System Engineering Department of Toyota Material HandlingJapan, which mainly engaged in business in Japan, and two
companies that joined the Toyota Industries Group in 2017,
namely U.S.-based Bastian Solutions LLC and Netherlandbased Vanderlande Industries Holding B.V., are promoting
business while leveraging their individual strengths.

FY2019114.6 billion¥n Toyota Material Handling Group

TMHG
Materials Handling Equipment Sales(Thousand units)

300
250
200
150
100
50
0

30

(FY)

15

Toyota Industries Report 2019

16

17

18

19

n Toyota Industries’
Global Lift Truck
Market ShareBusiness Overview in Fiscal 2019
In the Materials Handling Equipment Business, the lift truck market in 2018 asa whole continued to expand globally, driven by strong sales in Europe andChina. Amid this operating climate, Toyota Industries worked to strengthen
production and sales activities matched to respective markets and rolled out
new products. Consequently, unit sales of lift trucks for fiscal 2019 increased
by 23,000 units, or 9%, to a total of 300,000 units over the previous fiscal year.
As the need for higher logistics efficiencies remained strong, underpinned byan increase in logistics volume and a rise in the number of large logistics
bases, Toyota Industries made efforts for further business reinforcement
through collaboration with logistics solution subsidiaries in the United Statesand Europe. As a result of these activities, net sales in fiscal 2019 totaled¥1,466.6 billion, increasing ¥183.6 billion, or 14% year-on-year.

(Survey by Toyota Industries
Corporation, 2018)

TMHJ

TMHNA

TMHE

TMHI

TMHCN

Toyota Material
HandlingJapan

Toyota Material
Handling
North America

Toyota Material
Handling
EuropeToyota Material
Handling
International

Toyota Material
Handling
China

The Toyota Material Handling Group possesses several brands such as TOYOTA, BT and RAYMOND andengages in business by dividing the world into five areas: TMHJ (Japan), TMHNA (North America),
TMHE (Europe), TMHI (Asia, Australia, etc.) and TMHCN (China).

Financial Section /Corporate Information

Net Sales

Toyota Advanced Logistics Group (TALG)

Promotion of ESG Initiatives

Toyota Industries assists customers worldwide in attaining
greater logistics efficiencies by undergoing changes overtime as a market leader in the materials handling equipment
and logistics fields and by delivering logistics solutions
optimally tailored to their specific needs.
Under the TMHG management structure, we engage inthe Lift Truck Business under the TOYOTA, BT, RAYMOND,CESAB and Tailift brands. Mutually utilizing the development
and sales strengths of each brand, TMHG is promoting
business on a global scale.
We basically carry out product development in three
regions, namely Japan, North America and Europe. Basedon this structure, we develop and manufacture products ineach region, which are matched to the specific local needs
and characteristics, and ensure quick product delivery tocustomers.
At the same time, we seek greater product appeal by
conducting in-house development and production of key
components of lift trucks, including engines and motors.
In addition to supplying such high-quality products,
we have established a structure to support customers
throughout our entire value chain that encompasses
from selling products and providing after-sales services
through our extensive networks to offering sales financing
operations. Going forward, we will contribute to greater

Strategies and Businesses• An extensive logistics-related product lineup both in the fields of materials handling equipment (internal-combustion
lift trucks, electric lift trucks, fuel cell (FC) lift trucks, etc.) and materials handling systems (automated storage andretrieval systems, automatic guided vehicle (AGV) systems, automated lift trucks, etc.)• Software development capability to create such systems as a warehouse management system that comprehensively
manages distribution center operations, from acceptance to stock and shipment, and optimally controls materials
handling system equipment• In-house development and production of key components of lift trucks, including engines and motors• High technological capabilities, including those linked to environmental and safety performance• Production know-how that ensures high levels of quality and production efficiency• No. 1*1 in lift truck unit sales in the world• Global, well-developed production, sales and service networks• Total support services encompassing IT-based maintenance and inspection as well as operational management• A wealth of experience and know-how accumulated in the Logistics Solutions Businesslogistics efficiencies based on our comprehensive strengths
in satisfying varying needs of customers worldwide. On
the sales front, we are seeking to obtain large orders
by responding to demands of customers who conductbusiness globally while undertaking sales activities matchedto the specific conditions of each market. In terms ofservices, we assign experienced and knowledgeable service
personnel and utilize leading-edge information technology(IT) to provide finely tailored services to customers. Ourservice personnel visit customers on a periodic basis andprovide maintenance services to prevent troubles fromoccurring. When a problem does occur, they swiftly make avisit to the customer and promptly take appropriate action.
We are also strengthening our internal sales financing
operations mainly in Europe, the United States and otherdeveloped countries in order to respond to customers’
wide-ranging needs in the area of equipment sales.

Company Introduction

P30–35Materials Handling Equipment
Automobile

ToyotaIndustries

20%

World No.1

31

Business Activities

Activities of TMHG

TALG

Japanese Market
Logistics System
Engineering Departmentof Toyota Material
Handling JapanTALNA*2/
BastianVanderlande*2: Toyota Advanced Logistics North America

Business Activities in Fiscal 201932

Toyota Industries Report 2019*7: Survey by Crist Information & Research, LLC, 2018
*8: Survey by Raymond Corporation

Toyota Industries’ booth at ProMat 2019

Financial Section /Corporate Information

Aichi Corporation’s aerial work platform

In the expanding North American lift truck market, Toyota
Industries remained the market share leader*7 in 2018 withcombined unit sales of TOYOTA and RAYMOND brands ofapproximately 98,000 units, a record-high, up 10% from theprevious fiscal year. In addition to lift truck sales, parts sales
and orders for after-sales services remained strong.
Toyota Industries
is proactively releasing
new products bothunder the TOYOTA
and RAYMOND brands
to satisfy various
customer needs.
Toyota expanded its
warehouse productofferings with the
8-Series Order Picker
introduction of the
8-Series Order Picker. Toyota’s new electric towing tractor
utilizes high-output, high-efficiency drive motors to provide
comparable performance to internal-combustion engine
models and is an ideal solution for airports and cargoterminals. As for aerial work platforms, in addition to ascissor lift which is compact yet allows working at a greater
height, a vertical type was added to the lineup to provide
more options to customers. The vertical type realizes asmaller turning radius thanks to a shorter wheelbase,achieving higher operability in confined spaces.
Raymond rolled out the industry’s tallest*8 Model 7530
Reach-Fork electric lift truck with integrated technologies
and telematics. To respond to the industry need toautomate end of line and P&D (pick up, drop off), Raymondalso started offering a new stacker automated lift truck
combining unparalleled vision technology.

Promotion of ESG Initiatives*3: Survey by Aichi Corporation

North American Market

Strategies and Businesses

With the continued growth of the world’s lift truck market
in 2018, we worked to enhance the product appeal of ourmainstay lift trucks and reinforce our sales networks. We
also strove to offer reliable after-sales services, enhance
responsiveness to large-order customers and provide
solutions to achieve greater logistics efficiencies through theintroduction of distribution systems.
As an effort to meet the diverse needs of customers in
the field of lift trucks, we proactively deployed new products
in each region and have been increasing the lineup of
telematics-integrated models and automated models formore efficient fleet operations. To appeal the attractivenessof our products to a broader audience and secure contact
points with customers, we actively participated in exhibitions
held in various parts of the world. For promoting sales,
we reinforced sales of equipment and spare parts througheach brand’s Website to provide greater convenience tocustomers.
In the logistics solutions field, we formulated an outline of
our strategy to promote coordinated activities as TALG. We
will make maximum use of TALG’s resources and provide
logistics solutions unique to the Toyota Industries Group to
customers worldwide.
Meanwhile, Aichi Corporation,
which possesses the top
brand*3 in the field of aerial work
platforms in Japan, posted higher
sales to the leasing industry,
driven by an increase in capital
investment for construction
work. On the other hand, sales
declined in the electric power,
telecommunications and railway
industries. As a result, Aichi’s
overall sales were on par with theprevious fiscal year.

Toyota Industries’ booth at Logis-Tech Tokyo 2018
*4: Survey by Toyota Industries Corporation based on data published by Japan Industrial
Vehicles Association*5: Ichikawa City, Chiba Prefecture*6: Takahama City, Aichi Prefecture (within Toyota Industries’ Takahama Plant)

Toyota Industries
is also enhancing thelineup of entry-level
models, with Tailift
products handled by
Toyota and Lift-Rite
products marketedby Raymond. We
have been working toincrease recognition for
Model 7530 Reach-Fork electric lift truckthese products throughpromotional campaigns and other means. These models
are also available on our Websites, thereby responding tocustomers’ needs to make purchases over the Internet.
In reinforcing collaboration between the Lift TruckBusiness and Logistics Solutions Business, we started
selling and servicing Bastian products through our Toyota
sales network. At ProMat 2019, North America’s largest
materials handling trade show held in Chicago in April 2019,
Toyota, Raymond, Tailift, Bastian and Vanderlande joined
together with collaborative displays to showcase both theirindividual and collective strengths to respond to the logistics
issues of all customers.
Toyota Industries will continue to leverage the strengths
of TOYOTA and RAYMOND brands and further accelerate
the development of technologies utilizing automation,
telematics and other cutting-edge technologies. In addition,
we seek to expand our business by meeting customers’
needs for greater logistics efficiencies through deeper
collaboration within the logistics solutions field.

Company Introduction

Under TALG, Logistics Engineering Division of Toyota Material
Handling Company, Bastian and Vanderlande work together
to promote the Logistics Solutions Business on a global scale
while leveraging their individual strengths.

With the Japanese lift truck market continuing steady
growth in 2018, Toyota Industries posted record-high unit
sales in fiscal 2019 at 47,000 units, attaining a 9% increaseyear-on-year. Unit sales of Toyota Industries’ lift trucks
maintained the top position*4 in calendar 2018 for the 53rd
consecutive year.
An expansionof the e-commercemarket in recent
years has given riseto an increase in new
construction of larger
distribution centers.
Coupled with changes
in the businessToyota Material Handling Customer Center Osaka
environment causedby, for example, labor shortages, these developments havefurther increased the needs for logistics solutions that canoffer greater logistics efficiencies and a higher degree ofautomation at logistics sites. To respond to these needs,
Toyota Industries established in June 2018 the Toyota
Material Handling Customer Center (CC) Osaka, a large
consulting-based logistics show room, in Suita City, Osaka.
Our first customer center, CC Tokyo*5 opened in 2001, andthe second one, CC Aichi*6, have been well recognized bycustomers, receiving an increasing number of visitors every
year. CC Osaka, our third base to disseminate informationon our logistics solutions, serves to create closer ties
between the TOYOTA brand and customers in westernJapan.
Within CC Osaka, we exhibit many of our latest logistics
systems, equipment and technologies and present tocustomers the future logistics solutions envisioned by Toyota
Industries. Specifically, we re-create various logistics sites,
including a large distribution center fully automated withrobotics technology
and a production
line that can flexibly
respond to changes in
production items andvolumes, to showcase
example solutions
that capture thelogistics issues of each
Re-creating a large distribution center
business category. We
also devise ways for customers to experience and visualize
the functionality, ease of use and improvement effects ofour products through oral explanations by dedicated staff
along with visual exhibitions using virtual reality (VR) andaugmented reality (AR) technologies.
In September 2018, Toyota Industries participatedin Logis-Tech Tokyo 2018. Under the concept of “MoreInnovative and Beautiful Logistics for Japan—Opening a

Brand-New World of Logistics Aesthetics,” we operated
the largest booth among the participating companies
and displayed our advanced technologies and productappeal that have been further enhanced after the joiningof Vanderlande and Bastian. Through these exhibitions,
we showcased our global Logistics Solutions Business,
which we promote on a Group-wide basis, to some 35,000
visitors.

European Market
Despite a slowdown in Sweden, the three Baltic countries
and Turkey, the European lift truck market sustained
growth overall in 2018, with strong growth in Germany, theNetherlands and Poland. In response to growing customer
needs for automated and connected logistics solutions,Toyota Industries worked to enhance corresponding products
and services. As a result, we posted unit sales of 95,000 units33

Business Activities

ALOMA*9 and Chinese Markets*9: ALOMA is a Toyota Industries term for Asia, Latin America, Oceania, Middle East andAfrica.

Activities of TALG

Vanderlande

Logistics System Engineering Departmentof Toyota Material Handling Japan

intelligent mobile robot

BastianOn the back of strong needs for logistics automation in not
only the e-commerce sector but also in the manufacturing
and retail sectors in North America, Bastian has been
receiving orders from customers in a broad range ofbusiness categories and expanding sales. To handle
increasing orders, at a new plant the company initiated the

Financial Section /Corporate Information

In Japan, the aggravating issue of labor shortages has
prompted efforts for labor and work savings in distribution
warehouses, pushing up needs for automated logistics
systems. Amid this environment, we developed anautonomous vehicle (AV) that does not require theinstallation of magnetic guides needed for AGVs andinitiated a feasibility test. Among the existing AVs, our Key
Cart small carrier offers both an autonomous driving featureand price competitiveness, making it easy to be introduced
into a logistics site. Another AV, the AiR-series autonomous
intelligent mobile robot, provides afeature to track the picking operator
and help to resolve labor shortages
by reducing the work load. As a new
business domain, we are also carryingout the development of an autonomousconveying system that carries drugs andtest samples in a hospital and baggage
containers in an airport.
AiR-series autonomous

Among logistics sites in Europe and the United States,
which are Vanderlande’s primary markets, an expansion of
the e-commerce market and labor shortages have caused
a sharp increase in needs for automated systems. Under
such conditions, Vanderlande has obtained large orders forwarehouse logistics and parcel/postal services from suchcompanies as Amazon and DHL, and has been steadily
increasing orders and sales.
In the airport business,
Vanderlande has delivered
its systems to more than
600 airports around theworld. With orders for
systems from new large
airports, the company has
Baggage handling system (Heathrow Airport)
been achieving further
growth. Based on its longstanding relationship of trust with customers, Vanderlande
has concluded continuous servicing contracts with existingcustomers, including Heathrow Airport in the United Kingdom.
The sharp increase in orders has made the recruitmentof new personnel and swift human resources development
an urgent task for Vanderlande. Accordingly, in January
2019 the company opened a new training center within
the head office premises and started providing a rangeof educational programs aimed at globally maintaining its
superior capabilities to propose logistics solutions andprovide excellent services.
Vanderlande is also accelerating efforts to introduce its
products into Japan through TMHJ, including identifying
customer needs and establishing required sales andservice structures.

Promotion of ESG Initiatives

Toyota Industries covers the ALOMA markets of some 60
countries in Asia, Latin America, Oceania, the Middle East
and Africa as well as the Chinese market. We are serving
these markets with a lineup consisting of TOYOTA, BT,
RAYMOND and Tailift brands.
In 2018, both the ALOMA market (in all regions) andChinese market expanded. Amid such conditions, Toyota
Industries released new products and enhanced its sales
and after-sales service structures. Unit sales consequently
increased 15% over the previous fiscal year to 60,000 units
in fiscal 2019.
In the electric lift truck field, for which needs havebeen growing, we released a number of new products,
including four-wheel electric lift trucks, standing reachtype electric trucks, warehouse lift trucks equipped withlithium-ion batteries and electric
towing tractors for use in airports.
At the same time, we proactively
appealed the functionality andcharacteristics of our products to
New electric towing tractor
customers. As a result, sales ofelectric lift trucks in the ALOMA market showed an increaseof 13% over the previous fiscal year.
To reinforce after-sales services to customers in Asia,
we started implementing the Global Mobile Service Solution(GMSS), an internally developed mobile service systemutilizing Internet of Things (IoT) technology. GMSS links
Toyota Industries, dealers in each country and customers’
fleet information by using cloud services. By centrally
managing maintenance and repair information of lift
trucks, the system improves the efficiencies of preventive
maintenance and regular maintenance activities. Startingwith Asia, we plan to implement GMSS throughout theworld. In addition to our alreadysuperior product quality anddurability, we seek to reinforce ourafter-sales services and pursue
greater operational efficiencies
for customers by minimizing the

production of conveyors that have already been produced
in-house. By increasing production capacity of conveyors,a key item in a logistics system, Bastian aims to reducedelivery time and further improve product quality.
In addition to its
capabilities for systemdevelopment andintegration, Bastian has
strengths in its ability to
ULTRA exhibited at MODEX 2018
develop cutting-edge
technologies. At MODEX
2018, a logistics systems and equipment trade show
held in Atlanta in April 2018, the company presented its
ULTRA loading and unloading robot, which drew a great
deal of attention from customers around the world. Bastiandelivered the ULTRA for the first time at the end of 2018 to aleading food manufacturer in the United States.
Bastian has been reinforcing collaboration with dealersof TOYOTA and RAYMOND brands in North America. In the
future, Bastian will increase its capability to provide logistics
solutions to lift truck users as a member of the Toyota
Industries Group.

Strategies and Businesses

in fiscal 2019, up 3% over the previous fiscal year.
CeMAT 2018, the world’s premier intralogistics andsupply chain event, was held in April 2018 in Germany.
Toyota Material Handling Europe (TMHE), our European
base for materials handling equipment, exhibited the
newly launched offerings which help customers to improve
efficiency, such as the Toyota Traigo80, a heavy-duty electric
lift truck; in-house assembled lithium-ion batteries forelectric range; and T-Stream, a new after-sales service tool
developed in cooperation with Microsoft.
During the exhibition,
TMHE also announced
that all electric warehousetrucks produced at a plantin Sweden will be standard“smart trucks” integrating
telematics capabilities andSmart truck
started producing this modelin November 2018. Smart
trucks accumulate such data as running distance and hoursof operation immediately upon installation, making it easier
to monitor fleet operations and determine maintenancetiming based on the operation status. Customers can also
analyze the data to improve the efficiency of their fleet
operations. TMHE intends to maintain and reinforce its
market leading position by proactively incorporating leadingedge technologies to provide new value to customers.
Toyota Industries’
products have gained highrecognition in Europe. The
newly launched electric lift
truck Toyota Traigo80 was
recognized with two design
awards, the 2018 German
Toyota Traigo80
Design Award and the iF
Design Award for its highenergy efficiency, maneuverability and multi-pallet handling.
In addition to awards for the Traigo model, the Pallet Drone,
an autonomous pallet truck, obtained an iF Design Award in
the discipline Professional Concept in the Mobility category
for its advanced control technology.
In the area of sustainability, TMHE was awarded“Best Group Engagement” by EcoVadis, an internationalorganization providing sustainability ratings of suppliers.

downtime of their fleets.
As a total solution provider, Toyota Industries has beenstrengthening efforts to respond to every logistics need ofcustomers in the ALOMA market. In 2018, in collaboration
with a new partner, we started selling storage racks,
which makes it possible to offer lift trucks and racks inmajor countries in the ALOMA market. We offer a solution
optimized to the layout and operation of a customer’slogistics facility, providing greater convenience and helping
customers achieve higher efficiencies.
With a view to responding to expanding and diversifying
customer needs in the ALOMA and Chinese markets,
Toyota Industries will continue to establish and enhancesales and after-sales service structures in these regions.
Simultaneously, as the leading manufacturer of materials
handling equipment, we will utilize IoT and other advanced
technologies and further enhance our product lineup inorder to provide comprehensive logistics solutions jointlywith our dealers in each country.

Company Introduction

TMHE’s exhibition space at CeMAT 2018

TMHE was first evaluated at a group level by EcoVadis in2012 and has expanded its annual EcoVadis assessments
to 26 entities in Europe since then. In 2017, its four
European plants, 21 national sales companies and thegroup as a whole were awarded 11 Gold, 13 Silver and two
Bronze ratings.
In 2018, TMHE renewed its company strategy
and recognized “automation,” “connectedness” and“productivity” services as new priority areas for further
business growth. Needs for automated and other logistics
solutions are expected to increase in relatively small local
markets as well. In response, TMHE has established alogistics solutions competence hub in Austria, the first basein Europe to appeal its logistics solutions capabilities tocustomers, and will work to capture demand in this region.

GMSS mobile service system

34

Toyota Industries Report 201935

Business Activities

Automobile

VehicleIn the fields ranging from vehicle assembly to engines, car air-conditioning compressors and car
electronics, Toyota Industries continues to meet the expectations and trust of its customers.

Business Overview in Fiscal 2019

Strengths

Highest-Level SEQCD to Contribute to
Production of Toyota Cars

Opportunities• Increasing needs for energy-saving products due to stricter environmental regulations and growing environmental
consciousness• Sales expansion in each sector in line with growth of the automobile market

Risks• Shrinking of the automobile market caused by economic slowdown• Customers becoming reluctant to buy energy-saving products following less stringent environmental regulations• A drop in product competitiveness due to the yen’s appreciation or a rise in raw material costs

Development and Production of Plastic
Glazing

Operating
Profit¥29.6 billion

610.7 billion¥595.0 billion¥

Vehicle Sales

Engine Sales

Compressor Sales(Thousand units)(Thousand units)(Million units)

700

350

600

30

250

500

25

200

400

20

150

300

15

100

200

10

50

100

5

(FY) 15

Toyota Industries Report 2019

16

17

18

19

0

(FY) 15

FY20196.8 billion

¥

35

300

0

36

FY2018FY2019

16

17

18

19

0

The new RAV4 is TMC’s fifth-generation global strategic
vehicle. For this vehicle, Toyota Industries was involvedin vehicle planning and upper-body development andassumed our first-ever role of spearheading productionlines ahead of any other plants producing the newmodel around the world. It was a large project, involving
switching the production lines for the previous RAV4
to those for the new model. It also required converting
compact car production lines that had produced theVitz into medium-class lines for the new RAV4. Building
on our past experiences, we were able to launch
production in a sequential manner in November 2018.
These production lines are even more eco-friendly andboast a higher production efficiency than the previouslines. Several ideas generated within our plant havebeen highly recognized and adopted in other TMC
plants.
Going ahead, we will further improve our productplanning capability in addition to our existing strengths
in SEQCD and intend to play more important roles as aleading plant producing compact sports utility vehicles(SUV) within the Toyota Group.

* Survey by Toyota Industries Corporation(FY) 15

16

17

18

19

Financial Section /Corporate Information

FY2018Net Sales

Toyota Industries’ plastic glazing has been used in thepanoramic roof of TMC’s hybrid vehicle Prius a (Prius + in
Europe and Prius v in North America).
The panoramic roof retains the beautiful surface quality
typical of a glass roof yet is approximately 40%* lighter thanits glass counterpart, improving vehicle fuel efficiency, which
has become increasingly important, and thus contributing to
the reduction of CO2 emissions.
Toyota Industries will continue to develop attractive
new products that leverage the distinctive characteristics ofplastic glazing.

TOPIC

Promotion of ESG Initiatives

Toyota Industries’ comprehensive strengths lie in the highest
level of safety, quality, cost and delivery among all Toyotaaffiliated automobile body manufacturers. In fiscal 2019,
we received the Toyota Quality Control Award from TMC
for seven consecutive years. We will remain committed tofurther strengthening our already superior level of safety,
the environment, quality, cost and delivery (SEQCD). We
also are working to leverage our ability to quickly start
up production and a flexible structure in terms of vehicle
models and production volume to contribute to productionin Japan of Toyota vehicles.

* Survey by Toyota Industries Corporation“Thank You, Vitz” ceremony

Strategies and Businesses• Highest-level production efficiency and quality among all Toyota-affiliated automobile body manufacturers (Vehicle
assembly)• An agile structure to undertake all aspects from planning and development to production within a plant (Vehicle
assembly)• Know-how on the development and production of diesel engines and turbo chargers (Engine)• Highly efficient production of high-quality gasoline engines, including those for use in hybrid vehicles (HV) (Engine)• Ability to develop excellent products with greater fuel efficiency, quieter operation, compactness, light weight andeasiness to mount on vehicles (Car air-conditioning compressor)• Global top-share* products for use in a full range of vehicles, from internal-combustion vehicles to HVs, plug-in
hybrid vehicles (PHV), electric vehicles (EV) and fuel cell vehicles (FCV) (Car air-conditioning compressor)• Global production structure based on the concept of local production and local consumption (Car air-conditioning
compressor)• Higher technological capabilities accumulated through the development and production of products for Toyota Motor
Corporation (TMC), external sales and internal use (Car electronics)• Development, production and top-level quality of electronic parts and devices for electrified vehicles (Car electronics)

Toyota Industries had manufactured TMC’s Vitz (Yaris
outside Japan) for almost 20 years since January 1999. In
September 2018, the production of the Vitz was transferred
entirely from Toyota Industries to Toyota Motor East Japan,
Inc.

Company Introduction

While sales were slightly down in Europe, theautomobile market remained on par with the previous
fiscal year on a global basis.
In fiscal 2019, unit sales of the Vitz (Yaris outside
Japan) and the RAV4 decreased by 13,000 units, or
4%, from the previous fiscal year to 285,000 units.
Net sales, on the other hand, increased by ¥10.3
billion, or 14% year-on-year, to ¥82.4 billion as
production of the new RAV4 was launched in
November 2018.

Transfer of Vitz Production to Another
Company—“Thank You, Vitz”

Production line for the new RAV4

37

Business Activities

EngineBusiness Overview in Fiscal 2019

Highly Acclaimed by Customers
Worldwide

Turbocharger(mounted on Toyota 1ZS diesel engine)

TOPIC*3: Development policy and method for vehicle creation based on a modular platform

GD diesel engine

Developing Competitive Engines inIndustrial Fields
Toyota Industries’ engines are highly renowned for theirreliability and excellent environmental performance inindustrial fields as well. These engines are used for a wide
variety of applications, including our lift trucks, and adopted
by many customers such as GHP*1 manufacturers in Japanand CHP*2 manufacturers worldwide. These engines offer
downsized displacement compared with conventionalmodels with equivalent output, resulting in higher fuelefficiency, cleaner emissions and a reduction in size. In
2017, our engine was adopted for the first time in theconstruction machinery field. We will continue to expand
sales into this and other fields.
*1: Short for gas heat pump; air conditioner driven by a gas engine*2: Short for combined heat and power; co-generation system

38

Toyota Industries Report 2019

2.5-liter A25A engine for HVs

2.0-liter M20A gasoline engine

Seeking Engines with Greater ProductAppealFollowing the Paris Agreement adopted in December 2015
at the 21st session of the Conference of the Parties to theUnited Nations Framework Convention on Climate Change(COP21), and with some countries announcing their shift
from internal-combustion vehicles to electrified vehicles,
there has been a growing need for engines with even greater
fuel efficiency and cleaner emissions for HVs, PHVs and otherelectrified vehicles as well.

Business Overview in Fiscal 2019
In fiscal 2019, unit sales of car air-conditioning
compressors decreased 440,000 units, or 1%, fromthe previous fiscal year to 32.98 million units,affected by lower sales in Europe and Japan despite
an increase in sales in China and other emerging
countries. Net sales were down ¥5.2 billion, or 1%,
from the previous fiscal year to ¥346.2 billion.

Development Efforts Centered around
Energy Savings and Car Electrification
We expect continued growth of the car air-conditioning
compressors market on the back of the expanding
automobile market and an increase in the number ofvehicles fitted with an air conditioner. In order to reinforce
this business, we will channel resources into both types ofcompressors, namely compressors for internal-combustion
vehicles, which are still mainstay products for the time
being, and compressors for electrified vehicles, for which we
anticipate stronger demand in the future.
More stringent fuel efficiency standards have been
enforced across the world, driving needs for higher fuelefficiency both for internal-combustion vehicles andelectrified vehicles. Ourvariable-displacement typecompressors for internalcombustion vehicles, which
are renowned for high fuelefficiency and reduced weight,
have been adopted by theworld’s leading automakers,
including TMC, Daimler AG,
6SES14 compressor(variable-displacement type)
General Motors Company(GM), Volkswagen AG and
Hyundai Motor Company.
In the United States, our SES series became the firstcompressor to be approved under the country’s off-cycle
credits program. The program gives off-cycle credits totechnologies that can effectively improve fuel efficiency

Developing Next-Generation Products
Following car electrification and widespread use of
autonomous driving technology, there has been a growing
need to cool electronic devices, batteries and other heatemitting components. In response, Toyota Industries plans
to conduct development for using the cooling function of acompressor not only for vehicle interior air conditioning but
also for key components. Besides this cooling functionality,
we intend to utilize our core technologies to expand ourbusiness domain into core components for drive systems.

Financial Section /Corporate Information

Turbocharger(mounted on GD diesel engine)

Car Air-Conditioning
Compressor

Promotion of ESG Initiatives

In 2018, Toyota Industries launched production of twogasoline engines that are based on the Toyota New
Global Architecture (TNGA)*3, namely the 2.5-liter A25A
in October and 2.0-liter M20A in December. These newengines are mainly fitted in the new RAV4 manufactured
at the Nagakusa Plant in Aichi Prefecture.
With the advancement of car electrification, we
have added an HV version of the A25A engine to our
lineup. The basic framework of all these engines was
totally revamped based on the TNGA concept, andtheir renewed structure offers both excellent driving
performance and environmental performance. In
preparing to produce these engines, we incorporated
our improvement know-how accumulated in the
production of AR engines, the predecessor model.
Simultaneously, we shared the new method and otherinformation among relevant departments to swiftly
identify and resolve issues. Through these efforts, wewere able to smoothly launch production within a shortperiod of time.
We will improve product quality and productivity further
and contribute to the creation of “ever-better cars” by
TMC both through diesel engines and gasoline engines.

Strategies and Businesses

Toyota Industries’ diesel engines are mounted in a variety of
Toyota vehicles, including the Toyota Land Cruiser series, theworld’s renowned full-fledged four-wheel drive (4WD) model,
and TMC’s Innovative International Multipurpose Vehicle (IMV)
series targeting emerging countries. Their high performanceand reliability have gained strong market recognition.
Currently, our mainstay products are in-line 4-cylinder GD
diesel engines and V-type 8-cylinder VD diesel engines. GD
diesel engines equipped with a turbocharger specificallyand optimally designed and manufactured in-house are
manufactured in Japan and by Toyota Industries Engine
India Pvt. Ltd. (TIEI), a consolidated subsidiary in India. In
fiscal 2019, we increased our production capacity of GD
diesel engines in Japan, for which needs are increasing.

Toyota 1ZS diesel engine

under its emissions regulations. We have since beenworking to increase the number of models equipped with
the SES series compressors.
For electric compressors, for which growth indemand is expected over the medium to long term, weare differentiating them in accordance with the needs ofindividual electrified vehicles
ranging from HVs to EVs.
To ensure the quietness ofoperation, which is importantin all types of electrified
vehicles, we are conducting
sensory evaluation throughactual driving tests andSoundproof wind tunnel installed atquantitative evaluation
the Kameyama Proving Groundusing a soundproof windtunnel that can re-create theconditions of actual driving. These evaluations are carriedout at our new Kameyama Proving Ground (test driving
course) opened in Mie Prefecture in 2018. In response to
the expected increase in EVs, we are devising measuresagainst electromagnetic noise that could affect homeelectric appliances during charging. We utilize simulation
technologies to swiftly create designs suited for various
vehicles and offer solutions to problems by leveraging theinsight, which we, as the leading compressor manufacturer,
have accumulated through interactions with a number of
automakers.
Besides TMC, Ford Motor Company, Renault S.A.S.,
Honda Motor Co., Ltd., Nissan Motor Co., Ltd. andother automakers, which are already using our electriccompressors in their respective HVs, PHVs and EVs, wewill continue to ramp up our efforts to expand sales to otherautomakers around the world.

Company Introduction

We discontinued the production of AR gasoline
engines in June 2018. However, the launch of new
A25A and M20A gasoline engines and increased
sales of GD diesel engines pushed up unit sales infiscal 2019 by 19,000, or 3%, over the previous fiscal
year to 593,000 units. Net sales increased by ¥9.7
billion, or 10% year-on-year, to ¥108.4 billion.

Diesel engines, on the other hand, enjoy an enduring
popularity particularly as a power unit suited for SUVs andsuch commercial vehicles as pickup trucks, as they offer
excellent basic performance of high fuel efficiency and hightorque at low speed.
Aiming for further evolution of internal-combustion
engines, we will continue to seek the world’s highest-levelcombustion efficiency and develop more fuel-efficient andcleaner engines.

TOPIC
Based on compression technology used in compressors,
we have developed an oxygen-supplying air compressor
and hydrogen circulation pumps for FCVs, which havebeen fitted in TMC’s MIRAI FCV. The invention of an FCV
air compressor by Toyota Industries received the Japan
Patent Office Commissioner’s Award in the National
Invention Commendation 2018 hosted by the Japan
Institute of Invention and Innovation. As an FCV runs on

39

Business Activities

Establishing Optimum Global Productionand Supply Structures
To respond to growing demand for variable-displacement
type compressors triggered by the enforcement of more
stringent fuel efficiency standards, we are proceeding withaugmentation of corresponding production capacities andcommenced local production of key functional parts at our
production bases in North America.
In Europe, the ASEAN region and China as well, we are
expanding production capacities and increasing the ratio of
locally procured parts to accommodate growing demand for
car air-conditioning compressors.
We have also set up a system that allows design andproduction engineering departments to work as one teamand increase production capacities in a phased manner.
Through this system, we make efficient investment
according to the production volume.

Increasing Competitiveness by Creating
Production Facilities In-House
Achieving high levels of fuel efficiency and reliability requires
high-precision processing technologies for compressors forboth internal-combustion vehicles and electrified vehicles.
Toyota Industries realizes high-speed and high-precision
machining by leveraging its know-how accumulated throughresponding to the stringent demands of automakers
worldwide and by developing devices from processing
machines to associated cutting tools in-house.

of 50 million unitsn Worldwide Bases of Car Air-Conditioning Compressors (As of March 31, 2019)

DNDE

Germany

Germany

YST

DICH

MACI

China

China

U.S.A.

DIAM

U.S.A.
TICO

DNTS

Japan

Italy
SUBROS

TACK

India

China

TACG

U.S.A.
TICA

U.S.A.

TACI

Indonesia
Consolidated production bases

Licensed manufacturers

DNBR
Technical service stations

BrazilToyota Industries’ car air-conditioning compressors are widely adopted by automakers around the world, garnering the No. 1*4 position in global sales.
*4: Survey by Toyota Industries Corporation

40

Toyota Industries Report 2019*5: Survey by Toyota Industries Corporation

Core Components for Drive Systems
Steadily Expanding Roles of Our Devices
for Electrified Vehicles
Toyota Industries develops and produces electronic devices
for electrified vehicles, including HVs, PHVs, EVs and FCVs.
In addition to TMC, we are promoting new business to otherautomakers across the world.

Auxiliary Power Source Devices
A DC-DC converter converts the high voltage of HV, PHV
and EV batteries into a lower voltage level to supply power
to standard electricaldevices such as lights
and wipers. For the
fourth-generation Prius,
by developing the world’s
first*5 thick copper
substrate with excellent
heat dissipation capability,
we reduced the volume
DC-DC converter mounted in the Prius
and weight of the product.
An on-board charger
converts AC voltage from the power grid into DC voltageof high-voltage batteries in vehicles and is necessary forcharging EVs and PHVs, for which the market is expected to
expand in the future. Starting with TMC’s Prius PHV, we arepromoting sales to various automakers.
Additionally, we have started production of DC-DC
converters and on-board chargers outside Japan in
response to increasing
global production needs.
A DC-AC inverter isa power source device
equipped to use homeelectric appliances in a
vehicle. The 1.5-kW type,in particular, can operateappliances that requireOn-board charger mounted in the Prius PHV
more power, such as ricecookers and hot plates,
allowing use as an emergency power source in a disasterin addition to camping and other outdoor applications.
The role of a vehicle as a power source has drawn muchattention as we experienced a number of disaster-induced
power outages in Japan in fiscal 2019.

The fourth-generation Prius offers a 4WD model for the
first time in the series and is fitted with our rear inverter for
4WD. This product converts the DC voltage of HV batteries
to AC voltage and feeds power to the 4WD rear motor. The
adoption of a forced aircooling system eliminates
the need to install coolingwater piping, thereby
providing greater ease inmounting the inverter onvehicles. The inverter also
features quieter operation
as it is mounted near the
4WD rear inverter mounted in the Priusrear seat.

Charging Infrastructure
Toyota Industries sells public-use
charging stands and home-use
charging units for PHVs and EVs,
which were jointly developed with
Nitto Kogyo Corporation. Currently,
we are conducting an IoT
feasibility test at IKEA Nagakutein Aichi Prefecture. We are linking
charging-only sub-stands and amain control stand, which offers
charging functionality as well as
communication, billing and otherfeatures, and remotely controlling
optimum charging.

Sub-stand

Main control
standCharging stand for PHVs and EVs

Contributing to a Low-Carbon Society

Financial Section /Corporate Information

TDDK

Net sales of car electronics products increased,primarily supported by sales of DC-DC converters,
DC-AC inverters and other devices mainly to TMC.

Promotion of ESG Initiatives

TD Deutsche Klimakompressor GmbH (TDDK), ourconsolidated subsidiary in Germany, started its operation
as a base to supply car air-conditioning compressors
to Europe in April 2000. In August 2018, it marked amilestone, reaching cumulative production of 50 million
units. TDDK currently produces variable-displacement
type compressors with high fuel efficiency. In fiscal 2014,
TDDK started design and evaluation operations locallyand has been recognized highly
by automakers for its ability to
reduce development lead time.
TDDK will continue to play
an important role as one of the
global production and supply
Ceremony to commemorate TDDK
for reaching cumulative production
bases of Toyota Industries.

Business Overview in Fiscal 2019

We will proceed with the development and productionof DC-AC inverters as a key component that adds newvalue to electrified vehicles. (See Special Feature 2 on pages
26–29 for details.)
In addition, we supply power source devices for TMC’s
MIRAI FCV and FCVs of automakers around the world.

Strategies and Businesses

TOPIC

Car Electronics

Company Introduction

electric energy generated through the chemical reaction
between oxygen and hydrogen, an air compressor
that takes in, compresses and sends air (oxygen) toan electricity generation unit is a key component of an
FCV and greatly affects its performance. We utilized
our compression technology cultivated in developing
car air-conditioning compressors and developed an air
compressor with the world’s first six-lobe helical root-typerotor. By increasing the number of lobes of a rotor andtwisting them, we achieved continuous and efficient air
compression from low speed to high speed. The award
recognized its contribution to the quicker acceleration andlonger driving range of the world’s first mass-produced
MIRAI FCV. For the ultimate goal of realizing a hydrogenbased society, we willcontinue to improve
the performance ofcomponents fitted in an
FCV to help increase
the popularity and useof FCVs.
Oxygen-supplying air compressor for FCVs

The electrification of vehicles and materials handlingequipment is expected to become more widespread withthe enforcement of more stringent fuel efficiency standards
by many countries and higher environmental consciousness
among customers. We will reinforce our planning,development, production and sales structures in the fields of
HVs, PHVs, EVs and FCVs with the aim of contributing to a
low-carbon society.

41Business Activities

Textile Machinery Strengths
Carrying on the philosophy offounder Sakichi Toyoda, whichreflects his strong commitment tomanufacturing, Toyota Industries
responds to a broad range of needs
with its extensive product lineup,from air-jet looms, for which we
enjoy the world-leading market
share* in unit sales, to ring spinning
frames and roving frames.

• Broad product lineup both in the spinning andweaving machinery fields• Global, well-developed service network• World-leading market share* in unit sales of air-jet
looms• Ability to develop products that excel in high-speed
operations, reliability and energy-saving performance

Opportunities• A rise in textile demand in line with an increase in the • Further increasing applications in industrial textile
world population
products• Increasing need for high-quality and highly functional yarn and textile products, following the economic
growth of emerging countries

Risks

Promotion of ESG Initiatives
Further Promoting Initiatives to Sustain
Growth in the Areas of Governance,
Society and the Environment
Relevant sustainable development goals(SDGs) for Toyota Industries• Changes in each government’s policies concerning • A decline in capital investment due to a drop in raw
promotion of the country’s textile industry
cotton and/or yarn prices• Economic slowdown• Weaker sales due to intensifying competition* Survey by Toyota Industries Corporation

FY2018Air-Jet Loom Sales

Net Sales(Thousand units)

10
8

4
2

FY20197.3 billion¥(FY) 15

16

17

18

19

The textile machinery market was weak in some countries in Asia but
remained strong in China. Unit sales of air-jet looms increased 2,700
units, or 43% year-on-year, to 9,000 units. Net sales were up ¥10.8
billion, or 17%, over the previous fiscal year to ¥76.3 billion.

Growing Needs for Air-Jet Looms
Toyota Industries’ air-jet looms are adopted by customers
in China, India and many other countries. Produced fabrics
are used broadly for towels, shirts and other clothing
purposes as well as in industrial products such as materials
for electronic substrates and vehicle airbags. Recently, an
increase in mobile electronic devices has driven the need for
fabrics of woven glass fiber for use in electronic substrates,
and it is anticipated that applications for air-jet looms will
expand further. On the sales front, the recent adoptionof more stringent water quality regulations in China has
prompted demand to replace water-jet looms with air-jet
looms. In response, we plan to expand sales of air-jet looms
by appealing their high environmental performance.

Reinforcing Position as a Leading
Manufacturer of Quality Measurement
Instruments for Fiber, Yarn and FabricUster Technologies AG, a Swiss-based consolidated
subsidiary manufacturing quality measurement instruments
for fiber, yarn and fabric, made Israel-based Elbit Vision
Systems Ltd. (EVS) into a subsidiary in 2018. EVS develops
and produces inspection instruments for textile fabrics. The
acquisition has made Uster the world’s only* manufacturer
to offer quality measurement instruments for every stageof textile products from raw cotton to yarn and fabrics.
Capitalizing on this unique strength, Uster intends to further
reinforce its position as a leading manufacturer of quality
measurement instruments for fiber, yarn and fabric.

4276.3 billion¥

FY2018Operating
Profit¥6.1 billion

Business Overview in Fiscal 20196

0¥65.5 billion

FY2019Toyota Industries Report 2019

Taking Part in the Largest International
Textile Machinery Trade Show in Asia
In October 2018, Toyota Industries participated in ITMA ASIA
+ CITME 2018, Asia’s largest international textile machinery
trade show. The show was held in Shanghai, China, which isone of the largest textile markets in the world.
At Toyota Industries’ booth, we exhibited the JAT810
air-jet loom equipped with our original electronic shedding
device, and the demonstration of the high-speed weavingof complex-patterned fabrics was well received by many
visitors. We also displayed special design yarn samples
created by the RX300 high-speed ring spinning frame toshowcase its versatility to produce various types of yarn
from ordinary to decorative yarn.
At Uster’s booth, EVS’s fabric inspection instrument was
exhibited for the first time under the Uster brand, along with
Uster’s yarn quality measurement instruments, and drew theattention of many visitors. Through various textile machinery
exhibitions, we will continue to appeal to customers ourtechnological capability to meet their needs and reinforce
our brand strength to gain greater trust from them.

Uster’s booth bustling with many visitors

Corporate GovernanceP44–50Relationship with Our Stakeholders

P51–60

Environmental Initiatives

P61–76

Staff who participated in the trade show

43