Toyota Industries Report 2008
Ye a r e nde d Ma rc h 31, 2008

Cautionary Statement with Respect to Forward-Looking Statements
This report contains projections and other forward-looking statements that involve risks
and uncertainties. The use of the words “expect,” “anticipate,” “estimate,” “forecast,”“plan” and similar expressions is intended to identify such forward-looking statements.
Projections and forward-looking statements are based on the current expectations andestimates of Toyota Industries regarding its plans, outlook, strategies and results for the
future. All such projections and forward-looking statements are based on management’s
assumptions and beliefs derived from the information available at the time of producing
this report and are not guarantees of future performance. Toyota Industries undertakes
no obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise. Therefore, it is advised thatyou should not rely solely upon these projections and forward-looking statements inmaking your investment decisions. You should also be aware that certain risks anduncertainties could cause the actual results of Toyota Industries to differ materially fromany projections or forward-looking statements discussed in this report. These risks anduncertainties include, but are not limited to, the following: (1) reliance on a small numberof customers, (2) product development capabilities, (3) intellectual property rights,(4) product defects, (5) price competition, (6) reliance on suppliers of raw materials andcomponents, (7) environmental regulations, (8) success or failure of strategic allianceswith other companies, (9) exchange rate fluctuations, (10) share price fluctuations,(11) effects of disasters, power blackouts and other incidents, (12) latent risks
associated with international activities and (13) retirement benefit liabilities.

Contents

2 Financial Highlights
4 Message from the Chairman and President
8 Corporate Governance
10 Research and Development
11 Survey of Businesses
12
14
23
24
26
30

At a GlanceMaterials Handling Equipment
Logistics
Car Air-Conditioning Compressor
Automobile
Textile Machinery

31 Environmental Initiatives
32
33
34
36
38
40
41
42
44
45
46
47
48

Global Environmental Commitment
Environmental Management
Business Activities and Their Environmental Impact
Targets and Results of the Fourth Environmental Action Plan
Curbing Global Warming from Products
In-Product Features for Resource Saving
Reduction of Product-Derived Environmental Risks
Prevention of Global Warming Factors in Production
Resource Utilization in Production
Reduction of Environmental Risks in Production
Environmental Communication
Environmental Accounting
Independent Verification

49 Corporate Social Responsibility
50
52
54
56

Responsibility to Our Customers
Responsibility to Our Business Partners
Responsibility to Our Associates
Responsibility to Our Local Communities

58 History
60 Corporate Data
62 Directors, Corporate Auditors and Managing Officers
63 Financial Section
64
66
74
76
77
78
79
96
98

Consolidated Eleven-Year Summary
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Changes in Net Assets
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Reports of Independent Auditors
Investor Information

Regarding this Report
The Annual Report and Social and Environmental Report, which were published separately, have been combined into the Toyota Industries Report from the fiscal year
ended March 31, 2008.

Toyota Industries Report 2008

1

Financial Highlights

Toyota Industries Corporation
Years ended March 31

Thousands of
U.S. dollars

Millions of yen

2008

2007

2006

2005

% change
2008 vs 2007

2004

2008

For the YearNet sales¥2,000,536 ¥1,878,398 ¥1,505,955 ¥1,241,538 ¥1,164,378

6.5% $19,967,427

Operating income

96,853

89,95464,04053,12052,631

7.7

966,700

Ordinary income

126,488

108,484

80,63570,91258,97016.6

1,262,487

Net income

80,46059,46847,07743,35733,62335.3

803,083

Depreciation and amortization

119,905

106,060

87,28770,21365,35113.1

1,196,783

Capital expenditures

142,158

166,505

158,835

136,506

89,508-14.6

1,418,891

Research and development expenses

36,75034,54831,16630,051

29,562

6.4

366,813

Net income — basic¥257.50¥189.88¥146.16¥135.09¥108.04

35.6%

$2.57

Net income — diluted

257.43189.66146.02135.03101.97

35.7

2.57

Cash dividends

60.00

50.00

38.00

32.00

24.00

20.0

0.60

Per Share Data (yen, U.S. dollars)

At Year-End
Total assets¥2,965,585 ¥3,585,857 ¥3,245,341 ¥2,326,824 ¥2,011,995-17.3% $29,599,616

Total net assets

1,453,996

1,810,483

1,611,227

1,115,747

1,016,763-19.7

39,52836,09632,97730,99027,431

9.5

Number of employees

14,512,396

Note: U.S. dollar amounts have been translated from yen, for convenience only, at the rate of ¥100.19 = US$1, the exchange rate on March 31, 2008.

Sales by Business Segment
Thousands of
U.S. dollars

Millions of yen

2008

2007

2006

2005

2004

2008

Automobile¥969,226¥904,893¥746,795¥616,200¥603,862$9,673,884

Materials Handling Equipment

783,173

767,237

595,236

503,989

443,443

7,816,887

Logistics

117,591

89,47065,145––

1,173,684

Textile Machinery

66,26458,40349,78943,90245,968661,389

Others64,28058,392

48,98877,446

71,103

641,583

Net sales

2

Toyota Industries Report 2008

Net Income

Operating Income

Net Sales(¥ Billion)(¥ Billion)(¥ Billion)

2,500

100

100

2,000

80

80

1,500

60

60

1,000

40

40

500

20

20

0
(FY)

0

0

04

05

06

07

08

(FY)

04

05

06

07

08

(FY)

Total Assets(¥ Billion)(¥ Billion)(¥ Billion)

1,000

4,000

2,000

750

3,000

1,500

500

2,000

1,000

250

1,000

500

(FY)

0

04

05

06

07

08

Net Income per Share (Basic)

(FY)

05

06

07

08

06

07

08

06

07

08

Total Net Assets

Overseas Sales

0

04

0

04

05

06

07

08

(FY)

Cash Dividends per Share andConsolidated Payout Ratio

04

05

R&D Expenses

(¥)

(¥)

(%)

(¥ Billion)

300

60

60

40

250

50

50

200

40

40

150

30

30

100

20

20

50

10

10

30

20

10

0

0
(FY)

04

05

06

07

08

(FY)

0

04

05

06

07

08

0
(FY)

04

05

Payout ratio (right)

Toyota Industries Report 20083

Tadashi Ishikawa

Tetsuro Toyoda

ChairmanPresident

Message from the Chairman and President
In the fiscal year ended March 31, 2008 (fiscal 2008), Toyota

and employees and their families. We are determined to

Industries recorded consolidated net sales of ¥2,000.5 billion

continue our unflagging efforts to further raise corporate value

and ordinary income of ¥126.4 billion, both representing

by maintaining our commitment to creating products that

historic highs and marking the ninth consecutive year of

benefit society.

increases in sales and income.
Since our founding, we have consistently devoted

October 2005, we are targeting an increase in net sales fromourselves to manufacturing. Guided by our spirit of¥1,500.0 billion to more than ¥2,000.0 billion and an increase“contributing to society through manufacturing,” which has

in ordinary income from ¥80.0 billion to ¥140.0 billion for the

been handed down through successive generations, we havefive-year period ending March 31, 2011. The end of fiscal

steadily expanded our business fields over the years from2008 marks two years since the launch of the Medium-Termtextile machinery to such domains as vehicles, automotive

Management Plan. Looking back, we believe that in eachparts and materials handling equipment.

of the initial two years we attained solid progress toward

Our positive performance results and wide-ranging
businesses are the fruition of our passion for manufacturing

4

Under our Medium-Term Management Plan announced inrealizing the plan’s overriding objectives.
Turning our focus to the fiscal year ending March 31,

and also reflect the tremendous support of numerous

2009, the likelihood of an unprecedentedly unstable businessstakeholders, including our shareholders, customers,

environment precludes optimism. This is evidenced by abusiness partners, residents of respective local communities

continued surge in raw materials prices as a result of demand

Toyota Industries Report 2008

outstripping supply worldwide, with prices rising 70% for ironmanufactured in North America to other regions. Equally,ore and tripling for coal in particular. The price for steel, a

we will focus on core markets other than North America. In

raw material required in substantial amounts to manufacture

Europe, we will strive for an early realization of benefits arisinglift trucks, is projected to increase significantly versus thefrom sales channel integration of TOYOTA and BT brands thatbeginning of 2008. As for crude oil, even without speculative

is directed toward sales expansion in fast-growing Central

funds and surplus funds that are flowing in the oil market as

and Eastern Europe. Also, in BRICs countries and othera main factor, we are still faced with historically high prices

emerging markets, we will undertake concerted efforts todue to unabated demand from emerging nations. In addition,enhance our sales and service networks, particularly in China

the situation also remains uncertain in view of exchange

and India, to capitalize on the significant increase in demand.

rate fluctuations and volatile stock markets. Moreover, theMoreover, Toyota Industries will aim to further expand sales

subprime loan debacle is casting a longer shadow over thethrough implementing detailed sales management in Japan

U.S. economy than expected, whereby a delayed economic

and overseas by going back to the basics. Further, we will

recovery may in turn negatively impact the global economy.

work to speed up the development of revolutionary new

Under such challenging conditions, we realize that suchproducts and key components to improve competitiveness.

changes in the external environment are not a temporary

As one strategic move, in January 2008 we consolidated

situation and will strive to enhance overall quality as thesales with development and production operations of the

Toyota Industries Group through outside-the-box thinking and

Takahama Plant. Facilitating close cooperation among these

fresh perspectives.

three areas of operations will enable us to identify more

Turning to business-specific issues, in the Materials

focused customer needs in making a concerted effort toHandling Equipment Segment an overriding challenge willquickly provide excellent products in terms of safety, thebe how to compensate for the likely decrease in the Northenvironment, quality and cost.

American market. In North America, we will continue ourIn the Automobile Segment, we will strive for sustained

efforts to increase the market shares of both TOYOTA

growth by contributing to Toyota Motor Corporation’s global

and RAYMOND brands as well as aim to export products

strategy. In the Vehicle Business, Toyota Industries initiatedProgress of Medium-Term Management Plan

Ordinary income(¥ billion)

108.4

97.0

80.6

Over ¥2,000.0

Net sales(¥ billion)¥140.0126.4

1,878.3

2,000.5

2,000.0

1,505.9

Medium-term
management
plan*(FY) 06

07

08

09(forecast)11(target)*Announced Oct. 2005

Toyota Industries Report 20085

consigned production of the Mark X ZiO in fiscal 2008. We

more than a minimal impact on global warming. Combining

have taken this opportunity to upgrade the capabilities of ourthe collective wisdom of people comprising the Group andproduction line, which previously specialized exclusively inaiming to create a sustainable society, we intend to makecompact vehicles, to include midsize and luxury models. We

a concerted, proactive effort to develop new technologies

aim to further improve quality, cost and delivery in our efforts

and products contributing to a substantial reduction into create manufacturing plants that can flexibly respondenvironmental loads, promote innovation in production

to changes in volume and vehicle models. In the Engine

technologies and processes as well as establish an internalBusiness, the implementation of environmental regulations

structure to reduce total CO2 emissions volume.

and soaring crude oil prices are spurring automakers
worldwide to accelerate the development and sales of

involved social welfare, nature and environmental conservation

diesel engine vehicles. Accordingly, we plan to strengthen

as well as a commitment to local communities. In May 2008,

the structure to speed up development of clean diesel

we established the Volunteer Support Center to further

engines in line with continued market expansion. In the Car

strengthen cooperation with local communities as members

Electronics Business, we expect the hybrid vehicle market

of society. We plan to use the center to collect and transmit

to undergo rapid growth for the foreseeable future. Drawing

volunteer-related information and as a base to facilitateon our extensive proprietary technologies cultivated overparticipation in volunteer activities. While working to enhance

the years, we will focus primarily on creating technologies

the functions of the center, we aim to push ahead withfor realizing compact, lightweight and lower-cost devices

providing sustainable programs from a global perspective.

while developing new products. In the Car Air-Conditioning

Regarding compliance-related activities, Toyota Industries

Compressor Business, indicative of rising environmental

considers it essential to provide education targeting allawareness, increasingly strong demand is expected for car

Toyota Industries Group employees in an effort to instill a

air-conditioning compressors with greater fuel economy incompliance-oriented corporate culture. Such educational

developed countries, while a balance between performance

programs, which have long been provided to managerial-level

and cost will be a key requirement in emerging markets. We

staff, have been expanded to include all employees. We havebelieve such needs are likely to become progressively diverse

also formulated business conduct guidelines for employees atin the future, and with this in mind, we will aim to expand

overseas Group companies in accordance with local cultures,

sales by launching new products matched to market andcustoms and situations of each country/region as a means ofvehicle characteristics. At the same time, we will continue

raising awareness.

to pursue product distinctiveness through unrivaled new

We also consider human resources development to betechnologies, focusing on new refrigerants and serializing

an extremely important theme. Our efforts focus on threeelectrically driven compressors.

initiatives: refine technical skills, which constitute the origins

Toyota Industries nevertheless is facing an extremely harshof manufacturing; acquire abilities to solve problems throughbusiness climate. Even in such an inhospitable environment,

the Toyota Production System (TPS), quality control and otherit is absolutely essential that we carry out all imperative tasks

management skills; and foster teamwork featuring a spirit ofwith a view toward the medium term.

harmony and abundant humanity. As an example of refining

In addition, fulfilling our corporate social responsibilities

technical skills, we have been providing practical training onwith the utmost sincerity, beginning with consideration forassembling the Type G automatic loom. Originally completed

the environment, social contribution and the developmentin 1924 by company founder Sakichi Toyoda, this automaticof human resources, will serve as the base of corporate

loom enables automatic shuttle replacement and supplying

activities.

of weft yarn without any loss of speed during high-speed

Today, various environmental problems are posing

6

Toyota Industries’ social contribution activities haveoperation. The machine also is equipped with a mechanism

increasingly serious threats to our planet. As a company

that automatically stops operations when the warp yarn

involved in manufacturing, Toyota Industries is particularly

breaks, thereby preventing the outflow of defects to post-

attuned to those issues associated with climate changes.

processes. Using this ingenuity-filled product, we are providing

Moreover, the entire Toyota Industries Group recognizes thatyoung employees with practical lessons on manufacturing

manufacturing processes and usage of our products exert

while passing on the legacy of Sakichi’s design concepts.

Toyota Industries Report 2008

Tetsuro Toyoda
President

In addition, as one example of our achievements in

In closing, we ask our shareholders, customers, businessactively promoting the development of excellent humanpartners, residents of local communities and employees andresources, in fiscal 2008 we earned a gold medal in thetheir families for their continued support and guidance.

mechanical device control category at the International Skills
Festival for All, Japan 2007, and three gold medals at the
National Skills Competition. This accomplishment is not only

August 2008

attributable to the skills of individual participants but also
the result of our strengths as a company, which include thewealth of technologies we have accumulated to date as wellas the daily guidance provided to respective participants bysenior associates and supervisors. Looking ahead, we remain

Tadashi Ishikawa
Chairmancommitted to continuous development of human resources,
which will contribute to further enhancing our corporate value.
Starting from the fiscal year ended March 31, 2008,
we have combined the Annual Report and the Social andEnvironmental Report. This move stems from our belief that

Tetsuro Toyoda
President

our business activities and corporate social responsibility
activities are inextricably linked in our daily business
operations. It is therefore our sincere intent to fulfill our
corporate social responsibility through our business activities.

Toyota Industries Report 20087

Corporate Governance
Striving to Be a Company that Maintains the Trust of Society throughEstablishment and Meticulous Implementation of an Internal Corporate
Governance Structure
Maintaining and Enhancing Management
Efficiency and the Fairness and Transparency ofCorporate Activities

to meet with heads of each business division regularly to follow the stateof execution of the business policies in each division. At the Management
Council, directors and managing officers convene to confirm and share
information on the monthly status of the operations of each business.
These approaches enable precise decision-making and play a keyrole in the realization of an agile and efficient management structure.

Toyota Industries believes that it is of utmost importance to enhance
the long-term stability of corporate value and maintain society’s trust byimplementing the Basic Philosophy and earnestly fulfilling our corporatesocial responsibilities. Together with contributing to the enrichment ofsociety through our business activities, we also believe it is importantto build an amicable relationship with all stakeholders, starting fromshareholders and customers to business partners, local communities
and employees. Acting on this conviction, we are striving to maintain andenhance management efficiency and the fairness and transparency of
our corporate activities by building a corporate governance structure thatcan respond quickly and flexibly to changes in the business environment.
At the same time, we are bolstering management supervision andemphasizing the timely disclosure of accurate information as part of efforts
to upgrade our corporate governance.

Strengthening Auditing by Establishing the
Corporate Auditor’s Office under the Board of
Corporate Auditors
Toyota Industries has adopted a corporate auditor/board of corporate
auditors system. Corporate auditors attend meetings of the Boardof Directors to confirm matters discussed. Meetings of the Board of
Corporate Auditors are held once a month to discuss and make decisions
on such important matters as auditing policy and reporting.
Additionally, the Corporate Auditor’s Office has been establishedunder the Board of Corporate Auditors with a staff of dedicated personnel
to reinforce the auditing of duties carried out by the directors.
The corporate auditors also cooperate with independent auditors
and the Audit Department, which is in charge of internal audits, receiving
timely reports as appropriate and, where necessary, conducting additional
surveys.

Striving for an Agile and Efficient Management
Structure
Toyota Industries convenes monthly Board of Directors meetings to
discuss and resolve important management matters and monitor the
execution of the duties by directors. The Management Committee has
also been established to discuss important matters such as corporate
vision, management policies, medium-term business strategies andmajor investments. This committee is composed of directors above theexecutive vice president level as well as other relevant directors selectedby the president as determined by the matter discussed. Since we havedelegated significant authority to each business division under the divisionalorganization system, to better monitor various business activities we haveestablished the Business Operation Committee to enable the president

Establishing Committees for Responding to Key
Company-Wide Issues
To respond to key Company-wide issues, such as compliance andenvironmental conservation, we have established various committees,
including the Corporate Code of Conduct Committee, the Environmental
Committee, the Export Transaction Control Committee and the Stock
Option Committee. These committees discuss and monitor management
methods and the means of corporate conduct.

Corporate Governance Structure of Toyota Industries Corporation
Shareholders’ Meetings
Appointment/
Dismissal

Appointment/
Dismissal

ReportingBoard of Corporate Auditors
5 auditors(including 3 external auditors)

Monitoring

Monitoring Monitoring

Cooperation

Independent
Auditors

Board of Directors
17 directors(including 1 external director)
Appointment/
Monitoring

Corporate Auditor’s OfficeAppointment/
Dismissal

Reporting

ReportingAccounting
audit
ReportingDiscussion/
ReportingPresident
Directives
Directives

Management
Committee

Management
CouncilBusiness Operation
Committee(Deliberates on important mattersfrom management’s perspective)(Reports on execution ofbusiness operations)(Follows up on the execution ofbusiness operations)

Directives

Discussion/
ReportingDirectives

Reporting(monthly)

ReportingBusiness Divisions/In-House Company/Departments
Subsidiaries/Affiliates

8

Toyota Industries Report 2008

Committees*

Audit Dept.
Internal
Audit

Policies

Directives

Directors/Managing Officers

Reporting

Reporting

ReportingMajor Committees*
Corporate Code of
Conduct Committee

Reporting

Environmental Committee
Export Transaction
Control Committee
Stock Option Committee

Establishing an Internal Control System
In accordance with the Corporate Law, in May 2006 Toyota Industries’
Board of Directors adopted the Basic Policies for the Establishment ofan Internal Control System as part of our persistent efforts to raise theeffectiveness and efficiency of business operations, maintain reliabilityof financial reporting and ensure full compliance. While establishing a
structure that encompasses various systems and organizations, wewill rotate cycles for reviewing various regulations and evaluating andimproving operations, as we actively build effective frameworks for internal
control.
Highly aware of the frequent instances of corporate improprieties
in fiscal 2008, we carried out a host of activities to further strengthen
measures for ensuring comprehensive compliance. In tandem, we aremaking important progress with preparations for the implementationof J-SOX from fiscal 2009, taking such steps as building, operatingand evaluating systems that help assure the reliability of our financial
information. As we establish an internal control system, we also havedisclosed our basic stance on eliminating forces that run counter tosociety, while clarifying which departments are responsible for making
responses and preparing a response manual.

Thorough Implementation of Compliance via the
Corporate Code of Conduct Committee
Toyota Industries believes that compliance transcends the mere
adherence to laws and regulations and also encompasses respecting
local cultures and customs in a manner that is in step with the changing
times.
The Corporate Code of Conduct Committee, chaired by thepresident, is tasked with controlling the Toyota Industries Group’s overall
corporate conduct in areas related to compliance and crisis response.
Consisting of directors, managing officers and corporate auditors, thecommittee convenes several times per year to confirm the status of any
important incidents that may have occurred as well as countermeasuresand responses adopted. The committee draws on these outcomes todeliberate on matters to be addressed in the coming year.
We also carry out Company-wide education and training programs
according to the level of employees’ positions and their fields ofspecialization, while the designated legal compliance departments handle
education of persons in charge of related departments. In addition,
we undertake a diversity of enlightenment activities to raise employee
compliance awareness levels. We have augmented these initiatives byintroducing compliance e-learning for management supervisors, and in
fiscal 2008 all participants completed this program.
Moreover, we hold regular compliance study sessions for presidents
and persons responsible for executing business at subsidiaries andaffiliates as an integral part of our thorough Group-wide compliance.

Conduct Guidelines: Publishing Handbook for
Corporate and Employee Conduct
To ensure thorough compliance across the entire Group, we havecompiled specific conduct guidelines in the Handbook for Corporate and
Employee Conduct (first edition issued in 1998, revised in November2006) and require all employees to engage in sound conduct. Clarifying
matters that must be adhered to both as a company and as individual
employees, the handbook focuses closely on laws and corporate ethics
and clearly describes acceptable and unacceptable behavior. These
conduct guidelines serve as the basis of the Group’s overall corporate
conduct, whereby we continuously strive to promote a deeper penetrationof these guidelines via education and training.

Setting Up the Corporate Ethics Hotline and Other
Consultation Desks
As one channel for employee consultation on compliance-related
matters, we established the corporate ethics hotline staffed by outside
lawyers. By strictly protecting employee privacy to ensure they are notplaced in a disadvantageous position, we are building a structure thatenables employees to rest assured when seeking advice on a variety ofcompliance-related matters.
As part of a structure capable of properly responding to compliancematters, we have also set up various types of consultation desks toaddress opinions and requests of customers and local residents as wellas to respond to an array of concerns and questions from employees andtheir families.

Timely Information Disclosure
Toyota Industries believes it is crucial to provide stakeholders with timely
corporate information even if the information is unfavorable. To ensure
the fairness of the information, we convene the Information Disclosure
Committee to discuss and determine the importance of informationand the necessity of timely disclosure. We then disclose information inaccordance with the Timely Disclosure Regulations prescribed by the
Tokyo Stock Exchange. We strive for the fair disclosure of information in
Japan and overseas by simultaneously posting financial information andfinancial summaries on our Japanese and English-language Websites.
In working to further enhance our information disclosure, we are
combining our Social and Environmental Report and Annual Report intoa single publication called the Toyota Industries Report to present a morecomprehensive overview of our corporate activities during the fiscal year
ended March 2008.

Timely Disclosure

Board of Directors
ReportingPresident

Timing of Meetings
Upon submission of the securities report (June)
Upon submission of the quarterly financial reports(August, November, February)
Upon submission of the financial summary(July, October, January, April)
Convened when necessary in cases where important mattersmust be determined or arise

Board of Corporate Auditors/Corporate Auditors

Reporting

ReportingInformation Disclosure Committee
Information Disclosure Committee Secretariat
Important information to be disclosed

Business Divisions/In-House Company/Departments

Respect for Shareholders’ Rights
Toyota Industries strives to convene its shareholders’ meeting at an earlydate to ensure the participation of as many shareholders as possible. At
the same time, we work to hold “open shareholders’ meetings” and makeevery effort to report business results and hold question-and-answer
sessions in a shareholder-friendly format.
Regarding dividends, in keeping with a basic policy of maintaining
stable dividends, Toyota Industries returns profits to shareholders taking
into consideration a comprehensive range of factors that include businessresults and the payout ratio. For fiscal 2008, we raised annual cash
dividends per share by ¥10.0 to ¥60.0, and the total amount of dividends
paid for the year was ¥18.7 billion.
With the aim of aligning the interests of management and theCompany and promoting business activities that maximize corporate
value, we have adopted a stock option system, mainly for directors andmanaging officers, that features the use of subscription rights to shares.

Toyota Industries Report 20089

Research and Development
Engaging in Expansive R&D Activities for Maintaining a Competitive Edge
Guided by its founding spirit, “Be ahead of the times through endless creativity, inquisitiveness andpursuit of improvement,” Toyota Industries undertakes Company-wide strategic R&D aimed not just at
improving short-term business results but also at achieving sustainable growth over the long term. At
the same time, each business division actively carries out R&D activities that are important for ensuringthat the Toyota Industries Group maintains its competitive advantage.
Toyota Industries’ R&D can be broadly divided into the two categories
of product development and improvements performed independently
within each business division in addition to R&D carried out mainly by the
Research & Development Center in terms of overall management strategy.
Toyota Industries operates in an extensive range of business spheres,and each of the Company’s business divisions has its own distinctive
technological strengths, core technologies and market characteristics.
Accordingly, to efficiently develop products in line with customer needs,
the development departments of each business division play a leading rolein product improvement, technology development and applied research.
As such, these development departments maintain their own experimentequipment and research laboratories while proactively undertaking
technology development in cooperation with manufacturing departments
based on product development plans.
The Research & Development Center within the Head Office engages
in R&D in technology fields such as materials fields that serve as acommon foundation for all business divisions in addition to undertaking
R&D in new domains. The Research & Development Center is also
working to further strengthen and enhance the efficiency of our Companywide R&D structure, promote lateral transfers of technologies among
different business divisions and investigate new technology development
themes. Concurrently, the center deploys the accumulated technologies
and know-how of each business division in a continuous search for andcreation of new products and services that will form the pillars of our
future business. Depending on specific research themes, the center also

Lift truck evaluation test10

Toyota Industries Report 2008

promotes joint research in collaboration with Toyota Central Research &Development Laboratories, Inc., an R&D facility of the Toyota Group thatengages in basic research, as well as with universities and other outside
R&D institutions.
Toyota Industries actively promotes in-house manufacturing ofessential processing and assembly equipment. The Machinery & Tools
Sub-Division develops and manufactures specialized manufacturing
equipment for the Compressor Division, Engine Division, Toyota Material
Handling Company and affiliates. Manufacturing such equipment internallyyields a host of advantages, which include speedy development andmanufacturing through cooperation among development and design
departments as well as the rapid launch of production lines. Toyota
Industries’ outstanding manufacturing equipment also contributes to theGroup’s manufacturing, serving as a source of competitiveness for eachbusiness and protecting against any outflow of proprietary production
know-how. We are also utilizing our strength in creating manufacturing
equipment for the quick startup of operations at overseas production
bases while striving to nurture personnel with expertise in such equipment,
as we aim to further raise the production technology capabilities of the
Toyota Industries Group.
In fiscal 2008, R&D expenses increased 6.4% from the previous fiscal
year to ¥36.7 billion. By segment, R&D expenses amounted to ¥17.3
billion in the Automobile Segment, ¥16.5 billion in the Materials Handling
Equipment Segment, ¥0.9 billion in the Textile Machinery Segment and¥1.8 billion in the Others Segment.

Vehicle wind tunnel test

Textile machinery development test

Survey of Businesses
12
14
23
24
26
30

At a GlanceMaterials Handling Equipment
Logistics
Car Air-Conditioning Compressor
Automobile
Textile Machinery

Toyota Industries Report 200811

Survey of Businesses

At a Glance
Automobile• Passenger vehicles• Diesel engines• Gasoline engines• Car air-conditioning compressors• Electronic components forautomobiles• Foundry parts• Stamping dies

Materials Handling
Equipment• Counterbalanced lift trucks• Warehouse trucks• Aerial work platforms• Automated storage and retrieval
systems• Automatic guided vehicles

Logistics• Land transportation services• Logistics planning• Operation of distribution centers• Cash collection and delivery andcash proceeds management• Secure storage, management,collection and delivery ofcorporate documents

Textile Machinery• Ring spinning frames• Roving frames• Air-jet looms

Others• Semiconductor package
substrates• Manufacturing equipment

12

Toyota Industries Report 2008

The Automobile Segment is Toyota Industries’ largest business segment and accounts for
48% of consolidated net sales. Within this segment, the Vehicle Business manufactures
the Vitz (Yaris outside Japan), RAV4 and Mark X ZiO under consignment from Toyota
Motor Corporation (TMC). The Engine Business produces diesel and gasoline engines
under consignment from TMC as well as engines for its own materials handling equipment.
Commanding the top global share, the Car Air-Conditioning Compressor Business develops
and produces fixed-displacement compressors and variable-displacement compressors. This
segment also produces foundry parts for engines and electronics devices for automobiles. In
fiscal 2008, net sales of the Automobile Segment were ¥969.2 billion and operating income
amounted to ¥41.5 billion.

The Materials Handling Equipment Segment develops, manufactures, sells and services
industrial vehicles such as lift trucks, warehouse trucks, shovel loaders and tow tractors in
addition to aerial work platforms, automated storage and retrieval systems and automatic
guided vehicles. Toyota Industries sells its materials handling equipment under the Toyota
L&F (Toyota Industrial Equipment outside Japan), BT, RAYMOND, CESAB and AICHI brands.
In fiscal 2008, net sales of the Materials Handling Equipment Segment amounted to ¥783.1
billion. Operating income totaled ¥39.8 billion.

In addition to engaging in truck cargo transport and warehousing operations, Toyota
Industries carries out the Logistics Solutions Business for handling all aspects of logistics to
help customers reduce their logistics costs. We are steadily growing this business by meeting
today’s demands such as proper response to J-SOX and by contributing to the optimizationof customers’ overall logistics operations. In fiscal 2008, net sales of the Logistics Segment
amounted to ¥117.5 billion. Operating income was ¥4.2 billion.

The Textile Machinery Segment produces and sells spinning and weaving machinery. Spinningmachinery includes the manufacture and sales of high-speed ring spinning frames androving frames while weaving machinery involves the manufacture and sales of air-jet looms,
which insert weft yarns using air, and other products. In fiscal 2008, net sales of the Textile
Machinery Segment were ¥66.2 billion and operating income totaled ¥4.2 billion.

The Others Segment includes newer businesses that we have entered relatively recently.
This segment includes TIBC Corporation, a joint venture with Ibiden Co., Ltd. that produces
semiconductor package substrates. In fiscal 2008, net sales of the Others Segment
amounted to ¥64.2 billion and operating income was ¥6.7 billion.

7SEU17Compressor

RAV4

Net Sales

Operating Income(¥ Billion)(¥ Billion)

1,000

80

800

Percentage of
Net Sales

60

600

48.5%

40
400
20

200

VD
Diesel engine

DC-DC converter

0
(FY)

06

07

08

0
(FY)

06

07

08

Net Sales

Operating Income(¥ Billion)(¥ Billion)

1,000

80

800

Percentage of
Net Sales

60

600
40

39.1%

400

GENEO (8FG25)
Internal combustion
counterbalanced lift truck

ReflexReach truck

SB12A
Truck mountaerial work platform

20

200
0
(FY)

06

07

08

08

Operating Income(¥ Billion)

8

40

2

20
0

5.9%

4

60

(FY)

Percentage of
Net Sales

680

Secure storage,
management, collection
and delivery of corporate
documents

07(¥ Billion)

120

Land transportation
services

06

Net Sales

100

Cash collection anddelivery and cash
proceeds management

0
(FY)

06

07

08

0
(FY)

06

07

08

Net Sales

Operating Income (Loss)(¥ Billion)(¥ Billion)

100

6

80

Percentage of
Net Sales
3.3%

4

60
2
40
0

20

RX240
Ring spinning frame

JAT710Air-jet loom

0
(FY)

06

07

08

(2)
(FY)

06

07

08

Net Sales

Operating Income(¥ Billion)(¥ Billion)

8

100
80

Percentage of
Net Sales
3.2%

6

60
4
40

Wire bonding
package substrate

Flip chippackage substrate

2

20
0
(FY)

06

07

08

0
(FY)

06

07

08

Note: Segment net sales figures do not include intersegment transactions. However, segment operating income figures do include operating income (losses) arising from intersegment transactions.

Toyota Industries Report 200813

Survey of Businesses

Materials Handling Equipment
The World’s Leading Materials Handling Supplier—
Providing Customers with Optimum Solutions
Toyota Industries’ Materials Handling Equipment Business engages in thedevelopment, production, sales and services of industrial vehicles such ascounterbalanced lift trucks and warehouse equipment, as well as systems
for transportation, storage and retrieval of goods. We provide one-stop
shopping for products, services and added-value solutions that combine
cutting-edge technologies with materials handling expertise and a global
network presence. As a leading manufacturer of lift trucks and othermaterials handling equipment, Toyota Industries offers a product range that
includes the TOYOTA, BT and RAYMOND brands as well as AICHI, a top
brand in Japan for aerial work platforms.

Unit Sales of Materials Handling Equipment
Worldwide Marked a Record HighNet sales in the Materials Handling Equipment Business totaled¥783.1 billion, an increase of ¥15.9 billion over the fiscal year ended
March 2007. This was in spite of the figure for fiscal 2007 being
inflated as a result of including 15-month results of the BT Industries
Group that changed their fiscal year-end from December to March.
Excluding the effects of the change, net sales increased by ¥80.6
billion. Although lift truck sales decreased due to the slowdown in
the U.S. economy, overall unit sales of materials handling equipment
worldwide marked a record high, supported by robust markets in

Europe, Asia and Oceania. Aichi Corporation (Aichi) posted solid
sales due to an increase in demand from its principal customers in
the electric power industry.

Toyota Material Handling Group
Since becoming partners in 2000, Toyota Material Handling Company(TMHC) and the BT Industries Group continued to examine theirstrengths in the pursuit of synergies that include mutually supplying
respective brand products, sharing sales and production know-how,exchanging resources and jointly procuring products. Determining thetime was right for maximizing synergies via the full-scale integration

Organizational Chart of Toyota Material Handling Group

TMHG
Management Committee

Global Strategy, Optimum Resource Allocation, Global Management Control

TMHJ

TMHNA

TMHE

TMHI

TMHCN

Toyota Material HandlingJapan

Toyota Material HandlingNorth America

Toyota Material Handling
EuropeToyota Material HandlingInternational

Toyota Material
Handling China

R&D, Product Planning, Plant Operation, Information Systems/Information Technology,
Sub-Committees Quality,
Human Resources and FinanceIn managing and carrying out its operations, TMHG has divided its global markets into five regions—Japan, North America, Europe, International and China—and established a Board as thedecision-making body within each of these four regional organizations. A Management Committee composed of TMHG top management and representatives of each regional organization
oversees the formulation of strategies and manages TMHG as a whole. TMHG has also set up Sub-Committees comprising functional sections of each regional organization to handle suchprincipal functions as Quality, R&D, Product Planning, Plant Operation, Information Systems/Information Technology, Human Resources and Finance. Cross-sectional linkages permeating theentire organization facilitate the sharing of best practices and know-how cultivated regionally as well as globally.

14

Toyota Industries Report 2008

of operations, Toyota Material Handling Group (TMHG) became
operational from April 2006 as a new framework integrating TMHC
and the BT Industries Group.
We are currently pushing ahead with measures aimed atstrengthening our world leadership position as the “Undisputed No.
1” in the global industrial truck market, and each of these initiatives
already has begun to steadily yield important results. Examplesof the growing synergies already created include joint productdevelopment (e.g., three-wheel electric lift truck for the European
market), development of our own key components, strengtheningof our production structure through the horizontal deployment of
the Toyota Production System (TPS) throughout the entire group,

the reorganization of sales structures in a number of regions andenhanced development efficiency through the sharing of systems.
While the TOYOTA brand has achieved a solid position for
counterbalanced lift trucks not only in Japan but all over the world,
the BT brand is strong in the European market and the RAYMOND
brand is strong in North America. In its operations, TMHG intends
to firmly maintain its core TOYOTA, BT and RAYMOND brands whilesolidifying optimum brand and sales structures in each region toensure that the power of each brand is fully utilized.
Through the implementation of these measures, we plan to work
toward capturing an even greater global market share while aiming
for a further increase in profitability.

Business Activities in Fiscal 2008 by Geographic Region

Japanese Market
In calendar year 2007, unit sales in the lift truck market in Japandeclined slightly from the previous year.
Toyota Material Handling Japan (TMHJ) engaged in aggressive
sales and service activities aimed at increasing customer satisfaction
with its products. As a result, unit sales were on a par with theprevious fiscal year at 39,000 units, marking the 42nd consecutive
year that TMHJ has maintained the top-ranked position in theJapanese lift truck industry.
In November 2007, minor
modifications were made to 3.5to 5-ton GENEO-PRO and 5- to
8-ton G300 internal combustion
counterbalanced lift trucks,
culminating in upgradedversions with more market
appeal. Both of these models
are fitted with electronicallycontrolled engines and threeway catalytic mufflers as
GENEO-PROstandard equipment, whichmakes exhaust emissions
cleaner, improves fuelefficiency and increases power.
They also meet Japanese
special motor vehicle exhaustemission regulations for 2007.
The G300 boasts a new highpower design featuring thelatest common rail diesel
engine, making it ideal forcustomers requiring extra
G300
power, such as in harbor
freight operations.
TMHJ also reinforced the product value of its materials handlingsystems with the introduction of the Rack Sorter P, a unit-type

automated storage and retrieval system for pallets (1-ton models in
May 2007 and 1.5-ton and 2-ton models in October 2007). The newrack sorter features a function to automatically alert the user when it
is time to replace worn-out parts, which helps ensure stable operation
through preventive maintenance. It also includes a guidance display
function to assist in early recovery in case of breakdown.
Combining an extensive product lineup that encompasses lift
trucks, warehouse trucks, automated storage and retrieval systems,
automatic guided vehicles and aerial work platforms with anabundance of know-how, TMHJ aims to continue providing optimum
materials handling solutions for customers.

North American Market
In the North American market in 2007, actual sales decreased by 5%
due to a deceleration of the economy arising from the subprime loan
problem. Toyota Material Handling North America (TMHNA) engages
in the lift truck business through a 2-channel, 2-brand strategy.
The TOYOTA brand leverages its strength with a broad portfolio
of products that target the sit-down counterbalanced electric andinternal combustion engine-powered markets. The RAYMOND brandcapitalizes on its strength with a full line of electric trucks focusing on
warehousing and distribution markets. Both brands have a history of
extremely strong appeal and sales power that TMHNA will continue
to maximize in pursuing enhanced sales and service activities.
TOYOTA was the leading brand of lift trucks in North America
for the sixth straight year in 2007. Experts in the industry validated
Toyota’s delivery of products and services that exemplify quality,
durability and reliability. As an example, Modern Materials Handling/
Reed Research Group honored Toyota as having the leading lift truckin terms of quality and value for the fourth year in a row. Also, Toyota’s
new generation of engine-powered lift trucks (sold as the 8-Series inNorth America) were awarded the silver medal in Plant Engineeringmagazine’s annual “Product of the Year” ranking. Encouraged bysuch achievements, Toyota will continue to focus on raising customer
satisfaction through 2008 and beyond.
Raymond also introduced a number of new products, including

Toyota Industries Report 200815

Survey of Businesses

Materials Handling Equipment
Model 4100 and 4200 stand-up counterbalanced lift trucks, which
are designed for warehouse systems and other high-productivity
applications. Also introduced around the same time was the Model
4400 three-wheel, sit-down electric lift truck, which is ideal for heavyduty dock operations and higher-speed transport for supplying racksystems and moving picked orders. Among these, Plant Engineering
awarded Raymond’s Model 4200 its “2007 Product of the Year”
award. This prestigious award is given to products that rate thehighest compared with similar products of other companies.
In December 2007, Raymond released the industry’s broadest
range of new pallet trucks designed for extreme and corrosive
environments, specifically the Model 102XM and Model 8300 walkie
pallet trucks and Model 8400 end rider pallet truck.
TMHNA also is active in environmental protection and social
contribution activities. At the beginning of 2007, Toyota saw the
first full year of production of 8-Series lift trucks. In a partnershipannounced with the Arbor Day Foundation, Toyota pledged to planta tree for every 8-Series lift truck sold, symbolic of the environmental
accolades of the newly launched product. As a result, 20,000 trees
were planted in early 2008 to contribute to reforestation efforts inNorth America. Also, to aid in the recovery efforts for those affectedby the devastating fires that occurred in November 2007 in California,
TMHNA donated 13 Toyota lift trucks and hand pallet trucks, as wellas $55,000, to the American Red Cross. Through these activities andother initiatives, TMHNA will continue to be actively involved in efforts
to protect the environment and contribute to society.
At the end of fiscal 2008, the Raymond organization continued its
history of innovation by launching a three-year program for researchand development of hydrogen fuel cell technology. Raymond’s
Greene manufacturing facility is now a “living lab” for researching
the use of hydrogen fuel cell-powered Raymond lift trucks in actual
applications including an indoor, fast-fill hydrogen refueling system.
Raymond is the first North American lift truck company to embark onsuch research for fuel cells.
TMHNA also remains committed to continuous improvement of
its world-class manufacturing operations through the implementationof TPS at its facilities in Greene, New York; Muscatine, Iowa;
Columbus, Indiana; and Brantford, Ontario, Canada. This
implementation improves Toyota’s and Raymond’s already strong
reputation for product quality and reliability.

TMHE employs more than 4,800 highly trained service technicians
across Europe.

Multinational customers also benefit from excellent cooperation
between local key accounts teams and the TMHE European Key
Accounts team, ensuring optimum value and consistency in the
more than 30 countries where TMHE is active.
TMHE also enhanced its product offering, highlighted by thelaunch of the new generation of engine-powered lift trucks (sold as
the Toyota Tonero in Europe), for which production commenced in
September 2007. This range of 1.5- to 3.5-ton internal combustion
counterbalanced lift trucks addresses European customer needs interms of safety, productivity, durability, comfort and the environment.
The Tonero+ formula lets customers specify additional safety,
productivity, comfort and durability features to meet their specificbusiness requirements. The Toyota Tonero has been welcomed bycustomers and also won the “Prize for Environmentally Conscious
Design” at the Europack07 trade show in France. The Toyota Tonerois 99% recyclable and runs cleaner than the strict new European
exhaust emissions standards.

European Market
In 2007, the European market for industrial trucks continued to grow,led by continued strong growth in Central and Eastern Europe. Amid
this climate, Toyota Material Handling Europe (TMHE) significantly
increased unit sales to around 72,000 units compared with theprevious fiscal year.
In 2007, TMHE continued to implement and refine its new
business structure in many European markets, offering both
TOYOTA- and BT-brand trucks through one point of contact withthe customer. The integration of Toyota and BT operations at a
European level and in many European countries provides customers
with a stronger materials handling partner with a wider rangeof products, supported by high service levels and added-value
solutions.

16

Toyota Industries Report 2008

Toyota Tonero

In addition, TMHE introduced several new or updated warehouseequipment models. The new BT Opus OME100N and BT Opus
OME100NW order pickers provide safe, highly flexible and ergonomic
first-, second- and third-level order picking. The BT Reflex-M reachtruck and BT Veflex very narrow aisle (VNA) truck families were
updated to enhance truck performance and operator productivity.
The BT Lifter Silent hand pallet truck was also launched. Thirty
percent quieter than conventional hand pallet trucks, the BT Lifter
Silent is certified to meet strict noise standards for nighttime delivery
operations.
As a result of these activities, TMHE established a new sales
record for total unit sales of its three European brands: TOYOTA, BT
and CESAB.
These new and improved products, supported by innovative
services and solutions and delivered by a marketing and salesorganization that is closer than ever to the customer, provide TMHE
with an excellent foundation for its future success.

International and Chinese Markets
These markets include Asia, the Middle East, Oceania, Latin Americaand Africa. Strong economic expansion and ever-increasing demand
for materials handling equipment distinctly characterize many of thesemarkets. Toyota Material Handling International (TMHI) took steps tofurther develop and strengthen its sales and service networks in theseareas along with its ability to offer a full range of counterbalanced lift
trucks and warehouse trucks to the markets.
In India, new branches have been established throughout thecountry to improve
market coveragefor sales andservice operations.
Significant market
growth is fuelingan even stronger
conviction of theimportance of the
Toyota Industry (Kunshan) Co., Ltd.
Indian market.
In Brazil, TMHI
has initiated the integration of the sales network of TOYOTA and BT
brands to strengthen operations and provide customers with support
in all areas of materials handling.
In China, TMHI launched a sales dealer network to meet growing
demand in this prosperous market. Toyota Material Handling(Shanghai) Co., Ltd. have pursued a training process geared toward
members of its expanding national dealer network. The training will
ensure each dealer has a high level of product and materials handlingknowledge to ensure customer confidence and satisfaction. In the
beginning of 2008, lift truck production capacity at Toyota Industry(Kunshan) Co., Ltd. was also expanded to 5,000 units annually.

Looking Ahead

Japanese Market
The lift truck market in Japan in 2008 is projected to grow marginallyamid a weakening domestic economy.
Under such circumstances, competition among manufacturers is
expected to further intensify. Accordingly, TMHJ intends to enhance
the appeal of its products. Besides promoting differentiation fromcompetitors through a focus on strengthening the development of
key components such as engines, motors and hydraulic valves,
strenuous efforts will be made to lower costs through the global
standardization of key components developed in Japan.
The mainstay GENEO-B electric lift truck has been introduced
into the market in April 2008 after minor modifications to enhancesafety. In this model change, all aspects of safety have been
improved, with features such as a rear pillar assist grip (with a horn),which was included as standard equipment to ensure a stable driving
posture and excellent rearward vision when reversing. In addition tostronger engagement in the electric lift truck market, TMHJ aims toproactively pursue proposal-based and solution-based sales activities
that match customer needs.
From May 2008, TMHJ has begun manufacturing
counterweights, a key component of counterbalanced lift trucks, at
its subsidiary, Handa Casting Company, in Handa, Aichi Prefecture. In
addition, TMHJ has attempted to eliminate bottlenecks in production
processes to boost productivity at the Takahama Plant in Takahama,
Aichi Prefecture.
TMHJ will continue to promote the elimination of bottlenecks

in production processes and components in response to growing
demand for lift trucks worldwide. Meanwhile, to accommodate
fluctuations in demand at a regional level, Toyota Industries will pushahead with efforts to establish an optimum global production andsupply structure.

North American Market
Looking ahead, although the North American market is expected toremain challenging, TMHNA will dedicate resources to strengthen its
business platform and provide customers with innovative products
and services.
Having refined its vision “To retain our leadership as the mostsuccessful and respected materials handling solutions provider tocustomers,” TMHNA is now undertaking several new initiatives.
In the first half of fiscal
2009, Toyota has started
manufacturing TOYOTAbrand diesel tow tractors,
which were featured at
the Aviation Industry Expoin Dallas in March 2008,at its manufacturing site
Tow Tractor (02-2TDU25)
in Columbus, Indiana.
Producing these units in the United States allows TMHNA to be
more responsive to customers interested in the diesel tow tractor byconsiderably speeding up the delivery timeline.

Toyota Industries Report 200817

Survey of Businesses

Materials Handling Equipment
Toyota also will launch its new AC reach truck in late 2008 alongwith new internal combustion pneumatic models with increased
capacities of 22,000 to 35,000 lbs. The new reach truck will be
introduced at ProMat, the largest material handling trade show inNorth America, scheduled to be held in January 2009.
Toyota also is continuing its environmental stewardship programand commitment to the Arbor Day Foundation. Toyota will plant atree for every lift truck sold this year, which is estimated to result in an
additional 30,000 trees being planted in early 2009.
In 2008, Raymond will continue its commitment to innovationand technical leadership by enhancing what is already the mostcomprehensive electric lift truck portfolio in the industry. Raymondwill introduce the iWarehouse™ fleet optimization system for
warehouse and distribution center managers to collect and analyze
real-time lift truck data to maximize fleet productivity and reduce
costs. Warehouse managers can access this information throughthe Raymond Web portal to generate reports and benchmark lift
truck and operator productivity, detect lift truck issues before failuresoccur, reduce the risk of impacts and optimize lift truck capital andmaintenance costs.
Raymond’s 7000 Series Reach-Fork® truck, the industry-leading
solution for narrow aisle applications, will be further differentiated with
the introduction of an integrated laser option that will allow operatorsa quick and efficient way to store and retrieve goods at high levels
with low visibility. Raymond’s new truck models will be aimed ataddressing changing labor dynamics and improving operator
productivity in warehouse and distribution center applications.
Raymond will increase its focus on specific market segments
to ensure that R&D and marketing efforts are concentrated on
evolving and growing markets, such as the third party logistics (3PL)
market, which is expected to continue to flourish despite a sluggish
U.S. economy. Raymond will also focus on the green movement bycontinuing its evaluation of hydrogen fuel cell technology and otherenvironmentally friendly energy alternatives. Raymond, as a market
leader, will continue to develop relationships with suppliers of energy
alternatives in an effort to remain on the forefront of technology.

European Markets
The steady growth seen in Europe during the past two to three years
is expected to slow down in 2008, with demand in Eastern Europe
projected to remain stronger. In view of such expectations, overall
European demand for industrial trucks will likely remain relatively
stable at least for the coming year.
TMHE is now present in most European markets as one
comprehensive solutions provider with a network of wholly owned
sales and marketing companies, as well as independent distributors
and dealers offering innovative TMHE products. TMHE strives toenhance customer satisfaction through a comprehensive productrange based on TOYOTA counterbalanced lift trucks and BT
warehouse equipment, together with services and solutions toprovide trouble-free customer operations.
As a follow-up to introducing the Toyota Tonero in 2007, TMHE
has begun an ambitious strategy to renew within a two-year period
the models in our product range that address 70% of the European
market potential. At CeMAT 2008, TMHE launched the BT Levio

18

Toyota Industries Report 2008

powered pallet truck and BT Staxio pedestrian stacker. Both models
feature an all-new design incorporating extensive market researchto highlight the values of simplicity, safety and durability. Developed
specifically for “walkie” operations, the BT Levio and BT Staxio
address Europe’s largest lift truck market segment in terms of unit
sales.
At CeMAT, TMHE also previewed a new generation of BT Reflex
reach trucks and Toyota 48-volt electric counterbalanced lift trucks.
By setting even higher standards for safety, productivity and durability,
the new BT Reflex models will continue the tradition of reach truck
excellence for which the BT brand is famous. The new Toyota 48-volt
range will feature three-wheel and four-wheel models and will deliver
improved performance and productivity. When launched, the newtrucks will significantly enhance the competitiveness of TMHE’selectric counterbalanced lift truck range.
In addition, TMHE will continue to expand Toyota I_Site, aninformation system that provides customers with the information theyneed to reduce their materials handling costs, enhance safety andoptimize the use of their trucks based on information straight fromthe truck and its usage.
The new CESAB ECO-P high-tonnage electric counterbalanced
lift truck will also be launched. This compact yet robust truck has
load capacities of 6 to 8.5 tons and delivers excellent ergonomics,
performance and reliability.
TMHE will continue to enhance its capabilities in terms ofproviding excellent services and added-value solutions.

International and Chinese Markets
Continued strong growth is projected for the international market
in 2008. Accordingly, TMHI will engage in key efforts to further
strengthen its competitive advantage with regards to its productrange and market coverage, including the launch of several
products that will coincide with major trade shows and distributor
conferences. These new products will offer substantial improvements
for customers and enable TMHI to keep pace with robust market
growth.
In India, TMHI will work to strengthen its ability to provide a wide
range of products supported by services to meet expected growth indemand for materials handling equipment.
Brazilian operations will continue to focus on increased market
coverage and customer support. We expect to continue positive
developments achieved over the past few years due to ourstrengthened market position.
Overall strategies are based on TMHI’s dedication to determining
the best approach to strengthen its customer relationships andimproving its abilities to support customers.
A strong emphasis on growing the dealer network and capability
will continue in China to capitalize on the strong start realized todate. We will continue to develop Chinese operations and improvecapabilities to serve our customers.

Topics

Concentrating Domestic and International
Sales Operations for Materials Handling
Equipment at the Takahama Plant

a radio data frequency (RDF) system, a remote system to track the
goods on the shelf to optimize the picking activity.

In January 2008, Toyota Industries transferred the domestic
and international sales operations of its Nagoya branch to
the Takahama Plant in Takahama, Aichi Prefecture, which is
involved in the development and production of materials handlingequipment. This will enable closer cooperation among sales
departments and development and production departments,
which will make it easier to identify customer needs. Through thecomprehensive integration of functions, Toyota Industries intends
to supply products that are even more outstanding in terms ofsafety, the environment, quality, cost and delivery.

“Make it Happen”: TMHE Launches the
Toyota Tonero

In addition, customers can experience new productfunctions first-hand at the newly built showroom, which allows
us to engage in proactive sales promotion activities by proposing
ways to enhance logistics operations through TMHJ’s diverse
product lines.

CESAB Factory
The CESAB factory in Bologna, Italy, is continuing to take part in
TMHG’s program of deploying TPS throughout the entire group.
Applying the Genchi Genbutsu (“Go & See”) principle, several key
managers at CESAB have completed a training session at the
Takahama Plant in preparation for further TPS implementation
within the CESAB production center.
Joint activities in the area of product development are also
progressing according to plan, whereby preparations for new
product manufacturing are the main focus and challenge for the
management team. Important changes in the logistics process
are underway to prepare for and manage a significant flow ofcomponents from Japan. This will allow management of 45% moreparts, using an innovative kitting system to serve the assembly
line, as well as Junjo management of components, supported by

Sunny Marbella, Spain witnessed a unique event in May, 2007—
the birth of the Toyota Tonero, a new generation of enginepowered lift trucks. More than 120 members of the TMHE
network as well as 60 journalists from 19 countries gathered fora launch event with the theme “Make it Happen.” The program
included a Distributor Launch, European Press Event and Trainthe Trainer seminars. Participants learned how the Tonero delivers
class-leading standards in five key areas: safety, productivity,
durability, comfort and the environment. Also introduced was the
Tonero+ formula, which allows customers to choose additionalsafety, productivity, durability and comfort features in line with their
specific business needs.
Reactions to the Tonero launch were very positive. In addition
to enthusiasm over the new lift trucks, members of the TMHE
marketing and sales companies also welcomed the opportunity
to meet colleagues from within the newly integrated European
network at the first official TMHE launch event. Production of the
Toyota Tonero began in September 2007 at the Toyota Industrial
Equipment, S.A. plant in Ancenis, France.

Raymond Earns High Accolades for its
Efforts in Fuel Cell Field
In 2007, Raymond installed an indoor hydrogen-refueling centerand received all safety approvals. Overall documentation andtraining are complete. Currently, fuel-cell lift trucks are operatingin the factory. Raymond has received
excellent press coverage for its
fuel cell initiative including featurearticles in Industrial Utility Vehicle
and Industrial Vehicle Technology
International magazines. Additionally,
the company held a press conferencein December 2007 to provide an
update on the New York State Energy
Research and Development Authority(NYSERDA) project.

Toyota Industries Report 200819

Survey of Businesses

Materials Handling Equipment
Products for the Japanese and International Markets

Please visit www.global-toyotaforklifts.com for more information.

Industrial Vehicles

GENEO (8FG25)

GENEO-B (7FB15)

GENEO-E (7FBE15)

GENEO-R (7FBR15)

Tow Tractor

Skid Steer Loader

Internal combustion
counterbalanced lift truck

Electric counterbalanced
lift truck

Three-wheel electriccounterbalanced lift truck

Electric reach truck(2TD25)(5SDKL8)

Materials Handling Systems

Partner Rack

Rack Sorter B

Rack Sorter P

Tugcart2AFBR15APLB8Rail-less mobile rack

Automated storage andretrieval system(Plastic container type)

Automated storage andretrieval system(Pallet type)

Automatic guided
vehicle system

Automatic guided
lift truck

Automatic guided
pallet truck

Please visit www.aichi-corp.jp for more information.

Truck Mount Aerial Work Platforms

SH15B

SE08C

Self-Propelled Aerial Work Platforms

SB12A

SP14CJ

Note: Although Aichi Corporation is not integrated into the Toyota Material Handling Group, it comprises an important part of the Materials Handling Equipment Business.

20

Toyota Industries Report 2008

SV08CNL

Products for the North American Market
Please visit www.toyotaforklift.com for more information.

7FGU708FGCU25

7FGCU55-BCS

Internal combustion pneumatic tire
counterbalanced lift truck

Internal combustion cushion tire
counterbalanced lift truck

Internal combustion cushion tire
counterbalanced lift truck—boxcar
special model

8FGU25

7FBEU20

7FBCU25

7BPUE15

Three-wheel electric counterbalanced
lift truck

Electric cushion tire counterbalanced
lift truck

Electric order picker

Internal combustion pneumatic tire
counterbalanced lift truck

Please visit www.raymondcorp.com for more information.

Raymond Model 7400
Reach-Fork Truck

Raymond Model 4200 StandUp Counterbalanced Truck

Reach truck

Electric counterbalanced truck

Raymond Model 8400 Pallet Truck
Electric pallet truck

Raymond Model 5600
Orderpicker

RaymondSwing-Reach Truck

Order picking truck

Very narrow aisle truck

Toyota Industries Report 200821

Survey of Businesses

Materials Handling Equipment
Products for the European Market
Please visit www.toyota-forklifts.eu for more information.

Toyota Tonero

Toyota 7FG/D40

Toyota 7FBMF25

Internal combustion counterbalanced
lift truck (1.5-3.5 ton)

Internal combustion counterbalanced
lift truck (3.5-5 ton)

Electric counterbalanced lift truck (80V)

New Toyota 48V

Toyota Traigo

Toyota 4CBT2Three-wheel and four-wheel electriccounterbalanced lift truck (48V)*Will be launched in late FY2009

Three-wheel electric counterbalanced
lift truck (24V)Electric tow tractor

Please visit www.toyota-forklifts.eu for more information.

22

BT Vector

BT Reflex

BT Stratos

BT Staxio

Very narrow aisle truck with shuttle
forks

Reach truck* Will be launched in late FY2009

Powered stacker truck with stand-in
cab

Pedestrian powered stacker* Will be launched in FY2009

BT Minimover

BT Levio

BT Opus

BT Pro Lifter

Powered stacker truck

Powered stacker truck* Will be launched in FY2009

Low-level order picking truck

Hand pallet truck

Toyota Industries Report 2008

Survey of Businesses

Logistics
Offering Advanced and Efficient Logistics Services
Utilizing Know-How Cultivated through Toyota
Production System
In fiscal 2008, net sales of the Logistics Segment increased ¥28.1 billion, or
31%, to ¥117.5 billion, exceeding ¥100 billion in the sixth year of operation
since we initially entered this business in 2002. We will continue to respondto customer demand for services that utilize our extensive know-how inmaking logistics improvements, beginning with our expertise in the Toyota
Production System (TPS) cultivated at manufacturing sites.

Proposing Logistics Best Suited to
Respective Customers
Toyota Industries’ Logistics Business presently consists of the threebusiness pillars of planning, design and operation of distribution
centers, high value-added services and distribution of automotive
parts.
Planning, design and operation of distribution centers areundertaken mainly via the Advanced Logistics Division as well as
Advanced Logistics Solutions Co., Ltd., a wholly owned subsidiary.
Specific services include making proposals for logistics plans andoperating distribution centers for a variety of corporate customers.
Rather than merely providing consigned logistics services, we strive
to raise the overall efficiency of logistics by identifying and solving
new problems from the customer’s viewpoint as we execute logistics
solutions planned and proposed by Toyota Industries.
High value-added services are provided through two subsidiaries,
Asahi Security Co., Ltd. (Asahi Security) and Wanbishi Archives Co.,
Ltd. (Wanbishi Archives). Asahi Security, which became a subsidiaryin March 2005, meets the needs of the retail and services industries
by undertaking the equipment security business and providing cash
management outsourcing services such as cash and cash proceeds
collection and delivery. Meanwhile, Wanbishi Archives, which became
a wholly owned subsidiary in May 2007, offers sophisticated riskrelated services that include storing, managing and confidentially
deleting crucial data for companies and government agencies andproviding data backup in the event of disasters.
The distribution of automotive parts is handled by the Taikoh
Transportation Group, which undertakes consigned transportation for
numerous automotive parts manufacturers. These parts are collectedaccording to each delivery destination and then sorted onto pallets,
thereby ensuring the supply of “what is needed, when it is needed,
and in the amount needed.” Through cooperation with Toyota Motor
Corporation, Taikoh Transportation pioneered the completion of theindustry’s first automotive parts logistics system that consists ofrelay (intermediate) logistics bases. This business has achieved asteady increase in sales in line with increased production of TOYOTA
vehicles in recent years.
Backed by these three business pillars, we are building a
structure for logistics services under which customers can entrust
us with managing the flow and storage of “goods,” “cash” and“information.” Based on the concepts embodied in TPS, we will
respond to customer needs for reducing costs by thoroughly
eliminating waste in logistics.

TopicsWanbishi Archives Constructs New
Building for BPO Services
In February 2008, Wanbishi Archives completed a newbuilding for BPO (business process outsourcing) services at
the Kanto No.3 Center in Saitama Prefecture. The building
handles search services, which are one type of BPO services.
Specifically, this facility sorts, classifies, arranges and storeslarge volumes of documents entrusted by customers as wellas provides a document search and delivery service startingfrom volumes as low as single pages. Wanbishi Archives
is actively addressing the needs of contemporary society
in which company structures for managing information
assets are being strictly scrutinized, due in part to such
legislation as the Personal Information Protection Act and
J-SOX (the Japanese version of the U.S. Sarbanes-Oxley
Act). Accordingly, Wanbishi Archives maintains extremely
high levels of security by prohibiting entry by unauthorized
persons through measures such as restricting accesswithin the Kanto Center, the BPO building and the building’s
individual storage rooms and by clearly delineating document
storage space and work space.

Toyota Industries Report 200823

Survey of Businesses

Car Air-Conditioning Compressor
Our Global No.1 Share is Testimony to the High
Quality of Our Products
Thanks to outstanding technologies and unsurpassed high quality, Toyota
Industries’ car air-conditioning compressors have an overwhelming
competitive advantage, which is readily evidenced by our top share of
the world market. Determined to retain our leading global position, we will
rigorously continue to hone our technologies and meet the increasingly
sophisticated needs of users.

Worldwide Unit Sales Reach an All-Time High
Toyota Industries’ Car Air-Conditioning Compressor Business has

Responding Decisively to TechnologicalInnovations in Automobiles

consistently maintained the distinction of being the industry leader,

Advances in automobile-related technologies have been

as we continually leverage our unique technological capabilities

accompanied by increasingly sophisticated and diverse needs into develop new products ahead of competitors. Developed

car air-conditioning compressors. Moreover, high crude oil prices

through close collaboration with automakers, Toyota Industries’

and heightened environmental awareness worldwide have spurred

car air-conditioning compressors achieve world-class quality andunprecedented demand for air-conditioning compressors that

performance in terms of reliability at high operating speeds, quiet

enhance fuel efficiency in conventional internal-combustion vehicles.

operation, compactness, weight reduction and fuel efficiency.

Committed to meeting such needs, we continue to upgrade thePrime examples of our outstanding products include the compact,

performance of our externally controlled variable-displacement

lightweight 10-cylinder swash-plate fixed-displacement compressor

compressors, which were the world’s first such compressors, byand the variable-displacement compressor that automatically controls

drawing on our overwhelmingly superior product development

cooling in accordance with interior and exterior temperatures as wellcapabilities to differentiate our products from those of competitors.

as the state of the vehicle’s engine. Both of these compressors haveToyota Industries has also achieved significant advances in air-been widely adopted by top-name automakers worldwide, enabling

conditioning compressors for hybrid vehicles. Our electrically driven

us to firmly maintain the global No.1 share.

compressors, developed in collaboration with our Electronics Division,

Supported by the development of products that anticipate userneeds and proactive

the Prius, one of the world’s premier hybrid vehicles.

sales expansion activities,

Compressor Sales

Toyota Industries’(Million units)

total sales of car airconditioning compressors

With a view to EU restrictions on the use of certain CFC
substitutes scheduled to be gradually implemented from 2011, we

25

are focusing on various options for the development of compressorsthat utilize other substitute refrigerants.

20

in fiscal 2008 reached
an all-time high of 21.86
million units, an increase

As these examples demonstrate, we are determined to remain
15

at the forefront of the industry as we strive to appropriately respondto diversifying needs by fully taking advantage of our technological10of 1.4 million units, withmainly Europe and theexcellence and overall capabilities through cooperation with
automakers and other business divisions and pushing ahead with

5

United States contributing
to the increase.

24

Toyota Industries Report 2008

are fitted in Toyota Motor Corporation’s line of hybrid vehicles such as

development in new technology fields.
0
(FY)

04

05

06

07

08

Worldwide Manufacturing Bases of Car Air-Conditioning Compressors

TDDK

MACI

Toyota Industries
Corporation

DNTS

TACG
ACTIS

YSD
TACK
SUBROSDNIA
DNBRConsolidated subsidiaries
Licensed manufacturers

Toyota Industries produces compressors through a global tripolar structure encompassing Europe, the United States and Asia, established through direct investments. We also
license production in Asia and South America. By carrying out production near our markets, we believe we are better able to supply products precisely in line with local market
needs while reducing shipment costs and exchange rate risks.

Operating a High-Quality, Highly Efficient
Production Structure

Industries will strengthen its global production capabilities and further
enhance quality, cost and delivery (QCD).

Besides developing top-quality products, Toyota Industries is
responding to the needs of customers worldwide by strengthening its
production structure.

TopicsToyota Industries currently operates manufacturing bases inestablished an integrated production structure encompassing

Electrically Driven Compressor (ES34)
Seriesmolds, die casts, processing and assembly at the Kariya, Obu andToyota Industries’ electrically driven car air-conditioning

Higashiura plants, which serve as mother plants for all domestic andcompressors are fitted in TMC’s hybrid vehicles such as

overseas plants. Additionally, each manufacturing base carries out

the Prius. Widely recognized for their high quality, thesehigh-quality, highly efficient production utilizing robots and internallycompressors have been also fitted in the top-of-the-line

developed and manufactured equipment.

Lexus LS600h and LS600hL hybrid sedans.

Japan, the United States, Germany and China. In Japan, we have

To respond to increased orders from automakers, Toyota

Fixed-Displacement Type

10S17 compressor

SCS06 compressor

SV07 compressor(Swash-plate type)(Scroll type)(Vane type)Continuous Variable-Displacement TypeFor Hybrid Vehicles

7SBU16 compressor

7SEU17 compressor

ES27 electric compressor

ES34 electric compressor(Swash-plate type)(Externally controlled,
clutchless type)(Hermetic scroll type)(Hermetic scroll type)

Toyota Industries Report 200825

Survey of Businesses

Automobile
Working to Attain the Synergistic Benefits of theAutomobile-Related BusinessAs a member of the Toyota Group, Toyota Industries’ Automobile Segment
contributes to Toyota Motor Corporation’s (TMC) global operations throughthe assembly of vehicles and manufacture of engines, automotive parts andstamping dies. In an effort to support the advancement of automobiles, eachbusiness domain of the Automobile Segment carries out efficient, industryleading production based on the Toyota Production System (TPS).

Toyota Industries develops and manufactures vehicles, engines, car

Each of Toyota Industries’ automobile-related businesses

electronics products and stamping dies. The Vehicle Business ispreviously carried out operations as an autonomous entity. In January

responsible for the production of compact and midsize vehicles and2007, however, we established the Automotive Headquarters toproactively participates in the development of new cars. The Engine

bring together the capabilities of these businesses and further

Business manufactures diesel and gasoline engines, as well asreap synergistic benefits. We intend to deepen cooperation among

engages in environmental measures through the joint development ofthese businesses and mobilize the combined competencies of theclean diesel engines with TMC.

Automobile Segment in our efforts to contribute to the development

The Car Electronics Business is strengthening the development

and manufacture of appealing TOYOTA cars.

and manufacture of electronic components and devices primarily forhybrid vehicles for which market expansion is expected to continue.

Automotive Headquarters

Vehicle Division

Machinery &Tools Sub-Div.

26

Toyota Industries Report 2008

Engine Division

Electronics
Division

Vehicle

A Frontrunner among Automobile Body Manufacturers through QCD

Toyota Industries assembles compact and midsize automobiles

upper body and was highly commended by TMC for establishing an

under consignment from TMC. We currently manufacture threeefficient mass production structure.

TOYOTA models, specifically the Vitz (Yaris outside Japan), the RAV4

Through various measures implemented in gearing up for thefor overseas markets and the Mark X ZiO for the Japanese market.

assembly of the Mark X ZiO, our assembly plant has realized further

Moreover, through our active participation in the development of newquality improvements, beginning with the coating process, and isvehicles, Toyota Industries has further expanded its role in TMC’s

now firmly positioned to produce almost every type of midsize model.

operations.

In fiscal 2008, total production of the Vitz (Yaris), RAV4 andMark X ZiO reached a record-high 368,000 vehicles.

New Mark X ZiO Contributes to Record-High
Production of 368,000 Vehicles

In tandem with
TMC’s efforts to achieve

As an automobile body manufacturer specializing in compact cars,

further growth globally,

Toyota Industries has undertaken consigned production for TMC

Toyota Industries will

and actively participated in the development of several vehicles. The

undertake initiatives tosecond-generation Vitz (Yaris), which underwent a full model change

further enhance QCD

in 2005, is a global model incorporating the most advanced safety

and strive to make evenand environmental technologies, winning recognition worldwide as agreater contributions tocompact car of outstanding quality. Similarly positioned as a global

TMC’s global strategy inmodel, the RAV4 also underwent a full model change in 2005 andboth development andnow offers an even roomier interior, outstanding driving performance

production.

Vehicle Production(Thousand units)

400

300

200

100

0
(FY)

and world-class environmental and safety performance, features that

04

05

06

07

08

have earned this car high marks around the world.
Toyota Industries’ Vehicle Business maintains top-level quality,

Topicscost and delivery (QCD) among automobile body manufacturers in
the Toyota Group. In fiscal 2008, Toyota Industries continued to earn

Superior Quality Performance Award

high recognition for QCD, as we once again received the Superior

In February 2008, the Vehicle Division and Machinery & Tools

Quality Performance Award from TMC. Under TPS, our assembly

Sub-Division (stamping dies) received the Superior Quality

plant ensures the thorough elimination of all waste from production

Performance Award from TMC. This marks the seventh

processes, thereby enabling plants to operate with superb efficiency.

and eighth time, respectively, that the Vehicle Division and

QCD is further reinforced by Toyota Industries’ other strengths,

Machinery & Tools Sub-Division have been awarded thisincluding a flexible production system and the quick startup ofhonor in the past 10 years.

production.
In September 2007, we initiated assembly of the Mark X ZiO, a
new midsize luxury car, which underscores TMC’s strong confidence
in our QCD capabilities meticulously nurtured over many years.
Toyota Industries also handled the development of the Mark X ZiO’s

VehiclesVitz (Yaris)

RAV4Mark X ZiOToyota Industries Report 200827

Survey of Businesses

Automobile
EngineToyota Industries’ Engine Business manufactures diesel andBusiness Expansion Centered on Clean Diesel Engines

Toyota Industries also manufactures gasoline engines. Our

gasoline engines. Anticipating future market expansion, we are jointly

gasoline engine production line operates under a flexible structuredeveloping new clean diesel engines with TMC as part of integrated

utilizing automatic guided vehicles to respond quickly to changes

operations that extend to production. Toyota Industries also develops

in volumes and models.

and manufactures industrial engines for its lift trucks and other

Also, we have been highly

Engine Production

materials handling equipment.

commended for production

600(Thousand units)

preparation capabilities that500

New V8 Diesel Engine Being Produced for the
Toyota Land Cruiser

enable the quick startup of
cost-efficient production of

400

Clean diesel engines are attracting growing attention, thanks largely

new engines.

300

to their lower CO2 emissions compared with gasoline engines.

In addition, we also
200

Highlighting this rising interest, diesel engine vehicles already accountdevelop and manufacture

for approximately half of all new car sales in Europe. In Northengines that further enhance

100

America, the number of diesel engine vehicles is forecast to expand

the competitiveness of our lift

0in line with soaring energy prices.

trucks.

(FY)

04

05

06

07

08

Addressing these trends, Toyota Industries developed the 2.2-liter
AD diesel engine together with TMC and commenced productionin March 2005. This engine is currently fitted in such vehicles as theRAV4 and Lexus IS for the European market.
Adding to our lineup of diesel engines, in August 2007 we
commenced production of a new 4.5-liter, 8-cylinder VD clean diesel
engine for the new Land Cruiser. Toyota Industries played a central
role, with our engineers taking the lead in the development process.
The new Land Cruiser was developed under the concept “Kingof 4WD,” making it essential that the engine provides outstanding

TopicsTechnology Development Award
In fiscal 2008, Toyota Industries received the Technology
Development Award from TMC for developing a VD clean
diesel engine for the new Land Cruiser. The engine waspraised for such performance capabilities as clean exhaustemissions and driving power as well as for having theruggedness required as an engine for the Land Cruiser.

performance capabilities. In working to meet this objective, we set
out to “supply the world with diesel engines that satisfy demanding
owners” and successfully developed a diesel engine that offers toplevel performance in every category, including clean exhaust as wellEngineas power performance, fuel economy, quietness and reliability. In
recognition, Toyota Industries received the Technology Development
Award from TMC.
In fiscal 2008, we achieved favorable sales of our VD clean diesel
engines and KD diesel engines for TMC’s Innovative International
Multi-Purpose Vehicle (IMV) series. Mirroring this strong performance,
total sales (unit sales to outside customers) in fiscal 2008 reached arecord-high 510,000 engines.

VD diesel engine

2AD diesel engine(Displacement: 4.5 liters, used in
the Land Cruiser)(Displacement: 2.2 liters, used in
the RAV4 and Lexus IS)

to become the top manufacturer of diesel engines within the Toyota

2KD diesel engine

2AZ-FE gasoline engine

Group.

(Displacement: 2.5 liters, usedin the Hilux Vigo)(Displacement: 2.4 liters, used in
the Estima)

Becoming a Top Manufacturer of Diesel
Engines within the Toyota Group
Toyota Industries has strengthened its engine development structure
through such initiatives as upgrading testing facilities and increasing
development staff. In setting our sights on the global market for clean
diesel engines, we will develop next-generation clean diesel engines
and strengthen production capabilities in a timely manner as we strive

28

Toyota Industries Report 2008

Car Electronics

Power Source Devices that Support Ongoing Advances in Hybrid Cars

Utilizing power electronics circuit technologies and electric drive
system capabilities, Toyota Industries develops and manufactures

Topicselectronic components and devices for automobiles, including hybrid
vehicles.

Technology Development Award
In fiscal 2008, Toyota Industries’ Electronics Division received

New DC-DC Converters for Lexus LS600h

the Technology Development Award from TMC for the

Drawing on power electronics technologies cultivated through its

development of DC-DC converters for the Lexus LS600h.

development of electric lift trucks, Toyota Industries carries out in-

Responding to rising needs for energy conservation, wehouse production of electronic components for each businesswill continue to contribute to reducing environmental loads

division and has accumulated a vast array of technologies in thisin such ways as enhancing fuel efficiency through thefield. At the same time, Toyota Industries has also been engaged

development of core products for hybrid vehicles.

in the development and production of DC-DC converters for hybrid
vehicles and DC-AC inverters for internal-combustion as well as
hybrid vehicles. After being fitted in the first-generation Prius, our DCDC converters were subsequently selected for the Harrier Hybrid andthe Camry Hybrid, and in 2007 we expanded our lineup to include
converters for the Lexus LS600h. We also develop and manufacture
DC-AC inverters, which are capable of converting currents into the

Car Electronics

same voltage as household electricity, thereby enabling the use ofvarious household electronic products inside vehicles.
In addition to carrying out continuous quality-improvement andcost-cutting activities, we are also building new plants to reinforce
our mass production structure in anticipation of expanded market
demand for hybrid vehicles.

An Approach that Anticipates Further
Advances in Hybrid Vehicles
Looking ahead, we will further upgrade our development structureand strengthen collaboration with our other automobile-related
businesses while proactively proposing and developing new products

DC-DC converter
for the Prius
Down-converts the high-voltage direct
current (DC) of the main battery to a lower
voltage to recharge the auxiliary battery
and supply power for lights, wipers, thehorn and other in-car devices.

DC-DC converter for electric
power steering (EPS) for the
Harrier Hybrid (RX 400h)
Down-converts the high voltage ofthe main battery to a lower voltage tosupply power for EPS.

that anticipate needs in next-generation automobiles. We are placingemphasis on developing technologies that enable size, weight andcost reductions, which are particularly crucial for realizing distinctive
products. Concurrently, we will focus our efforts on devices for plugin hybrid vehicles, for which commercialization is highly anticipated.
In addition, besides continuing to develop such auxiliary devices asconverters, we will also strengthen the development of core parts for

DC-DC converter
for Camry Hybrid

DC-DC converter for EPS
for the Lexus LS600h

DC-DC converter for EPS
for the Lexus LS460

DC-AC inverter for
the Tacoma (400W)

electronic components and devices for hybrid vehicles.
As we facilitate collaboration among business divisions, we will
supply key functional components for use in our textile machinery andmaterials handling equipment, including drive and load controllers
for electric lift trucks. Through such measures, we will strive tosignificantly contribute to the creation of competitive products.

Converts DC electricity of the mainbattery into an alternate current (AC),enabling the use of various household
electronic appliances.

Toyota Industries Report 200829

Survey of Businesses

Textile Machinery
Maintaining Our Global No.1 Position Backed by
Our Air-Jet Looms
The history of the Toyota Group began with the invention of an automatic
weaving machine by Toyota Industries founder Sakichi Toyoda. Since then,we have successively developed innovative textile machinery through ourrelentless pursuit of cutting-edge technologies and unceasing applicationof ingenuity, thereby making significant contributions to the development of
the textile industry worldwide. In fiscal 2008, Toyota Industries posted solid
results in the Textile Machinery Business, with sales of air-jet looms once
again surpassing 10,000 units.

Weaving Machinery
Toyota Industries develops, manufactures and sells such weaving
machinery as air-jet looms, which insert weft yarns using air. Our
weaving machinery has won high acclaim from customers worldwide
not only for excellence in basic performance requirements for highspeed and reliability but also for integrating such advanced functions
as monitoring and remote setting via the Internet.
Benefiting from rising sales in China in recent years, Toyota
Industries has sustained a high level of sales of its mainstay air-jet
looms since fiscal 2007, and this trend continued in fiscal 2008, as
sales of air-jet looms once again exceeded 10,000 units. Accordingly,

TopicsCumulative Production of Air-Jet Looms
Reaches 100,000 Units
In February 2008, cumulative production of air-jet looms
reached 100,000 units. Toyota Industries achieved thisnoteworthy milestone 27 years and nine months after
commencing production in May 1980.
Thanks to such outstanding basic functions as highspeed, excellent energy efficiency and low vibration, thecurrent JAT710 seventh-generation model has earned
high acclaim worldwide, including from China. Moreover,continuous technological improvements have enabled the
JAT710 to weave items difficult to produce using previous
air-jet looms such as automobile air bags and glass fibers forelectronic substrates to respond to an even wider range ofcustomer needs.

Toyota Industries maintained the top global market share, a position
we have solidly maintained for more than a decade.
While focusing on developing technologies aimed at reducing theenvironmental burden through greater energy efficiency and raisingproductivity by achieving higher speeds, we will strengthen our global
sales and service structures while working to meet the expectationsof customers the world over.

Spinning Machinery
The Spinning Machinery Business offers an extensive lineup of
spinning machinery, including high-speed ring spinning frames androving frames, capable of both spinning high-quality yarns andproviding superior productivity, in an effort to respond to diverse userneeds.
Overseas, Kirloskar Toyoda Textile Machinery Pvt. Ltd., oursubsidiary in India, manufactures and supplies ring spinning frames tothe local market while also realizing a global product supply structure.

Weaving Machinery

JAT710 air-jet loom

Spinning Machinery

RX240 series ring spinning frame

30

Toyota Industries Report 2008

FL200 roving frame

Environmental Initiatives
32
33
34
36
38
40
41
42
44
45
46
47
48

Global Environmental Commitment
Environmental Management
Business Activities and Their Environmental Impact
Targets and Results of the Fourth Environmental Action Plan
Curbing Global Warming from Products
In-Product Features for Resource Saving
Reduction of Product-Derived Environmental Risks
Prevention of Global Warming Factors in Production
Resource Utilization in Production
Reduction of Environmental Risks in Production
Environmental Communication
Environmental Accounting
Independent Verification

Toyota Industries Report 200831

Environmental Initiatives

Global Environmental Commitment
The Toyota Industries Group will contribute to thecompatibility of environmental conservation and economic
growth throughout its wide range of business activities,
including automobile, materials handling equipment,
logistics and electronics.

Address environmental concerns by working in harmony
with both regional communities and global society.

Harmony

Sustainable
Management

Basic Policy•The Toyota Industries Group will continue to set
challenging targets aimed at further reducing theenvironmental impact of its business activities, listening
carefully to voices of its stakeholders such as customers,
and acting in compliance with the letter and spirit of laws
and regulations.
•The Toyota Industries Group will continuously improve
its environmental management, placing environmental
activities among its highest priorities. In particular, theCompany will give priority to the following items.
Curb global warming
Aiming to reduce energy consumption and the output ofgreenhouse gases through the entire lifecycle of its products,
services and production activities
Use resources more efficiently
Utilizing raw materials, water and other resources efficiently whileworking to reduce, reuse and recycle waste products

Enhancement

Enhance the eco-efficiency of
all our business activities,
products and services.

Responsibility

Fulfill our social responsibility
to participate inenvironmental conservation.

•The Toyota Industries Group will aim to foster greatercommunication and teamwork within a wide rangeof partnerships, including those with customers andsuppliers, in order to promote sustainable managementof the environment. In addition, the Toyota Industries
Group will act as an upstanding corporate citizen, taking
an active part in the planning of activities that contributeto various regional communities as well as to our global
society.
July 2005

Tetsuro Toyoda

Reduce environmental risk factors
Reducing the use and output of substances of concern while
evaluating environmental risk factors at the planning stage ofbusiness activity in order to prevent pollution

President

Scope of Group-Wide Environmental Management

EuropeManufacturing
company:
Sales company:
Others:Total:

4
3
2
9

Asia
Manufacturing
company:
Sales company:
Others:Total:

4
1
1
6

Japan
Toyota Industries: 10 plants
Manufacturing
company:
16
Sales company: 41
Others:22
Total:
79

Australia
Sales company:

32

Toyota Industries Report 2008

North America
Manufacturing
company:
9
Sales company: 3
Others:2
Total:
14

Latin America
Sales company:
11Environmental Initiatives

Environmental Management
education programs after clarifying the capabilities required
for the integration of a Company-wide EMS and reviewing
targeted persons and educational objectives. Based on the latest
environmental trends and effectiveness of education, we intend
to continuously review these programs to nurture personnel wellversed in environmental affairs.

Environmental Education Program

Chiefexperts
Seniorexperts
Experts
Generalemployees

Environmental audit overview
Environmental management overview

Supervisor training(technical)

Supervisor training(clerical andengineering)

Newly appointed senior staff training

Mid-career employee training

Newly appointed managerial staff training
Managerial
staff

Product environmental training

Toyota Industries uses an ISO 14001-based environmental
management system (EMS) as an effective tool in its efforts topromote environmental management and fulfill its corporate social
responsibility. EMS was previously operated independently at
respective plants. Aiming for greater environmental management,
however, in fiscal 2008 we newly established a Company-wide
EMS, with the president at the top. We will continue to work tostrengthen our environmental governance based on an environmental
management structure compatible with Toyota Industries’ business
management structure. We will also strive to reduce environmental
impacts that accompany our business activities in productdevelopment and manufacturing.
In fiscal 2008, Toyota Industries obtained EMS certifications forthe corporate center as well as the Textile Machinery and Compressor
divisions as a form of pre-integration of certification. In fiscal 2009,
we plan to acquire Company-wide integration of certification that
includes all business operations.

Mid-career employee training

Environmental Management System

Assistantmanagers

Heads

Generalemployees

New employee training (those in technical positions aswell as clerical and engineering positions)

Employees in technical positions

Managerial
staff

Employees in clerical and engineering positions

Environmental Education
Acting on its belief that manufacturing starts with nurturing
excellent personnel, Toyota Industries regards human resource
development as one of the most important management issues.
In the environmental area as well, we revised environmental

Environmental Management Structure
President

Environmental
Committee

Internal audit
Responsible internal
auditor(executive vice president)

Executive
vice
president•Team leader•Supervising auditors•Auditors
Specialized committees

Chief environmental
administrator(executive vice president)

Secretariat(Plant Engineering& Environment Dept.)

Head Office

Divisions

Corporate Planning

Materials Handling
Equipment

R&D

Logistics

Purchasing

Car Air-Conditioning
Compressor

Quality Control

VehicleHuman Resources
GeneralAdministration

Product Technology
Subcommittee
Production Environment
Subcommittee

Internal Environmental Audits
Previously, auditors assigned at respective Toyota Industries
plants undertook internal environmental audits. This prompted
external auditors to point out areas for improvement in terms of
the independence and quality of audits. Taking the opportunity of
the integration of a Company-wide EMS, a fundamental review ofthe structure and procedures of internal audits was conducted.
Specifically, we have established an internal audit structure in which
the executive vice president in charge of audits appoints a teamleader tasked with implementing audits. Under the team leader areauditors selected from each business division.
In fiscal 2008, internal auditors detected underlying, intrinsic
problems at respective organizations, and each organization
subsequently implemented corrective measures. With regard to
the external environmental audit conducted by an independentcertification agency for fiscal 2008, Toyota Industries wascommended for improving the level of its internal audits.

Internal Environmental Audit Structure
An internal environmental audit structure has been organized tostrengthen the checking function of Toyota Industries’ environmental
efforts, as indicated below.

Business
PromotionCouncilAudit organization

Roles/initiatives

Responsible
internal auditor(1 person)(executive vice president)•Devise internal audit plan
•Appoint team leader•Summarize audit results and report topresident

Team leader(1 person)•Responsible for implementing audits•Select supervising auditors and plan
audit schedules•Report results to responsible internal
auditor•Hold auditor meetings

EngineElectronics
Textile Machinery

Environmental conservation
organization by
manufacturing sites

Environmental Risk
Reduction
Subcommittees

Supervising auditors(20 people)(environmental risk management overseen
by plant managers)(respective plants)

Auditors•Implement audits•Confirm progress of corrective
measures•Report results to team leader

Toyota Industries Report 200833

Environmental Initiatives

Business Activities and Their Environmental Impact
As a manufacturer of a wide variety of products, including lift trucks,
car air-conditioning compressors, textile machinery and automobiles,
Toyota Industries strives to understand the environmental impactof our products across their entire lifecycle from parts procurement
through to production and disposal.
The most notable environmental impacts generated by Toyota
Industries’ operations include global warming caused by the use ofenergy in casting and coating processes and the use of greenhousegases; waste from manufacturing processes such as casting
and machining processes; the atmospheric impact of chemical
substances used in the painting of automobiles, lift trucks and car airconditioning compressors; and the impact of industrial wastewateron public waterways. Toyota Industries is systematically striving to
reduce these kinds of environmental impacts.

EnergyRaw Materials*2

Energy Consumption(TJ)

Raw Materials Consumption

Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated*1

Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated

(kt)

600

12,000
9,000

7,934

8,397

565
505

9,085 9,280

436
383
333

6,678

300

6,000
3,000
0
(FY) 04

06

05

07

0
(FY) 04

08*1: Terajoule is a unit used to measure heat.
1 TJ = 1012 joules

05

06

07

08

*2: Metals such as iron and aluminum,
as well as resins such as plastics

INPUT
Emissions and Environmental Impact ofEach Process (as of March 2008)

Plant

Product Development
Focus of Environmental Activities in
Product Development

Business
Materials Handling
Equipment

Develop clean energy vehicles
Improve fuel efficiency and achievecleaner exhaust emissions
Improve recyclability

Textile Machinery

Create designs with improved energy
efficiency

Car AirConditioning
Compressor

Reduce weight and improve efficiency
Reduce power consumption and utilize
new, environmentally friendly
refrigerants

VehicleMachining,cleaning

CO2 (global warming)
Waste

Coating

VOC*4, chemical substances (air pollution)
CO2 (global warming)

Machining,cleaning

CO2 (global warming)
Waste

Coating

VOC, chemical substances (air pollution)
CO2 (global warming)

Die-casting

CO2 (global warming)

Machining,cleaning

CO2 (global warming)

Coating

VOC (air pollution)

Use of CFC
substitutes

HFC*5 (global warming)

Coating

VOC, chemical substances (air pollution)
CO2 (global warming)

Machining,cleaning

CO2, HFC (global warming)
Water pollution, waste

HekinanHigashichita
Kyowa

Machining

CO2 (global warming)

Casting

CO2 (global warming)
SOx*6 (air pollution), waste products

Kyowa

Plating

Water pollution

Takahama

KariyaKariyaObu
Higashiura

Reduce weight and improve recyclability

Nagakusa

CommonthemesEngineImprove fuel and combustion efficiency
Reduce noise and vibration

Electronics

Contribute to the development of clean
energy vehicles

OUTPUT

Reduce the use of substances of concern
Promote green procurement

Into the Air
Greenhouse Gas Emissions
Non-consolidated(kt-CO2)

0.6t
236t

34

Toyota Industries Report 2008

Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated

(t)

4,000
33

589

634

745
680 700

3,429
2,580 2,523

27

25

20

500

0.3t

*7: Nitrogen oxides

Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated(kt-CO2)

2,747
2,531

2,000

16
12

Consolidated

141t

VOC Emissions

40

1,000

12kt
757kt

Air Pollutant Emissions
SOx
NOx*7

Emissions of Other
Greenhouse Gases
Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated

745kt

296kt
CO2
Other greenhouse gases(HFC, SF6, etc.)
3kt
Total
299kt

Non-consolidated

CO2 Emissions

Consolidated

0(FY) 04

05

06

07

08

0
(FY) 04

05

06

07

08

0
(FY) 04

05

06

07

08

CO2 Emission Conversion Factors

Chemical Substances

Packaging Materials

Chemical Substances
Consumption (Japan only)

Packaging Materials
Consumption

Water
Water Consumption
Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated(million m3 )

8
6.88
5.60

Non-consolidated

7.23

05

06

07

10,000

9,215
8,445

3,031t40(FY) 04

Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated(t)•PRTR law*3
designated substances

6.66

6.18

Consolidated*3: Short for Pollutant Release andTransfer Register, the PRTR law is ascheme whereby businesses measure
the release and transfer of
PRTR-designated pollutants and reporttheir performance to the government.
The government then compiles this data
and releases it to the public.

08

Focus of Environmental
Activities

6,616 6,549

4,136t

FY2008Results

5,000

5,029

CO2 Emission Conversion Factors from Logistics

0(FY) 04

05

06

07

08

Contents
Gasoline

Conversion factor
2.32kg-CO2/kWh

Light oil

2.62kg-CO2/kg

LPG

3.00kg-CO2/l

Major Environmental Impacts
during Product Use

Emissions and Major Environmental
Impacts Generated during Transportation

Materials Handling Equipment

CO 2 (global warming)
NOx and particulate matter (PM) (air pollution)

Curbing Global Warming

Contents
Conversion factor
0.3817kg-CO2/kWh
Electricity*
2.3576kg-CO2/m3
City gas
3.0094kg-CO2/kg
LPG
3.2502kg-CO2/kg
Coke
2.7000kg-CO2/l
A heavy oil
2.5308kg-CO2/l
Kerosene
2.6468kg-CO2/l
Light oil2.3609kg-CO2/l
Gasoline
2.790kg-CO2/kg
LNG
3.141kg-CO2/kg
Propylene*The electricity conversion factor in the table is applied
to companies in Japan.
Overseas companies uses factors publicly announced
in each region.

Global warming caused by vehicle operation
Air pollution resulting from exhaust emissions

10% improvement compared with FY2004
levels in eco-efficiency of energy-derived
CO 2 emissions (consolidated) by the end of
FY2011

Focus of Environmental Activities
Textile Machinery

25% improvement compared to FY2004
levels (eco-efficiency indicator: 1.25)

Reduction of CO 2 emissions

Global warming caused by power
consumption

Resources Recycling

Car Air-Conditioning Compressor

Reduce landfill waste (Japan
consolidated) to less than 1% of
FY1999 levels by the end of FY2011

Global warming caused by vehicle operation
Global warming caused by CFC substitutes

Less than 1% compared with FY1999 levels

Further reductions in emissions of
substances of concern (Japan consolidated)by the end of FY2011 to 95% of FY2004
environmental impact levels

EngineFocus of Environmental Activities

1% reduction compared with FY2004 levels

Waste

PRTR Law-Designated Substances

Into theatmosphere
Into waterways
Into soil
Total

Waste Generation
626t
12t

–

–

543t

638t

Global warming caused by power
consumption and vehicle operation

Water Pollutants (Japan only)

Overseas subsidiaries
Subsidiaries in Japan
Non-consolidated(kt)Electronics

Into Waterways

Consolidated

536t
7t

Global warming caused by vehicle operation
Air pollution caused by exhaust emissions

Toyota Industries pursues product developmentthat takes into account the 3Rs ̶ Reduce, Reuse
and Recycle. This is achieved by reducing waste
through making products longer-lasting, smaller
and lighter; reusing components; and recycling
used products by reprocessing them and using
them as different materials.

*4: Volatile organic compounds*5: Fluorocarbon substitute*6: Sulfur oxide

Non-consolidated

Global warming caused by vehicle operation
Air pollution caused by exhaust emissions

CO 2 emissions during recycling (global warming)
Generation of waste

Reduction in Environmental Risk

Emissions (Japan only)

VehicleMajor Environmental Impacts during
Recovery, Recycling and Disposal

200
137

Consolidated

20t
0.5t
13t

23t
0.6t
20t

NitrogenPhosphorous
COD*

148

Non-consolidated

8

CO2 from Logistics
CO2 Emissions from
Logistics Operations (Japan only)
Subsidiaries in Japan
Non-consolidated(t-CO2)30,00024,855*8: Chemical oxygen demand(indicator of the degree of water pollution)

20,60020,000100

Transfers (Japan only)
Non-consolidated

Consolidated

Waste

129t

Sewage

–

867t
–
867t

Total

129t

81

83

Wastewater Discharge (Japan only)90(million m3)

Subsidiaries in Japan
Non-consolidated

10

7.28
5 4.950(FY) 04

06

07

08

(FY) 04

05

9,341 9,910

4.55 4.58 4.25

005

10,000 8,571

06

07

08

0
(FY) 04

05

06

07

08

*Certain environmental data have been updated

Toyota Industries Report 200835

Environmental Initiatives

Targets and Results of the Fourth Environmental Action Plan
Outline of the Fourth Environmental Action
Plan
As one of Toyota Industries’ major approaches to the environment,
we devise and implement a five-year Environmental Action Plan. In
the Fourth Environmental Action Plan (fiscal 2007 to fiscal 2011),
curbing global warming, using resources more efficiently, reducing
environmental risk factors and consolidated management are
positioned as the key areas of environmental activities. Target
management is measured by the concept of “eco-efficiency,” whichquantifies the effectiveness of our environmental activities.
During fiscal 2008, we focused primarily on the developmentof products with superb environmental performance, four of which
received in-house accreditation as eco-products. We also strove tofurther improve production eco-efficiency through the introductionof more efficient equipment and the implementation of efficiency
improvement measures.

Eco-Efficiency Calculation Formula

Product
Eco-efficiency =Product functions
Environmental impact of products

Production

Production indicator(Net sales or production volume, etc.)

Production efficiency =Eco-efficiency =Environmental impact
of production activities
Production efficiency in subject year
Production efficiency in base year

Progress of the Fourth Environmental Action Plan (Product-Related)
Action Policies

CurbingGlobalWarmingSpecific Actions

FY2008 Achievements

Automobile-related•Develop technologies to reduce vehicle
products: Promoteweightthe development•Develop engines to meet fuel efficiencyof technologies
targets set during the product planningthat achieve thestage
best fuel-efficiency•Develop high-efficiency car airperformance in eachconditioning compressors
country and region•Expanded the range of electricallydriven compressors•Developed new continuous
variable-displacement
compressors

Non-automobilerelated products:
Promote thedevelopment oftechnologies that
achieve the bestenergy efficiency inthe industry•Develop technologies to improve theenergy efficiency of lift trucks•Develop industry-leading, energy-saving
technologies for textile machinery•Improve the energy efficiency of industrial
engines•Improved fuel efficiency of shovel
loaders by 15%

Promote thedevelopment ofdevices for clean
energy vehicles•Further improve the performance ofdevices for hybrid vehicles•Develop devices for the next generationof fuel-cell vehicles•Improved power density of DCDC converters for hybrid vehicles
by 67%

FY2009 Plan

Page

•Expand the range of electricallydriven compressors•Develop new continuous variabledisplacement type compressors•Make DC-AC inverters for vehicles
smaller•Improve fuel efficiency of engines

P38,
39

•Improve durability of lift truckparts•Establish targets forrecoverability rate for products

P40•Steadily reduce lifecycle environmental
impact through implementation of lifecycle •Reduced power consumption of
Reduce greenhouse assessments (LCA) for all products
unit-type automated storage andgases throughout•Develop products with high eco-efficiency retrieval systems for pallets byproducts’ lifecycles •Develop car air-conditioning compressors 15%
that use refrigerants with low global•Improved fuel efficiency of engines
warming potential (GWP)

Using
Resources
More
Efficiently

Further promote
the use of designs
that are based on
the Designs for
Recycling (DfR)
concept•Steadily improve recyclability throughthe establishment of recyclability
assessments for all products•Develop products that are easy todismantle and recycle•Improved dismantling feature of
DC-DC converters and utilized
reclaimed materials•Established targets forrecoverability rate*1 for developed
products•Eliminate use worldwide of the four
•Established compliance structure
Promote stricter
substances of concern (lead, mercury,for REACH (Registration,•Comply with voluntary control ofcontrol of and further
cadmium and hexavalent chromium) (some Evaluation, Authorisation andfour substances of concern
reduction in the use
parts are exempted)
restriction of Chemicals) regulations •Establish chemical substancesof substances of•Increase the number of substances of•Started voluntary control of four
control system
Reducing
concernconcern that are subject to controls
substances of concern
Environmental

Risk Factors Reduce exhaust•Develop high-efficiency clean diesel
emissions to improveengines
air quality in urban•Introduce top-performing, low-emissions
areas in all countries
lift trucks
and regions•Complied with domestic
emissions regulations for lift
trucks•Complied with emissions
regulations for automobiles

P41•Comply with domestic emissions
regulations for lift trucks•Comply with emissions
regulations for automobiles*1: Recoverability rate refers to reusable, recyclable and energy-recoverable rate relative to the weight of new vehicle

36

Toyota Industries Report 2008

Progress of the Fourth Environmental Action Plan (Production-Related)

Reduce CO2
emissionsthrough green
logistics

Enhanceresource
productivity

Control Items

Specific Actions

Reduce CO2 from energy use•Streamline production processes•Optimize supplied energy•Promote introduction of alternative
energy sources

FY2008 Achievements
Target Result Assessment

Non-consolidated
Energy-derived CO2
eco-efficiency

1.30

1.36

○

Non-consolidated
Emission volume perunit of sales (unit:
t-CO2/100 million yen)

26.1

24.3

○

Consolidated
Eco-efficiency

1.19

1.25

○

FY2009 Plan

Page

•Curb total CO2 emissions
and improve emission
volume per unit of sales
amid business expansion•Launch Company-wide CO2
reduction conference andpromote activities

P42,
43

Consolidated
Emission volume perunit of sales (unit:
t-CO2/100 million yen)

38.9

37.2

○

CFCs
•Review production process•Look for alternative materials--

3ktCO2-•Promote modal shift•Devise green logistics guidelines andstrengthen cooperation with contractors

-

1.01

1.07

○

•Expand modal shift•Improve load capacity

Resources•Reduce the volume of discarded materials Non-consolidated
External disposal ecoby taking action at the source, such as
efficiency
improving yields and other measures•Promote internal re-use

1.00

1.12

○

•Reduce external disposal
through reduction of defects
and improvement of yields

Non-consolidated
Packaging materials•Reduce use of timber-derived packaging Packaging material
eco-efficiency
materials

1.35

2.06

○

•Reduce use of wood andcardboard as packaging
materials

924

714

○

•Switch to industrial waterfrom groundwater•Expand wastewater recycling○•Select reputable recycling
contractors•Promote further segmentationand optimization of waste
separation○•Strengthen activities toreduce environmental
abnormalities/claims throughreciprocal patrols among
plantsReduce use ofgroundwater•Promote recycling of wastewater•Reduce use of water

Non-consolidated
Groundwater use(unit: km3)

Reduce total
environmental
impacts ofwaste disposal•Eliminate landfill disposal at all
consolidated manufacturing companies•Establish measures to evaluate
environmental impact of waste disposal

Manufacturing sites inJapanLandfill volume (unit: t)

Minimize
environmental
risks•Establish environmental risk assessment
systems at the planning stage (incorporate
measures to reduce environmental
impacts in the business planning stage) •Devise pilot guidelines for prior•Ensure appropriate management ofassessment systemchemical substances in accordance with •Commence full implementationsocial conditions•Enhance risk communication withstakeholders such as local residents

Further reduce
emissions of
substances ofconcernNon-consolidated•Reduce emissions of air pollutants,
17%
20%
Environmental impact×including volatile organic compounds
reduction reduction(unit: index)(VOCs)−Expand use of water-soluble andManufacturing sites inpowdered coatings
Japan
23%
21%
×
−Introduce VOC removal equipment
Environmental impact reduction reduction•Reduce emissions of water contaminants (unit: index)

183

46

•Devise regulations•Apply to 27 items

Reducing
Environmental
Risk Factors

Promote energy
reductionand energy
conservation
throughinnovative
production
technologies

Production

Waste

Using
Resources
More
Efficiently

Raw Materials

Logistics

CurbingGlobalWarming

Production

Action Policies

P44

P45
•Expand use of watersoluble coatings in Materials
Handling Equipment andVehicle businesses

Progress of the Fourth Environmental Action Plan (Management)
Action Policies

Specific Actions
Business partners•Further promote green procurement−Improve environmental performance by supporting the establishment and promotion ofenvironmental management systems (EMS)−Enhance management of substances of concern

Consolidated
Management

Strengthen
cooperation withbusiness partners

Group companies•Promote consolidated environmental management by enhancing mutual communication−Thorough environmental compliance (all companies)−Establish EMS (sales and service companies)−Introduce green procurement and environmental accounting (manufacturing companies)−Improve environmental performance and enhance external environmental
communication (manufacturing companies)

FY2008 Achievements•Confirmed management
systems for substancesof concern at all business
partners•Supported environmental
management at Group
companies

Toyota Industries Report 200837

Environmental Initiatives

Curbing Global Warming from Products
Approach to Curbing Global Warming
Products developed and manufactured by Toyota Industries
inevitably exert various types of impact on the environment during all
stages of the product lifecycle, including usage by customers andfinal disposal. These impacts include global warming from energy
consumption, resource depletion from the use of raw materials andthe emission of polluting substances at the time of final disposal. We
believe that adopting initiatives starting from the development stage
is particularly crucial for minimizing the environmental impact of our
products. Acting on this belief, Toyota Industries has introduced theEnvironmentally Friendly Product Certification System in an effort
to promote a broad array of environmental considerations, such as
curbing global warming.

Environmentally Friendly Product
Certification System
Certification Flow
Development Department
Problem

Certification Committee
Independent Verifying
Organization

Problem

Product Technology
Subcommittee

Problem

Certification

Eco-Friendly Product Certification System
Our proprietary Environmentally Friendly Product Certification
System was established with the aims of pursuing environmental
considerations during product development and properly providing
Toyota Industries’ customers with information on its eco-friendly
products. This system is based on the International Standards
Organization (ISO) Type II environmental labeling standard* (ISO14021). Environmentally friendly products are certified if they meet
Toyota Industries’ in-house regulations in consideration of the main
themes of the Fourth Environmental Action Plan, which was launchedin fiscal 2007, during their product development.
Assessment under the certification program is conducted withfocus on two categories. The first is a Factor Assessment, whichassesses quantitatively how much the newly developed product’s
eco-efficiency has improved compared with that of the base product(existing Toyota Industries product). The second is a Development
Process Assessment, which includes assessment of factors suchas fuel efficiency improvements, smaller size and lighter weight.
Products that satisfy the criteria are then checked by an independent
verifying agency and evaluated within the Company before being
granted certification. Certified products carry a Toyota Industries
environmental label.
Under the Type II environmental labeling standard, ISO requires
only self-declaration by the enterprise (no independent third-party
certification required). To create an even more reliable program,
however, Toyota Industries has decided to have its self-assessment
confirmed by Bureau Veritas Japan Co., Ltd., an international
inspection and certification organization.
* Environmental labeling: Labeling that conveys to consumers the environmental aspects ofa product or service through printed text on the product, advertisements, symbol marks andother means. ISO has established three categories of environmental labels: Type I labels,
which indicate certification by an independent verifying organization; Type II labels, whichindicate self-declaration by the enterprise that certain standards have been met; and Type III
labels, which provide environmental impact data for the product.

Environmental Label
Certified products carry an“environmental label” containing
the mark shown on the left on
the product itself, its packaging,catalogs and other materials.
The mark’s circle represents the
Earth, wrapped in a green leaf.

38

Toyota Industries Report 2008

Certification Criteria
Products that meet the Factor Assessment and Development
Process Assessment are certified as Environmentally Friendly
Products.

Factor Assessment
Rationale Embodied in the Factors
Improve product and service values

Maximize product performance and value

Reduce environmental impact

Minimize impact on the environment

Factor Computation Method
Functionality*1 of developed productEco-efficiency ofdeveloped product

Factor =Environmental impact of developed product=Eco-efficiency of acomparable product

Functionality of comparable productEnvironmental impact of comparable product

Assessment Category

Certification Standard

Curbing global warming

CO2 emissions volume

Using resources more
efficiently

Resource consumption
volumeReducing environmental
risk factors

Environmental impact
substances

Any of the factors in theassessment categories atthe left is equal to 1.3 orabove. Otherwise, all thecategories are equal to 1.0
or above.

*1: Product functionality = Basic functionality
Examples: Cooling capabilities for car air-conditioning compressors; volume of work during
product lifecycle of lift truck

Development Process Assessment
All items listed are evaluated.
Assessment Category
Curbing
globalwarming

Energyconsumption

Items for Consideration
Improved fuel efficiency(engines, internal combustion lift trucks)
Improved cooling capability(car air-conditioning compressors)
Reduced amount of energy consumption (textile
machinery, electronic parts, electric lift trucks)

Using
resourcesmore
efficiently

Resource
savings

Miniaturization and reduced weights
Reduced number of parts
Use of recycled parts and materials as well as
recyclable materials

Recycling

Improved ability to break down and sort
Indication of raw materials used
(plastics, rubber parts)

Environmental Substances
risk factorsof concern
Environmental Provision
informationof information

Number of fastening parts limited to bare minimum
Improved the recoverability rate
Satisfying in-house regulations for control
Information about collection, disassembly,
disposal and recycling methods provided inoperation manuals

Examples of Products Certified in Fiscal 2008

Rack Sorter

Two-Wheel Drive Shovel

CO2 factor 1.18

CO2 factor 1.03-1.15

Energy-Saving Operation Achieved through Installationof Regenerative Units and More Efficient Movement

Realizing Excellent Fuel Economy with an ElectronicallyControlled Internal Combustion Engine

Launched in May 2007, the Rack Sorter P, a unit-type automatedstorage and retrieval system for pallets, incorporates a speedcontrol function and realizes energy-saving
operations. For loading and unloading,when the sorter’s traveling in a certain
direction requires a longer time, the hoisting
and lowering acceleration/deceleration
will be controlled in accordance with therequired traveling time, thereby reducing
energy used for acceleration/deceleration.
Accordingly, unnecessary motion iseliminated without delaying storing andretrieving at the warehouse.
Combining the speed control
with the optional regenerating unit*
enables a 15% reduction in energy
consumption compared withprevious models.

The Shovel Loader, our new two-wheel drive shovel launched in
September 2006, incorporates an electronically controlled internal
combustion engine as a standard feature.
This engine minimizes the amount of fuelinjection by cutting fuel consumption
during idling, thereby realizing highpower output and improved
fuel economy, with fuelconsumption reduced
by approximately 15%
compared with previous
models.

Fuel Consumption*
The fuel consumption of previous models is set at one.
１

* Optional regenerating unit: device for recovering excess energy for reuse as electric power.

Approximately

15% reduction
Speed Control Function of Rack Sorter P
New Rack Sorter P

Rises
up

Rises
up
A smaller amount of energy isconsumed when rising up.

Previous model0

The hoisting and lowering motion is controlled sothat it finishes at the same time as traveling.

Rises
up

TravelHoisting and lowering motion is completed whenin motion.

Rises
up

A larger amount of energy isconsumed when rising up

TravelPower Consumption*
The power consumption of previous models is set at one.
１
Approximately

15% reduction0

New model(with option installed)

Previousmodel* Power consumption and energy savings vary depending on the model, height, lengthand speed specifications.

Newshovel loader

Previous
shovel loader* Fuel consumption shows a comparison with values based on JISD6202 testing
conditions. Fuel consumption could also differ accordingly depending on conditions(weather, road surface, vehicle and operating conditions) during actual operation.

TopicsEnvironmentally Friendly Product
Certification System Earns EcoEfficiency AwardIn December 2007,
Toyota Industries
earned the EcoEfficiency Award*
2007 from theJapan Forum on
Eco-Efficiency.
This accolade wasreceived based on the high acclaim for Toyota Industries’
introduction of an independent third-party review for its
Environmentally Friendly Product Certification System.
In the future, Toyota Industries plans to further improveits certification system by re-evaluating the criteria for
certification. We believe these efforts will lead to thedevelopment of even more environmentally friendly products.
* This award is presented in recognition of the activities of companies taking
initiatives to improve socio-economic conditions while reducing environmental
impacts.

Toyota Industries Report 200839

Environmental Initiatives

In-Product Features for Resource Saving
Approach to Resource Saving
To achieve efficient use of finite resources, Toyota Industries promotes
design and development that implements the 3Rs: reduce materials
used by using them more efficiently, reuse products and parts thathave completed their service life and recycle resources.

Major Principles of 3R Design

and re-evaluated the structure of the headlights to improve ease of
dismantling and recycling. Regarding our new unit-type automatedstorage and retrieval system for pallets (Rack Sorter P), we improved
the ease of dismantling by making it unnecessary to use special tools
to remove the wheel bearings and deceleration gear shift. To ensure
customers can use this product over an even longer operating life, wehave enhanced maintenance features by incorporating an automaticfunction for displaying a parts-replacement warning.

ReduceRationalize the use of raw materials, etc./promote
long-term use of products

3R
DesignReuse
Make better use of raw materials/improve
construction/ensure the safety of the disposal
process
RecycleCreate recycle-friendly designs
Make better use of raw materials/improve
construction/improve the methods for separating
trash for recycling/ensure the safety of thedisposal process/consider recycle-friendly design
with minimal environmental impact
Create designs free of hazardous substances
Avoid banned substances/reduce the use of
substances of concern

Implementing 3R Design for All Products
To ensure easy implementation of reducing, reusing and recyclingof resources, starting from the development and design stages wepursue the rationalization of raw materials usage and the safety
and efficiency of dismantling processes. Several examples illustrate
the scope of our efforts in this area. For our new two-wheel drive
shovel (Shovel Loader), a certified Environmentally Friendly Product,
Toyota Industries utilized recycled materials for the counterweight

Headlight

Rack Sorter P display for parts replacement warning

Utilization of Reclaimed Materials
Our DC-DC converter for electric power steering (EPS) downconverts the high voltage of a hybrid vehicle into a lower voltage
for use by the EPS. We have improved dismantling features andenhanced the ease of recycling by utilizing reclaimed aluminum forthe converter’s case and reducing the number of fastened parts.
Also, by significantly re-evaluating electronic parts and making suchinnovations as optimizing the configuration of the heat dissipation
structure through the use of computer-aided engineering (CAE), we
minimized an increase in the size of the converter that accompanied
an expansion in power output. At the same time, we reduced theamount of raw materials used.

DC-DC converter

Installed Model: Lexus LS600h
Counterweight

Shovel loader

40

Toyota Industries Report 2008

Positioning of DC-DC
converter (above HV battery)Environmental Initiatives

Reduction of Product-Derived Environmental Risks
Approach to Environmental Risks

Environmental Measures for GENEO-PRO

As measures to reduce environmental risks during the productusage and final disposal stages, Toyota Industries works to lower or
eliminate the use of substances of concern while striving to reduceengine exhaust emissions.

The GENEO-PRO lift truck underwent a minor change in 2007.
The product now features an electronically controlled internal
combustion engine and a three-way catalytic muffler as standard
equipment. These features enable clean exhaust emissions, lower
fuel consumption and a reduction in substances of concern whileachieving high power output (in compliance with Japan’s 2007
special motor vehicle exhaust emission regulations).

Management of Substances of Concern
The management of products containing substances of concern has
become increasingly critical in line with implementation of Europe’s
REACH*1 regulation enacted in June 2007. Accordingly, Toyota
Industries has totally rebuilt its Chemical Substances Management
System and strengthened the functions and handling capabilities
to comply with REACH legislation. We are now firmly positioned toquickly provide customers with in-depth information, while swiftly
responding to public inquiries by providing information on products
containing substances of very high concern (SVHC) as stipulated
by REACH. In designing our Chemical Substances Management
System, we established a flexible system framework to respondto additional environmental regulations in the future. Together withstrengthening such internal structures, we are also enhancing ourindividual consulting to business partners so that they can quickly
provide information on chemical substances contained in theirproducts.
In compliance with the European Union’s (EU) directive on endof-life vehicles (ELV), which targets automobiles and automotive parts,
Toyota Industries has completed its replacement of four substances
prohibited by the directive, specifically lead, mercury, cadmium andhexavalent chromium with alternative substances. We are working ona changeover for currently exempt applications under the EU’s ELV
directive. Additionally, Toyota Industries aims to eliminate use of thesefour substances in its lift trucks and other non-automotive products
not covered by the directive.

Exhaust Emissions Reduction
By adding a three-way catalytic muffler and electronically controlledinternal combustion engine as standard features, we have achieved
a balance between realizing a lift truck with increased power andclean exhaust emissions (CO2 emissions reduced by approximately
94%, NOx emissions by approximately 97% and HC emissions byapproximately 96%).

Improved Fuel Efficiency
The use of an electronically controlled fuel-injection system enables
an approximately 7% improvement*2 in fuel efficiency of the lift truckcompared with other internal combustion lift trucks.
*2: Values in Toyota Industries’ prescribed testing conditions*1: REACH (Registration, Evaluation, Authorisation and Restriction of Chemicals) is a system
for the comprehensive registration, evaluation, authorization and restriction of substancesof concern within the EU, and targets parties involved in the manufacture and import ofsubstances of concern.

GENEO-PRO

Outline of the Chemical Substances Management System
Regulatory Compliance

Information about substances ofconcern obtained from suppliersStandard data sheet

Customers

Parts List System

ChemicalSubstances
Management
SystemReport environmental
information for delivered
products. Assist customers
with green procurement andthe development ofenvironmentally friendly
products.

Provision of
product
information

Managementof substancesof concern

Substances of concern contained in all products are ascertained toensure reliable compliance with product environmental standards suchas the EU’’s ELV directive.

Green Procurement
Supplier management and substance control based on the data
received from suppliers regarding substances of concern.

LCA

Tools forenvironmentallyfriendly design

The environmental impact of a product is calculated and assessed
throughout the production of raw materials, parts manufacture, productusage and recycling stages. This contributes to reducing environmental
impacts across the entire product lifecycle.

Recycling
Recyclability rates are compiled for each product to assist in improving
recycling rates.

Toyota Industries Report 200841

Environmental Initiatives

Prevention of Global Warming Factors in Production
Approach to Curbing Global Warming
The year 2008 marked the start of the first commitment period (2008– 2012) of the Kyoto Protocol—an international framework for curbing
global warming—amid the emergence of various problems worldwide
attributed to global warming. Toyota Industries has designated theprevention of global warming as one of its most crucial management
issues and thus focuses on “realizing energy reductions andconservation via innovations in production technology” and “promoting
measures to curb global warming.” For fiscal 2008, Toyota Industries
set the target of improving its eco-efficiency by 30% on a nonconsolidated basis compared with fiscal 1991 levels. To attain thistarget, we utilized the Toyota Production System as part of exhaustive
efforts to reduce energy consumption.
On a Group-wide basis, Toyota Industries established the targetof a 19% improvement in eco-efficiency from fiscal 2004 levels,and respective Group companies adopted proactive approaches
to achieve this goal. As one example, U.S-based Toyota Industrial
Equipment Mfg., Inc., which manufactures materials handlingequipment, reduced its natural gas consumption by enhancing theefficiency of its powder coating drying furnace. In addition, Toyota
Industries is implementing energy efficiency diagnoses and looking at
various ways to reduce energy consumption for Group companies.
Thanks to these efforts, Toyota Industries improved eco-efficiency
by 36% from fiscal 1991 levels on a non-consolidated basis and 25%
compared with fiscal 2004 levels for the Group as a whole.
Total CO2 emissions have been increasing along with an
expansion in business. With a view toward the first commitment
period of the Kyoto Protocol, we have established the CO2 Emission
Reduction Conference to make concerted efforts to promote activities
throughout our businesses to curb global warming. The conference
will act to promote rapid decision-making and facilitate across-theboard activities.

routes to reduce transportation distances and the number of delivery
trips. We also improved load capacity efficiencies and expanded ourmodal shift (switching to different modes of transportation).

TopicsIntroduction of Solar Panels (TDDK)TD Deutsche Klimakompressor GmbH (TDDK), a company
that manufactures car air-conditioning compressors inGermany, undertook initiatives to reduce increased CO2
emissions in line with an expansion in business. Solar panels
were installed over the roof area (approximately 20,000 m2) of
its production plant in December 2007. These solar panels,
the largest-scale installation in Europe, will generate close to700 MWh of power annually. This is expected to reduce CO2
emissions by around 500 tons, equivalent to approximately
3.6% of TDDK’s annual CO2 emissions.

Energy-Derived CO2 Emissions
Non-consolidated

Subsidiaries
in Japan

Overseas subsidiaries

Eco-efficiency(non-consolidated)

Eco-efficiency(consolidated)

Target (non-consolidated)

Promoting a Modal Shift (Aichi Corporation)

Target (consolidated)

Total emissions(kt)

Fourth Environmental Action Plan (Eco-efficiency)
Non-consolidated: 30% improvement over FY1991 levels
Consolidated: 10% improvement over FY2004 levels

1.22
1.00

800
600
400
200
Good 0Eco-efficiency
Good

1.34

1.36
1.4
1.30
1.25 1.2
1.19 1.0

1.01

1.02

1.00

1.01

589

634

680

700

745

04

05

06

07

08

1.23
1.06

273

(FY) 91

Reducing CO2 Emissions from Transportation
With transportation operations accounting for approximately 20% of
our energy-derived CO2 emissions, we have long collaborated withcargo carriers to reduce CO2 emissions.
In fiscal 2008, we targeted the achievement of a 1% improvementin eco-efficiency from fiscal 2007 on a non-consolidated basis.
However, we significantly surpassed this target and attained a 7%
improvement via such measures as reorganizing truck transportation

42

Toyota Industries Report 2008

Aichi Corporation, which develops and manufactures aerial
work platforms, is shifting transportation modes to reduce
CO2 emissions in its logistics operations. Specifically, Aichi isshifting to marine transport using large ships as a substitutefor transportation previously handled by trailer trucks for longdistance shipping, mainly to such destinations in Japan as
Kyushu, Shikoku and Hokkaido. This modal shift
has enabled Aichi to achieve an approximately
28% reduction in annual CO2 emissions in
Hokkaido
its logistics operations. Furthermore, marinetransportation is capable of handling large
volumes of freight, thus proving to be ahighly effective means of transportation for
reducing CO2 emissions. With this inmind, Aichi will also expand the
Aichi
Corporation
use of marine transportation
for medium-distance
Shikokushipping.
KyushuEco-Factory Activities

Flow of Prior Assessment System

Toyota Industries undertakes its eco-factory activities in view ofrealizing the ideal mode of production with consideration to theenvironment. In relation, in fiscal 2007 Toyota Industries introduced
the Prior Assessment System for verifying the appropriateness ofhealth, safety and environmental measures for buildings and facilities
at the planning stage as well as after installation or completion.
Establishing this system will enable more efficient and effective
implementation of environmental measures.

Planning

Factor in safety and environmental measures in the plan for
new buildings and facilities

Prior
Assessment

Assessment of health, safety and environmental measures

Construction
and Installation

Inspections for health, safety and environmental measures

After Opening

Confirmation of effects

Overview of Standards for Prior Assessment System
Category

Principal Categories for Verification

HealthHealth andand safety
safetyLegal compliance
Legal compliancePrevention ofof environmental
environmental accidents
accidents
Prevention
Improvement of eco-performance
Improvement of eco-performance

Meeting standards for use of specified chemical substances, dust, summer temperatures, etc.
Compliance with the Air Pollution Control Law, Water Pollution Prevention Law, Noise Regulation
Law, Vibration Regulation Law, etc.
Implementation of measures to prevent underground seepage
Reduction of CO2 emissions, reduction of externally discharged waste, reduction of water usage,
curbing of VOC emissions, etc.

TopicsEnvironmentally Friendly TMHG Technical Center❶ Light Duct and Light Control System❶

Light duct system
Lets sunlight inside the building asa substitute for regular office lights
Light control system
Controls the degree of lighting toan appropriate level❷

Effect in reducing CO2 emissions:

40 t-CO2 annually❷❸❷ Rooftop Greenery
Effective in reducing solar heatgain and electrical heat for
better cooling efficiency

Effect in reducing CO2 emissions:

3.4 t-CO2 annually
In December 2007, the TMHG Technical Center was constructed
at our Takahama Plant, which develops and manufacturesmaterials handling equipment, under the framework of our Prior
Assessment System. In keeping with the concepts of “curbing
increases in office energy consumption” and “thoroughlymanaging newly installed equipment and visualizing energysaving effects,” environmental considerations encompass all
aspects of the new building. A central focus was placed on
global warming prevention measures such as making use of solar
power and rooftop greenery.

❸ Solar Power Generating System

Effect in reducing CO2 emissions:38.3 t-CO2 annually

Toyota Industries Report 200843

Environmental Initiatives

Resource Utilization in Production
Approach to Waste Reduction

Approach to Water Consumption

To promote the effective utilization of finite resources, Toyota
Industries aims to improve resource efficiency and reduce waste
generation at the source through such measures as increasing yields
at every manufacturing process, while also promoting in-house reuse
and recycling. In fiscal 2008, we implemented a host of improvement
measures such as reducing the use of steel materials in the Textile
Machinery Business. As a result, we attained our target for ecoefficiency, with a 12% improvement compared with fiscal 2004 levels.
We also promoted segmentation and optimization of separated
waste to achieve zero landfill waste at subsidiaries in Japan. As aresult, in fiscal 2008 we disposed of 46 tons of waste at landfill sites,a more than 99% reduction compared with fiscal 1999 levels.
We will continue to thoroughly implement improvement activities
directed toward achieving a balance between business efficiency andresource efficiency.

Giving strong consideration to the risks of ground sinkage, Toyota
Industries places particular emphasis on efforts to curtail the use ofgroundwater. In fiscal 2008, Toyota Industries achieved its target byrealizing a 44% reduction in the use of groundwater compared withfiscal 2004 levels by taking such steps as changing its feed water
control method and switching to greater use of industrial water.
Conversely, despite undertaking water-saving activities at each plant,
including recycling of wastewater and recovery and reuse of steam
drainage, the total volume of water used in fiscal 2008 rose 1%
from the previous fiscal year due to increased production and fullscale operation of the Anjo Plant. We will strive to reduce total water
consumption through such initiatives as implementing water-saving
measures in all manufacturing processes and making thorough efforts
to recycle wastewater.

Waste Generated
Waste moved offsite

Total Water Consumption

Eco-efficiency

TargetWaste amount
(kt)

0.93

81

80

0.98

1.00

120

96

Eco-efficiency

Good

Fourth Environmental Action Plan (Eco-efficiency)
Non-consolidated: 5% improvement over FY2004 levels

110

1.02
112

1.12
1.00
109

1.2
1.0

GroundwaterIndustrial water
Target (Groundwater use)

Fourth Environmental Action Plan (Groundwater use)
Non-consolidated: Less than 50% of FY2004 levels (less than 633km3)

Water consumption
(km3)

0.8

3,028

0

3,162

3,166

3,186

3,197

2,000

40
Good

Public water supply

1,267
(FY)

04

05

06

07

08

0
Good

(FY)

04

1,333
05

1,189
06

1,029
07

924

714

08

Topics

Improved Packaging Method for Pistons

Reducing Groundwater Use

In the Car Air-Conditioning Compressor Business, piston parts
produced at the Higashiura Plant were previously packed into
small cardboard boxes and shipped to our overseas subsidiaries.
To decrease the amount of cardboard used, we began using
egg-pack plastic packaging materials as a substitute for dividers
and shock-absorbing materials, which enabled us to eliminate
the use of cardboard boxes and increase load capacity. Unlike
cardboard packaging materials, egg packs can be reused
repeatedly, thereby reducing the volume of waste cardboard by
70% annually.

The Kariya Plant, which develops and manufactures textile
machinery and car air-conditioning compressors, uses
groundwater when faced with a shortage of industrial water.
When the amount of industrial water supplied per hour to the
Kariya Plant exceeded the contracted amount, the control device
on the plant’s water-drawing pump would recognize this situation
as a shortage of water, regardless of the actual water level in theplant’s raw water tank, pumping unneeded groundwater to theplant. To correct this situation, we adopted a new control method
whereby the plant’s water-drawing pump operates according
to actual water levels. As a result, the Kariya Plant now pumps
only the necessary amount of groundwater, reducing the total
groundwater use by 25,000 m3, or approximately 43%, annually.

Packaging of Piston Parts

Rainwater Capture System

Before improvement

44

Toyota Industries Report 2008

After improvement

Completed in December 2007, the Takahama Plant’s TMHG
Technical Center (see page 43) is installed with a rainwater
capture system to make more effective use of water resources.
Rainwater collected on the roof of the building is stored for suchuses as watering rooftop greenery as well as lavatory flushing.

Environmental Initiatives

Reduction of Environmental Risks in Production
Risk Assessment Program
Toyota Industries recognizes that its wide-ranging business activities
entail crucial responsibility for protecting the environment of local
communities and preventing any adverse impacts from environmental
accidents. Accordingly, Toyota Industries’ action policies for the
reduction of environmental risks in production place emphasis on the“minimization of environmental risk factors” and “further reductions in
the emissions of substances of concern.” In carrying out its activities,
Toyota Industries utilizes its own quantified environmental impact
index* to calculate environmental impacts.
For fiscal 2008, a 20% reduction in the environmental impact
index was targeted on a non-consolidated basis and a 23%
reduction on a consolidated basis (manufacturing companies inJapan) compared with fiscal 2004 levels. To attain these targets,
we implemented such measures as changing our piston coating
method (Car Air-Conditioning Compressor Business) and raising athinner recovery ratio (Vehicle Business). Despite progress, we fellslightly short of our targets, attaining a 17% reduction on a nonconsolidated basis and a 21% reduction for consolidated operations.
This was due mainly to the effects of a production increase in the
Materials Handling Equipment Business and giving priority to theimplementation of measures to curb global warming in lieu of largescale energy consumption countermeasures.
We intend to promote more balanced activities to reduce theCompany’s environmental impacts as well as overall impacts on
global warming. Through such measures as expanded use of waterbased coatings in the Materials Handling Equipment and Automobile
businesses, we aim to attain fiscal 2011 targets set out in the Fourth
Environmental Action Plan.

oils, we have drilled observation wells at all plants to conduct regularchecks.

Trichloroethylene Readings (FY2008)
Weighted Average Concentrationin Groundwater (mg/l)

Current Status

Kariya Plant

0.99

Cleanup in progress

Kyowa Plant

0.79

Cleanup in progress

Plant

Legal Compliance
In November 2007, it was learned that oil concentration levels in
wastewater at the Obu Plant surpassed standard values. The primarycauses of this incident was a decline in oil-dissolving and processing
capabilities due to faulty coagulation at the plant’s wastewater
treatment facility, as well as an ambiguous framework for detecting
abnormal values in wastewater. To prevent a recurrence, we switched
to a different coagulant and made Company-wide improvements
to our framework for facilitating communications and detecting
abnormal values in wastewater. We will strengthen our approachto realizing zero abnormalities and claims by taking such steps as
carrying out reciprocal patrols among our plants.
In fiscal 2008, both in Japan and overseas, no infringements ofenvironmental legal standards were committed and Toyota Industries
was not subject to any fines or penalties. Also, no environmentrelated legal action was taken against Toyota Industries.

Topics

VOC* Reduction by Overseas
Subsidiaries

Environmental Impact Index
Consolidated (index)

Non-consolidated (index)(index)

Non-consolidated target (index)

140
120

100

100

97.0

80

Consolidated target (index)
Fourth Environmental Action Plan (Environmental impact)
Non-consolidated: 10% reduction from FY2004 levels
Consolidated: 5% reduction from FY2004 levels

83.6

68.2

76.8 78.8

60
40
20
Good 0

(FY)

04

05

06

07

08

* Toyota Industries properly manages different substances of concern withenvironmental and water pollutant properties, among others. To clarify priority, infiscal 2007 we introduced a quantified environmental impact index for the integrated
management of environmental impacts.
<Substance covered by calculations for environmental impact index>
HFC PRTR emission volumes (VOC-derived)
Water contaminants (BOD, COD, nitrogen, phosphorous)

To prevent atmospheric pollution from VOC emissions
during the coating process, overseas subsidiaries involved
in lift truck production are proactively undertaking emissionreduction activities by changing their coating methods andimproving coating efficiency. In fiscal 2008, France-based
Toyota Industrial Equipment
S.A. switched to a coating
containing less solvents, which
reduced annual VOC emissions
by approximately 25%. In
North America, The RaymondCorporation Greene and Lift-Rite
Inc. decided to expand the useof a VOC-free powdered coating.
Toyota Tonero* VOC: Volatile Organic Compounds

Soil and Groundwater Pollution
Countermeasures (Status Report)
Toyota Industries carries out surveys and purification of soil andgroundwater contaminated from its past use of trichloroethylene asa cleaning agent. We report the survey results to local government
authorities and provide information at local community meetings. As
measures to prevent pollution from substances covered by the Soil
Contamination Countermeasures Law as well as from grease andPowder Coating Process
Heat is applied to a powder coating that uses no VOCs,
then it forms into the finished paint film
Coating

Baked on to the surface

Heating

During coating(powder condition)

Cooling

Degassingsmoothingdrying reaction
Heating(when partially melted)

During film formation(paint film in finished condition)

Toyota Industries Report 200845

Environmental Initiatives

Environmental Communication
Promoting Internal and External
Environmental Communication

BT Products Provides Environmental
Education to Local Elementary Schools

The Toyota Industries Group promotes environmental activities
closely linked with society. Working to foster a deeper understandingof our environmentally friendly products, we strive to disclose abroad array of information to the general public through such meansas our annual environmental reports, Website and exhibits. At thesame time, we are undertaking concerted efforts to interact withlocal communities, holding community roundtables and providing
environmental education programs for local elementary school
students.
Within the Company, we utilize the Environment Section of ourIntranet to communicate and share pertinent information, while ourmonthly in-house magazine publishes articles on environmental
issues to foster a greater
environmental awareness among
our employees and their families.
In fiscal 2008, we held
an Environmental Liaison
Conference, which brings
together personnel responsible
for environmental programs ateach Group company in Japan.
To further deepen environmental
communications both within
the Group and externally,
Environment information available
we will continue to focus on
via Website (http://www.toyotasharing important environmental
industries.com/csr/)
information.

In May 2007, Sweden-based BT Products AB (BTP) provided local
elementary school children with an educational program coveringsuch topics as global environmental problems and environmentrelated activities of BTP and the Toyota Industries Group. A
collection of presentation materials used in the children’s program
was displayed in BTP’s cafeteria to further enlighten employees onenvironmental issues.

Children’s environmental presentation

Environmental Awards
Toyota Industries’ environmental activities have earned wide acclaim,
and in fiscal 2008 we received environmental awards in three fields,
as shown below.

Environmental Award Earned in Fiscal 2008
Name of Award

Activities Acclaimed

ToyotaIndustries

Eco-Efficiency Award 2007 fromJapan Forum on Eco-Efficiency

Effective use of eco-efficiency via
proprietary Environmentally Friendly
Product Certification System (Seepage 39 for details.)

Kariya Plant

Outstanding Energy Management
Facility Awards from Chubu
Bureau of Economy, Trade andIndustry

Contribution to the rationalizationof energy use through continuous
implementation of energy
management initiatives

Higashichita
Plant

Environmental Project Awardof the Japan Environmental
Management Awards

Reduction in the volume of external
CO2 emissions by reducing pig ironconsumption and effective use of
scrap metals

Recipient

Participating in Eco-Products Exhibition
In December 2007, we exhibited our products at Eco-Products 2007
held at Tokyo Big Sight. The exhibition is held every year to promoteinteraction and communicate companies’ environmental initiatives.
In keeping with this year’s theme, “Diet! CO2,” we introduced ourenvironmental technologies byshowcasing Toyota Industries’
hybrid lift trucks and various
hybrid vehicle components. A
broad range of people, fromelementary and junior highschool students to various
companies and the general
Eco-Products Exhibition
public, visited our booth.

Recycled Compost Distributed to Local
Communities
Toyota Industries recycles
branches pruned from trees at its
plants as compost. The compost
is not only used to grow trees at
our plants but also distributed
free-of-charge to employees,
local residents and local facilities
for flowerbeds and vegetablegardens.

46

Toyota Industries Report 2008

Flowers in Hanakatsumi Garden
in Agui Town to which Toyota
Industries provides compost

Participating in Environmental Partnership
Organizing Club
Environmental Partnership Organizing Club (EPOC) encourages
cooperation in environmental activities carried out by companies
in the Chubu Region and promotes exchanges with citizens andschools. As a corporate member of EPOC, Toyota Industries
participates in the School Exchange Subcommittee for promoting
environmental education at schools.

Environmental Initiatives

Environmental Accounting
Toyota Industries regards environmental accounting, which evaluates
the effectiveness of its environmental activities from the perspective ofcost, as a critical tool not only for corporate management but also forthe disclosure of quantitative information about the environment. As
such, we are continually striving to further enhance our environmental
accounting systems. Environmental accounting data is collectedin compliance with the Ministry of the Environment’s Environmental
Accounting Guidelines 2005 Edition.

Scope of data collection: Toyota Industries, TIBC Corporation
Data collection period: April 1, 2007 – March 31, 2008

electricity consumption during operation as well as the GENEO-PRO
internal combustion lift truck, which is equipped with an electronicallycontrolled engine and a three-way catalytic muffler to achieve cleaner
exhaust emissions and lower fuel consumption while offering highpower output.

Environmental Conservation Benefits

Table 2The benefits of environmental conservation indicate the accumulated
outcomes of yearly environmental conservation measures. In fiscal
2008, waste generation increased approximately 11,000 tons. This isbecause since September 2006 we started counting casting debris
generated at the Higashichita Plant as waste instead of valuable
resources.

Fiscal 2008 Results
Environmental Conservation Costs

Table 1

The total cost of environmental conservation programs in fiscal 2008was ¥9.69 billion, consisting of ¥2.29 billion in investment and ¥7.4
billion in expenses. Global environmental conservation costs primarily
included introduction of a solar power generating system and lightduct and light control system at the TMHG Technical Center at the
Takahama Plant.
Research and development costs included development of
the following products: the Rack Sorter P, a unit-type automatedstorage and retrieval system for pallets that realizes a reduction in

Environmental Conservation Costs*1

Economic Benefits of Environmental Conservation
Initiatives Table 3
Toyota Industries calculates the actual economic benefits ofenvironmental conservation initiatives through calculable benefits,
including reductions in energy costs and wastewater treatment costs,
as well as profits from the sale of valuable resources. The economic
benefit achieved in fiscal 2008 was ¥7.86 billion, an increase of¥0.84 billion from fiscal 2007. The main contributor to the total was
the profits from the sale of valuable resources, which accounted for¥7.58 billion.

Table 1

FY2008Investment Expenses

Category

Principal Approaches in FY2008

Pollution prevention costs-Preventing air pollution
Business -Preventing water pollution
area costs Global environmental
conservation costs
Resource recycling costs
Upstream/downstream costs

Expanding number of plants in which water-based coating of lift trucks is
introduced
Renovation and maintenance of wastewater treatment facility
Introduction of a solar power generating system and high-efficiency motors,
countermeasures for air leakage
Promotion of waste recycling and converting waste into valuable resources
Promoting green procurement

Management costs

Newspaper advertising promoting environmental considerations,publication of Social and Environmental Report
Development of Rack Sorter P unit-type automated storage and retrieval
system for pallets, etc.
Support for environmental organizations
Purification of soil and groundwater contamination, measures toprevent occurrence of oil and grease ground seepage

Research and development costs
Social contribution activity costs
Environmental remediation costs
Total

Environmental Conservation Benefits*2
Table 2

Environmental
Impact

FY2007
Investment Expenses

1,074

753

483

866

934

3,055

875

3,147

225

1,718

4

1,715

–

25.0

–

15.3

48

906

–

1,123

–

909

92

3,592

8

14

–

10

1

26

1

20

2,289
9,689

7,400

1,455
10,494
11,949Economic Benefits of Environmental Conservation Initiatives
Table 3Comparison with
Previous Fiscal Year

Item

CO2

13kt decrease

Revenue

VOC

135t increase

Generation ofwaste products

10,783t increase

Water

442t decrease

SOX

0.04t decrease

NOX

6t decrease

COD

0

Details

Returns from sale of recycled waste products
Energy cost reductions

Cost
reductions*3 Cost reduction by resource savings (including reductions inamount of water use and amount of wastewater)
Total

FY2008FY2007

7,577

6,237

278

632

8

156

7,863

7,025

*1: Depreciation expenses are not included in environmental conservation costs. Costs and investments that
include objectives other than environmental aspects either have the difference aggregated or the component
removed.
*2: Figures are calculated after correcting the sales volume difference as the difference between the volume ofenvironmental impacts in the previous fiscal year and the volume of environmental impacts in the current
applicable period. Effects of environmental conservation = Amount of environmental impacts in previous year x(Sales volume in applicable period/Sales volume in previous year) - Environmental impacts of applicable period*3: Cost reduction is calculated by multiplying the volume of reduction in environmental impacts by the unit cost.

Toyota Industries Report 200847

Environmental Initiatives

Independent Verification

Reference View
Bureau Veritas Japan has verified environmental data collection activities at the Head Office and the designatedsites and has concluded the following.

Good Points

Opportunities for Improvement

All manufacturing sites, both national and international, are now
included in the scope of verification, in turn contributing to themonitoring and disclosure of environmental burden data of the wholeGroup more accurately.
Environmental Efficiency, added as a new report subject in 2006,
is effectively used to drive improvement actions and is a guideline for
evaluation of activities with a potential environmental impact.
For waste classification, the specification of waste types,
confirmation of amounts and clarification over its storage are deemed
to be appropriate. In addition, the handling, storage, collection andtransportation of waste management involving contracted parties are
effectively integrated and the location of waste management facilities
at each site is commendable.

Head Office/domestic plants

Follow-up on Issues from Verification Reporton Social & Environmental Report for 2007
With the introduction and implementation of revised environmental
performance data aggregation rules, there appears to be a reduced
discrepancy between the scope of data collection at each plant andthe Head Office, with closer alignment of data aggregation acrosssites.
The organizational structure which collects and processes
environmental performance data is better defined, resulting in
improved data management to better manage environmental risks.
The process for the classification of both waste and recycling
materials has been further defined and clarified, enabling theidentification of reusable and recyclable materials. Recycling activity
has increased not only at Toyota Industries’ plants but also subsidiary
and affiliate sites.

While activities are well-managed for data collection through toreporting, there is less attention currently paid to the quantitative
monitoring of parameters lessrelated to direct purchasesuch as undergroundwater usage; this could beincorporated into the data
management and reportingfor complete consumption
figures.
The management ofrecycling has improved
through implementation ofa systemic approach. There
could be room to further
improve recycling activities
through cooperation with subcontracted and third parties.

Domestic manufacturing subsidiaries
Training has been implemented for people in charge of data
management; however, to ensure continuous application of theprocesses for data management, it will be necessary to establish
such an approach across the whole Group.
The English versions of the Independent Verification Report and Reference View from Bureau
Veritas Japan are translated from the original Japanese versions. The Japanese versions
shall be the sole official texts in case of discrepancy.

Manufacturing Subsidiaries and Affiliates in the Consolidated Performance Data
Subsidiaries in Japan48

ISO14001
Certification
Acquisition Date

Overseas Subsidiaries

ISO14001
Certification
Acquisition Date

Nishina Industrial Co., Ltd.

Jan. 2002

Toyota Industrial Equipment Mfg., Inc.

Jun. 1999

Tokaiseiki Co., Ltd.

Mar. 2002

Michigan Automotive Compressor, Inc.

Jun. 1999

Tokyu Co., Ltd.

Nov. 2001

The Raymond Corporation

Mar. 1999

Mino Tokyu Co., Ltd.

May 2007

Raymond Industrial Equipment Ltd.

Feb. 2001

Izumi Machine Mfg. Co., Ltd.

Dec. 2002

Raymond-Muscatine Inc.

Sep. 2004

Hara Corporation

Nov. 2003

Lift-Rite Inc.

May 2007

Iwama Loom Works, Ltd.

Apr. 2004

ACTIS Manufacturing, Ltd. LLC

Mar. 2005

Miduho Industry Co., Ltd.

Sep. 2003

TD Automotive Compressor Georgia, LLC–

Aichi Corporation

Jul. 2004

BT Products AB

Nov. 1997

Nagao Kogyo Co., Ltd.

Oct. 2002

TD Deutsche Klimakompressor GmbH

Mar. 2002

Unica Co., Ltd.

Nov. 2002

Toyota Industrial Equipment, S.A.

Jan. 2001

Altex Co., Ltd.

Sep. 2003

CESAB Carrelli Elevatori S.p.A.

May 2006

SKE Inc.

Mar. 2003

Toyota Industry (Kunshan) Co., Ltd.

Oct. 2001

TIBC Corporation

Jan. 2000

Toyota Industry Automotive Parts (Kunshan) Co., Ltd.

–

Kirloskar Toyoda Textile Machinery Pvt. Ltd.

Jan. 2002

Toyota Industries Report 2008

Corporate Social Responsibility
50
52
54
56

Responsibility to Our Customers
Responsibility to Our Business Partners
Responsibility to Our Associates
Responsibility to Our Local Communities

Toyota Industries Report 200849

Corporate Social Responsibility

Responsibility to Our Customers

Placing Top Priority on Maintaining and Improving Quality
Quality is a Key Management Issue Diagram 1
Carrying on the spirit of the teachings of Toyota Industries’ founder
Sakichi Toyoda that “A product should never be sold unless it has
been carefully manufactured and has been tested thoroughly andsatisfactorily,” Toyota Industries believes quality is its lifeline and a key
management issue. Maintaining and improving quality is our mostimportant responsibility to our customers and forms the basis of ourcorporate social responsibilities.
Toyota Industries encourages all employees to be an active
part of its efforts to maintain and improve quality in all areas of its
corporate activities, most notably “product quality,” “marketing
quality” and “total quality.” “Product quality” is embodied in the
durability, safety and eco-friendliness of our products, “marketing
quality” in excellent sales and service and “total quality” in our overall
corporate image and brand strength.

Types of Quality Sought by Toyota Industries
Diagram 1

Quality levels that
customers truly expect

Total
quality

Marketingquality

Manufacturing
quality
Designquality● Sales● Eco-friendliness ●Workmanship ● Service●Durability ● Safety● Brandstrength● Corporate
image, etc.

Product quality
Brand identity

Establishing Daily Quality Assurance Systems
Diagram 2

Developing and providing products from the customer’s viewpointsummarizes Toyota Industries’ comprehensive “market-in” approach.
In all processes, predetermined procedures are carried out
according to instructions in order to ensure that no defective products
are sent to post-processes and thereby achieve manufacturing
through self-conclusion of the process. We believe this is the basis
for ensuring high-quality products.
Whenever any of Toyota Industries’ business divisions develops
a new product, a design review (DR) system is utilized to evaluate
quality at all stages until customer satisfaction is realized. This
ensures that no product progresses to the next stage unlessestablished target levels have been achieved.
Once new products are launched and important customer
information reaches the quality assurance departments of eachbusiness division, it is immediately fed back to the responsible
department (such as design and manufacturing) to quickly devise

50

Toyota Industries Report 2008

countermeasures. At the same time, the DR system is reviewed toprevent the recurrence of any problems in subsequent models.
While making sure to undertake all measures to prevent defective
products from proceeding to the next stage of the production process
or leaving the factory, we also proactively tackle quality improvements
throughout five stages, starting from cleanliness and neatness.
As part of such efforts, in 2006 we initiated a new “Thank-youfor-finding-the-defect award.” This honor recognizes workers who
sensed something unusual or different in their work and thereby
detected a defect in the early stages, along with their superiors who
took the necessary actions to help solve the problem.

Improving Quality throughout the Global
Supply Chain by Reflecting Customer
Opinions
In manufacturing, Toyota Industries devotes enormous efforts to
the research and development of new functions, endeavoring todevelop products that are ahead of the times. Using the DR system,
general managers of each business division evaluate every step of the
production process from product planning and design to production
preparations, production, initial quality and customer satisfaction levels.
For example, in the Textile Machinery Business, when we deliver
new machines to textile manufacturers in various parts of the world,
we ask them to evaluate the product. These comments are in turnutilized in the development of new products and the improvement of
our after-sales service.
In the Materials Handling Equipment Business, in which
distributors and dealers handle sales and after-sales service, we
attempt to ensure that customers can use our products in an
excellent condition without any inconveniences. Distributors anddealers work together to optimize their response to customers while
Toyota Industries directly interfaces with customers through customer
consultation desks. Sales staff at distributors, dealers and Toyota
Industries also visit customers to conduct actual usage fact-finding
surveys.
Individual comments and requests received from customers inthis way are promptly fed back to the relevant department, such as
design, and a response is subsequently provided to the customer
through dealers.
As a company that supplies products to the global market, we
believe that customer confidence in our quality is synonymous with
the Toyota Industries brand, a precious element of our corporate
value that must be preserved. We therefore aim to continue
implementing quality assurance activities that encompass our entire
global supply chain, including affiliates and business partners inJapan and overseas.

Dealing with Significant Quality Issues
In cases where serious quality issues arise, such as accidents that
result in personal injury or property damage due to quality, the quality
assurance department of the responsible business division must,in accordance with our Rules for Dealing with Significant Quality
Issues, minimize the trouble to customers by promptly devisingcountermeasures; at the same time, the general manager of thebusiness division must report the issue to the president and theexecutive vice president in charge of quality. In addition, based on
information provided to the Global Quality Control Department at
the head office through the Significant Quality Issues Notification
Form, the director in charge of quality will carry out quality audits as
deemed necessary to prevent recurrence and ensure deployment ofcountermeasures in similar areas.

Distributing Quality Guidelines
Reflecting on the previous year’s quality-related issues andidentifying important quality improvements for the coming fiscal
year, the president issues the Quality Guidelines to the entire Toyota
Industries Group at the beginning of each fiscal year. At each of the

Quality Assurance and Quality Control Structurebusiness divisions, the executive vice president in charge of quality
confirms the implementation of the guidelines through the Quality
Functional Committee, including on-site quality inspections. In orderto sufficiently raise customer satisfaction, during fiscal 2008 we went
back to the basics of our customer-first activities and identified andreviewed each business division’s and department’s shortcomings
relative to the Quality Guidelines.
Toyota Industries remains committed to undertaking any andall measures to achieve “zero inconvenience” to our customers. We
will continue to promote quality assurance activities through selfconclusion of the process to ensure there is no outflow of defects
from respective processes.

Diagram 2

Product Development

Head Office

Production

Individual Divisions and Departments
Quality enhancement steps during the
manufacturing process

Nine Design Reviews (DR)Inspecting

President

DR0

Commercial productplanning review

DR1

Product planning review

DR2

Prototype design review

DR3

Pilot production review

DR4

Production design review

DR5

Production preparation
review

DR6

Mass production review

DR7

Initial production review

DR8

Customer satisfaction
review

High

ReportingDirectives

Reporting

Reports on
items coveredby theRegulations for
Dealing with
Significant
Quality Issues

Review DR system andimprove processassurance levels

Defectprevention
activities
Self5
conclusionof respective
Raise
processes
process
assurance Measures to deallevelswith problem origins;
4
prevent outflow of
defective products
Process
manage- ・Check sheets andcontrol charts
3 ment・Automation
Streamline
・Managing change points
standards
andStandardization, work
manuals
procedure instruction
2
sheets1

Cleanliness
Neatness

5S (2S+3S)

Prevent
outflow of
defective
items(inspections)Issues to be addressed at
the mass production stage
Issues to be addressed
regarding the system

Global Quality
Control
Department

Next
product
development

Individual
department reviews

Issues to be addressed at
the new productdevelopment stage

Move onto thedevelopment of
next
products

Auditing

Quality assurance departments in business divisions
Reporting

Replies and responses

Customer information (requests, opinions, etc.)

Customers

Toyota Industries Report 200851

Corporate Social Responsibility

Responsibility to Our Business Partners

Aiming for Co-Existence and Co-Prosperity
with Business Partners
Procuring Parts, Materials and Equipmentfrom around the World through Fair Trading
Practices
Toyota Industries procures parts, materials and equipment in a varietyof areas from business partners all over the world. We work toward
the realization of co-existence and co-prosperity with our business
partners from a long-term perspective. Through fair trading practices,we purchase high-quality products at lower costs while cooperatingwith our business partners in responding to environmental
conservation and other social demands.

Procurement Policy
Fair Competition Based on an Open-Door Policy
We have an open and fair entry process that allows all potential
suppliers, regardless of nationality, size and experience, the same
opportunity to offer us their products or services. We select ourbusiness partners based on economic reasons such as the quality,
price and volume of their products, as well as on their adherence
to delivery times. In addition, we also comprehensively consider
such matters as environmental awareness, company stability andtechnological development ability.

Amicable Relationship of Mutual Benefit Based on
Mutual Trust
At Toyota Industries Corporation, we work hard to realize an amicable
relation of mutual benefit with our suppliers based on mutual trust.
We also believe that it is important to promote friendly communication
with our suppliers by means of our procurement activities.

Environmentally Friendly Products Based on “Green
Procurement”
In order to create environmentally friendly products, we aim to
procure parts, materials and equipment that have low environmental
impact from suppliers that always give sufficient consideration to theenvironment.

Localization of Business Based on Good Corporate
CitizenshipAs a company that undertakes local production overseas, we
promote procurement from local suppliers in order to contribute to
the local community.

in order to explain annual procurement policies and to gain theirunderstanding and cooperation with our efforts.
We also hold topic-based meetings for important matters related
to corporate social responsibilities so that our business partners
can share information on our respective needs and reinforce ourrelationships with them.

Offering Business Opportunities to SuppliersWorldwide
Toyota Industries offers open procurement opportunities tosuppliers worldwide through its Website to achieve broad andopen procurement. To ensure fairness and equity, we publicly makeavailable our standard procurement procedures from marketing to
the conclusion of contracts so that suppliers clearly understandthis process. To apply, potential suppliers must register the statusof their environmental certifications, such as ISO 14001, as well asother basic information that includes the scale of their business andfinancial results.

Compliance with Subcontracting Act
Toyota Industries stresses compliance with the Act against Delayin Payment of Subcontract Proceeds, etc., to Subcontractors(hereinafter Subcontracting Act) in its commitment to fair trading
practices. As of March 2008, some 800 suppliers are covered by
the Subcontracting Act among our approximately 1,300 suppliers
worldwide.
In fiscal 2008, the Purchasing Department, which is responsible
for ensuring compliance with the Subcontracting Act, held 43
in-house training seminars regarding this act, training a total of
2,650 employees involved in procurement in their respective
business divisions. The department also publishes a monthly“News Concerning Subcontracting Act” newsletter via the Intranet
in its efforts to keep employees up-to-date regarding legislative
amendments and important notices.
Since fiscal 2006, Toyota Industries has been providing a hotline
to handle complaints and consultations from business partners
regarding the Subcontracting Act. Such efforts in turn provide aplatform for maintaining mutual trust and improving our procurement
activities.
Although the hotline is placed within the Purchasing Department,
fairness is maintained by having impartial personnel who are notresponsible for business transactions in charge of the hotline.

Compliance with the Law
It is Toyota Industries’ policy to strictly abide by both the letter andspirit of laws and regulations and to also carefully handle and protect
our partner’s confidential corporate information.

Conducting Procurement Policy Explanatory
Meetings
Toyota Industries strives to communicate with business partners invarious forms in its efforts to enhance mutual trust. For example,
we hold procurement policy meetings for major business partners

52

Toyota Industries Report 2008

Supporting Business Partner Reforms
Toyota Industries supports business partners’ efforts to improvetheir management platform in order to consistently procure better
products. For Hoeikai, which is comprised of 65 business partners
working with Toyota Industries, we proactively support quality andcost improvements, safety and health management as well as
environmental conservation.
In fiscal 2008, a total of 904 people attended quality training
programs held for our business partners on 30 occasions. In addition

to providing guidance and cooperation directed toward improving
manufacturing processes at business partners’ production sites
on 51 occasions, we also held a Safety, Health and Environment
Convention. Furthermore, we encourage major business partners toenroll in the TPS dojo* to facilitate the development and strengtheningof personnel well-versed in the Toyota Production System (TPS). In
fiscal 2008, we accepted six people from five business partners.
* TPS dojo: A training program established in January 2000 for workers to experience
for themselves a basic education in the Toyota Production System (TPS) as a means ofdeveloping “thoughts and actions” and acquiring kaizen (continuous improvement) skills.

Promoting Environmentally Friendly
Procurement
Based on our Green Procurement Guidelines, we promote
procurement of products with minimal environmental loads frombusiness partners with an established environmental management
system.
We make it a rule for parts and raw materials suppliers to acquire
external certification on their environmental management systems
such as ISO 14001.
In order to adhere to regulations regarding the use of substancesof concern, we require the suspension and reduction of use as wellas the management of usage of these substances if they are included
in our products or manufacturing processes.
In March 2005, we held an Environmental Response Meetingfor almost all our business partners in seeking to establish amanagement system for substances of concern. Follow-throughToyota Industries’ Substances ofConcern Management System

Supporting Compliance at Suppliers
In response to growing demand for greater corporate social
responsibility, Toyota Industries requires all business partners to fullycomply with laws and regulations.
In April 2007, we held a Procurement Policy Explanatory Meeting,in which we presented a summary of related laws and regulations
and requested full compliance. We also held a total of four study
sessions on various laws and regulations in an effort to help raise thelevel of knowledge and compliance awareness among our business
partners. We plan to continue these programs according to aprearranged annual schedule.

TopicsHolding Compliance Seminars for Major
Business Partners

Company-Wide Regulation

Products

Production

Research &Development Center

Plant Engineering &Environment Department

Each business division
Engineering Department / Production
Engineering Department

Technology

efforts are being carried out with regard to setting specific targets.
Our procurement system requires our business partners to
submit in advance a non-use declaration of prohibited substances
as well as data on substances of concern, including a report on thesubstances contained in parts. Before purchasing products that will
become a component of Toyota Industries’ products, the informationin these reports is confirmed by the quality assurance departmentsof each business division. For products that will be used in our
manufacturing processes, confirmation is carried out by the Plant
Engineering & Environment Department before purchasing.
In addition, we visit our business partners’ production plants
as deemed necessary in order to carry out process inspections.
Furthermore, in an effort to strengthen management of substances ofconcern, analysis equipment was introduced in fiscal 2005 to carryout random inspections of supplied products.

Specifications

On October 18 and 25, 2007, Toyota Industries heldcompliance seminars for major business partners. We
provided detailed and updated interpretations regarding thespirit of the law and compliance requirements in the areas ofhealth and safety administration, environmental conservation,
labor management, contracts, the Subcontracting Act andthe management of classified materials, and requested fullcompliance.

Confirmation of results

Procurement

Confirmation

Purchasing Department at
Head Office (materials andoils)
Purchasing departments ateach business division(parts)

Products: Quality assurance
departments at eachbusiness division
Production: Plant
Engineering & Environment
Department
Confirmationof results

Green Procurement
Guidelines andspecifications

Procurement

Audit

Non-use declaration ofprohibited substances
Data on substances of concern

Business Partners

Toyota Industries Report 200853

Corporate Social Responsibility

Responsibility to Our Associates

Maintaining Workplaces Where Associates Can Work
Actively and Safely
Ensuring Occupational Health and Safety

Initiatives for Realizing “Zero Danger”
In accordance with our fundamental policy of “creating workplaces
and people capable of autonomously maintaining occupational healthand safety,” Toyota Industries strives to prevent industrial accidents
and realize safe work environments to achieve “improvement fromzero accidents to zero danger.”In fiscal 2008, activities in this area were carried out under threemajor policies, namely firmly establishing an occupational health andsafety management system (OHSMS) to enhance workplace strengths
while promoting activities to raise work ethics; pursuing equipment
safety; and promoting improvements in work environments.
Besides in operational departments, we are striving to establishOHSMS activities in administrative departments as well.
An analysis of the cause of industrial accidents revealed
numerous instances involving relatively inexperienced workers. To
address this issue, we carried out highly focused prevention activities,
which included preparing detailed work procedure manuals andundertaking work observations and interviews at worksites under the
principle of on-site checking.
In pursuing equipment safety, since 2005 a lockout* is being
fully introduced in an effort to thoroughly prevent industrial accidents
caused by the erroneous operation of machinery by others. We havefurther extended the lockout to outside subcontractors carrying
out work operations inside our plants, with the aim of preventing
industrial accidents by all workers at our plants.
Recognizing the importance of safety countermeasures andinstructions whenever we place orders for work performed byoutside subcontractors, we are making preparations to introduce a
qualification system for persons placing such orders, with introduction
scheduled for fiscal 2009.
* Lockout: This is a system where locks will be used to ensure that the shutdown state ofmachinery will be maintained once the power to that machine has been cut off. This willallow workers to protect themselves against being injured by incorrect operation of themachinery by other persons.

Frequency Rate

Severity Rate

1.50

0.12
1.01

1.01

0.07

0.07

0.55

0.55

0.55

0.11

0.17

0.07

Toyota Industries promotes a diversity of activities to help supportand maintain the health of our associates. In response to themedium-term task of promoting Company-wide health improvement
programs concerning risks associated with aging and greater stress,
we have implemented a variety of measures to prevent lifestylediseases. Efforts include providing health guidance for persons withmetabolic syndrome from fiscal 2008, as well as holding age-based,
one-day health education courses targeting all associates aged 30,
35, 40, 45, 50, 55 and 59.
Mental health care activities include strengthening self-care/linecare education and health consultation hotlines as well as introducing
a preparatory work system, which allows associates to work half days.

Principal Health Improvement and Mental Health Care
Programs Implemented
Program

Details

Lifestyle disease
prevention

Introduce specific health examinations for metabolic
syndrome
Implement guidance on health maintenancefollowing specific health examinations
Provide age-based, one-day health education
courses

Job monitoring

Anticipatory management for proper job posting(restrictions on overseas travel, late-night workand overtime work)

0.08

Strengthening
support systems

Support a return to work through preparatory work
system0.04

06

ToyotaIndustries

07

08

Transport equipment
industry in Japan

0.002
0
(FY)

06

0.009

0.006

07

08

Manufacturingindustry in Japan

Frequency rate
Number of occupational injuries resulting in lost workdays ÷ Total working hours x 1,000,000(Value indicates the frequency of occurrence of occupational injuries per 1 million working hours.)
Severity rate
Workdays lost ÷ Total working hours x 1,000(Value indicates the severity of occupational injuries per 1,000 working hours.)

54

Health Management and Improvement

0.11

0.08

0.50

(FY)

0.09

In cooperation with the relevant internal departments, Toyota
Industries holds study sessions for our subsidiaries in Japan focused
mainly on compliance-related themes while carrying out periodic
on-site inspections and providing guidance. Additionally, we issue
reports on industrial accidents at subsidiaries, strengthen activities tooffer specific industrial accident countermeasures as well as conduct
on-site checking. By taking these measures, we are working to raiselevels of occupational health and safety.

1.02

1.00

0

0.09

Supporting the Improvement of Health and
Safety Activities at Subsidiaries

Toyota Industries Report 2008

Report on Explosion
On May 7, 2008, an explosion occurred at the Obu Plant,
claiming the life of one associate. To prevent a recurrence of suchan accident, we are investigating the cause of the explosion,
while identifying the causes of other hazardous incidents at all
workplaces and devising preventive countermeasures.

Human Resources

Enhancing Team Strength and Spirit
In order for each associate to be enthusiastic about their work, aswell as to ensure continued development of the Company, increasingteam strength (organizational power) is essential.
Team strength is comprised of technical skills, which serve as
the originating source of manufacturing; management skills, which
fully utilize technical skills; and teamwork, which supports the first
two techniques. While further enhancing our team strength, which
also serve as a strong asset of the Toyota Industries Group, we are
striving to extend and hand down team strength beyond businessdomains, generations and geographic regions.

At the International Skills Festival for All, Japan 2007, held in
November 2007, Koji Tsuchiya won the gold medal as Japan’s
representative in the mechanical device control category. Thereafter,
11 Toyota Industries associates participated in the National Skills
Competition in February 2008 and earned a total of seven medals,
including three gold medals.
Number of medals won at
National Skills Competition(Medals)

3

Gold

3

Silver1

Bronze3Technical Skills

Management Skills

Expertise,skills and know-how

Team
Strength

TPS, QC, SQC, etc.
Skills developed by identifying
problem areas and finding solutions
Management to unite a broad rangeof abilities

LeadershipTo pursue improvements thoroughly
until the final goal is achieved

Teamwork
Spirit of harmony
Well-rounded humanity

Associate Relations Built on Mutual Trust
Mutual trust between associates and management is one of thebasic principles of Toyota Industries in the area of associate relations.
In realizing this principle, we have established the Labor-Management
Council along with various types of meetings and numerous forums
for exchanging opinions as we work to nurture a vibrant corporate
culture. Additionally, we carry out audits to ascertain that this principle
has firmly taken root at overseas Group companies.

Human Resources Development
Cultivating Global LeadersWith approximately half of our associates working at Group
companies outside Japan, Toyota Industries is undertaking efforts
to develop human resources capable of playing globally activeroles that transcend national and regional boundaries. In working toachieve this objective, we began implementing Global Management
Training (GMT) for managers of overseas Group companies in2005. Moreover, in fiscal 2008, we commenced construction of the
Hazu Academy, a global learning center, in Hazu, Aichi Prefecture.
The academy will function as our base for developing truly global
leaders in Japan and overseas.

Improving Techniques and Skills
In January 2007, Toyota Industries established the Technical Learning
Center to nurture engineers possessing expertise and execution
capabilities as well as highly skilled technicians capable of handlingthe fundamentals of manufacturing.

1
(FY)

06

2
07

08

Gold medal winner Koji Tsuchiya

Ensuring Equal Opportunities and Respecting
Diversity
Toyota Industries is working to establish fair and impartial workplaces
where a diverse range of human resources can fully exercise theircapabilities. To realize such workplaces, we are implementing ahost of measures. This includes support that allows associates toachieve a balance between work and child care or nursing care;
employment and skills development support for the persons withdisabilities support for re-employment after mandatory retirement;
and opportunities that enable temporary associates to become
regular associates.

Supporting a Balance between Work and Child Care/
Nursing Care
Toyota Industries provides support for helping associates achievea balance between work and child care or nursing care. As a primeexample, in October 2007 Toyota Industries and four companies in
the Toyota Group jointly opened a day-care center for associates.
Situated in Kariya, Aichi Prefecture, the new center is open to preelementary school children. We have also publicized to all associates
the opinions of male associates who have taken child care leave.
In March 2008, we published a handbook to promote a deeper
understanding and use of various internal systems.

Support for the Employment and Skills Development of
Persons with Disabilities
Toyota Industries established an internal promotion team to facilitate
the employment of persons with disabilities. In fiscal 2008, theemployment rate of persons with disabilities was 1.93% (168people, non-consolidated basis). We are also actively promoting the
support of in-house skills development for persons with disabilities.
In February 2008, actual examples of these efforts were introduced
at the “60th Anniversary of the Universal Declaration of Human
Rights/22nd National Human Rights Enlightenment Workshop.”

Toyota Industries Report 200855

Corporate Social Responsibility

Responsibility to Our Local Communities

Co-Existing in Harmony with Local Communities
Toyota Industries carries out a broad range of social contribution
activities based on its Guiding Principles for Corporate Citizenship,with particular emphasis on social welfare, youth development andnature and environmental conservation. At the same time, we placehigh value on fostering good relations with local communities, making
efforts to promote close communications via regular meetings
with residents. Further, as a responsible corporate citizen, we also
vigorously participate in various activities, including cleanup, traffic
safety and crime-prevention activities.

Guiding Principles for Corporate Citizenship
Basic Philosophy
Toyota Industries is respectful of the people, culture and traditionsof each region and country in which it operates. We also work topromote economic growth and social development in these regions
and countries.

Basic Perspective
While striving to achieve sustainable growth as a company, we strive
to fulfill our role as a good corporate citizen and actively undertakesocial contribution activities in every community where Toyota
Industries does business in our efforts to help realize a prosperous
and healthy society.
To accomplish this, Toyota Industries actively promotes
cooperative support activities with the objective of contributing tolocal communities through the provision of human resources, facilities
and funds. Each of our employees also endeavors to be of service tothe community through such means as volunteer activities.

with local communities and enhancing internal education andenlightenment programs. We have also organized the Social
Contribution Subcommittee under the Corporate Code of Conduct
Committee, which is directly controlled by the president. This
subcommittee deliberates together with relevant departments on theformat and specific details of social contribution plans. In 1997, weestablished the Heartful Club as an internal volunteer organization
to encourage each employee to proactively participate in social
contribution activities. The Heartful Club is composed of volunteers
that include current and former employees of Toyota Industries andits subsidiaries as well as their families, and engages in a range ofactivities aimed at raising awareness of volunteerism and contributing
to social prosperity.

Breakdown of Social Contribution Activities in FY2008
Community activities/
social welfare/others 15%
International
exchange/cooperation 3%
Arts and culture 6%
Health andmedical science 8%852
million yen

Science and research 25%

Education/social education 43%

Social Contribution Promotion Structure
We established the Corporate Citizenship Office as a dedicatedorganization within the General Administration Department at
the Head Office. Through this office, we promote initiatives for
implementing voluntary programs, facilitating communications

Society
Local communities/NPOs/NGOs/
social welfare organizations

Corporate social contribution activities
Direct•Voluntary programs•Lending of facilities
and equipment•Dispatching employees•Donations

Indirect•Establishing and supporting
environments for volunteer
activities•Disseminating information on
volunteering•Implementing employee education

Social contribution
activities by each
employee

Corporate Citizenship Office, General Administration Department

Corporate Code of Conduct Committee/Social Contribution Subcommittee

56

Toyota Industries Report 2008

Volunteer Support CenterWe established the Volunteer Support Center in recognizing theimportance of each employee’s compassion to contribute to society.
The center serves as a base to facilitate participation in social
contribution activities by as many employees as possible. Anotherpurpose is to work together with local communities for the bettermentof society while nurturing relationships with respective communities.
Through a variety of initiatives mainly undertaken via the center, weare cultivating a flexible and creative corporate culture. Concurrently,
we aim to take a proactive approach toward working with membersof local communities in solving a host of social issues as we strive tocreate a better future.

Examples of Social Contribution Activities

Social Welfare Activities

Nature Protection and Environmental Conservation

Shokki Festa Welfare Corner

Present from the Forest Program

Every May, we hold the Shokki Festa, a festivalthat serves as a forum for promoting interaction
between members of local communities andToyota Industries employees and their families.
The festival includes a social welfare corner wherebooths are set up by vocational aid centers tosell their own products. Besides providing people
with disabilities with the opportunity to sell theirproducts, the festival also allows vocational aid centers to widely
publicize their activities. In fiscal 2008, a total of 13 vocational aid
centers set up booths and generated sales exceeding ¥270,000.

In cooperation with Friends of the Earth Japan, an international
environmental NGO, we create wooden “friendly pallets” throughthe use of lumber harvested from forest thinning in Japan. By
actively encouraging the participation of pallet manufacturers andusers, we took part in the maintenance of 10.7 hectares of forest,
which significantly exceeded our targets, and created 30,000“friendly pallets” in fiscal 2008. We will continue such support witha view toward promoting environmental conservation through themaintenance of forests and revitalizing Japan’s forest industry throughincreased demand for thinned wood.
Thousand30

Clam Digging Excursions
Every May, we invite people with disabilities
living in communities near our plants toparticipate in clam digging excursions. As
part of a program to gain social experience,
students from the Technical Training School
set up tents, assist participants with disabilities and engage in beachcleanup activities. This is a truly meaningful event, providing people
with disabilities with an opportunity to interact with nature and othermembers of society while enabling students to acquire volunteer
experience.

Youth Development

Volume of Production of“Friendly Pallets”
Production
Plan

20
10
0

Jun.

Sep.

Dec.

Mar.

Beautification of Local Communities
Every September, Toyota Industries carries
out Company-wide beautification activities.
In fiscal 2008, more than 4,000 employees,
including those from 19 subsidiaries,
participated. Also, our Managers’ Councils,
which consist of employees grouped by job
position, along with Toyota Industries Council of Retired Employees,
take part in annual cleanup activities on a regular basis. Additionally,
we participate in the Adopt-an-Area Program beautification activities
carried out in cooperation with local government.

Support for Youth Invention Clubs
With the aim of developing youth fullof creativity, we provide various formsof support for Youth Invention Clubs in
Nagoya, Kariya, Obu, Takahama and Anjo.
For example, we assist the Obu YouthInvention Club with administrative expenses. We also dispatch
instructors and volunteers and lend buses for a number of events,
including classes on weaving machinery during summer vacations
and handmade kite-flying competitions.

Kariya Rugby School
Twice a month, Toyota Industries holds the
Kariya Rugby School for elementary andjunior high school students at our athleticgrounds. Approximately 70 students
currently participate, with instruction
provided mainly by former members of Toyota Industries’ rugby club.
Serving as “big brothers,” the former rugby club members teachyoung students not only about the joy of sports but also about theimportance of rules and communication. The Kariya Rugby School
also enjoys appreciation from participating students’ families.

Community Activities
Traffic Safety Activities
As an automotive-related manufacturer,
Toyota Industries is working to achieve thegoal of zero traffic accidents as a positive
example to society. To this end, we provide
employees with various education andenlightenment programs and support community-based traffic safety
activities. Our employees station themselves near plants to carry out
patrol activities at times such as during national traffic safety campaigns
and on Zero Traffic Accident Day together with local governments andother Toyota Group companies. In fiscal 2008, the Company’s 13,000
employees participated in these activities. In cooperation with local
governments and police authorities, we are carrying out enlightenment
activities aimed at preventing traffic accidents.

Crime-Prevention Patrols
Each month on dates that contain the numeral five, our employees
volunteer for crime-prevention patrols. At year-end, we also take partin crime-prevention patrols in local communities in cooperation with
police authorities.

Toyota Industries Report 200857

HistoryFoundation

1970s –

1924

1940

1970

1987

Toyoda automatic loom, Type G
invented by Sakichi Toyoda.

Steel Production Department
separates and becomes Toyoda
Steel Works, Ltd. (now Aichi SteelCorporation).

Takahama Plant starts operations,producing industrial vehicles.

Sprinter Cielo (exported as the
Corolla Lift Back) production starts.

1944
Obu Plant starts operations,producing castings.

1949
1926
Toyoda Automatic Loom Works, Ltd.
(now Toyota Industries Corporation)
established to manufacture andmarket automatic looms invented by
Sakichi Toyoda.

Company stock listed on Tokyo,
Osaka and Nagoya stock exchanges.

1953
Automobile engine (S-type gasoline
engine) production starts.
Kyowa Plant starts operations,producing engines and assembling
automobiles.

1955
Vehicle Division set up.

1956

Spinning frame production starts.
Automatic loom patent sold to PlattBrothers & Co., Ltd. of the U.K.

1933
Automobile Department set up.

1934
A-type automobile engine completed.

1935
Prototype of Model A1 passenger carcompleted.

1977
Compressor Division separates from
Textile Machinery Division.
Swash-plate compressor technology
licensed to Chrysler and Ford.

1978
Starlet (automobile) production starts.
Aerial work platform production
starts.

1989
Michigan Automotive Compressor,
Inc. established in Jackson, Michigan,in the U.S., as a joint venture with
Nippondenso Co., Ltd. (now DENSO
Corporation).

1990
Sprinter Carib (automobile; exported
as the Corolla Wagon) production
starts.

1992

10P compressor production starts.

Materials Handling System Division
set up.

1960
Shovel loader production starts.
Car air-conditioning compressor(CC3A type, CC3B type) production
starts.

1963
Dump truck production starts.
Friction welding machine production
starts.

Publica (van) and Mini Ace(automobile) production starts.

Toyota Industries Report 2008

6P compressor production starts.

1981

Nagakusa Plant starts operations,producing small commercial vehicles.

58

Toyota Industrial Equipment Mfg.,
Inc. established in Columbus,
Indiana, in the U.S., as a joint venturewith Toyota Motor Corporation.

JA air-jet loom production starts.

1967

Automobile Department seperates
and becomes Toyota Motor Co., Ltd.
(now Toyota Motor Corporation).

1973

RX100 ring spinning frame production
starts.

P-type gasoline engine production
starts.

J-type diesel engine production
starts.

1937

Corolla (van) production starts.

1988

1959

1964

Company unveils Model G1 truckat a new car-release exhibition in
Shibaura, Tokyo.

Divisional organization system
introduced (Head Office, Textile
Machinery, Industrial Vehicle, Vehicle
and Obu Plant).

Electronics Sub-Division set up.

Company
receives 1990
PM Excellent
Plant Award.

Lift truck production starts.

1929

1971

Electric counterbalanced lift truck
production starts.

1968
Open-end spinning frame production
starts.

1980

1982
Hekinan Plant starts operations,producing automobile diesel engines.
Production starts on C-type diesel
engines for small passenger cars.

1985
Engine Division separates from
Vehicle Division.

JAT600 air-jet loom production
starts.
Production starts on automatedstorage and retrieval systems.

1993
RX200 ring spinning frame production
starts.

10PA compressor production starts.

1994

1986

X500 internal combustion
counterbalanced lift truck production
starts.

Company awarded
the Deming
Application Prize
for quality control
implementation.
X300 internal combustion
counterbalanced lift truck production
starts.

Toyota Industry (Kunshan) Co., Ltd.
established in China as a joint venturewith Toyota Tsusho Corporation and
Lioho Machine Works, Ltd.
R500 electric reach truck production
starts.

1995
Toyota Industrial Equipment, S.A.
established in France as a joint
venture with Toyota Motor
Corporation and Manitou B.F.

2000s –7SB compressor production starts.

2000

2004

2006

B500 electric counterbalanced lift
truck production starts.

BT Industries AB of Sweden (nowToyota Industries Sweden AB),a world-leading manufacturer of
warehouse trucks, becomes a Toyota
Industries subsidiary.

Toyota Industry Automotive Parts(Kunshan) Co., Ltd. established in
China as a joint venture with Toyota
Tsusho Corporation and Lioho
Machine Works, Ltd. to produce
foundry parts.

New GENEO (8FG/D outside Japan)
internal combustion counterbalanced
lift truck production starts after a fullmodel change.

Kirloskar Toyoda Textile Machinery
Pvt. Ltd. established in India asa joint venture with the Kirloskar
Group.

1996
JAT610 air-jet loom production
starts.
RX240 ring spinning frame
production starts.
Compressor production reaches
100 million units.

1997
6SE compressor production starts.
10S compressor production starts.

2UZ gasoline engine production
starts.
Higashichita Plant starts operations,producing foundry parts.

2001
GENEO-R (7FBR outside Japan)
electric reach truck production starts.
Company takes over the Industrial
Equipment Sales Division of Toyota
Motor Corporation.
TOYOTA Material Handling Company
established as an in-house company.
RAV4 production starts.

1998
GENEO (7FG/D outside
Japan) internal combustion
counterbalanced lift trucks
introduced.
TD Deutsche Klimakompressor
GmbH established in Germany
as a joint venture with DENSO
Corporation to produce car airconditioning compressors.
TIBC Corporation established asa joint venture with Ibiden Co.,
Ltd. to produce semiconductor
package substrates.

1999
Vitz (Yaris outside Japan)
production starts.
Company takes over water-jet
loom business from Nissan Texsys
Co., Ltd.

TD Automotive Compressor Georgia,
LLC established in the U.S. as a joint
venture with DENSO Corporation
to produce car air-conditioning
compressors.

2005

Vitz (Yaris outside Japan) production
starts after a full model change.

Company name changed to Toyota
Industries Corporation.

2007
Wanbishi Archives Co., Ltd. becomesa subsidiary of Toyota Industries.

2002
Advanced Logistics Solutions Co.,
Ltd. established to plan overalllogistics operations and operate
distribution centers.
Higashiura Plant starts operations,producing parts for car airconditioning compressors.
Toyota Motor Industries Poland
Sp.zo.o. established in Poland asa joint venture with Toyota Motor
Corporation to produce diesel
engines.

VD diesel engine production starts.

Asahi Security Co., Ltd., which
engages in collection and delivery ofcash, management of sales proceeds
and electronic security service,
becomes a subsidiary of Toyota
Industries.

TD Automotive Compressor Kunshan,Co., Ltd. established in China as a
joint venture with DENSO Corporationand other entities to produce car airconditioning compressors.

Mark X ZiO production starts.

AD diesel engine production starts.

2003
JAT710 air-jet loom production
starts.
KD diesel engine production starts.

1CD diesel engine production
starts.
GENEO-B (7FB outside Japan)
electric counterbalanced lift trucks
introduced.
GENEO-E (7FBE outside Japan)
three-wheel electric counterbalanced
lift truck production starts.
Aichi Corporation, a manufacturer of
special-purpose vehicles, becomes
one of Toyota Industries’ subsidiaries.

New RAV4 production starts after afull model change.

Toyota Industries Report 200859

Corporate Data

(As of March 31, 2008)

Major Plants (Parent Company)
Start of
Operations

Main Products

Kariya Plant
Obu Plant
Kyowa Plant
Nagakusa Plant
Takahama Plant
Hekinan Plant
Higashichita Plant
Higashiura Plant

Textile machinery, car air-conditioning compressors
Parts for car air-conditioning compressors
Electronic equipment, automotive press dies, production facilities, engine parts
Automobiles
Lift trucks, materials handling systems
Engines for automobiles and industrial equipment
Engines for automobiles, foundry parts, engine parts
Parts for car air-conditioning compressors

1927
1944
1953
1967
1970
1982
2001
2002

Major Consolidated Subsidiaries
Ownership
Ratio (%)*

Company Name

Location of Head Office

Aichi Corporation
Wanbishi Archives Co., Ltd.
TIBC Corporation
HANDA Casting Company
Mail & e Business Logistics Service Co., Ltd.
Asahi Security Co., Ltd.
TOYOTA L&F Tokyo Co., Ltd.
Altex Co., Ltd.
Sun River Co., Ltd.
IZUMI MACHINE MFG. CO., LTD.
TOYOTA L&F Keiji Co., Ltd.
Tokyu Co., Ltd.
Advanced Logistics Solutions Co., Ltd.
Toyoda High System, Incorporated
Nishina Industrial Co., Ltd.
KTL Co., Ltd.
TF Logistics Co., Ltd.
Tokaiseiki Co., Ltd.
Taikoh Transportation Co., Ltd.
SKE Inc.
SKM CORPORATION
Unica Co., Ltd.
Iwama Loom Works, Ltd.
Nagao Kogyo Co., Ltd.
TOYOTA L&F Shizuoka Co., Ltd.
TOYOTA L&F Hyogo Co., Ltd.
Hara Corporation
Sun Valley Inc.
Miduho Industry Co., Ltd.
Sun Staff, Inc.
ALT Logistics Co., Ltd.
Shine’s Co., Ltd.
Toyota Industries Well Support Corporation

Saitama
Tokyo
Aichi
Aichi
Mie
Tokyo
Tokyo
Shizuoka
Osaka
Aichi
Kyoto
Aichi
Aichi
Aichi
NaganoTokyo
Tokyo
Shizuoka
Aichi
Aichi
Aichi
Aichi
Aichi
Aichi
Shizuoka
Hyogo
Gifu
Aichi
Aichi
Aichi
Aichi
Aichi
Aichi

51.0%
100.0%
60.0%
100.0%
50.5%
100.0%
100.0%
75.0%
100.0%
100.0%
75.0%
100.0 %
100.0 %
100.0 %
97.5 %
50.5%
51.0%
100.0%
50.7%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
60.0%
100.0%
100.0%

Toyota Industries Europe AB
Toyota Industries Sweden AB
BT Products AB
Toyota Material Handling Sweden AB
Toyota Industries Finance International AB
Toyota Material Handling Norway AS
Toyota Material Handling Finland OY
Toyota Material Handling Eesti AS

MjölbyMjölbyMjölbyBrommaMjölbyTrondheim
VantaaHarjumaa

100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Japan

EuropeSwedenNorwayFinland
Estonia* Including indirect investment

60

Toyota Industries Report 2008

Latvia
Lithuania
Denmark
U.K.
Germany
FranceFrance/Belgium
Belgium
Netherland
Spain
Austria
Switzerland
Italy

GreeceOwnership
Ratio (%)*

Company Name

Location of Head Office

Toyota Material Handling Latvija Ltd.
Toyota Material Handling Lietuva UAB
Toyota Material Handling Danmark A/S
Toyota Material Handling UK Limited
Toyota Material Handling Deutschland GmbHTD Deutsche Klimakompressor GmbH
Toyota Industrial Equipment, S.A.
BT France S.a.r.l
Toyota Industrial Equipment Europe, S.A.R.L.
Toyota Material Handling Europe, NV/SA
Toyota Material Handling Belgium NV/SA
Toyota Material Handling Nederland B.V.
Toyota Material Handling España, S.A.
Toyota Material Handling Austria GmbH
Toyota Textile Machinery Europe, AG
CESAB Carrelli Elevatori S.p.A.
Toyota Carrelli Elevatori Italia S.r.l.
BTCESAB S.r.l.
Toyota Material Handling Greece SA

Riga
Vilnius
Slangerup
Slough, Berkshire
Langenhagen
Bernsdorf
AncenisMarne La ValléeAncenis (France)/Brussels (Belgium)
Brussels
Wilrijk
Ede
Barberá del Vallés
Wiener Neudorf
Uster
Bologna
Bologna
Bologna
Tavros100.0%
100.0%
100.0%
100.0%
100.0%
65.0%
80.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Toyota Industries North America, Inc.
Toyota Industrial Equipment Mfg., Inc.
The Raymond Corporation
Raymond-Muscatine Inc.
Indiana Hydraulic Equipment Corp.
Toyota Material Handling, U.S.A., Inc.
Michigan Automotive Compressor, Inc.
TD Automotive Compressor Georgia, LLC
ACTIS Manufacturing, Ltd. LLC
Toyoda Textile Machinery, Inc.
Toyota Industries Personnel Service of America, Inc.
Raymond Industrial Equipment Ltd.
Lift-Rite Inc.
G. N. Johnston Equipment Co., Ltd.

Elk Grove Village, Illinois
Columbus, Indiana
Greene, New York
Muscatine, Iowa
Franklin, Indiana
Irvine, California
Parma, Michigan
Pendergrass, Georgia
Grapevine, Texas
Charlotte, North Carolina
Elk Grove Village, Illinois
Brantford, Ontario
Brampton, Ontario
Mississauga, Ontario

100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
60.0%
65.0%
60.0%
100.0%
100.0%
100.0%
100.0%
100.0%

Toyota Material Handling Mercosur Comercio de Equipamentos LTDA
Toyota Máquinas Têxteis Brasil Ltda

São PauloSão Paulo

100.0%
100.0%

Toyota Material Handling Australia Pty Limited
Kirloskar Toyoda Textile Machinery Pvt. Ltd.
Toyota Material Handling (Shanghai) Co., Ltd.
TD Automotive Compressor Kunshan Co., Ltd.
Toyota Industry (Kunshan) Co., Ltd.
Toyota Industry Automotive Parts (Kunshan) Co., Ltd.
Toyota Industries Trading & Logistics (China) Co., Ltd.

New South Wales
Bangalore
Shanghai
Kunshan, Jiangsu
Kunshan, Jiangsu
Kunshan, Jiangsu
Shanghai

100.0%
95.1%
100.0%
59.8%
70.0%
60.0%
100.0%

North America
U.S.A.

CanadaSouth America
BrazilAsia and Oceania
Australia
India
China

Major Affiliates Accounted for by the Equity Method
Ownership
Ratio (%)*

Company Name

Location of Head OfficeFuji Logistics Co., Ltd.

Tokyo

26.0%

Toyota Motor Industries Poland Sp.zo.o.
Toyota Material Handling Schweiz AG

Jelcz-Laskowice
Zürich

40.0%
50.0%

Japan
EuropePolandSwitzerland* Including indirect investment

Toyota Industries Report 200861

Directors, Corporate Auditors and Managing Officers(As of June 20, 2008)

Board of Directors

ChairmanPresident

Tadashi Ishikawa

Tetsuro Toyoda

Executive Vice President

Executive Vice President

Executive Vice President

Executive Vice President

Norio Sato

Yoshikatsu Mizuno

Tatsuo Matsuura

Akira Imura

Senior Managing Directors

Shigetaka Yoshida
Masafumi Kato
Yasuharu Toyoda
Yutaka Murodono
Kazunori Yoshida

Honorary Chairman

Kosaku Yamada
Toshiyuki Sekimori
Kimpei Mitsuya
Hiroshi Sakai

Yoshitoshi Toyoda
Director

Tatsuro Toyoda

Corporate Auditors
Standing Corporate Auditors

Masanori Ito
Kakuo Ishikawa

Corporate Auditors

Hiroshi Okuda
Fumio Kawaguchi
Katsuaki Watanabe

Managing Officers
Senior Managing Officers

Kenji Takenaka
Satoshi Kaseda
Hirofumi Tsuji
Kazue Sasaki
Hirotaka Morishita
Shinya Furukawa
Akira Onishi

62

Toyota Industries Report 2008

Managing Officers

Yukio Yamakita
Takaki Ogawa
Eishi Furuta
Takashi Okubo
Norio Sasaki
Toshifumi Ogawa
Hayato Ikeda
Toshifumi Onishi
Kouhei Nozaki

Osamu Miura
Taku Yamamoto
Yukihisa Tsuchimoto
Kan Otsuka
Masaharu Suzuki
Hiroaki Asai
Takashi Ito
Toshiya Yamagishi

Financial Section
64 Consolidated Eleven-Year Summary
66 Management’s Discussion and Analysis ofFinancial Condition and Results of Operations
74 Consolidated Balance Sheets
76 Consolidated Statements of Income
77 Consolidated Statements of Changes in Net Assets
78 Consolidated Statements of Cash Flows
79 Notes to Consolidated Financial Statements
96 Reports of Independent Auditors

Toyota Industries Report 200863

Financial Section

Consolidated Eleven-Year Summary

Toyota Industries Corporation
Years ended March 31
The figures in this table are unaudited.
Millions of yen

2008

2007

¥2,000,536¥1,878,398

2006

2005

¥1,505,955¥1,241,538

For The YearNet sales
Operating income

96,853

89,95464,04053,120Ordinary income

126,488

108,484

80,63570,91280,46059,46847,07743,357¥ 829,855¥ 791,913¥ 620,946¥ 539,002

Depreciation and amortization

119,905

106,060

87,28770,213

Capital expenditures

142,158

166,505

158,835

136,506

Research and development expenses

36,75034,54831,16630,051

Net income
Overseas sales

Per share of common stock (yen, U.S. dollars):
Net income per share — basic
Net income per share — diluted¥

257.50¥189.88¥146.16¥135.09257.43189.66146.02135.03

4,483.32

5,612.11

5,044.45

3,504.80

60.00

50.00

38.00

32.00

Total assets¥2,965,585¥3,585,857¥3,245,341¥2,326,824

Total net assets

1,453,996

1,810,483

1,611,227

1,115,747

Common stock

80,46280,46280,46280,462

Number of shares outstanding (excluding treasury stock)311,589

312,075

319,320

318,237¥ 188,805¥ 177,467¥ 131,784¥ 100,095(138,789)(164,446)(205,013)(128,230)

Total net assets per share
Cash dividends per share
At Year-End(thousands)
Cash FlowsNet cash provided by operating activities
Net cash used in investing activities
Net cash provided by (used in) financing activities(33,992)(19,749)

85,17250,020Cash and cash equivalents at end of year

121,284

108,569

112,596

100,535Return on equity (ROE) (%)

5.1

3.5

3.5

4.1

Return on assets (ROA) (%)

2.5

1.7

1.7

2.0

Return on sales (ROS) (%)

4.0

3.2

3.1

3.5

Debt/equity ratio (%)

35.9

28.9

29.4

34.4

IndicesInterest coverage (times)
EBITDA (millions of yen, thousands of U.S. dollars)
Number of employees at year-end

7.5

7.4

7.8

7.7

¥ 222,125¥ 191,007¥ 150,674¥ 128,381

39,52836,09632,97730,990Notes: 1. U.S. dollar amounts have been translated from yen, for convenience only, at the rate of ¥100.19 = US$1, the approximate exchange rate on March 31, 2008.
2. Main changes in accounting standards and methods during the above periods are as follows. These changes have not been applied to the financial statements presented prior to each year
retroactively.
(1) Depreciation expense, which was listed as a separate component of non-operating expenses, is included in other non-operating expenses because the amount is immaterial.
(2) Effective beginning the year ended March 31, 2007, the new accounting standards for directors’ bonus, presentation of net assets in the balance sheet, share-based payment and businesscombinations have been applied. Details are described in Notes to Consolidated Financial Statements.
(3) Effective beginning the year ended March 31, 2005, the new accounting standards for impairment on fixed assets have been applied.
(4) Effective beginning the year ended March 31, 2003, the new accounting standards for net income per share have been applied.
(5) Effective beginning the year ended March 31, 2001, the new accounting standards for retirement benefits, financial instrument and foreign currency transactions have been applied.
(6) Effective beginning the year ended March 31, 2000, Toyota Industries Corporation (the “Company”) has used annual average exchange rate instead of the year-end rate in order to present theoperating results more precisely as significance of the overseas consolidated subsidiaries had been increasing and their revenue and expenses were incurred throughout the fiscal years.

64

Toyota Industries Report 2008

Thousands of
U.S. dollars

Millions of yen

2004

2003

2002

2001

2000

1999

1998

2008

¥1,164,378¥1,069,218¥ 980,163¥ 767,382¥625,772¥558,875¥572,698$19,967,427

52,63152,477

46,33047,304

28,867

24,81332,729966,700

58,97051,37547,86544,52627,162

23,172

33,201

1,262,487

33,623

21,93327,311

22,637

13,686

10,391

20,491

803,083¥ 497,356¥ 451,593¥ 396,470¥ 298,794¥191,992¥178,737¥150,417$ 8,282,822¥

65,351

59,15455,17346,45442,751

34,37927,9581,196,783

89,50887,55988,319127,273

44,74660,46862,006

1,418,891

29,562

29,70529,98526,19524,061

23,231

23,112366,813108.04

¥

70.19

¥

87.28

¥

75.90

¥

48.32

¥

36.30

¥

72.33

$

2.57

101.97

62.90

78.26

67.77

43.18

32.62

63.48

2.57

3,199.69

2,522.52

2,809.54

3,036.77

1,116.62

1,063.05

1,056.81

44.75

24.00

22.00

19.00

17.00

16.00

16.00

16.00

0.60

¥2,011,995¥1,650,391¥1,770,401¥1,869,642¥685,914¥617,070¥593,003$29,599,616

1,016,763

738,867

878,812951,298

316,293

301,158

304,097

14,512,396

80,462

68,04668,02168,01840,17840,17840,133803,101

317,666

292,777

312,796313,260

283,260

283,296287,752

92,406¥ 103,183

78,412¥ 68,057¥ 44,133¥ 50,952$ 1,884,474(92,667)(95,120)(106,710)(155,870)(67,186)(96,222)(26,897)(1,385,261)¥¥

81,078¥(56,015)

57,775

1,225

94,472

27,49924,368(12,918)(339,278)

77,212

136,929

71,11995,296

77,332

49,95574,303

1,210,543

3.8

2.7

3.0

3.6

4.4

3.4

7.0

1.8

1.3

1.5

1.8

2.1

1.7

3.6

2.9

2.1

2.8

2.9

2.2

1.9

3.6

31.6

55.6

35.9

30.7

60.5

51.6

37.5

7.4
¥ 113,676
27,431

6.7¥

95,47225,0305.8¥

97,54023,056

¥

9.1

14.5

16.4

17.6

79,921¥ 64,681¥ 51,033¥ 55,212

21,11813,132

12,797

11,239$ 2,217,044

The Company also has adopted tax effect accounting due to the amendment of the accounting standards for income taxes.
Deferred tax assets have been newly recognized in current assets, and investments and other assets. Deferred tax liabilities have been recognized in current and long-term liabilities.
(7) Effective beginning the year ended March 31, 1999, the Company has presented consolidated financial statements as follows: In the consolidated statements of income, enterprise taxes,
which had been included in selling, general and administrative expenses up to and including the previous year, have been included in income taxes.
Amortization of goodwill, which had been classified as a deductible item from income before income taxes until the previous year, has been included in selling, general and administrative
expenses. Equity in earnings/losses of affiliates, which had been added to or deducted from income before income taxes until the previous years, has been included in non-operating income
or expenses.
3. Net income per share, ROE and ROA are computed based on the average number of shares, total net assets and total assets, respectively, for each year.
4. Debt/equity ratio = Interest-bearing debt / Total net assets
5. Interest coverage = (Operating income + Interest and dividends income) / Interest expenses
6. EBITDA = Income before income taxes + Interest expenses - Interest and dividends income + Depreciation and amortization

Toyota Industries Report 200865

Financial Section

Management’s Discussion and Analysis ofFinancial Condition and Results of Operations
The following Management’s Discussion and Analysis of Financial Condition and Results of Operations isbased on information known to management as of June 2008.
This section contains projections and forward-looking statements that involve risks, uncertainties andassumptions. You should be aware that certain risks and uncertainties could cause the actual results ofToyota Industries Corporation and its consolidated subsidiaries to differ materially from any projections or
forward-looking statements. These risks and uncertainties include, but are not limited to, those listed under“Risk Information” and elsewhere in this annual report.
The fiscal year ended March 31, 2008 is referred to as fiscal 2008 and other fiscal years are referred toin a corresponding manner. All references to the “Company” herein are to Toyota Industries Corporation andreferences to “Toyota Industries” herein are to the Company and its 163 consolidated subsidiaries.

As a result, total consolidated net sales of Toyota Industries

Result of Operations

amounted to ¥2,000.5 billion, an increase of ¥122.2 billion (7%) over

Operating Performancefiscal 2007.

In fiscal 2008, the Japanese economy continued on a moderate

At the profit level, ordinary income amounted to ¥126.4 billion, an

recovery track as private-sector capital investment increased

increase of ¥18.0 billion (17%) over fiscal 2007. Despite the effects ofamid strong corporate earnings. Consumer spending picked up

higher depreciation expenses, sharp rises in raw materials and parts

momentum as well on the back of improved employment conditions.

costs as well as higher personnel expenses, this increase was achieved

In the second half of the fiscal year, however, the economy came todue largely to expanded sales, cost-reduction efforts throughout thea standstill as a result of soaring crude oil and other raw materials

Group and an increase in non-operating income. Net income amounted

prices, apparent deceleration of the U.S. economy triggered by theto ¥80.4 billion, an increase of ¥21.0 billion (35%) over fiscal 2007.

subprime loan debacle as well as rapid depreciation of the U.S.
economy beginning to reverberate around the world, the European

Cost of Sales and Selling, General and
Administrative Expenses

economy remained solidly on track and China and India maintained

Cost of sales for fiscal 2008 increased ¥91.7 billion (6%) overhigh economic growth.

fiscal 2007 to ¥1,678.4 billion. This increase reflected increases indollar. Overseas, despite the impact of deceleration of the U.S.

In this operating environment, Toyota Industries undertook efforts
to strengthen its management platform by ensuring customer trust

depreciation expenses, raw materials prices, purchased parts prices
and personnel expenses in addition to an increase in net sales.

through its dedication to quality, the development of appealing new

Selling, general and administrative expenses increased ¥23.5

products, aggressive sales promotions and the execution of a Group-

billion (12%) to ¥225.1 billion, due primarily to increases in personnel

wide program to reduce costs.

expenses.

Operating Income andOperating Income Ratio

Net Sales(¥ Billion)(¥ Billion)

(%)

2,500

100

20

2,000

80

16

1,500

60

12

1,000

40

8

500

20

4

0
(FY)

0

04

05

06

07

08

0

(FY)

04

05

06

07

Ordinary income (left)
Ordinary income ratio (right)

66

Toyota Industries Report 200808

Ordinary Income andOrdinary Income Ratio

Net Sales ofAutomobile Segment

Operating Income ofAutomobile Segment(¥ Billion)(%)(¥ Billion)(¥ Billion)

120

12

1,000

50

100

10

800

40

80

8
600

30

60

6
400

20

40

4

20

2

200

10

0

0
(FY)

04

05

06

07

08

0
(FY)

0

04 05 06 07 08(FY)

04 05 06 07 08

Ordinary income (left)
Ordinary income ratio (right)

Operating Income

Materials Handling Equipment Segment

Operating income for fiscal 2008 increased ¥6.9 billion (8%) overIn the materials handling equipment industry as a whole, sales in thefiscal 2007 to ¥96.8 billion, attributable mainly to Group-wide cost-

Japanese market remained at the same level as fiscal 2007. Overseas

reduction activities as well as higher sales.

markets continued to expand steadily, with increases in sales in Europe
and BRICs countries, despite a decline in the North American market.

Operating Performance Highlights by Business
Segment¥783.1 billion, an increase of ¥15.9 billion (2%) over fiscal 2007.

Following are the operating results by business segment. Net sales

Operating income amounted to ¥39.8 billion, a decrease of ¥7.4

for each segment do not include intersegment transactions.

billion (16%). Excluding the effects of changes in the fiscal year-end

Net sales of the Materials Handling Equipment Segment totaledof certain overseas subsidiaries in fiscal 2007, net sales increased

Automobile Segment¥80.6 billion (11%) and operating income decreased ¥5.4 billion

Although domestic sales were sluggish during fiscal 2008, higher(12%). With regards to lift trucks, Toyota Industries strove to enhancesales overseas, primarily in emerging markets, gave rise to an overall

its sales network, resulting in increases in total unit sales for both theincrease in sales. Amid this environment, net sales of the Automobile

TOYOTA and BT brands backed by the robust European market.

Segment totaled ¥969.2 billion, an increase of ¥64.4 billion (7%) overSales of aerial work platforms were solid, bolstered by replacementfiscal 2007, while operating income rose ¥8.0 billion (24%) to ¥41.5

demand from customers in the electricity and construction industries.

billion.
Within this segment, net sales of the Vehicle Business totaled

Logistics Segment¥500.1 billion, an increase of ¥29.9 billion (6%) over fiscal 2007.

The overall operating environment remained severe in the logistics

This was attributable to an increase in sales of the Vitz (Yaris outsideindustry as the volume of cargo transport continued to decline in theJapan) in addition to sales of the Mark X ZiO, for which productioncommenced in September 2007.
Net sales of the Engine Business totaled ¥178.7 billion, an
increase of ¥11.3 billion (7%) over fiscal 2007. Despite a decrease insales of AD diesel engines for the RAV4 in the European market, thisincrease was achieved due largely to an increase in sales of KD diesel
engines for Toyota Motor Corporation’s (TMC) Innovative International

Car Air-Conditioning
Compressor Unit Sales(Million Units)
25

20

Multi-Purpose Vehicle (IMV) Project as well as VD diesel engines,
which are fitted in the Land Cruiser for overseas markets.

15

Net sales of the Car Air-Conditioning Compressor Businesstotaled ¥253.5 billion, an increase of ¥18.1 billion (8%) over fiscal

10

2007. A slight decrease in sales in Japan was offset by an increase in5

sales overseas, mainly in Europe.
0
(FY)

04

05

06

07

08

Japan
North America
EuropeAsia and Oceania

Toyota Industries Report 200867

Financial Section

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Net Sales ofMaterials Handling
Equipment Segment

Operating Income ofMaterials Handling
Equipment Segment

Net Sales of
Logistics Segment

Operating Income of
Logistics Segment(¥ Billion)(¥ Billion)(¥ Billion)(¥ Billion)

800

50

120

5

100

40

4

600
80
3

30
400

60
2

20
40
200
10

0
(FY) 04

0

05 06 07 08(FY) 04

1

20

0

0

05 06 07 08(FY) 04

05 06 07 08(FY) 04

05 06 07 08

The logistics-related business, which was included in the Others Segment, had been
separated and declared independently as the Logistics Segment starting from fiscal 2006.

domestic market accompanied by an increase in costs resulting fromJapan

higher crude oil prices.

Net sales increased ¥110.9 billion (9%) over fiscal 2007 to ¥1,343.0

Amid this environment, net sales of the Logistics Segment totaled

billion, while operating income totaled ¥82.0 billion, up ¥13.1 billion¥117.5 billion, an increase of ¥28.1 billion (31%) over fiscal 2007.

(19%). These increases were due mainly to a rise in unit sales of car

Operating income amounted to ¥4.2 billion, an increase of ¥2.5 billion

air-conditioning compressors and making Wanbishi Archives a wholly(138%). This was due largely to the solid performance of transportation

owned subsidiary.

businesses accompanied by an increase in the transport volume ofautomotive parts in addition to making Wanbishi Archives Co., Ltd.

North America(Wanbishi Archives), which provides total information management

Net sales decreased ¥21.8 billion (8%) from fiscal 2007 to ¥265.5

services, a wholly owned subsidiary in May 2007.

billion, while operating income totaled ¥3.5 billion, down ¥2.4 billion(41%), due largely to the sluggish market and rising prices of raw

Textile Machinery Segment

materials and purchased parts.

In the textile machinery industry as a whole, the mainstay Chinese
market remained strong on the back of robust capital investment

Europesupported by rapid growth.

Net sales increased ¥15.7 billion (5%) over fiscal 2007 to ¥327.7 billion

Net sales of the Textile Machinery Segment totaled ¥66.2 billion,

as a result of an increase in unit sales of lift trucks. Operating income

an increase of ¥7.8 billion (13%) over fiscal 2007, while operating

totaled ¥7.9 billion, down ¥3.3 billion (30%), attributable primarily toincome rose ¥3.2 billion (297%) to ¥4.2 billion. In fiscal 2008, Toyota

higher prices for raw materials and purchased parts as well as to an

Industries sold more than 10,000 air-jet looms, primarily to China,

increase in expenses arising from reorganization of the sales network.

for the second consecutive year. Cumulative production of 100,000
air-jet looms, which Toyota Industries began manufacturing in 1980,

Otherswas also commemorated in February 2008. Strong sales of spinning

Net sales totaled ¥64.1 billion, an increase of ¥17.3 billion (37%),

machinery in Vietnam and Indonesia also contributed to the strong

whereas operating income rose ¥2.0 billion (65%) to ¥5.1 billion.

performance of this segment.

Non-Operating Income and Expenses
Others Segment

Non-operating income increased ¥14.1 billion (28%) to ¥64.9 billion

Net sales of the Others Segment totaled ¥64.2 billion, an increase ofin fiscal 2008, owing primarily to an increase in dividends income¥5.9 billion (10%) from fiscal 2007, while operating income rose ¥0.4

from TMC.

billion (6%) to ¥6.7 billion in fiscal 2008.

Non-operating expenses totaled ¥35.2 billion, an increase of ¥2.9
billion (9%), due mainly to increases in interest expenses.

Sales by Geographical Segment
Below are Toyota Industries’ operating results by geographical

Income before Income Taxes

segment. Net sales for each geographical segment do not include

Income before income taxes amounted to ¥132.3 billion, up ¥24.0

intersegment transactions.

billion (22%) as a result of an ¥18.0 billion increase in ordinary income
in fiscal 2008.

68

Toyota Industries Report 2008

Net Sales of
Textile Machinery
Segment

Operating Income (Loss)of Textile Machinery
Segment(¥ Billion)(¥ Billion)

70

5

60

4

50

3

40

2

30

1

20

0

10

(1)

Net Sales of
Others Segment

Operating Income of
Others Segment(¥ Billion)(¥ Billion)

80

7
6

60

5
4

40

05 06 07 08(FY) 04

2

20

1

(2)

0
(FY) 04

3

0

05 06 07 08(FY) 04

0

05 06 07 08(FY) 04

05 06 07 08

Income Taxes

Industries North America, Inc. (TINA) and Toyota Industries Finance

Income taxes increased ¥3.0 billion (7%) to ¥44.5 billion, due largely

International AB (TIFI) centrally manage the funds of subsidiaries in

to an increase in corporate income taxes of the Company.

North America and Europe, respectively.
Through close cooperation among the Company, TINA andMinority Interest in Consolidated Subsidiaries

TIFI, we strive for efficient, unified fund management on a global

Minority interest in consolidated subsidiaries amounted to ¥7.3 billion.

consolidated basis.

Net Income
Net income totaled ¥80.4 billion, an increase of ¥21.0 billion (35%)
over fiscal 2007. Net income per share was ¥257.50 compared with

Cash Flows¥189.88 in fiscal 2007. Diluted net income per share increased from

Cash flows from operating activities amounted to ¥188.8 billion¥189.66 to ¥257.43.

in fiscal 2008, due mainly to income before income taxes in theamount of ¥132.3 billion, an increase of ¥24.0 billion (22%). Net cash
provided by operating activities increased by ¥11.4 billion (6%) from

Liquidity and Capital Resources¥177.4 billion in fiscal 2007.

Toyota Industries’ financial policy is to ensure sufficient financing

by ¥138.7 billion in fiscal 2008, attributable primarily to payments forand liquidity for its business activities and to maintain strong balancepurchases of property, plant and equipment amounting to ¥135.5

sheets. Currently, funds for capital investments and other long-termbillion, down ¥20.0 billion (13%). Net cash used in investing activities

capital needs are provided from retained earnings and long-term

decreased by ¥25.7 billion (16%) from ¥164.4 billion for fiscal 2007.

Cash flows from investing activities resulted in a decrease in cash

debt, and working capital needs are met through short-term loans.

Cash flows from financing activities resulted in an increase inLong-term debt financing is carried out mainly through issuance of

cash by ¥33.9 billion in fiscal 2008, due mainly to repayments ofcorporate bonds and loans from financial institutions.

bonds in an amount of ¥60.0 billion, an increase of ¥44.1 billion

In addition to current assets such as cash and cash equivalents
and securities, Toyota Industries maintained a commercial paper
issuance capacity of ¥100.0 billion as of March 31, 2008.
Toyota Industries continues to maintain its solid financial
condition. Through the use of such current assets as cash and(275%). Net cash provided by financing activities increased by ¥14.2
billion from ¥19.7 billion in fiscal 2007.
After translation adjustments, cash and cash equivalents as ofMarch 31, 2008 stood at ¥121.2 billion, an increase of ¥12.7 billion(12%) over fiscal 2007.

cash equivalents and securities, as well as free cash flows andfunds procured from financial institutions, Toyota Industries believes
that it will be able to provide sufficient funds for the working capitalnecessary to expand existing businesses and develop new projects,
as well as for future investments.
Regarding fund management, the Company undertakes
integrated fund management of its subsidiaries in Japan, while Toyota

Investment in Property, Plant and Equipment
During fiscal 2008, Toyota Industries made a total investment of¥130.7 billion in property, plant and equipment (including vehicles
and materials handling equipment for lease) in order to launch new

Toyota Industries Report 200869

Financial Section

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Net Income per ShareTotal Assets, Total Net Assets
and Total Net Assets Ratio(¥)(¥ Billion)

(%)

4,000

80

3,500

70

3,000

60

2,500

50

2,000

40

1,500

30

1,000

20

500

10

300

250

200

150

100

50

0
(FY)

0

04

05

06

07

08

(FY)

Basic
Diluted

0

04

05

06

07

08

Total assets (left)
Total net assets (left)
Total net assets ratio (right)

products, streamline and upgrade production equipment, andan anticipated ongoing depreciation of the U.S. dollar, further rises inaugment R&D facilities.

raw materials costs and a downturn in the global stock market. ThereIn the Automobile Segment, investment in property, plant andare also concerns over the impact that a delay in the U.S. economic

equipment totaled ¥43.5 billion. A primary breakdown of this amountrecovery might have on the global economy. Amid this challenging

included ¥24.1 billion for the Company, ¥4.6 billion for Tokaiseiki Co.,

operating environment, Toyota Industries forecasts consolidated net

Ltd., ¥2.7 billion for TD Deutsche Klimakompressor GmbH, ¥2.5

sales of ¥2,050.0 billion, operating income of ¥77.0 billion, ordinary

billion for TD Automotive Compressor Georgia, LLC, ¥2.2 billion forincome of ¥107.0 billion and net income of ¥59.0 billion.

Tokyu Co., Ltd., ¥2.1 billion for Iwama Loom Works, Ltd., ¥1.4 billion

By segment, we forecast net sales of ¥970.0 billion in thefor Michigan Automotive Compressor, Inc. and ¥1.2 billion for Toyota

Automobile Segment and ¥840.0 billion in the Materials HandlingIndustry Automotive Parts (Kunshan) Co., Ltd.

Equipment Segment. We are determined to place utmost emphasis

The Materials Handling Equipment Segment made an investment

on product quality, the environment and safety, as well as promotein property, plant and equipment in the total amount of ¥57.0 billion.

the development of leading-edge technologies to provide high value-

The primary breakdown comprised ¥8.6 billion for the Company, ¥20.4

added products that anticipate customer needs. Toyota Industries

billion for the Toyota Industries Sweden Group, ¥2.6 billion for Handa

will further make concerted efforts to strengthen sales and service

Casting Co., Ltd., ¥2.5 billion for the Aichi Group, ¥1.5 billion for Toyota

structures, enhance the value chain and undertake Group-wide cost-Industries Equipment Mfg., Inc. and ¥1.2 billion, respectively, for Toyota

reduction activities.

Industries Equipment S.A. and Indiana Hydraulic Equipment Corp.

Our projections are based on an exchange rate of ¥100.0 = US$1.

Investment in property, plant and equipment in the Logistics
Segment totaled ¥14.4 billion, including ¥13.0 million for theCompany, ¥8.6 billion for Wanbishi Archives Co., Ltd. and ¥3.7 billion
for Taikoh Transportation Co., Ltd.

Dividend Policy

The Textile Machinery Segment made an investment in property,

The Company regards the benefits of shareholders as one of its mostplant and equipment in the total amount of ¥1.4 billion, including ¥1.1

important management policies. Based on this stance, we will strive

billion for the Company.

to strengthen Toyota Industries’ corporate constitution, promote

The Others Segment made an investment in property, plant andequipment in the total amount of ¥14.3 billion, including ¥8.7 billion
for the Company and ¥5.1 billion for TIBC Corporation.
Necessary funds were provided by a portion of bonds as well as
treasury stock and bank loans.

proactive business development and raise its corporate value.
The Company’s dividend policy is to meet the expectations ofshareholders while giving full consideration to business performance,
capital demand, the dividend payout ratio on a consolidated basis
and other factors. Toyota Industries’ Ordinary General Meeting of
Shareholders, held on June 20, 2008, approved a year-end cash
dividend of ¥32.0 per share. Including the interim cash dividend of

Strategies and Outlook
Outlook for Results for Fiscal 2009
In fiscal 2009, ending March 31, 2009, uncertainties persist in view of70

Toyota Industries Report 2008

¥28.0 per share, cash dividends for the year totaled ¥60.0 per share,
an increase of ¥10.0 per share over fiscal 2007.
The dividend payout ratio was 33.1%. On a consolidated basis, it
was 23.3%.

Cash Flows

Investment in Property,
Plant and Equipment(¥ Billion)(¥ Billion)

200

160

150

140

100

120

50

100

0
80
(50)
60
(100)
40

(150)

20

(200)
(250)

0
(FY)

04

05

06

07

08

Net cash provided by operating activities
Net cash used in investing activities
Net cash provided by (used in) financing activities

Toyota Industries will use retained earnings to improve the(FY) 04

05

06

07

08

Automobile
Materials Handling Equipment
Logistics
Textile Machinery
Others

Product Development Capabilities

competitiveness of its products, augment production capacity in

Based on the concept of “developing appealing new products,” Toyota

Japan and overseas, as well as expand into new fields of businessIndustries proactively develops new products by utilizing its leading-and strengthen its management platform in securing future profits foredge technologies, as it strives to anticipate increasingly sophisticatedits shareholders.

and diversifying needs of the market and ensure the satisfaction of

The Company’s Articles of Incorporation stipulate that it may pay

its customers. R&D activities are focused mainly on developing andinterim cash dividends as prescribed in Article 454-5 of the Corporate

upgrading products in current business fields and peripheral sectors.

Law, and it is the Company’s basic policy to pay dividends fromToyota Industries expects that revenues derived from these fields willretained earnings twice a year (interim and annual). The Company’s

continue to account for a significant portion of total revenues andArticles of Incorporation also stipulate that what is prescribed in

anticipates that future growth will be contingent on the development

Article 459-1 of the Corporate Law can be added to the Articles ofand sales of new products in these fields. Toyota Industries believes that

Incorporation. As the Company’s policy, discretion to pay interim cash

it can continue to develop appealing new products. However, Toyota

dividends is determined by the Board of Directors while payment

Industries may not be able to forecast market needs and develop

of year-end cash dividends is subject to approval at the Ordinary

and introduce appealing new products in a timely manner. This could

General Meeting of Shareholders.

result in lower future growth and have an adverse impact on Toyota
Industries’ financial condition and business results. Such a situation
could result from risks that include no assurance Toyota Industries

Risk Information

can allocate sufficient future funds necessary for the development

The following represent risks that could have a material impact on

successful, as forecasts of products supported by the market may not

Toyota Industries’ financial condition, business results and sharealways be accurate; and no assurance that newly developed products

prices. The risks mentioned in this annual report represent only aand technologies will always be protected as intellectual property.

of appealing new products; no assurance that product sales will be

portion of the risks that could have an impact on Toyota Industries’
financial condition and business results, and do not necessarily coverIntellectual Property Rights

all possible risks. There is also a possibility that Toyota Industries

In undertaking its business activities, Toyota Industries has acquired

could be affected in the future by risks currently unknown or not

numerous intellectual property rights, including those acquiredconsidered noteworthy or significant.

overseas, such as patents related to its products, product designs
and manufacturing methods. However, not all patents submitted will

Principal Customers

necessarily be registered as rights, and these patents could thus be

Toyota Industries’ automobile and engine products are sold primarily

rejected by patent authorities or invalidated by third parties. Also,

to TMC. In fiscal 2008, net sales to TMC accounted for 35.6% of

a third party could circumvent a patent of Toyota Industries andconsolidated net sales. Therefore, TMC’s vehicle sales could have an

introduce a competing product into the market. Moreover, Toyota

impact on Toyota Industries’ business results. As of March 31, 2008,

Industries’ products utilize a wide range of technologies. Therefore,

TMC held 24.6% of the Company’s voting rights.

Toyota Industries could become a party subject to litigation involving
the intellectual property rights of a third party.

Toyota Industries Report 200871

Financial Section

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Product Defects

Alliances with Other Companies

Guided by the basic philosophy of “offering products and services

Aiming to expand its businesses, Toyota Industries engages in jointthat are clean, safe and of high quality,” Toyota Industries makes its

activities with other companies through alliances and joint ventures.

utmost efforts to enhance quality. However, Toyota Industries cannot

However, a wildly fluctuating market trend or a disagreement between

guarantee all its products will be defect-free and that product recalls

Toyota Industries and its partners, owing to business, financial or

will not be made in the future. Toyota Industries is insured for productother reasons, could prevent Toyota Industries from deriving theliability indemnity. However, Toyota Industries cannot guarantee that

intended benefits of its alliances.

this insurance will sufficiently cover final indemnity amounts incurred.
Product defects that could lead to large-scale recalls and productExchange Rate Fluctuations

liability indemnities could result in large cost burdens and have a

Toyota Industries’ businesses encompass the production and sales

significant negative impact on the evaluation of Toyota Industries.

of products and the provision of services worldwide. Generally, theIt could also have an adverse effect on Toyota Industries’ financial

strengthening of the yen against other currencies (especially against

condition and business results due to a decrease in sales, deterioration

the U.S. dollar and the euro, which account for a significant portion ofof profitability and decrease in share prices of Toyota Industries.

Toyota Industries’ sales) has an adverse impact on Toyota Industries’
business, while a weakening of the yen has a favorable impact. An

Price Competition

increase in the value of currencies in countries or regions where

Toyota Industries faces extremely harsh competition in each of the

Toyota Industries carries out production could lead to an increase inindustries in which it conducts business, including its Automobile

local production, procurement and distribution costs. Such an increase

and Materials Handling Equipment businesses, which are the core

in costs could reduce Toyota Industries’ price competitiveness.

of Toyota Industries’ earnings foundation. Toyota Industries believes

Additionally, because export sales of several businesses are

it offers high value-added products that are unrivalled in terms ofdenominated mainly in yen, exchange rate fluctuations could have an

technology, quality and cost. Amid an environment characterized

adverse impact on Toyota Industries’ financial condition and businessby intensifying price competition, however, Toyota Industries may

results due to a change in market prices.

be unable to maintain or increase market share against low-costcompetitors or to maintain profitability. This could have an adverse

Share Price Fluctuations

impact on Toyota Industries’ financial condition and business results.

Toyota Industries holds marketable securities, and therefore bears
the risk of price fluctuations of these shares. Based on fair market

Reliance on Suppliers of Raw Materials andComponents

value of these shares at the end of the fiscal year under review,

Toyota Industries’ products rely on various raw materials andmarketable securities could worsen depending on future share pricecomponents from suppliers outside the Toyota Industries Group.

movements. Additionally, a fall in share prices could reduce the value

Toyota Industries has concluded basic business contracts with theseof pension assets, leading to an increase in the pension shortfall.

Toyota Industries had unrealized gains. However, unrealized gains on

external suppliers and assumes it can carry out stable transactions
has no assurances against future shortages of raw materials andEffects of Disasters, Power Blackouts and Other
Incidents

components, which arise from a global shortage due to tight supply

Toyota Industries carries out regular checks and inspections of its

or an unforeseen accident involving a supplier. Such shortages could

production facilities to minimize the effect of production breakdown.

have a negative effect on Toyota Industries’ product production andHowever, there is no assurance Toyota Industries can completely

cause an increase in costs, which could have an adverse impact on

prevent or lessen the impact of man-made or natural disasters,

Toyota Industries’ financial condition and business results.

including malfunctions of production facilities, fires at production

for raw materials and components. However, Toyota Industries

facilities and power blackouts. For example, the majority of Toyota

Environmental Regulations

Industries’ domestic production facilities and most of its businessIn view of its social responsibilities as a company, Toyota Industries

partners are situated in the Chubu region. Therefore, a major

strives to reduce any burden on the environment resulting fromearthquake such as the Tokai Earthquake, or an incident that affects

its production processes, as well as strictly adheres to applicable

other operations, could delay or stop production or shipment activities.

environmental laws and regulations. However, various environmental

Such prolonged delays and stoppages could have an adverse impact

regulations could also be revised and strengthened in the future.

on Toyota Industries’ financial condition and business results.

Accordingly, any expenses necessary for continuous strict adherence
costs and have an adverse impact on Toyota Industries’ financial

Latent Risks Associated with International
Activities

condition and business results.

Toyota Industries manufactures and sells products and provides

to these environmental regulations could result in increased business72

Toyota Industries Report 2008

services in various countries. Such unforeseen factors as social

thus becomes an expense and is recognized as a liability in futurechaos, including political disruptions, terrorism and wars, as well as

accounting periods. Toyota Industries believes its assumptions arechanges in economic conditions, could have an adverse impact onreasonable. However, differences between actual results or changes

Toyota Industries’ financial condition and business results.

in the assumptions could have an impact on retirement benefits andretirement benefit expenses and liabilities after employee retirement.

Retirement Benefit Liabilities
Toyota Industries’ employee retirement benefit expenses and liabilities
are calculated based on expected rates of return on pension assets
as well as assumptions upon making actuarial calculations thatincorporate discount rates and other factors. Therefore, differences

Toyota Industries’ Relationship to Toyota
Motor Corporation

between actual results and assumptions as well as changes in the

Due to historical reasons, Toyota Industries maintains close

assumptions could have a significant impact on recognized expenses

relationships with TMC and Toyota Group companies in terms ofand calculated liabilities in future accounting periods.

capital and business dealings.

Historical BackgroundSignificant Accounting Policies andEstimates

In 1933, Kiichiro Toyoda, the eldest son of founder Sakichi

Toyota Industries’ financial statements are prepared in conformity

Department within the Company based on his resolve to manufacturewith accounting principles and practices generally accepted inJapanese-made automobiles. In 1937, the Automobile Department

Japan. In preparing financial statements, management must makewas spun off and became an independent company, Toyota Motorestimates, judgments and assumptions that affect reported amounts

Co., Ltd. (the present Toyota Motor Corporation).

Toyoda and then Managing Director of Toyota Industries (thenToyoda Automatic Loom Works, Ltd.), established the Automobile

of assets and liabilities at fiscal year-end as well as revenues andexpenses during each fiscal year. Among Toyota Industries’ significant

Capital Relationshipaccounting policies, the following categories require a considerable

In light of this historical background, Toyota Industries and TMC

degree of judgment and estimation and are highly complex.

have maintained a close capital relationship. As of March 31, 2008,
Toyota Industries held 6.4% (200,195 thousand shares) of TMC’s

Allowance for Doubtful Accounts

total shares issued. Likewise, as of the same date, TMC held 24.6%

To prepare for the risk of receivables becoming uncollectible, Toyota

of Toyota Industries’ total voting rights. Toyota Industries is a TMC

Industries estimates its allowance for doubtful accounts by utilizing

affiliate accounted for by the equity method.

the percentage of historical experiences in credit losses for ordinary
receivables and individually examining the feasibility of collection for

Business Relationshipreceivables that seem to be uncollectible. Evaluating the allowance for

Toyota Industries assembles certain cars and produces automobile

doubtful accounts involves judgments made in accordance with theengines under consignment from TMC. Additionally, we sell a portion

nature of the situation, and this allowance represents an essential andof our other components and products directly or indirectly to othercrucial estimate—including future estimates of cash flow amounts andToyota Group companies. In fiscal 2008, our net sales to TMC

timing—that could change significantly. Based on currently available

accounted for 35.6% of our consolidated net sales.

information, Toyota Industries’ management believes its present
allowance for doubtful accounts is sufficient. However, the need toContributions to the Toyota Groupsignificantly increase allowance for doubtful accounts in the future

As a member of the Toyota Group, Toyota Industries aims to

could have an adverse impact on Toyota Industries’ business results.

contribute to strengthening the competitiveness of TMC and otherToyota Group companies in such areas as quality, cost, delivery andAllowance for Retirement Benefits

technologies. Toyota Industries is confident that raising the Toyota

Calculations differ for retirement benefits, retirement benefit expenses

Group’s competitiveness will lead to increases in our sales to andand liabilities after employee retirement, as well as benefits forprofits from the Toyota Group, thereby contributing to raising Toyota

employees on leave of absence, because different assumptions are

Industries’ corporate value.

used at the time of calculation. Assumptions include such factors as
discount rates, amount of benefits, interest expenses, expected rates
of return on pension assets and mortality rates. The difference inamounts between these assumptions and actual results is calculated
cumulatively and amortized over future accounting periods, andToyota Industries Report 200873

Financial Section

Consolidated Balance Sheets

Toyota Industries Corporation
As of March 31, 2008 and 2007
Thousands of
U.S. dollars (Note 1)

Millions of yen

ASSETS

2008

2007

2008

¥ 121,284¥ 108,569$ 1,210,543

244,035

234,6112,435,723

45

48

453

Inventories (Notes 5 and 8)

124,633

120,737

1,243,973

Deferred tax assets (Note 16)

18,86017,924

188,243

Other current assets

89,241

88,894

890,719

Less — allowance for doubtful accounts(2,486)(2,784)(24,820)595,612568,001

5,944,834

Buildings and structures (Note 6)

188,776

171,897

1,884,187

Machinery, equipment and vehicles (Note 6)

266,347

269,769

2,658,427

Tools, furniture and fixtures (Note 6)

28,14526,081

280,920

Land (Note 8)

107,727

99,117

1,075,234

Construction in progress

31,84939,056

317,894

Total property, plant and equipment

622,847

605,922

6,216,662

Goodwill

137,163

101,1021,369,030

Software12,522

11,714

124,991

Total intangible assets

149,685

112,816

1,494,021

1,506,312

2,172,648

15,034,555

Investments in unconsolidated subsidiaries and affiliated companies

15,79660,415

157,662

Long-term loans

8,056

8,460

80,415Long-term prepaid expenses

16,574

11,603

165,426

Deferred tax assets (Note 16)

8,578

7,435

85,621Other investments and other assets

42,29938,784422,188

Less — allowance for doubtful accounts

(177)

(232)

(1,768)

Total investments and other assets

1,597,439

2,299,117

15,944,099

2,369,972

3,017,856

23,654,782¥2,965,585¥3,585,857$29,599,616

Current assets
Cash and cash equivalents
Trade notes and accounts receivable
Short-term investments

Total current assets
Fixed assets
Property, plant and equipment

Intangible assets

Investments and other assets
Investments in securities (Notes 4 and 8)

Total fixed assets
Total assets
The accompanying notes are an integral part of these financial statements.

74

Toyota Industries Report 2008

Thousands of
U.S. dollars (Note 1)

Millions of yen

LIABILITIES AND NET ASSETS

2008

2007

2008

¥ 214,084
52,32633,70020,00030,38979,241
27,137
22,632
1,881
626
56,020¥ 205,168
37,10333,76060,00037,80877,69825,85422,0203,162
554
55,275$ 2,136,789
522,274
336,361
199,621
303,320
790,912
270,863
225,895
18,7786,252
559,145538,041

558,405

5,370,210

230,766
185,513482,787
47,102
27,376

250,761
141,567
751,764
45,482
27,3932,303,290
1,851,613
4,818,724
470,136
273,247

973,547
1,511,588

1,216,969
1,775,374

9,717,010
15,087,220

80,46280,462

803,101

106,184
466,780(50,644)

105,055
402,431(47,253)

1,059,830
4,658,955(505,481)

Total shareholders’ equity
Valuation and translation adjustments
Net unrealized gains or losses on other securities
Deferred gains or losses on hedges
Foreign currency translation adjustments

602,783

540,696

6,016,406

752,553140
41,477

1,157,793(0)52,9127,511,261
1,402
413,991

Total valuation and translation adjustments
Subscription rights to shares
Minority interests in consolidated subsidiaries
Total net assets
Total liabilities and net assets

794,171695
56,345
1,453,996¥2,965,585

1,210,704
202
58,8781,810,483¥3,585,857

7,926,653
6,946
562,390
14,512,396$29,599,616

Current liabilities
Trade notes and accounts payable
Short-term bank loans (Note 8)
Commercial paper
Current portion of bonds
Other payables
Accrued expenses
Accrued income taxes
Deposits received from employees
Deferred tax liabilities (Note 16)
Allowance for bonuses to directors and corporate auditors
Other current liabilities (Note 8)
Total current liabilities
Long-term liabilities
Bonds (Note 7)Long-term bank loans (Notes 7 and 8)
Deferred tax liabilities (Note 16)
Allowance for retirement benefits (Note 14)
Other long-term liabilities
Total long-term liabilities
Total liabilities
Shareholders’ equity (Note 11)
Common stock:
Authorized — 1,100,000,000 shares
Issued— 325,840,640 shares as of March 31, 2008
325,840,640 shares as of March 31, 2007
Capital surplus
Retained earnings
Treasury stock at cost
14,251,070 shares as of March 31, 2008
13,765,165 shares as of March 31, 2007

Toyota Industries Report 200875

Financial Section

Consolidated Statements of Income

Toyota Industries Corporation
For the years ended March 31, 2008, 2007 and 2006
Thousands of
U.S. dollars (Note 1)

Millions of yen

2008

Net sales
Cost of sales (Note 12)
Gross profit
Selling, general and administrative expenses (Notes 12 and 15)
Sales commissions
Salaries and allowances
Retirement benefit expenses
Depreciation
Research and development expenses
Other
Operating income
Non-operating income
Interest income
Dividends income
Gain on sales of marketable securities
Rental income of fixed assets
Equity in net earnings of unconsolidated subsidiaries andaffiliated companies
Other non-operating income
Non-operating expenses
Interest expenses
Depreciation
Loss on disposal of fixed assets
Other non-operating expenses
Ordinary income
Extraordinary gains
Proceeds from sales of investment securities
Extraordinary losses
Losses of discontinuing production of designated electronic parts
Income before income taxes and minority interests
Income taxes — current (Note 16)
Income taxes — deferred (Note 16)
Minority interests in consolidated subsidiaries
Net income

2007

2006

2008

¥2,000,536 ¥1,878,398 ¥1,505,955
1,678,493 1,586,781 1,276,499
322,043
291,616
229,456
11,65082,362
2,063
10,05822,36596,68896,853

11,32574,360
1,678
8,733
21,52784,03689,954

10,87558,382
1,982
6,507
20,30767,36164,040116,284
822,064
20,600100,391
223,230
965,055
966,700

14,73734,850
3,043
987
2,749

13,76027,547
–
2,389
317

9,113
20,090
1,280
2,110
3,593

147,098
347,847
30,3789,860
27,445

8,547

6,868

7,665

85,308(19,453)–(2,988)(12,840)
126,488(17,855)(1,932)(3,567)(8,997)
108,484(11,955)(1,716)(4,487)(9,099)80,635(194,164)–(29,824)(128,162)
1,262,487

5,866

4,305

–

58,556–80,63530,446(2,137)
5,249
47,077–
1,321,043
469,682(25,237)
73,514$ 803,083–(4,390)132,355
108,399
47,05743,750(2,528)(2,209)7,365
7,390¥ 80,460 ¥ 59,468 ¥YenNet income per share — basic (Note 22)
Net income per share — diluted (Note 22)
Equity per share (Note 23)
Cash dividends per share
The accompanying notes are an integral part of these financial statements.

76

Toyota Industries Report 2008

$19,967,427
16,753,103
3,214,324¥ 257.50
257.43
4,483.32
60.00¥ 189.88
189.66
5,612.11
50.00

U.S. dollars (Note 1)¥ 146.16
146.02
5,044.45
38.00

$

2.57
2.57
44.75
0.60

Financial Section

Consolidated Statements of Changes in Net Assets

Toyota Industries Corporation
For the years ended March 31, 2008, 2007 and 2006
Millions of yen
Common stock Capital surplus

Balance at March 31, 2005
Dividends paid
Bonuses to directors and corporate auditors
Decrease due to increase in affiliates
accounted for under the equity method
Net income for the period
Repurchase of treasury stock
Exercise of stock options
Change to items other than shareholders’equity during accounting period
Balance at March 31, 2006
Dividends paid
Interim dividends paid
Bonuses to directors and corporate auditors
Decrease due to increase in affiliates
accounted for under the equity method
Decrease due to decrease inconsolidated subsidiaries
Net income for the period
Repurchase of treasury stock
Exercise of stock options
Change to items other than shareholders’equity during accounting period
Balance at March 31, 2007
Dividends paid
Decrease due to increase inconsolidated subsidiaries
Decrease due to decrease inconsolidated subsidiaries
Decrease due to increase in affiliates
accounted for under the equity method
Net income for the period
Repurchase of treasury stock
Exercise of stock options
Change to items other than shareholders’equity during accounting period
Balance at March 31, 2008

Retainedearnings

Treasury stock Net unrealized Deferred gains
at costgains or losses or losses onon other
hedgessecurities¥(16,726) ¥ 591,218
–
–
–
–
–
–

¥

Foreigncurrencytranslation
adjustments

Subscription
rights to shares

Minority
interests inconsolidated
subsidiaries

–
–
–
–

¥29,861
–
–
–

¥

–
–
–
–

¥40,904–––¥80,462–––¥105,600–––¥325,330(11,793)(406)(1,821)

–
–
–
–

–
–
65
–

47,077
–
–
–

–
(52)
2,415
–

–
–
–
455,972

–
–
–
–

–
–
–
4,024

–
–
–
–

–
–
–
8,366

80,462––––

105,665––––

358,385(6,386)(6,864)(427)(1,673)(14,363)––––

1,047,190
–
–
–
–

–
–
–
–
–

33,886
–
–
–
–

–
–
–
–
–

49,270
–
–
–
–

–

–

(71)

–

–

–

–

–

–

–
–
–
–

–
–
(610)
–

59,468––––(35,524)
2,634
–

–
–
–
110,602

–
–
–
(0)

–
–
–
19,026

–
–
–
202

–
–
–
9,607

80,462––

105,055––

402,431(17,489)(1,316)(47,253)––

1,157,793
–
–

(0)
–
–

52,912
–
–

202
–
–

58,878
–
–

–

–

(77)

–

–

–

–

–

–

–

–

2,771

–

–

–

–

–

–

–
–
–
–

–
–
1,128
–

80,460––––(8,728)
5,337
–

–
–
–
(405,239)

–
–
–
140

–
–
–
(11,434)

–
–
–
493

–
–
–
(2,532)¥80,462¥106,184¥466,780¥(50,644) ¥ 752,553¥140¥41,477¥695¥56,345

Foreigncurrencytranslation
adjustments

Subscription
rights to shares

Minority
interests inconsolidated
subsidiaries

(7)
–
–

$528,122––$2,025––$587,670––

Thousands of U.S. dollars (Note 1)
Common stock Capital surplus

Balance at March 31, 2007
Dividends paid
Decrease due to increase inconsolidated subsidiaries
Decrease due to decrease inconsolidated subsidiaries
Decrease due to increase in affiliates
accounted for under the equity method
Net income for the period
Repurchase of treasury stock
Exercise of stock options
Change to items other than shareholders’equity during accounting period
Balance at March 31, 2008

Retainedearnings

Treasury stock Net unrealized Deferred gains
at costgains or losses or losses onon other
hedgessecurities$803,101 $1,048,563 $4,016,685 $(471,637) $11,555,974––(174,560)––––(13,144)
–
–

$

–

–

(771)

–

–

–

–

–

–

–

–

27,662

–

–

–

–

–

–

–
–
–
–

–
–
11,267–803,083––––(87,122)53,278––––(4,044,712)

–
–
–
1,409

–
–
–
(114,131)

–
–
–
4,921

–
–
–
(25,280)$(505,481) $ 7,511,261$1,402$413,991$6,946$562,390$803,101 $1,059,830 $4,658,955

The accompanying notes are an integral part of these financial statements.

Toyota Industries Report 200877

Financial Section

Consolidated Statements of Cash Flows

Toyota Industries Corporation
For the years ended March 31, 2008, 2007 and 2006
Thousands of
U.S. dollars (Note 1)

Millions of yen

Cash flows from operating activities
Income before income taxes and minority interests
Adjustments to reconcile income before income taxes andminority interests to net cash provided by operating activities:
Depreciation and amortization
Increase (decrease) in allowance for doubtful accounts
Interest and dividends income
Interest expenses
Equity in net earnings of affiliates(Increase) decrease in receivables(Increase) decrease in inventories
Increase (decrease) in payables
Others, net
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities
Payments for purchases of property, plant and equipment
Proceeds from sales of property, plant and equipment
Payments for purchases of investment securities
Proceeds from sales of investment securities
Payments for acquisition of subsidiaries’ stock resulting inchange in scope of consolidation
Proceeds from acquisition of subsidiaries' stock resulting inchange in scope of consolidation
Payments for loans madeProceeds from collections of loans
Others, net
Net cash used in investing activities
Cash flows from financing activities
Increase (decrease) in short-term loans
Increase (decrease) in commercial paper
Proceeds from long-term loans
Repayments of long-term loans
Proceeds from issuances of bonds
Repayments of bonds
Payments for repurchase of treasury stock
Cash dividends paid
Cash dividends paid to minority shareholders
Others, net
Net cash provided by (used in) financing activities
Translation adjustments of cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
The accompanying notes are an integral part of these financial statements.

78

Toyota Industries Report 2008

2008

2007

2006

2008

¥ 132,355¥ 108,399¥ 80,635$ 1,321,043

119,905(365)(49,588)
19,453(2,749)(6,623)(7,490)7,568(6,777)
205,687
49,506(19,318)(47,069)
188,805

106,060(250)(41,307)17,855(317)(25,836)(9,221)
15,022
17,238
187,642
41,294(17,777)(33,692)
177,467

87,287101(29,204)
11,955(3,593)(27,435)(9,227)
21,376
12,161
144,055
29,236(11,009)(30,498)
131,784

1,196,783(3,643)(494,945)
194,164(27,445)(66,107)(74,766)
75,539(67,649)
2,052,972
494,122(192,815)(469,806)
1,884,474(135,561)
15,456(1,568)26,551(36,929)(155,550)
7,624(17,604)
8,419(1,939)(161,504)
8,415(47,726)
2,045–(1,353,040)
154,269(15,652)
265,010(368,597)

424

–

–

4,240

(2,320)3,059(7,901)(138,789)(3,172)
4,490(6,714)(164,446)(2,256)
3,264(7,250)(205,013)(23,164)
30,534(78,861)(1,385,261)

7,115–
51,662(10,210)–(60,000)(8,728)(17,489)(1,594)
5,252(33,992)(3,309)12,714
108,569¥ 121,284(12,434)–
40,004(14,020)
25,107(15,980)(35,524)(13,250)(1,039)7,388(19,749)
2,700(4,027)
112,596¥ 108,569(22,902)
29,52038,824(3,365)68,730(20,300)(52)(11,784)
(854)
7,357
85,172
117
12,060100,535¥ 112,596

71,025–515,648(101,913)–(598,862)(87,122)(174,560)(15,919)
52,426(339,278)(33,027)
126,908
1,083,636$ 1,210,543

Financial Section

Notes to Consolidated Financial Statements

1. Basis of presenting consolidated financial statements
The accompanying consolidated financial statements have been
prepared based on the accounts maintained by Toyota Industries
Corporation (the “Company”) and its consolidated subsidiaries(together, hereinafter referred to as “Toyota Industries”) in accordancewith the provisions set forth in the Corporate Law of Japan and the
Financial Instruments and Exchange Law, and in conformity withaccounting principles generally accepted in Japan, which are different
in certain respects from the application and disclosure requirements ofInternational Financial Reporting Standards.
Certain items presented in the consolidated financial statements

submitted to the Director of Kanto Finance Bureau in Japan havebeen reclassified in these accounts for the convenience of readers
outside Japan.
Amounts in U.S. dollars are included solely for the convenience ofreaders outside Japan. The rate of ¥100.19=US$1, the approximate
rate of exchange prevailing at March 31, 2008, has been used intranslation. The inclusion of such amounts are not intended to imply
that the Japanese yen actually represent, or have been or could be
converted into, equivalent amounts in U.S. dollars at this rate or any
other rates.

2. Summary of significant accounting policies(1) Consolidation
The consolidated financial statements include the accounts of theCompany and its 163 subsidiaries (45 domestic subsidiaries and 118
overseas subsidiaries, which are listed on pages 60 and 61) as of March
31, 2008, 162 subsidiaries (45 domestic subsidiaries and 117 overseas
subsidiaries) as of March 31, 2007 and 153 subsidiaries (43 domestic
subsidiaries and 110 overseas subsidiaries) as of March 31, 2006.
For the year ended March 31, 2008, two subsidiaries were newly
added to the scope of consolidation and three companies were
excluded from the scope of consolidation because of liquidation, sales,
mergers and acquisitions. Additionally, 12 subsidiaries were newly
added to the scope of consolidation and 10 companies were excluded
from the scope of consolidation because of mergers and acquisitions
as a result of reorganization of the sales structure.
For the year ended March 31, 2007, 12 subsidiaries were newly
added to the scope of consolidation and three companies were
excluded from the scope of consolidation because of mergers andacquisitions.
For the year ended March 31, 2006, nine subsidiaries were newly
added to the scope of consolidation and two companies were excluded
from the scope of consolidation because of mergers and acquisitions.
Some of the affiliates are not accounted for under the equity method
since their net income/losses, retained earnings and other financial
amounts are immaterial.
The fiscal years of certain subsidiaries are different from the fiscal
year of the Company. Since the difference is not more than threemonths, the Company is using those subsidiaries’ statements for
those fiscal years, making adjustments for significant transactions thatmaterially affect the financial position or results of operations.
All significant intercompany transactions, balances and unrealized
profits within Toyota Industries have been eliminated.
A full portion of the assets and liabilities of the acquired subsidiaries
is stated at fair value as of the date of acquisition of control.

(2) Equity method
Investments in 15 major affiliates in 2008, 21 major affiliates in 2007
and 22 major affiliates in 2006 are accounted for by the equity methodof accounting. For the year ended March 31, 2008, one affiliate was
newly added to the scope of equity-method accounting from the scopeof consolidation and seven affiliates were excluded from the scopeof equity-method accounting because of transfer to the scope of
consolidation, mergers and a decline of holding shares.
For the year ended March 31, 2007, one affiliate was newly added
to the scope of equity-method accounting and two affiliates were
excluded from the scope of equity-method accounting and added tothe scope of consolidation.
For the year ended March 31, 2006, two affiliates were newly added
to the scope of equity-method accounting.

Investments in unconsolidated subsidiaries and affiliates notaccounted for by the equity method are stated at cost due to theirinsignificant effect on the consolidated financial statements.
The major affiliates accounted for by the equity method are listed on
page 61.

(3) Translation of foreign currencies
Foreign currency denominated receivables and payables are translated
into Japanese yen at the year-end exchange rates and the resulting
transaction gains or losses are included in the consolidated statements
of income.
All asset and liability accounts of foreign subsidiaries and affiliates
are translated into Japanese yen at year-end exchange rates andall revenue and expense accounts are translated at prevailing fiscal
average rates.

(4) Cash and cash equivalents
Cash and cash equivalents include all highly liquid investments,
generally with original maturities of three months or less, that are readily
convertible to known amounts of cash and are so near maturity thatthey present insignificant risk of changes in value because of changes ininterest rates.

(5) Marketable securities and investment in securities
Toyota Industries classifies securities into four categories by purpose ofholding: trading securities, held-to-maturity securities, other securities
and investments in unconsolidated subsidiaries and affiliates. Toyota
Industries did not have trading securities or held-to-maturity securities
as of March 31, 2008 and 2007.
Other securities with readily determinable fair values are stated at fairvalue based on market prices at the end of the year. Unrealized gains
and losses are included in “Net unrealized gains on other securities” asa separate component of net assets. Cost of sales of such securities
is determined by the moving-average method. Other securities without
readily determinable fair values are stated at cost, as determined by themoving-average method.
Investments in unconsolidated subsidiaries and affiliates areaccounted for by the equity method (see Note 2 (2)).

(6) Inventories
Inventories are stated mainly at cost determined by the moving-averagemethod.

(7) Property, plant and equipment, and depreciation
Property, plant and equipment are stated at cost. Depreciation
expenses of property, plant and equipment are computed mainlyby the declining-balance method for the Company and Japanesesubsidiaries and by the straight-line method for foreign subsidiaries.

Toyota Industries Report 200879

Financial Section

Notes to Consolidated Financial Statements
Significant renewals and additions are capitalized at cost. Repairs
and maintenance are charged to income as incurred.
Accumulated depreciation as of March 31, 2008 and 2007 was¥703,879 million (US$7,025,448 thousand) and ¥651,653 million,
respectively.
Toyota Industries changed the depreciation method for property,
plant and equipment acquired on or after April 1, 2007 in accordancewith the revised Corporate Tax Law of Japan, effective from the fiscal
year beginning April 1, 2007. As a result, operating income decreased¥3,181 million (US$31,752 thousand), and ordinary income andincome before income taxes decreased ¥3,182 million (US$31,764
thousand), respectively.
As for property, plant and equipment acquired before April 1,
2007, Toyota Industries applied the pre-revised depreciation method
during the fiscal year beginning April 1, 2007. Among these, property,
plant and equipment for which the allowable limit on the depreciable
amount has been reached are to be depreciated evenly over five years
beginning from the following fiscal year.
As a result, operating income decreased ¥1,762 million (US$17,596
thousand), and ordinary income and income before income taxes
decreased ¥1,763 million (US$17,601 thousand), respectively.

(8) Intangible assets and amortization
Amortization of intangible assets is computed using the straight-line
method. Software costs for internal use are amortized by the straightline method over their expected useful lives (mainly five years).
Goodwill, if material, is amortized principally over less than 20
years on a straight-line basis, while immaterial goodwill is charged toincome as incurred.
Accumulated amortization of intangibles and goodwill as of March
31, 2008 and 2007 was ¥76,371 million (US$762,263 thousand) and¥70,124 million, respectively.

(9) Impairment of fixed assets
Calculation of the impairment of fixed assets is based on reasonable
and supportable assumptions and projection of the grouping ofassets and recoverable value, with due consideration for the specificconditions of each company.
The recoverable amount of assets is calculated based on net
selling price.

(10) Deferred charges
Stock issuance costs and bond issuance costs are expensed as
incurred.

(11) Allowance for doubtful accounts
Toyota Industries adopted the policy of providing an allowance for
doubtful accounts in an amount sufficient to cover possible losses
on collection by estimating individually uncollectible amounts andapplying to the remaining accounts a percentage determined bycertain factors such as historical collection experiences.

(12) Allowance for bonuses to directors and corporate
auditors
Bonuses to directors and corporate auditors are recorded on theaccrual basis with a related change to income.

It was resolved at the Board of Directors meeting on March
20, 2008 that the Company abolish the retirement benefit planfor directors as of the closing of the Ordinary General Meetingof Shareholders held on June 20, 2008. In appreciation of theircontributions to the Company while in office until the closing of theOrdinary General Meeting of Shareholders, retirement benefits will be
paid to directors within reasonable amounts to be determined basedon the tenure of service to the Company. The amounts and methodsof payment thereof will be entrusted to the decision of the Board of
Directors.

(14) Lease transactions
Finance leases other than those that are deemed to transfer theownership of the leased assets to lessees are accounted for mainly bya method similar to that applicable to ordinary operating leases.

(15) Hedge accounting(a) Method of hedge accounting
Mainly the deferral method of hedge accounting is applied. In the caseof foreign currency forward contracts and foreign currency option
contracts, the hedged items are translated at contracted forward rates
if certain conditions are met.
(b) Hedging instruments and hedged items
Hedging instruments: Derivatives instruments (interest rate swaps,
foreign currency forwards and foreign currency
option contracts)
Hedged items:
Risk of change in interest rate on borrowings
and risk of change in forward exchange rate ontransactions denominated in foreign currencies(assets and liabilities, and forecasted
transactions)(c) Hedging policy
Hedging transactions are executed and controlled based on Toyota
Industries’ internal policy and Toyota Industries is hedging interest raterisks and foreign currency risks. Toyota Industries’ hedging activities
are reported periodically to a director responsible for accounting.
(d) Method used to measure hedge effectivenessHedge effectiveness is measured by comparing accumulatedchanges in market prices of hedged items and hedging instruments
or accumulated changes in estimated cash flows from the inceptionof the hedge to the date of measurements performed. Currently it isconsidered that there are high correlations between them.
(e) Others
Due to the fact that counterparties to Toyota Industries represent
major financial institutions which have high creditworthiness, Toyota
Industries believes that the overall credit risk related to its financial
instruments is insignificant.

(16) Consumption tax
The consumption tax under the Japanese Consumption Tax Law
withheld by Toyota Industries on sales of goods is not included in theamount of net sales in the accompanying consolidated statements
of income, and the consumption tax paid by Toyota Industries under
the law on purchases of goods and services, and expenses is notincluded in the related amount.

(17) Income taxes(13) Allowance for retirement benefits
Toyota Industries accrues an amount which is considered to be
incurred in the period based on the estimated projected benefit
obligations and estimated pension assets at the end of the year. To
provide for the retirement benefits for directors and corporate auditors,
an amount which is calculated at the end of the year as required byan internal policy describing the retirement benefits for directors andcorporate auditors is accrued.

80

Toyota Industries Report 2008

The provision for income taxes is computed based on the pretax
income included in the consolidated statements of income. The
asset and liability approach is used to recognize deferred tax liabilities
and assets for the expected future tax consequences of temporary
differences between the carrying amounts and the tax bases of assets
and liabilities.
Valuation allowances are recorded to reduce deferred tax assets
when it is more likely than not that a tax benefit will not be realized.

(18) Net income per share
The computation of basic net income per share is based on theweighted-average number of outstanding shares of common stock.
The calculation of diluted net income per share is similar to thecalculation of basic net income per share, except that the weighted-

average number of shares outstanding includes the additional dilution
from potential common stock equivalents such as subscription rights
to shares. Cash dividends per share shown in the consolidated
statements of income are the amounts applicable to the respective
years.

3. Changes in accounting policies and adoption of new accounting standards
For the year ended March 31, 2008
Classification Change in Consolidated Statements ofIncomeon December 9, 2005 by the Accounting Standards Board of Japan.
If the previous accounting policy is applied, net assets at March 31,
2007 were ¥1,751,402 million.

Effective from the fiscal year beginning April 1, 2007, depreciation
expense, which was listed as a separate component of non-operating
expenses, is included in other non-operating expenses because theamount is immaterial. Depreciation expense in fiscal 2008 was ¥60
million (US$605 thousand).

Accounting Standard for Share-based Payment

For the year ended March 31, 2007
Accounting Standard for Directors’ Bonus
Effective from the fiscal year beginning April 1, 2006, Toyota Industries
applied Financial Accounting Standard No. 4 “Accounting Standard for
Directors’ Bonus” issued on November 29, 2005 by the AccountingStandards Board of Japan. As a result, ordinary income and income
before income taxes and minority interests decreased by ¥554 million.

Accounting Standards for Presentation of Net Assets in
the Balance Sheet
Effective from the fiscal year beginning April 1, 2006, Toyota
Industries applied Financial Accounting Standard No. 5 “AccountingStandards for Presentation of Net Assets in the Balance Sheet”
and its Implementation Guidance No. 8 “Guidance on AccountingStandards for Presentation of Net Assets in the Balance Sheet” issued

Effective from the fiscal year beginning April 1, 2006, Toyota Industries
applied Financial Accounting Standard No. 8 “Accounting Standard
for Share-based Payment” issued on December 27, 2005 by the
Accounting Standards Board of Japan and its Implementation
Guidance No. 11 “Guidance on Accounting Standard for Share-based
Payment” issued on May 31, 2006 by the Accounting Standards
Board of Japan. As a result, ordinary income and income before
income taxes and minority interests decreased ¥202 million.

Accounting Standard for Business Combinations
Effective from the fiscal year beginning April 1, 2006, Toyota Industries
applied Financial Accounting Standard for Business Combinations
issued on October 27, 2003 by the Business Accounting Council
in Japan, and Financial Accounting Standard No. 7 “AccountingStandard for Business Divestitures” and the related Implementation
Guidance No. 10 “Guidance on Accounting Standard for Business
Combinations and Accounting Standard for Business Divestitures”
issued on December 27, 2005 by the Accounting Standards Board ofJapan.

4. Marketable securities(1) As of and for the year ended March 31, 2008:(a) Other securities with readily determinable fair value as of March 31, 2008 are as follows:
Millions of yen
Acquisition
cost

Securities with carrying amountexceeding acquisition cost:
StocksSubtotal
Securities with carrying amountnot exceeding acquisition cost:
StocksOthersSubtotal
Total

Thousands of U.S. dollars

Carrying
amountDifference¥219,262
219,262¥1,472,631
1,472,631¥1,253,369
1,253,369$2,188,464 $14,698,392 $12,509,928
2,188,464 14,698,392 12,509,928

7,081
340
7,421
¥226,683

6,318
340
6,658
¥1,479,290

(763)
–
(763)
¥1,252,606

70,67863,062(7,617)
3,396
3,396
–
74,07466,457(7,617)$2,262,537 $14,764,849 $12,502,312

Acquisition
cost

Carrying
amountDifference(b) Other securities sold during the year ended March 31, 2008 are as follows:
Millions of yen
Proceeds

Realized gains¥6,567¥5,866

Thousands of U.S. dollars
Realized losses–

Proceeds

Realized gains$65,550$58,556

Realized losses–(c) The carrying amount of securities (excluding held-to-maturity bonds which are included within securities with fair value) without readily
determinable fair values as of March 31, 2008 are as follows:
Millions of yen

Thousands of
U.S. dollars

Carrying amount

Other securities:
Domestic unlisted stocks excluding over-the-counter stocks
Money management funds
Negotiable certificate of deposit¥27,021
25,211
15,400$269,706
251,640
153,708

Toyota Industries Report 200881

Financial Section

Notes to Consolidated Financial Statements(2) As of and for the year ended March 31, 2007:(a) Other securities with readily determinable fair value as of March 31, 2007 are as follows:
Millions of yen
Acquisition
cost

Securities with carrying amount exceeding acquisition cost:
StocksSubtotal
Securities with carrying amount not exceeding acquisition cost:
StocksSubtotal
Total

Carrying
amountDifference¥223,782
223,782¥2,152,078
2,152,078¥1,928,296
1,928,296

3,716
3,716
¥227,499

2,910
2,910
¥2,154,989

(806)
(806)
¥1,927,490(b) Other securities sold during the year ended March 31, 2007 are as follows:
Millions of yen
Proceeds

Realized gains¥8,419¥4,305

Realized losses–(c) The carrying amount of securities (excluding held-to-maturity bonds which are included within securities with fair value) without readily
determinable fair values as of March 31, 2007 are as follows:
Millions of yen
Carrying amount

Other securities:
Domestic unlisted stocks excluding over-the-counter stocks
Money management funds¥17,659
30,065

5. Inventories
Inventories as of March 31, 2008 and 2007 consist of the following:
Millions of yen

Finished goods
Raw materials
Work in process
Supplies
Total

2008
¥ 57,959
19,11635,873
11,683¥124,633

2007¥ 51,144
20,32537,841
11,426¥120,737

Thousands of
U.S. dollars

2008$ 578,500
190,799
358,060
116,615$1,243,973

6. Property, plant and equipment
Accumulated depreciation as of March 31, 2008 and 2007 is as follows:
Millions of yen

Buildings and structures
Machinery, equipment and vehicles
Tools, furniture and fixtures

82

Toyota Industries Report 2008

2008
¥159,862
468,784
75,233

2007¥146,690
437,123
67,838

Thousands of
U.S. dollars

2008$1,595,590
4,678,952
750,907

7. Long-term debt
(1) Long-term debt as of March 31, 2008 and 2007 consists of the following:Thousands of
U.S. dollars

Millions of yen

The Company:
2.70% bonds due 2008 without collateral
2.15% bonds due 2008 without collateral
1.94% bonds due 2009 without collateral
1.91% bonds due 2010 without collateral
0.41% bonds due 2007 without collateral
1.13% bonds due 2012 without collateral
1.03% bonds due 2012 without collateral
1.46% bonds due 2014 without collateral
1.01% bonds due 2010 without collateral
1.66% bonds due 2015 without collateral
Consolidated subsidiaries:
0.49-4.813% medium-term notes due 2009-2010
1.95% bonds due 2016 without collateralLong-term bank loans
Less: current portion of long-term debt and bonds
Total

2008

2007

2008

¥

–
20,00015,00020,000–50,00030,00020,00020,00030,000¥ 30,000
20,00015,00020,00030,00050,00030,00020,00020,00030,000$25,77519,991
192,019(26,506)¥416,279

25,77019,990145,940(64,372)¥392,328

257,263
199,535
1,916,552(264,560)$4,154,903–
199,621
149,716
199,621–499,052
299,431
199,621
199,621299,431(2) Annual maturities of long-term debt as of March 31, 2008 are as follows:Year ending March 31

Millions of yen

Thousands of
U.S. dollars

2010
2011
2012
2013
2014 and thereafter
Total¥ 46,713
61,083
41,87075,120191,491¥416,279$ 466,253
609,672
417,913749,782
1,911,283$4,154,903

8. Assets pledged as collateral(1) Assets pledged as collateral as of March 31, 2008 and 2007 are as follows:
Thousands of
U.S. dollars

Millions of yen

Investments in securities
Inventories
Land
Buildings and structures
Total

2008
¥40,530
1,153
875
425
¥42,9842007¥56,710
–
1,989
1,160
¥59,8592008$404,531
11,513
8,738
4,245$429,026(2) Secured liabilities as of March 31, 2008 and 2007 are as follows:
Thousands of
U.S. dollars

Millions of yen

Other current liabilities
Short-term bank loans
Long-term bank loans
Total

2008
¥22,359
1,187
33¥23,579

2007¥21,736138
67¥21,9422008$223,171
11,848334$235,353

9. Contingent liabilities
Toyota Industries is contingently liable for guarantees as of March 31, 2008 and 2007 as follows:
Thousands of
U.S. dollars

Millions of yen

Guarantees given by the Company
Guarantees given by consolidated subsidiaries
Guarantee forwards given by the Company

2008
¥402
324
–

2007
¥ 473
455
4,200

2008
$4,015
3,236–

Toyota Industries Report 200883

Financial Section

Notes to Consolidated Financial Statements

10. Export discount bills
Export discount bills as of March 31, 2008 and 2007 are as follows:
Millions of yen

Export discount bills

2008
¥394

2007
¥443

Thousands of
U.S. dollars

2008$3,941

11. Net assets
Under the Japanese Corporate Law, amounts equal to at least 10% of
the sum of the cash dividends and other external appropriations paidby the Company and its domestic subsidiaries must be set aside as alegal reserve until it equals 25% of common stock. The legal reserve
may be used to reduce a deficit or may be transferred to common
stock by taking appropriate corporate action. In consolidation, thelegal reserves of the Company and its domestic subsidiaries areaccounted for as retained earnings.
The year-end cash dividend is approved at the Ordinary General
Meeting of Shareholders of the Company held after the close of the
fiscal year to which the dividend is applicable. In addition, interim cash
dividends may be paid upon resolution of the Board of Directors,
subject to limitations imposed by the Japanese Corporate Law.

12. Research and development expenses
Research and development expenses, which are included in selling,
general and administrative expenses and manufacturing costs,
amounted to ¥36,750 million (US$366,813 thousand), ¥34,548 millionand ¥31,166 million for the years ended March 31, 2008, 2007 and2006, respectively.

13. Derivative instruments(1) Qualitative disclosure about derivatives(a) Contents of derivative instruments into which Toyota Industries
entered, policy with respect to entering into derivative instruments,
and purpose of using derivative instruments:
Toyota Industries uses interest rate swap agreements to reduce
interest rate risks on borrowings. Toyota Industries alsouses foreign currency forward contracts and foreign currency
option contracts to hedge foreign currency risks on transactions
denominated in foreign currencies (receivables and payables
and forecasted transactions).
(b) Contents of risks related to derivative instruments:
Interest rate swaps, foreign currency forward contracts andforeign currency option contracts into which Toyota Industries
entered have risks of fluctuations in interest rates and in foreign
currency exchange rates. Due to the fact that counterparties to

Toyota Industries represent major financial institutions whichhave high creditworthiness, Toyota Industries believes that theoverall credit risk related to its financial instruments is
insignificant.
(c) Controls in place over transactions handling derivative instruments:
Hedging transactions are executed and controlled based on
Toyota Industries’ internal policy and Toyota Industries’ hedging
activities are reported periodically to a director responsible foraccounting.

(2) Quantitative disclosure about derivatives
Toyota Industries omitted this information because hedge accounting
is applied to all of the derivative instruments into which Toyota
Industries entered.

14. Retirement benefits(1) Outline of retirement benefit plans
The Company and its domestic subsidiaries maintain tax-qualified
pension plans, lump-sum indemnities plans and welfare pension fundplans, all of which are non-contributory defined benefit pension plans.
In addition, certain foreign subsidiaries maintain non-contributory
defined benefit pension plans.
Since 1987, the Company has been transferring the covering

84

Toyota Industries Report 2008

percentages of its pension plan from its lump-sum indemnities plan to
its tax-qualified pension plan. As of March 31, 2008 and 2007, its taxqualified pension plan covers 50% of total plans. Also, the Company
established an employee retirement benefit trust. In April 2003, theCompany transferred a portion of the lump-sum indemnities plan to adefined contribution pension plan.

(2) Components of allowance for retirement benefits as of March 31, 2008 and 2007 are as follows:
Thousands of
U.S. dollars

Millions of yen

2008¥149,465(105,287)
44,178(7,668)(267)
36,242(5,584)¥ 41,826

Benefit obligation
Plan assets
Unfunded benefit obligation
Unrecognized actuarial gains or losses
Unrecognized loss in prior service obligation
Net amount recognized on the balance sheets
Prepaid pension expenses
Allowance for retirement benefits

2007¥150,203(118,227)
31,9752,907(331)
34,552(6,212)¥ 40,7642008$ 1,491,820(1,050,877)
440,943(76,538)(2,670)361,735(55,737)$ 417,472

Certain subsidiaries use the simplified method to determine benefit obligations. Prepaid pension expenses are included in other investments andother assets.

(3) Components of retirement benefit expenses for the years ended March 31, 2008, 2007 and 2006 are as follows:
Thousands of
U.S. dollars

Millions of yen

2008¥ 8,897
5,235(3,847)1,207(0)¥11,493

Service cost
Interest cost
Expected return on plan assets
Amortization of prior service obligation
Amortization of unrecognized actuarial gains or losses
Retirement benefit expenses

2007¥ 9,171
5,036(3,573)398(153)¥10,878

2006¥ 7,921
4,079(2,435)94
778¥10,4382008$ 88,810
52,255(38,404)
12,055(2)$114,713

Retirement expenses of subsidiaries which adopted the simplified method are included in service cost.

(4) Assumptions used for calculation of retirement benefits for the years ended March 31, 2008, 2007 and 2006 are as
follows:
Method of attribution of estimated retirement benefits
to periods of employee service: Straight-line method
Discount rate
Expected return on plan assets
Amortization period of prior service obligation

Amortization period of unrecognized actuarial gains
or losses

2008

2007

2.00%
3.00%
6–11 years

2.00%
3.00%
6–11 years

20 years

20 years

2006

2.00%
3.00%
6–11 years — Straight-line method over theremaining service period of
employees
20 years — Straight-line method over the
average remaining service
period of employees(5) Plan assets relating to welfare pension fund under multiemployer pension plan:
Effective from the fiscal year beginning April 1, 2007, Toyota Industries applied a new method of disclosure of retirement benefits. Information
regarding the welfare pension fund under multiemployer pension plans as of March 31, 2008 is as follows.

As of March 31, 2007
Plan assets
Estimated benefit obligation
Variance
As of March 31, 2008
Toyota Industries Group contribution to welfare pension plan

The Japan Society of Industrial
Machinery Manufacturers’ welfare
pension fund¥97,361 million¥99,244 million¥ (1,883 million)

Other welfare pension funds¥174,653 million¥166,460 million¥ 8,192 million

4.99%

4.47%

Disclosure of retirement benefits as of March 31, 2007
The amount of plan assets calculated based on the proportion of contribution to the fund made by each domestic subsidiary was ¥12,473 million
as of March 31, 2007.

(6) Additional note regarding retirement benefit
Effective from the fiscal year beginning April 1, 2007, Toyota Industries applied Implementation Guidance No. 14 “Partial Revision No.2 ofAccounting Standard for Retirement Benefit” issued on May 15, 2007 by the Accounting Standards Board of Japan.

Toyota Industries Report 200885

Financial Section

Notes to Consolidated Financial Statements

15. Stock options(1) Stock option expenses recorded in the fiscal year and class of options
Thousands of
U.S. dollars

Millions of yen

2008
¥493

Selling, general and administrative expenses

2007
¥202

2008
$4,921(2) Stock option details, number of stock options and state of fluctuation(1) Stock option details
2008

2007

The Company

The Company

The Company

Position and number ofgrantees

Directors: 16
Managing officers and employees: 159

Directors: 17
Managing officers and employees: 152

Directors: 30
Employees: 134

Class and number of shares*

830,000 shares of common stock

802,000 shares of common stock

791,000 shares of common stock

Date of issue

August 1, 2007

August 1, 2006

August 1, 2005

1. Grantee must be employed as adirector, managing officer or regular
employee of the Company at the time of
exercise. However, this does not apply
if no more than 18 months have elapsed
after retirement or resignation from theCompany.

Same as left

Same as left

2. Other conditions of exercise shall bedecided as prescribed by the Contract
for Allotment of Stock Acquisition Rights
concluded by the Company and grantee
in accordance with resolutions at the
Meeting of Shareholders and resolutions
on the issue of stock acquisition rights
by the Board of Directors.

Same as left

Same as left

3. In the case where grantee becomesno longer applicable to the conditionsof exercise, the grantee immediately
loses stock acquisition rights and must
return the rights to the Company without
consideration.

––

Periods that grantees must
provide service in return forstock options

From August 1, 2007 to July 31, 2009

From August 1, 2006 to July 31, 2008

From August 1, 2005 to June 30, 2007

Periods that stock subscription
rights are to be exercised

Four years after determination of rights

Four years after determination of rights

Four years after determination of rights

Company name

The Company

The Company

The Company

Position and number ofgrantees

Directors: 30
Managing officers and employees: 135

Directors: 30
Managing officers and employees: 128

Directors: 30
Employees: 115

Class and number of shares*

775,000 shares of common stock

750,000 shares of common stock

728,000 shares of common stock

Date of issue

August 2, 2004

August 1, 2003

August 1, 2002

1. Grantee must be employed as a director,
managing officer or regular employee of theCompany at the time of exercise. However,this does not apply if no more than 18
months have elapsed after retirement or
resignation from the Company.

Same as left

1. Grantee must be employed as a director,
managing officer or regular employee of theCompany at the time of exercise. However,this does not apply if no more than 6 months
have elapsed after retirement or resignationfrom the Company.

2. Other conditions of exercise shall bedecided as prescribed by the Contract
for Allotment of Stock Acquisition Rights
concluded by the Company and grantee inaccordance with resolutions at the Meetingof Shareholders and resolutions on the issueof stock acquisition rights by the Board of
Directors.

Same as left

2. Other conditions of exercise shall bedecided as prescribed by the Contract
for Allotment of Stock Acquisition Rights
concluded by the Company and grantee inaccordance with resolutions at the Meetingof Shareholders and resolutions on the issueof stock acquisition rights by the Board of
Directors.

Periods that grantees must
provide service in return forstock options

From August 2, 2004 to June 30, 2006

From August 1, 2003 to June 30, 2005

From August 1, 2002 to June 30, 2004

Periods that stock subscription
rights are to be exercised

Four years after determination of rights

Four years after determination of rights

Four years after determination of rights

Condition of settlement ofrights2005

Condition of settlement ofrights*Number of options granted by class are listed as number of shares.

86

2006

Company nameToyota Industries Report 2008

2004

2003

(2) Number of stock options and state of fluctuation
Stock options are those outstanding in the fiscal year and are listed as the number of shares.
(a) Number of stock options
Non-exercisable stock options
Stock options outstanding at the end of the previous fiscal year
Stock options granted
Forfeitures
Conversion to exercisable stock options
Stock options outstanding at the end of the fiscal year

2008–
830,000––
830,000

2007
802,000–––
802,000

2006
791,000––
791,000
–

2005
–
–
–
–
–

2004
–
–
–
–
–

2003
–
–
–
–
–

2008
–
–
–
–
–

2007
–
–
–
–
–

2006
791,000–
655,500
5,000
130,500

2005
38,500–22,9002,000
13,600

2004
6,000
–
2,000
2,000
2,000

2003
108,000–
2,000
106,000–

2008¥5,866–682

2007¥4,642–759

2006¥3,306
5,183
–

2004
¥2,074
4,820
–

2003
¥1,982
5,370
–

2008
21.78%
4 years¥56/share
1.210%

2007
20.63%
4 years¥40/share
1.210%

Exercisable stock options
Stock options outstanding at the end of the previous fiscal year
Conversion from non-exercisable stock options
Stock options exercised
Forfeitures
Stock options outstanding at the end of the fiscal year(b) Price of options
Exact yen amounts

Paid-in value
Average market price of the stock at the time of exercise
Fair value of options on grant date2005
¥2,652
4,492–(3) Methods for estimating fair value of stock options
The methods for estimating fair value of stock options granted for fiscal 2008 and 2007 are as follows:(a) Valuation methods used: Black-Scholes model(b) Principal basic values and estimation methods
Share price fluctuations *1
Projected remaining period *2
Projected dividend *3
Non-risk interest rate *4*1 Computed based on actual share prices during a four-year period (from August 2003 to July 2007) and (from August 2002 to July 2006).
*2 Because of a lack of accumulated data and difficulty in making rational estimates, it is assumed the rights are exercised at the midpoint of the exercise period.
*3 Based on the year-end dividend for the fiscal year ended March 31, 2007 and 2006, respectively, and the estimated interim dividend on the grant date.
*4 Yields on government bonds for the period corresponding to the projected remaining period.

(4) Method for estimating the number of confirmed stock option rights
Specifically, because of the difficulty in rationally estimating the number of expired rights in the future, a method has been adopted that reflects
actual past expirations.

Toyota Industries Report 200887

Financial Section

Notes to Consolidated Financial Statements

16. Income taxes(1) The significant components of deferred tax assets and liabilities as of March 31, 2008 and 2007 are as follows:
Thousands of
U.S. dollars

Millions of yen

Deferred tax assets:
Allowance for retirement benefits
Trade receivables
Accrued expenses
Net operating loss carry-forwards for tax purposes
Depreciation
Securities
Enterprise tax payable
Other
Subtotal
Less: valuation allowance
Total deferred tax assets
Deferred tax liabilities:
Other securities
Depreciation
Land
Reserve for advanced depreciation
Reserve for special depreciation
Other
Total deferred tax liabilities
Net deferred tax liabilities

2008

2007

2008

¥ 16,576
992
8,198
3,163
5,206
2,712
1,830
11,32450,004(1,341)
48,663¥ 15,347
2,464
7,465
2,039
6,350
2,066
1,692
12,74150,168(2,742)47,425$

499,760
6,590
562
484
470
(1,975)505,893¥(457,230)

768,659
6,155
1,111
502
590
(26)
776,992¥(729,567)

4,988,131
65,780
5,619
4,839
4,697
(19,722)5,049,345$(4,563,638)

165,451
9,902
81,831
31,57851,96427,06918,272
113,027
499,096(13,389)
485,707

Net deferred tax liabilities consist of the following components on the consolidated balance sheets.
Thousands of
U.S. dollars

Millions of yen

Current assets — deferred tax assets
Investments and other assets — deferred tax assets
Current liabilities — deferred tax liabilities
Long-term liabilities — deferred tax liabilities
Net deferred tax liabilities2008¥ 18,860
8,578(1,881)(482,787)¥(457,230)

2007¥ 17,924
7,435(3,162)(751,764)¥(729,567)

2008
188,243
85,621(18,778)(4,818,724)$(4,563,638)$(2) Reconciliations of differences between the statutory rate of income taxes and the effective rate of income taxes
for the years ended March 31, 2008 and 2007 are as follows:
Statutory rate of income taxes
Addition (reduction) in taxes resulting from:
Dividends income and others permanently not recognized as taxable income
Other
Effective rate of income taxes

88

Toyota Industries Report 2008

2008
39.9%

2007
39.9%

(5.4)
(0.9)
33.6%

(5.2)
3.6
38.3%

17. Leases(1) Finance leases (as a lessee) which do not transfer ownership of leased properties to lessees(a) Pro forma information regarding the leased properties such as acquisition cost and accumulated depreciation, which are notreflected in the accompanying consolidated balance sheets under finance leases as of March 31, 2008 and 2007 are as follows:
Thousands of
U.S. dollars

Millions of yen

Buildings and structures:
Acquisition cost equivalents
Accumulated depreciation equivalents
Buildings and structures net balance equivalents
Machinery and equipment:
Acquisition cost equivalents
Accumulated depreciation equivalents
Machinery and equipment net balance equivalents
Tools, furniture and fixtures:
Acquisition cost equivalents
Accumulated depreciation equivalents
Tools, furniture and fixtures net balance equivalents
Software:Acquisition cost equivalents
Accumulated depreciation equivalents
Software net balance equivalents
Total net leased properties

2008

2007

¥

¥

276
125
150

2008
–
–
–

$

2,760
1,255
1,505

17,656
8,965
8,691

14,047
7,830
6,217

176,230
89,48086,75014,946
7,306
7,639

13,6676,396
7,271

149,182
72,92876,254132
49
82¥16,564

154
77
76¥13,564

1,320
497
823
$165,332

Acquisition cost equivalents include the imputed interest expense portion because the percentage which is computed by dividing
future minimum lease payments by total balance of property, plant and equipment at year-end is immaterial.
(b) Pro forma information regarding future minimum lease payments as of March 31, 2008 and 2007 is as follows:
Thousands of
U.S. dollars

Millions of yen

Due within one year
Due after one year
Total

2008
¥ 6,134
13,741¥19,8762007¥ 4,342
9,221¥13,564

2008$ 61,233
137,153$198,387

The amount equivalent to future minimum lease payments as of the end of the year includes the imputed interest expense portion because thepercentage which is computed by dividing future minimum lease payments by future minimum lease payment and total balance of property, plantand equipment at year-end is immaterial.
(c) Total lease payments and pro forma depreciation expenses for the years ended March 31, 2008 and 2007 are as follows:
Thousands of
U.S. dollars

Millions of yen

Lease payments
Pro forma depreciation expenses

2008¥5,997¥5,9972007¥5,212¥5,212

2008$59,857$59,857

Pro forma depreciation expenses, which are not reflected in the accompanying consolidated statements of income, are computed mainly by
the straight-line method, which assumes zero residual value and the leasing term to be useful lives for the years ended 2008 and 2007, and areequivalent to the amount of total lease payments of the above.

Toyota Industries Report 200889

Financial Section

Notes to Consolidated Financial Statements(2) Finance leases (as a lessor) which do not transfer ownership of leased properties to lessees(a) Information regarding leased properties such as acquisition cost and accumulated depreciation under finance leases as of March 31, 2008 and2007 is as follows:
Thousands of
U.S. dollars

Millions of yen

Machinery and equipment:
Acquisition cost
Accumulated depreciation
Total net leased property

2008

2007

2008

¥10,957
7,297¥ 3,660¥10,013
5,711¥ 4,301$109,364
72,833$ 36,531(b) Pro forma information regarding future minimum lease income as of March 31, 2008 and 2007 is as follows:
Thousands of
U.S. dollars

Millions of yen

2008

2007

2008

¥3,073
5,832¥8,906¥1,161
5,166¥6,328$30,677
58,219$88,896

Due within one year
Due after one year
Total

Future minimum lease income under finance leases include the imputed interest income portion because the percentage which is computed by
dividing the total of future minimum lease income and estimated residual value by the total of future minimum lease income and estimated residual
value and the balance of operating receivables balance at the year-ends is immaterial.
(c) Total lease payments to be received and depreciation expenses for the years ended March 31, 2008 and 2007 are as follows:
Thousands of
U.S. dollars

Millions of yen

2008

2007

2008

¥2,5432,239¥2,4502,391$25,388
22,349Total lease payments to be received
Depreciation expenses(3) Operating leases (as a lessee)
Pro forma future lease payments under operating leases as of March 31, 2008 and 2007 are as follows:
Millions of yen

Due within one year
Due after one year
Total

2008
¥ 9,143
43,762¥52,9062007¥ 5,068
18,307¥23,376

Thousands of
U.S. dollars

2008$ 91,263
436,797$528,061(4) Operating leases (as a lessor)
Pro forma information regarding future minimum rentals under operating leases as of March 31, 2008 and 2007 is as follows:
Millions of yen

Due within one year
Due after one year
Total

90

Toyota Industries Report 2008

2008
¥22,406
26,638¥49,0442007¥14,835
23,639¥38,475

Thousands of
U.S. dollars

2008$223,637
265,880$489,51718. Changes in net assets(1) Common stock outstanding for the years ended March 31, 2008 and 2007:
SharesBalance at March 31, 2006
Increase
Decrease
Balance at March 31, 2007
Increase
Decrease
Balance at March 31, 2008

325,840,640––
325,840,640––
325,840,640(2) Treasury stock outstanding for the years ended March 31, 2008 and 2007:
SharesBalance at March 31, 2006
Increase due to purchase of treasury stock in accordance with the resolutions at
Ordinary General Meeting of Shareholders held on June 22, 2006
Increase due to purchase of odd stock
Decrease due to exercise of stock options
Balance at March 31, 2007
Increase due to purchase of treasury stock in accordance with the resolutions at
Board of Directors meeting
Increase due to acquisition from shareholders by share exchange
Increase due to purchase of odd stock
Decrease due to exercise of stock options
Decrease due to share exchange
Balance at March 31, 2008

6,520,194
8,000,000
16,471(771,500)
13,765,165
2,000,000
26,00014,280(871,975)(682,400)
14,251,070(3) Subscription rights to shares outstanding for the years ended March 31, 2008 and 2007:
Thousands of
U.S. dollars

Millions of yen

2008
¥695

The Company

2007
¥202

2008
$6,946(4) Dividends(a) Dividends paid
Total dividends

Dividends per share

Resolutions

Class of shares

Millions of yen

Thousands of
U.S. dollars

Yen

U.S. dollars

Record date

Effective dateOrdinary General Meeting of
Shareholders held on June 21, 2007

Common stock¥8,738$87,215

¥28

$0.28

March 31,2007

June 22,
2007

Board of Directors meeting held on
October 31, 2007

Common stock

8,751

87,34528

0.28

September 30,
2007

November 26,2007(b) Dividends with a record date in the fiscal year under review for which the effective date falls in the following fiscal year:
Total dividends
Resolutions

Ordinary General Meetingof Shareholders held on
June 20, 2008

Class of shares

Millions of yen

Thousands of
U.S. dollars

Common stock¥9,970$99,520

Dividends per share
Source ofdividends

Retainedearnings

Yen

U.S. dollars

Record date

Effective date

¥32

$0.32

March 31,2008

June 23,
2008

19. Subsequent events
None

Toyota Industries Report 200891

Financial Section

Notes to Consolidated Financial Statements

20. Segment information(1) Business segments
As of and for the years ended March 31, 2008, 2007 and 2006:
Thousands of
U.S. dollars

Millions of yen

Sales:
Automobile
Outside customer sales
Intersegment transactions

2008

2007

2006

2008

¥ 969,226
26,026995,252¥ 904,893
21,134926,028¥ 746,795
20,768
767,564$ 9,673,884
259,771
9,933,655

783,173
3,415
786,589

767,237805
768,042595,236482
595,718

7,816,887
34,0887,850,975

117,591
7,942
125,533

89,4707,275
96,746

65,145
6,355
71,5001,173,684
79,271
1,252,955

66,264
7
66,271

58,403
5
58,40949,78922
49,811

661,38973
661,462

64,28021,386
85,666
2,059,313(58,777)¥2,000,536

58,392
21,85580,2481,929,475(51,077)¥1,878,398

48,98820,851
69,8391,554,436(48,480)¥1,505,955

641,583
213,455
855,038
20,554,084(586,657)$19,967,427¥ 953,734
746,747
121,303
61,97478,958(59,035)¥1,903,682¥ 892,435
720,840
94,96557,32773,920(51,046)¥1,788,443¥ 747,468
556,950
69,91349,882
66,107(48,407)¥1,441,915$ 9,519,262
7,453,315
1,210,733
618,571788,083(589,237)$19,000,727

¥

¥

¥

$

Materials Handling Equipment
Outside customer sales
Intersegment transactions
Logistics
Outside customer sales
Intersegment transactions
Textile Machinery
Outside customer sales
Intersegment transactions
Others
Outside customer sales
Intersegment transactions
Subtotal
Elimination of intersegment transactions
Total
Operating costs and expenses:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersElimination of intersegment transactions
Total
Operating income (loss):
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersElimination of intersegment transactions
Total
Assets:Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate assets or elimination
Total
Depreciation and amortization:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of intersegment transactions
Total
Capital expenditures:
Automobile
Materials Handling Equipment
Logistics
Textile Machinery
OthersCorporate or elimination of intersegment transactions
Total

92

Toyota Industries Report 2008¥

41,51839,841
4,230
4,297
6,708
258
96,853¥33,592
47,201
1,780
1,081
6,328
(30)
89,954¥20,09538,768
1,587
(70)
3,732
(73)
64,040$414,393
397,660
42,22242,891
66,954
2,580
966,700¥ 434,952
601,299
187,064
17,811
81,342
1,643,115¥2,965,585¥444,564
593,607
132,857
17,034
113,156
2,284,637¥3,585,857¥ 420,204
509,366
106,356
16,516103,083
2,089,813¥3,245,341$ 4,341,278
6,001,591
1,867,094
177,780
811,881
16,399,992$29,599,616¥

57,98746,609
9,012
1,310
4,985
−
¥ 119,905¥

53,557
41,947
4,178
1,087
5,288
–
¥ 106,060¥

48,37030,044
3,309
1,010
4,544
9
87,287$¥¥¥ 101,897
43,520
4,046
730
8,620
20
¥ 158,835$

50,14568,945
15,067
1,869
6,130
−
¥ 142,158

74,967
67,152
5,863
1,472
17,049–¥ 166,505¥

578,776465,21089,95413,081
49,763−$ 1,196,783
500,505
688,146
150,393
18,65961,187−$ 1,418,891

1. Business segments are divided by the type and nature of the product.
2. Main products of each segment are as follows:
Fiscal 2008
Automobile ...............................................Passenger vehicles, diesel and gasoline engines, car air-conditioning compressors, foundry parts, electronics components
Materials handling equipment ...................Counterbalanced lift trucks, warehouse trucks, automated storage and retrieval systems, truck mount aerial work platforms
Logistics ...................................................Transportation services, logistics planning, operation of distribution centers, collection and delivery of cash and management of sales proceeds,
secure storage, management, collection and delivery of corporate documents
Textile machinery ......................................Air-jet looms, water-jet looms, ring spinning frames
Others ......................................................Semiconductor package substrates

Fiscal 2007
Automobile ...............................................Passenger vehicles, diesel and gasoline engines, car air-conditioning compressors, foundry parts, electronics components
Materials handling equipment ...................Counterbalanced lift trucks, warehouse trucks, automated storage and retrieval systems, truck mount aerial work platforms
Logistics ...................................................Transportation services, logistics planning, operation of distribution centers, collection and delivery of cash and management of sales proceeds
Textile machinery ......................................Air-jet looms, water-jet looms, ring spinning frames
Others ......................................................Semiconductor package substrates

3. Corporate assets included in corporate assets or elimination consist mainly of cash and cash equivalents, short-term investments andinvestments in securities held by the Company. Corporate assets were ¥1,707,060 million (US$17,038,228 thousand) and ¥2,352,362 million as ofMarch 31, 2008 and 2007, respectively.

(2) Geographical segments
As of and for the years ended March 31, 2008, 2007 and 2006:
Thousands of
U.S. dollars

Millions of yen

Sales:
Japan
Outside customer sales
Intersegment transactions

2008

2007

2006

2008

¥1,343,041
132,206
1,475,248¥1,232,131
121,338
1,353,470¥1,009,368
112,543
1,121,912$13,404,946
1,319,557
14,724,503

265,571
2,185
267,756

287,316
2,712
290,029

246,129
2,056
248,186

2,650,677
21,814
2,672,490

327,7857,821
335,607

312,051
7,152
319,204

216,230
5,689
221,919

3,271,644
78,063
3,349,707

64,137
7,630
71,7682,150,380(149,843)¥2,000,536

46,897
5,573
52,471
2,015,175(136,776)¥1,878,398

34,227
3,998
38,226
1,630,243(124,288)¥1,505,955

640,161
76,159716,320
21,463,021(1,495,594)$19,967,427¥1,393,225
264,232
327,674
66,633(148,083)¥1,903,682¥1,284,500
284,095
307,91249,364(137,428)¥1,788,443¥1,069,137
241,467
217,370
36,743(122,804)¥1,441,915$13,905,834
2,637,316
3,270,527
665,076(1,478,026)$19,000,727

¥

¥

¥

$

North America
Outside customer sales
Intersegment transactions
EuropeOutside customer sales
Intersegment transactions
Others
Outside customer sales
Intersegment transactions
Subtotal
Elimination of intersegment transactions
Total
Operating costs and expenses:
Japan
North America
EuropeOthersElimination of intersegment transactions
Total
Operating income:Japan
North America
EuropeOthersElimination of intersegment transactions
Total
Assets:Japan
North America
EuropeOthersCorporate assets or elimination
Total

¥

82,022
3,524
7,933
5,134
(1,760)96,853¥ 906,548
165,525
356,570
71,882
1,465,058¥2,965,585¥

68,9705,934
11,292
3,106
651
89,954¥ 887,351
196,769
337,866
66,1482,097,722¥3,585,857¥

52,775
6,718
4,548
1,482
(1,484)64,040¥ 834,716
179,116
278,825
48,207
1,904,475¥3,245,341$

818,669
35,174
79,18051,244(17,568)
966,700$ 9,048,290
1,652,114
3,558,945
717,462
14,622,804$29,599,616

Toyota Industries Report 200893

Financial Section

Notes to Consolidated Financial Statements
1. Geographical segments are divided into categories based on their geographical proximity.
2. Significant countries or areas belonging to each segment are as follows:
Fiscal 2008
North America .........................................U.S.A., Canada
Europe ....................................................Sweden, Germany, France
Others .....................................................Australia, China, Brazil

Fiscal 2007
North America .........................................U.S.A., Canada
Europe ....................................................Sweden, Germany, France
Others .....................................................Australia, China, India

3. Corporate assets included in corporate assets or elimination consist mainly of cash and cash equivalents, short-term investments andinvestments in securities held by the Company. Corporate assets were ¥1,707,060 million (US$17,038,228 thousand) and ¥2,352,362 million asof March 31, 2008 and 2007, respectively.

(3) Overseas sales
For the years ended March 31, 2008, 2007 and 2006:
Thousands of
U.S. dollars

Millions of yen

Overseas sales:
North America
EuropeOthers
Total
Total sales
Ratio of overseas sales to total sales (%):
North America
EuropeOthers
Total

2008

2007

2006

2008

¥ 265,942
373,374
190,539¥ 829,855¥2,000,536¥ 287,957
347,617156,338¥ 791,913¥1,878,398¥ 247,957
249,237
123,751¥ 620,946¥1,505,955$ 2,654,380
3,726,665
1,901,777$ 8,282,822$19,967,427

13.3%
18.7
9.5
41.5%

15.3%
18.5
8.4
42.2%

16.5%
16.5
8.2
41.2%

1. Geographical segments are divided into categories based on their geographical proximity.
2. Significant countries or areas belonging to each segment are as follows:
Fiscal 2008
North America .........................................U.S.A., Canada
Europe ....................................................Germany, France, Russia
Others .....................................................China, Australia, Indonesia

Fiscal 2007
North America .........................................U.S.A., Canada
Europe ....................................................Germany, France, Italy
Others .....................................................China, Australia, Pakistan

3. Overseas sales are sales of the Company and its consolidated subsidiaries in countries and areas other than Japan.

21. Related party transactions
The following transactions were carried out with related parties:(1) Sales of goods and services for the years ended March 31, 2008 and 2007 were as follows:
Millions of yen

Toyota Motor Corporation

2008¥710,9762007¥665,595

Thousands of
U.S. dollars

2008$7,096,281

Toyota Motor Corporation held 24.61% of the Company’s voting rights as of March 31, 2008. The above transactions were carried out oncommercial terms and conditions.

94

Toyota Industries Report 2008

(2) Purchase of goods and services for the years ended March 31, 2008 and 2007 were as follows:
Purchase of goods:
Thousands of
U.S. dollars

Millions of yen

2008¥521,644

Toyota Motor Corporation2008$5,206,552

2007¥484,336

Purchase of services:
Thousands of
U.S. dollars

Millions of yen

2008
Toyota Industries Health Insurance Society
Toyota Medical Corporation

–
¥671

2007
¥ 41
664

2008
–
$6,706

Toyota Industries Health Insurance Society’s chairman as of March 31, 2008 and 2007 is Yutaka Murodono, who is a director of the Company
and holds 0.00% of the Company’s shares. Toyota Medical Corporation’s chairman as of March 31, 2008 and 2007 is Yoshitoshi Toyoda, who
is a director of the Company and holds 0.08% and 0.07% of the Company’s shares, respectively. The above transactions were carried out oncommercial terms and conditions.

(3) Outstanding balances arising from sale/purchase of goods/services as of March 31, 2008 and 2007 are as follows:
Receivables from a related party:
Thousands of
U.S. dollars

Millions of yen

2008¥30,282

Toyota Motor Corporation

2008$302,255

2007¥33,859

Payable to a related party:
Thousands of
U.S. dollars

Millions of yen

2008¥49,571

Toyota Motor Corporation

2008$494,778

2007¥48,815

22. Net income per share (EPS)The basis of calculation for net income per share basic and net income per share diluted is as follows:
Thousands of
U.S. dollars

Millions of yen

Net income per share basic:
Net income
Net income not attributable to common shareholders(bonuses for directors and statutory auditors that are paid through appropriation)
Net income attributable to common shareholders
Weighted-average shares (thousand)Net income per share basic (exact yen amounts) (exact US$ amounts)
Net income per share diluted:
Weighted-average shares for diluted computation (thousand)Net income per share diluted (exact yen amounts) (exact US$ amounts)

2008

2007

2008

¥ 80,460–¥ 59,468–$803,083–

80,460312,467¥ 257.50

59,468313,191¥ 189.88

803,083
–
$
2.57

85
¥ 257.43362¥ 189.66

$

–
2.57

23. Equity per share
The basis of calculation for equity per share is as follows:
Thousands of
U.S. dollars

Millions of yen

Equity per share:
Total net assets
Amounts deducted from total net assets:
Subscription rights to shares
Minority interests in consolidated subsidiaries
Equity applicable to common stock at end of year
Outstanding shares of common stock at end of year used
for the computation of equity per share (thousand)Equity per share (exact yen amounts) (exact US$ amounts)

2008

2007

2008

¥1,453,996¥1,810,483$14,512,396

695
56,345
1,396,955

202
58,878
1,751,401

6,946
562,390
13,943,059

311,589¥ 4,483.32

312,075¥ 5,612.11

$

44.75

Toyota Industries Report 200895

Financial Section

Reports of Independent Auditors

Report of Independent Auditors

To the Board of Directors of Toyota Industries Corporation

We have audited the accompanying consolidated balance sheets of Toyota Industries Corporation (“theCompany”) and its subsidiaries as of March 31, 2008, and the related consolidated statements of income,changes in net assets and cash flows for the year then ended, all expressed in Japanese yen. These
consolidated financial statements are the responsibility of the Company’s management. Our responsibility
is to express an opinion on these consolidated financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in Japan. Thosestandards require that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our audit provides a reasonablebasis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the financial position of the Company and its subsidiaries as of March 31, 2008, and the resultsof their operations and their cash flows for the year then ended in conformity with accounting principles
generally accepted in Japan.
The U.S. dollar amounts in the accompanying consolidated financial statements with respect to the year
ended March 31, 2008, are presented solely for convenience. Our audit also included the translation ofJapanese yen amounts into U.S. dollar amounts and, in our opinion, such translation has been made on
the basis described in Note 1 to the consolidated financial statements.

July 14, 200896

Toyota Industries Report 2008

Report of Independent Auditors

To the Board of Directors of Toyota Industries Corporation

We have audited the accompanying consolidated balance sheet of Toyota Industries Corporation (“theCompany”) and its subsidiaries as of March 31, 2007, and the related consolidated statements of income,changes in net assets and cash flows for the year then ended, all expressed in Japanese yen. These
consolidated financial statements are the responsibility of the Company’s management. Our responsibility
is to express an opinion on these consolidated financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in Japan. Thosestandards require that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our audit provides a reasonablebasis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the financial position of the Company and its subsidiaries as of March 31, 2007, and the resultsof their operations and their cash flows for the year then ended in conformity with accounting principles
generally accepted in Japan.
The U.S. dollar amounts in the accompanying consolidated financial statements with respect to the year
ended March 31, 2007, are presented solely for convenience. Our audit also included the translation ofJapanese yen amounts into U.S. dollar amounts and, in our opinion, such translation has been made on
the basis described in Note 1 to the consolidated financial statements.

July 10, 2007

Toyota Industries Report 200897

Financial Section

Investor Information(As of March 31, 2008)

Corporate Head Office

Number of Shareholders

TOYOTA INDUSTRIES CORPORATION

21,5722-1, Toyoda-cho, Kariya-shi, Aichi-ken, 448-8671, Japan
Telephone: +81-(0)566-22-2511

Independent Accountants

Facsimile:

PricewaterhouseCoopers Aarata+81-(0)566-27-5650

Shin-Marunouchi Bldg., 32nd Floor

Date of Establishment

1-5-1, Marunouchi, Chiyoda-ku, Tokyo

November 18, 1926

100-6532, Japan

Common Stock

Transfer Agent

No par value

Mitsubishi UFJ Trust and Banking Corporation

Authorized: 1,100,000,000 shares

1-4-5, Marunouchi, Chiyoda-ku, Tokyo-to, 100-8212, Japan

Issued:Telephone: +81-(0)3-3212-1211

325,840,640 shares

Stock Exchange Listings
Tokyo, Osaka and Nagoya (Ticker Code: 6201)

Major Shareholders (Top 10) (As of March 31, 2008)

98

Distribution of Shares

Toyota Motor Corporation

76,600 (Thousands of shares)

DENSO Corporation

29,647

Third Avenue Fund-Custodial Trust Company

18,376

Towa Real Estate Co., Ltd.

15,697The Master Trust Bank of Japan, Ltd.

9,901

Toyota Tsusho Corporation

8,289

Nippon Life Insurance Company

6,735

Aisin Seiki Co., Ltd.

6,578

Japan Trustee Services Bank, Ltd.

5,398

Mitsui Sumitomo Insurance Company, Limited

5,345

Toyota Industries Report 2008

0.3%

12.3%

20.4%

As of
March 31,
2008

46.0%

21.0%

Individuals, etc.
Financial institutions
Foreign corporate entities and others
Other corporate entities
Brokerages

Common Stock Price and Trading Volume(Tokyo Stock Exchange)
Stock Price

(¥)

7,000

6,000
High
Low
5,000

4,000

3,000

2,000

1,000

0

Trading Volume(thousand shares)

30,00025,00020,00015,00010,0005,000

0FY 2004

FY 2005

FY 2006

FY 2007

FY 2008High¥2,530¥3,180¥4,850¥6,160¥5,830

Low

1,686

2,235

2,780

3,980

3,320

At Year-End

2,475

3,020

4,810

5,580

3,540

Toyota Industries Report 200899

2-1, Toyoda-cho, Kariya-shi, Aichi-ken 448-8671, Japan
Telephone: +81-(0)566-22-2511 Facsimile: +81-(0)566-27-5650
www.toyota-industries.com

This report is printed on FSC-certified paper that contributes to forest conservation
with ink derived from soybeans using a waterless printing process.
Printed in Japan