Company Introduction

Strategies and Businesses Promotion of ESG Initiatives
Business Activities

Business Activities
Materials Handling Equipment — P26–30 Automobile (Vehicle / Engine / Car Air-Conditioning Compressor / Car Electronics) — P31–36

Textile Machinery — P37

	Business Structure

Web

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

Link to productdetails.

We will work to develop and propose new products and services incorporating cutting-edge technologies through theproactive use of open innovation and co-creation with customers.
Our goal is to become the logistics solutions partner of the first choice for customers by meeting their wide-ranging
needs and helping them increase their logistics efficiencies based on the Toyota Industries Group’s comprehensive strengths
covering both the lift trucks and logistics solutions fields.

	Business Characteristics
Opportunities• An extensive logistics-related product lineup both in the fields of materials handlingequipment (internal-combustion lift trucks, electric lift trucks, fuel cell (FC) lift
trucks, etc.) and materials handling systems (automated storage and retrieval
systems, automatic guided vehicle (AGV) systems, automated lift trucks, etc.)• High technological capabilities, including those linked to environmental and safety
performance• Production know-how that ensures high levels of quality and production efficiency• Global, well-developed production, sales and service networks• An extensive value chain encompassing in-house development and production ofengines, motors and other key components; total after-sales services including
maintenance and inspections as well as operational management; and sales
financing operations offering more options in sales• No. 1*1 in lift truck unit sales in the world• A wealth of experience and know-how as well as a global network in the Logistics
Solutions Business• Software development capability to create such systems as a warehousemanagement system• An expansion of global logistics volume in line with an increase in the world
population and economic growth• Growing need for products with high energy savings and low environmental impact
following enforcement of more stringent environmental regulations around the world• Growing need for electric lift trucks driven by a rise in eco-consciousness• Rising need for higher logistics efficiencies prompted mainly by a growth in
e-commerce transactions as well as soaring labor costs and labor shortages

Risks• Restrained capital investment due mainly to a slowing economy and disasters• Weaker sales due to intensifying competition• Change in business environment triggered by an expanding market of low- to
mid-priced lift trucks• Suspension of production caused by supply chain disruptions*1: Survey by Toyota Industries Corporation

FY2019Net Sales

FY2020¥1,466.6 billion

1,436.3 billion¥

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

	Toyota Material Handling Group (TMHG)

Medium-Term Direction of Business

Strengths

Operating
Profit

FY2019¥114.6 billion

FY2020102.2 billion¥

Toyota Industries assists customers worldwide in attaining
greater logistics efficiencies as a market leader in thematerials handling equipment and logistics fields bydelivering logistics solutions optimally tailored to their
specific and ever-changing needs.
Under the TMHG management structure, we engage inthe Lift Truck Business under the TOYOTA, BT, RAYMOND,CESAB and Tailift brands. Mutually utilizing the development
and sales strengths of each brand, TMHG is promoting
business on a global scale.
We basically carry out product development in three
regions, namely Japan, North America and Europe. Basedon this structure, we develop and manufacture products ineach region, which are matched to the specific local needs
and characteristics, and ensure quick product delivery tocustomers. At the same time, we seek greater productappeal by conducting in-house development and productionof key components of lift trucks, including engines
and motors. In response to the enforcement of stricter
environmental regulations and growing eco-consciousness
worldwide, we are improving the energy-saving performanceand enhancing our electric lift truck lineup. We are also
promoting development of autonomous driving technology
as a response to growing needs for greater logistics
efficiencies mainly driven by labor shortages.
In addition to supplying high-quality products, we haveestablished a structure to support customers throughout
our entire value chain that encompasses from providing
after-sales services through our extensive networks tooffering sales financing operations. We contribute to greater

logistics efficiencies based on our comprehensive strengths
in satisfying varying needs of customers worldwide. On
the sales front, we are offering products and logistics
improvement solutions optimally matched to individual
customers’ logistics sites. Simultaneously, we are seeking toobtain large orders by responding to demands of customers
who conduct business globally. In terms of services,
we assign experienced and knowledgeable personnel
and utilize leading-edge information technology (IT) to
provide finely tailored services to customers. Our service
personnel visit customers on a periodic basis and provide
maintenance services to prevent troubles from occurring.
When a problem does occur, they swiftly make a visit to thecustomer and promptly take appropriate action. We are also
strengthening our internal sales financing operations mainlyin Europe, the United States and other developed countries
in order to respond to customers’ diverse needs in the areaof equipment sales. Additionally, TMHG is collaboratingwith TALG to create synergies between the lift trucks andlogistics solutions fields in development and other domains.

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

Toyota Material Handling Group

TMHG
Materials Handling Equipment Sales(Thousand units)

250
200
150
100
50
0

26

(FY) 16

Toyota Industries Report 2020

17

18

19

20

n Toyota Industries’
Global Lift Truck
Market ShareBusiness Overview in Fiscal 2020
In the Materials Handling Equipment Business, the lift truck market in 2019
turned downward except for China, where sales continued to increase. Amid
this operating climate, Toyota Industries engaged in sales and after-sales
service activities matched to respective markets. However, unit sales of lift
trucks for fiscal 2020 were down 22,000 units, or 7%, to a total of 278,000
units from the previous fiscal year. As the need for higher logistics efficiencies
is getting increasingly stronger, underpinned by an expansion of the
e-commerce market, Toyota Industries made efforts for further business
reinforcement through collaboration with logistics solutions subsidiaries in the
United States and Europe. Net sales in fiscal 2020 declined by ¥30.3 billion, or
2% year on year, to ¥1,436.3 billion.

300

Corporate Information(Survey by Toyota Industries
Corporation, 2019)

TMHJ

TMHNA

TMHE

TMHI

TMHCN

Toyota Material
HandlingJapan

Toyota Material
Handling
North America

Toyota Material
Handling
EuropeToyota Material
Handling
International

Toyota Material
Handling
China

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

ToyotaIndustries

19%

World No.1

27

Company Introduction

Strategies and Businesses Promotion of ESG Initiatives

Corporate Information

Business Activities

Toyota Advanced Logistics Group

TALG
Logistics System
Engineering Departmentof Toyota Material
Handling JapanTALNA*2/
BastianVanderlande*2: Toyota Advanced Logistics North America (Holding Company of Bastian)Under TALG, the Logistics System Engineering Department of Toyota
Material Handling Japan, Bastian and Vanderlande work together topromote the Logistics Solutions Business on a global scale whileleveraging their individual strengths.

	Business Activities in Fiscal 2020
Despite continued growth in China, the world’s lift truck
market in 2019 turned downward with weaker sales inJapan, North America, Europe and emerging countries.
Amid this environment, we worked to enhance the productappeal of our mainstay lift trucks and expand sales. We
also strove to offer reliable after-sales services, enhance
responsiveness to large-order customers and provide
solutions to achieve greater logistics efficiencies through theintroduction of distribution systems.
To meet the diverse needs of customers in the field oflift trucks, we made efforts to increase our product lineup ineach region and promoted the development of autonomous
driving technology internally and with external organizations.
We also worked to reinforce our IT-based services in orderto ensure a more accurate response to individual customers.
In the logistics solutions field, we have been accelerating
coordinated activities as TALG to mutually supply equipment
and systems while encouraging each company to leverage
its strengths to bolster business.
Meanwhile, Aichi Corporation, which possesses the top
brand*3 in the field of aerial work platforms in Japan, enjoyeda growth in demand up until thefirst half of fiscal 2020, driven by
enforcement of strict emissions
standards. However, demand
declined on the rebound in thesecond half. Sales were also
affected by Typhoon Hagibis thatmade a landfall in Japan in 2019and decreased in all industries
except for the leasing industry. As
a result, Aichi’s overall sales were
down from the previous fiscal year.
Aichi Corporation’s*3: Survey by Aichi Corporation

aerial work platform

Activities of TMHG
Japanese Market
The business environment in Japan became difficult as thelift truck market slowed down slightly in 2019. It was further
compounded as the production of lift trucks at a Toyota
Industries plant was suspended due to a disruption of parts
supply following Typhoon Hagibis. Unit sales of Toyota
Industries’ lift trucks consequently declined by 6% year on
year to 45,000 units in fiscal 2020, but still maintained the top

28

Toyota Industries Report 2020

position*4 in calendar 2019 for the 54th consecutive year.
In recent years, customer needs have become
increasingly diversified in line with changes in the businessenvironment, including an expansion of the e-commercemarket, labor shortages and growing safety andenvironmental consciousness among companies. As theleading manufacturer of materials handling equipment,
Toyota Industries has been proactively promoting therelease of new products that lead to resolving issues facing
customers.
For example, wereleased an FC lift truck forthe first time in Japan*5 in
2016. This 2.5-ton model
has been highly acclaimed
by customers not only for
its excellent environmental
performance of not emitting
1.8-ton FC lift truck
CO2, NOx and other gases
while in operation but also
for its great convenience of completing hydrogen charging
in about three minutes. More recently, we added a 1.8-ton
type as growing environmental consciousness pushed upneeds for smaller models. As part of efforts to enhance thelineup of FC models, we have also conducted a feasibility
test of an FC towing tractor.
Needs are also growing for the automation of materials
handling equipment to reduce logistics work and improve
efficiencies. In response, we have carried out autonomous
driving tests of our towing tractors jointly with All Nippon
Airways Co., Ltd. within restricted areas at Kyushu-Saga
International Airport and Chubu Centrair International
Airport. We have also joined the Consortium for OpenField Agricultural Robotics*6 engaging in research anddevelopment for labor saving in the agricultural field. Ourpart in the project is to develop a lift truck that autonomously
loads cargoes onto a truck.
In February 2020, we participated in Logis-Tech Tokyo –INNOVATION EXPO – under the concept of “Exact Solutions
to Your Logistics.” We ran the largest booth among theparticipating companies and showcased to some 22,000
visitors our latest logistics solutions, including the Key Cart
automatic guided vehicle (AGV) based on simultaneous

Toyota Industries’ booth at Logis-Tech Tokyo

localization and mapping (SLAM) technology and the AiR-T
autonomous intelligent mobile robot.
*4: S urvey by Toyota Industries Corporation based on data published by Japan Industrial
Vehicles Association*5: Survey by Toyota Industries Corporation*6: C onsortium engaging in a research and development project, selected as an Innovative
Technology Development and Immediate Deployment Project (in the category of Future
Agriculture Creation Projects Using Artificial Intelligence) of the National Agriculture andFood Research Organization’s Bio-oriented Technology Research Advancement Institution	North American Market
With a year-on-year decline in the North American lift truck
market in 2019, Toyota Industries posted unit sales in fiscal
2020 of 92,000 units, down 7% from the previous year,
but still remained the market share leader*7 in 2019.
Meanwhile, parts sales and orders for after-sales services
remained strong.
Amid this environment, Toyota Industries is proactively
pushing ahead with product lineup and functional
enhancements both under the TOYOTA and RAYMOND
brands.
Toyota enhanced its
electric product offering not
only with the release of a 1-tonelectric lift truck that has beendeveloped by a subsidiary
in North America based on
local customer needs but also
1-ton electric lift truck
with the addition of a numberof new options to its electric
pallet trucks. The focus was also on battery solutions that
present optimum ways of charging and handling batteries.
Toyota’s efforts for improving the competitiveness of its
dealers include operating an after-sales service evaluationand certification system and promoting a program to build aleaner and more efficient business structure in a systematicmanner. Some Toyota dealers have also captured a new
business opportunity by starting to use this program to solve
customers’ problems.
Raymond further
augmented the functionalityof its iWAREHOUSE fleet
management system. It has
evolved into a platform tocentrally manage various
functions associated with
iWAREHOUSE
warehouse equipment, fromthe existing roles to certify
operators, detect collisions and analyze the operational
status of lift trucks to additional features to manage
personnel and provide virtual reality (VR) operation training.
Raymond developed a new system to remotely support
operators’ order picking work and has been leveraging
cutting-edge technologies to assist customers in increasing
their logistics efficiencies.
Additionally, Toyota and Raymond are selling partsand entry-level models and providing safety operations
e-learning materials through e-commerce sites to provide
greater convenience to customers and expand business
opportunities. Toyota and Raymond are also accelerating
technology development for next-generation materials
handling equipment by working closely together with two
universities.
Toyota Industries will continue to promote productdevelopment, sales and after-sales service activities byleveraging the strengths of the two brands. In addition,
through closer collaboration with the Logistics Solutions
Business we will accurately respond to the needs for greater
logistics efficiencies, including those for automation.
*7:

Survey by Crist Information & Research, LLC, 2019	European Market
Although the European lift truck market in 2019 was downfrom the previous fiscal year, Toyota Industries posted unit
sales of 93,000 units in fiscal 2020 on par with fiscal 2019.
In addition to new lift truck sales, orders for after-sales
services and sales of parts remained strong.
In Europe, needs forconnected and automatedlift trucks are growing.
Toyota Industries offers
I_Site, a fleet management
system that enables
customers themselves
Logiconomi Forumto collect and analyze
operational and otherinformation of their lift trucks connected to a network. Morethan 12,000 lift trucks are now using I_Site. We are also
fostering partnerships with outside companies to reinforce
our development capabilities in the fields of automationand other advanced technologies. As part of this effort,
Toyota Material Handling Europe (TMHE), our European
headquarters for materials handling equipment, hosted the
Logiconomi Forum, inviting leading companies in various
industries to give lectures and exchange views.
As for electrification,
TMHE released a newelectric pallet truck withan entirely optimized
structure. The adoptionof lithium-ion batteries
has made the resulting
New electric pallet truck
truck considerably smaller,
lighter, more energyefficient and easier to operate. The truck received the iF
Design Award 2020 for these excellent features. TMHE alsorolled out new internal-combustion counterbalanced lift
trucks surpassing the latest EU Stage V regulations. These
trucks are equipped with internally produced engines, which
offer high efficiency, reliability and maintainability.
We will continue to upgrade the environmental
performance and other functions of our products and help
customers improve their logistics efficiencies by focusing on
automation that leverages the latest technologies.

ALOMA*8 and Chinese Markets
Toyota Industries covers the ALOMA markets of some 60
countries in Asia, Latin America, Oceania, the Middle East
and Africa as well as the Chinese market. We are serving
these markets with a lineup consisting of TOYOTA, BT,
RAYMOND and Tailift brands.
In 2019, the ALOMA market declined from the previous
fiscal year while the Chinese market continued to expand.
Amid such conditions, Toyota Industries worked to enhance
its product lineup, reinforce sales and after-sales service
activities and promote logistics improvement solutions. In
spite of these efforts, unit sales were down 18% from theprevious fiscal year to 48,000 units in fiscal 2020.
To date, Toyota Industries has launched sales activities
with a focus on logistics improvement solutions in 14
countries. We are strengthening our relationships of trustwith customers by offering solutions to reduce logistics

29

Company Introduction

Strategies and Businesses Promotion of ESG Initiatives

Corporate Information

Business Activities

costs and improve safety at their logistics sites. Our dealers
are also promoting improvements at their own facilities
to bolster their abilities to make improvement proposals
to customers. We will promote these and other efforts ascustomers’ total logistics solutions partner.
In the field of aftersales services, we areproceeding with theintroduction of the
Global Mobile Service
Solution (GMSS) thatleverages Internet of
GMSS mobile service system
Things (IoT) technology.
GMSS centrally manages
information on lift trucks owned by customers and thehistory of repairs conducted by dealers in each country byusing cloud services. Through this system, we will reinforce
our capability to provide better after-sales services. We arealso utilizing telematics to collect operational informationof lift trucks. The aim is to minimize downtime by analyzing
this information to foresee and prevent equipment failures.
Additionally, we established T-CORE, a new system toshare customer information, lift truck specifications andproduction data with our dealers by using cloud services.
Dealers in each country will use this system when placing
orders to Toyota Industries. Going ahead, we will share with
our local dealers information of our lift trucks throughout
their lifecycle by linking GMSS, telematics and T-CORE,
thereby establishing a system to ensure a quick response tocustomers.
As the leading manufacturer of materials handlingequipment, Toyota Industries will offer comprehensive
logistics solutions and satisfy the diverse logistics needs ofcustomers.
*8: ALOMA is a Toyota Industries term for Asia, Latin America, Oceania, Middle East andAfrica.

Activities of TALG	Logistics System Engineering Departmentof Toyota Material Handling Japan
In Japan, the installation of logistics systems that bring aboutlabor and work savings in distribution centers has beenproceeding rapidly in line with the exacerbating issue of labor
shortages. Toyota Industries is enhancing its product offering
throughout the entire logistics operations by introducing
systems and equipment of Bastian and Vanderlande into
Japan.
Bastian’s ULTRA automatic truck loading and unloading
robot has started operating at a customer’s logistics siteand has already contributed to improved work efficiency.
We also accept orders for
Vanderlande’s high-speed
CROSSBELT SORTER andengage in sales negotiations
for the company’s ADAPTO,
a high-speed storage andretrieval system. With Toyota
ULTRA
Industries supporting the
introduction of the two30

Toyota Industries Report 2020

companies’ products into Japan, we are making a more
meticulous response to the needs of customers in the
country. (See Special Feature 1 on pages 18–21 for details of
collaboration among the three companies.)

Web

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

Link to productdetails.

	BastianOn the back of strong needs for logistics automation not
only in the e-commerce sector but also in the manufacturing
and retail sectors in North America, Bastian has been
receiving orders from customers in a broad range of businesscategories and expanding sales.
Based on a wealth of know-how accumulated insmall- to medium-scale projects, Bastian has increased its
capabilities for large system development and integration,
thereby successfully receiving an order for the largest project
in its history in 2019. Working together with TMHJ, Bastian
has rolled out ULTRA, an automated system leveraging its
strengths in developing cutting-edge technologies, in theJapanese market.
In North America, Bastian has been accelerating its
offering of logistics solutions to lift truck users by reinforcing
collaboration with dealers of the TOYOTA and RAYMOND
brands.

	Vanderlande
In Europe and the United States, an expansion of the
e-commerce market and labor shortages have caused a
sharp increase in needs for automated systems. Under
such conditions, Vanderlande steadily increased orders
from and sales to warehouse logistics and parcel/postal
services, obtaining orders related to the establishment of
new distribution centers as well as long-term servicing
contracts from leading global operators of e-commerce, retailand delivery services. In the warehouse logistics business,in particular, Vanderlande has been reinforcing systemdevelopment targeting industry’s
top companies and focusedbusiness categories according
to its basic business strategy.
Recently, orders have been
growing from the apparelindustry for solutions
leveraging its pocket sorter
Pocket sorterto pick and sort goods into
hanging pockets.
In the airport business, Vanderlande obtained orders for
systems for new terminals from existing airport customers
as well as long-term servicing contracts based on its longstanding relationships of trust. The company is working tofurther augment such relationships.
Vanderlande is also promoting collaboration within the
Toyota Industries Group, working together with the Logistics
System Engineering Department of TMHJ and Bastian to
introduce its systems into the markets in Japan and North
America, respectively.

Strengths

Opportunities• An agile structure to undertake all aspects from planning and development toproduction within a plant (Vehicle)• Highest-level production efficiency and quality among all Toyota-affiliatedautomobile body manufacturers (Vehicle)• Know-how on the development and production of diesel engines and turbochargers(Engine)• Highly efficient production of high-quality gasoline engines, including those for use
in hybrid vehicles (HV) (Engine)• Ability to develop excellent products with greater fuel efficiency, quieter operation,compactness, light weight and ease to mount on vehicles (Car air-conditioning
compressor)• Global top-share*1 products for use in a full range of vehicles, from internalcombustion vehicles to HVs, plug-in hybrid vehicles (PHV), electric vehicles (EV)and fuel cell vehicles (FCV) (Car air-conditioning compressor)• Monozukuri (manufacturing) using equipment created in-house to produce
high-quality products and flexibly accommodate changes in production volume(Car air-conditioning compressor)• Higher technological capabilities accumulated through the development andproduction of products for Toyota Motor Corporation (TMC), external sales andinternal use (Car electronics)• Development, production and top-level quality of electronic parts and devices forelectrified vehicles (Car electronics)• Increasing needs for energy-saving products due to stricter environmental
regulations and growing environmental consciousness• Sales expansion in each sector in line with growth of the automobile market

FY2019Net Sales

Risks• Shrinking of the automobile market caused by economic slowdown• Customers becoming less willing to buy energy-saving products following lessstringent environmental regulations• A drop in product competitiveness due to the yen’s appreciation or a rise in raw
material costs• Suspension of production caused by supply chain disruptions*1: Survey by Toyota Industries Corporation

FY2020Operating
Profit613.8 billion¥610.7 billion¥

Vehicle Sales

Engine Sales(Thousand units)(Thousand units)350¥6.8 billion

30
25

600

200

500

20

150

400

15

300

0

10

200

50

5

100
(FY) 16

17

18

19

20

0

17.2 billion(Million units)

700

100

¥

35

800

250

FY2020Compressor Sales

900

300

FY2019(FY) 16

17

18

19

20

0

(FY) 16

17

18

19

20

31

Company Introduction

Strategies and Businesses Promotion of ESG Initiatives

Corporate Information

Business Activities

VehicleMedium-Term Direction of BusinessWe will contribute to TMC as a development andproduction base of compact sports utility vehicles (SUV)
by leveraging our comprehensive strengths derived
from the highest level of safety, environment, quality,
cost and delivery (SEQCD) among all Toyota-affiliatedautomobile body manufacturers and through greatercollaboration within the Toyota Industries Group.

accomplishment for successfully improving the painting
process that accounts for about 60% of the plant’s total CO2
emissions. It also has the added effectiveness as it could
be applied to other plants, including the Takahama Plant
producing materials handling equipment. We will continue toundertake activities to eliminate the wasteful use of energy
through focused investigation and analysis.

	RAV4 Designed, Developed and Producedby Toyota Industries Selected as the Car of
the Year JapanThe new Toyota RAV4, TMC’s global strategic vehicle thatmade a comeback to the Japanese market, received the
Car of the Year Japan 2019-2020 award for its capabilities
as an SUV of the new era to satisfy every need of users at
a high level. The RAV4 became the first Toyota vehicle toreceive the award in a decade.
Toyota Industries was involved in exterior and interior
design and upper-body development of the vehicle andundertakes production of the RAV4. We will continue topursue vehicle
planning anddevelopment aswell as assure
quality in a way
to meet the
expectations ofcustomers.
Award-winning RAV4

	Highly Acclaimed by Customers Worldwide

Diesel Engines for Automobiles
Toyota Industries representative receiving the award fromMETI State Minister Hideki Makihara	Receiving an Excellent Karakuri Kaizen
Award
At the Karakuri KAIZEN*2 Exhibition 2019 hosted by theJapan Institute of Plant Maintenance, a project of Toyota
Industries was selected among 454 projects of 110
companies and received an Excellent Karakuri Kaizen
Award. The project, undertaken by the Painting Section of
the Manufacturing Department in the Vehicle Division, wasrecognized for its safe, secure and comfortable karakuri
mechanical device that resolves problems facing painting
operators and suppliers in relation to the 3Ms (muri, muraand muda: literally translated as overburden, unevenness
and waste).
*2: Achieving kaizen (improvement) at low cost by karakuri (Japan’s traditional, nonpowered mechanical systems that utilize gravity, the principle of leverage, etc.)	Winning a Minister of Economy, Trade andIndustry Award in the 2019 Energy
Conservation Grand Prize
The Nagakusa Plant, a vehicle assembly base in Aichi
Prefecture, has implemented a comprehensive energysaving initiative to reduce heat dissipation loss in the drying
process of electrodeposited vehicle painting and cut down
its annual CO2 emissions by 391 tons. In recognition of thisinitiative, Toyota Industries received a Minister of Economy,
Trade and Industry Award in the Industrial Field, which is
the highest award in the Energy Conservation Grand Prize
program (Energy Saving Projects Category) run by the
Energy Conservation Center, Japan, in 2019.
We believe that the initiative was an excellent

32

Toyota Industries Report 2020

Business Overview in Fiscal 2020

Thanks to the growth in sales of engines, including
new A25A and M20A gasoline engines, unit sales infiscal 2020 totaled 807,000 units, an increase of
214,000 units, or 36%, over the previous fiscal year.
Net sales increased by ¥14.0 billion, or 13% year on
year, to ¥122.4 billion.

Business Overview in Fiscal 2020

The automobile market remained on par with theprevious fiscal year in Japan, but sales declined inother parts of the world.
In fiscal 2020, unit sales increased by 39,000
units, or 14%, over the previous fiscal year to
324,000 units on the back of growing sales of the
new RAV4, production of which was launched in
November 2018. Net sales also increased by¥7.5 billion, or 9% year on year, to ¥89.9 billion.

way to the era of zero emissions by pursuing thefurther evolution of internal-combustion engines anddeveloping new, globally top-level technologies andproducts that also respond to car electrification.

Two Toyota Industries’ representatives
receiving the award (on the right)

Toyota Industries’ diesel engines are mounted in a variety of
Toyota vehicles, including the Toyota Land Cruiser series,
the world’s renowned full-fledged four-wheel drive (4WD)model, and TMC’s Innovative International Multipurpose
Vehicle (IMV) series targeting emerging countries. Theirhigh performance and reliability have gained strong market
recognition. Currently, our mainstay products are in-line
4-cylinder GD diesel engines and V-type 8-cylinder VD
diesel engines. GD diesel engines equipped with aturbocharger specifically and optimally designed andmanufactured in-house are manufactured in Japan and by
Toyota Industries Engine India Pvt. Ltd. (TIEI), a consolidated
subsidiary in India.
TO PIC

Launched Production of a New
Turbocharger Realizing Higher Output of
GD Diesel Engine
In March 2020, Toyota Industries launched
production of a new turbocharger that realizes higher
output of the Toyota GD diesel engine to be mounted
on such vehicles as TMC’s IMV series sold across theworld. The new turbocharger provides considerably
better performance through the adoption of newtechnologies, such as a ball bearing-type system anda newly designed impeller and turbine wheel, and has
successfully achieved a dramatic increase of around
15% in the output of the engine without changing its
basic components. We will continue to improve thebasic performance of our turbochargers and offer
diesel engines with even greater competitiveness.

EngineOur Toyota New Global Architecture (TNGA)*3 gasoline
engines, namely the 2.5-liter A25A and 2.0-liter M20A, aremainly fitted in the RAV4 manufactured at the Nagakusa
Plant in Aichi Prefecture. Developed based on the TNGA
concept, these engines
offer both excellent
driving performanceand environmental
performance. Responding
to the advancement of car
electrification, we have also
added an HV version of the
A25A engine to our lineup.
We will improve productquality and productivity
further and contribute to
the creation of “ever-better
2.5-liter A25A engine for HVscars” by TMC both throughdiesel engines and gasoline
engines.
*3: Development policy and method for vehicle creation based on a modular platform

Engines for Use in Industrial Fields
Toyota Industries’ engines are highly renowned for theirreliability and excellent environmental performance inindustrial fields as well. These engines are used for a wide
variety of applications, including our lift trucks, and adopted
by many customers such as GHP*4 manufacturers in Japanand CHP*5 manufacturers worldwide. These engines offer
downsized displacement compared with conventional models
with equivalent output, resulting in higher
fuel efficiency, cleaner emissions and areduction in size.
Web*4: Short for gas heat pump; air conditioner driven by a gas
engine*5: Short for combined heat and power; co-generation system

Link to product details.

Toyota 1ZS diesel engine and turbocharger	Seeking Engines with Greater ProductAppealMedium-Term Direction of BusinessIn line with more stringent environmental regulations
adopted globally, there is a growing demand forengines with even greater fuel efficiencies and cleaner
emissions. Amid this environment, we aim to pave theGasoline Engines for Automobiles

High-output GD diesel engine and new turbocharger

Following the Paris Agreement adopted in December 2015
at the 21st session of the Conference of the Parties to theUnited Nations Framework Convention on Climate Change(COP21), and with some countries announcing their shift
from internal-combustion vehicles to electrified vehicles, there
has been a growing need for engines with even greater fuelefficiency and cleaner emissions for HVs, PHVs and other33Company Introduction

Strategies and Businesses Promotion of ESG Initiatives

Corporate Information

Business Activities

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

Car Air-Conditioning Compressor
Medium-Term Direction of BusinessIn the Car Air-Conditioning Compressor Business, wewill leverage our core compression technology andbecome an innovative component supplier in a futuresociety where car electrification and the use of
autonomous technology are expected to advance
rapidly.
In the field of car air-conditioning compressors, wewill further enhance our capability to develop productsthat offer excellent fuel efficiency, quieter operation,compactness, light weight and ease to mount on
vehicles. In addition, with the aim of satisfying needs ofa broader variety of customers, we will utilize ouraccumulated technologies to expand our development
domain into core components for drive systems.

Business Overview in Fiscal 2020

In fiscal 2020, unit sales of car air-conditioning
compressors decreased 1.95 million units, or 6%,
from the previous fiscal year to 31.03 million units.
Despite an increase in sales in Japan, unit sales were
negatively affected by lower sales in North America
and Europe due primarily to the impact of the
COVID-19 pandemic. Net sales were down ¥18.1
billion, or 5%, from the previous fiscal year to¥328.1 billion.

More stringent fuel efficiency standards have been
enforced across the world, pushing the need for higher
fuel efficiency both for internal-combustion vehicles
and electrified vehicles. Our variable-displacement typecompressors for internal-combustion vehicles, which arerenowned for high fuel efficiency and reduced weight,
have been adopted by the world’s leading automakers,
including Toyota Motor Corporation, Daimler AG, General
Motors Company (GM), Volkswagen AG and Hyundai Motor
Company.
In the United States, our SES series became the firstcompressor*6 to be approved under the country’s off-cycle
credits program. The program gives off-cycle credits totechnologies that can effectively improve fuel efficiency
under its emissions regulations. We have since beenworking to increase the number of models equipped with
the SES series compressors.
For electric compressors, we are differentiating theirperformance by leveraging our original evaluation andanalysis techniques and know-how. Specifically, we
are working to add even greater competitiveness toour products. Efforts include improving efficiency that
affects the driving range of electrified vehicles; adopting
countermeasures against electric waves specific toelectrified vehicles; and achieving quieter operation. We arealso augmenting our support capabilities for automakers
through our solution offering to solve diverse noise andvibration issues of the entire vehicle. Besides Toyota, Ford
Motor Company, Renault
S.A.S., Honda Motor Co.,
Ltd., Nissan Motor Co.,
Ltd. and other automakers,
which are already using
our electric compressors intheir respective HVs, PHVs
and EVs, we will continue
to ramp up our efforts
to expand sales to otherautomakers around theworld.
*6: S urvey by Toyota Industries
Corporation

ESB20 electric compressor

	Establishing Stronger Global Productionand Supply Structures
Currently, the car air-conditioning compressor market
remains unstable due to weak automobile sales, eventhough growth is expected over the medium term. The
move toward more stringent fuel efficiency regulations
and car electrification has also prompted the possibilityof fluctuating demand for compressors both for internalcombustion vehicles and electrified vehicles. In response,
we are building a production structure less vulnerable tochanges in production volume through such measures
as automating our plants to save labor and implementing
flexible shifts in production operations. Meanwhile, we
expect the rapid spread of electrified vehicles in China driven
by the country’s new energy vehicles (NEV) regulation*7.
Accordingly, we will promote the local production of electriccompressors to capture booming demand.

Even though growth in the car air-conditioning compressor
market is currently slowing down due to weak sales ofautomobiles, we expect continued growth over the medium
term on the back of the expanding automobile market
and an increase in the number of vehicles fitted with an air
conditioner. The market of electrified vehicles, in particular,
is expected to accelerate growth gradually in and after2020 as automakers roll out new models. In order toreinforce our development and production structures, we willchannel resources into both types of compressors, namely
compressors for internal-combustion vehicles, which are still
mainstay products for the time being, and compressors forelectrified vehicles, for which we anticipate stronger demand
over the medium to long term.

34

Toyota Industries Report 2020

TO PIC
Since launching the world’s first mass productionof electric compressors in 2003, Toyota Industries
has maintained the world’s top share*8 for electriccompressors and manufactured approximately 20
million units to date. Previously, we had manufactured
these compressors only in Japan, but in responseto the growing demand in China, initiated local
production at TD Automotive Compressor KunshanCo., Ltd. (TACK) in March 2020. There is also aplan to launch production at Yantai Shougang TD
Automotive Compressor Co., Ltd. (YST) in the future.
By installing production lines that have been refinedfor higher quality and productivity at a mother plantin Japan to bases in China, we will ensure stableproduction at a high quality level.

*7: Regulation in China mandating automakers to produce a certain percentage of EVs
and other new energy vehicles

	Increasing Competitiveness by Creating
Production Facilities In-House
Achieving high levels of fuel efficiency and reliability requires
high-precision processing technologies for compressors forboth internal-combustion vehicles and electrified vehicles.
Toyota Industries realizes high-speed and high-precision
machining by leveraging its know-how accumulated throughresponding to the stringent demands of automakers
worldwide and by developing devices from processing
machines to associated cutting tools in-house. With the*8: Survey by Toyota Industries Corporation

Worldwide Bases of Car Air-Conditioning Compressors (As of March 31, 2020)

TDDK
DNDE

Germany

Germany

YST

DICH

MACI

China

China

U.S.A.

DIAM

U.S.A.

	Developing Next-Generation Products	Development Efforts Centered around
Energy Savings and Car Electrification

aim of increasing our production efficiency further, we havealso set up a system that allows design and productionengineering departments to work as one team to design
mixed production lines to manufacture a wide variety of
products while increasing production capacities in a phasedmanner.

Following car electrification and widespread use of
autonomous driving technology, there has been a growing
need to cool electronic devices, batteries and other key
heat-emitting components. In response, we are developing
compressor models with increased cooling capability in order
to use their cooling function not only for vehicle interior air
conditioning but also for key components. Additionally, we
are making our electric compressors compatible with varying
voltage and capacity needs and increasing their reliability
through multifaceted evaluations using our evaluation
facilities created in-house and a test driving course.
Besides this cooling functionality, we intend to utilize
our core technologies to expand our business domain
into components for drive systems. Currently, we engage
in production of an oxygen-supplying air compressor andhydrogen circulation pumps for FCVs and are promoting
development of next-generation products.

TICO

DNTS

Japan

Italy
SUBROS

TACK

India

China

TACG

U.S.A.
TICA

U.S.A.

TACI

Indonesia

DNBR

BrazilConsolidated production bases

Licensed manufacturers

Technical service stations

Toyota Industries’ car air-conditioning compressors are widely adopted by automakers around the world, garnering the No. 1*9 position in global sales.
*9: Survey by Toyota Industries Corporation

35

Company Introduction

Strategies and Businesses Promotion of ESG Initiatives

Corporate Information

Business Activities

Car Electronics
Medium-Term Direction of BusinessCar electrification is steadily progressing in keeping withthe enforcement of more stringent environmental
regulations and growing energy-saving consciousness
among customers. The Electronics Division willcontribute to car electrification in a broad range offields, from offering on-board power source devices toimproving social infrastructure through the provision of
charging stands and systems to feed electricity
externally.

Business Overview in Fiscal 2020

Net sales of car electronics products expanded,primarily supported by sales of DC-DC converters
and on-board chargers mainly to TMC.

	Contributing to Car Electrification
Toyota Industries develops not only DC-DC converters,
on-board chargers and AC inverters in the field of on-board
power source devices but also rear inverters in the field ofcore components for drive systems and charging stands. In
addition to TMC, we are promoting new business to otherautomakers across the world.

DC-DC converter

On-board charger

A DC-DC converter converts the high voltage of HV,
PHV and EV batteries into a lower voltage level to supply
power to standard electricaldevices such as lights andwipers. Our DC-DC converters
are fitted in the Prius, Aqua andother major electrified vehicles.
By utilizing such technologies
as the world’s first thick copper
substrate*10, we have reduced
the volume and weight of the
product. In December 2019, we
also started production of a DCDC converter for the new Yaris.
Sub-stand Main control
stand
An on-board charger
converts AC voltage from theCharging stand for PHVs and EVs
power grid into DC voltage

36

Toyota Industries Report 2020of high-voltage batteries in vehicles and is necessary forcharging EVs and PHVs, for which the market is expected
to expand in the future. We offer chargers compatible with awide range of voltages to enable their use in various parts of
the world.
In addition, we have been contributing to theadvancement in car electrification by developing a rear
inverter for electric 4WD vehicles and public charging stands
for PHVs and EVs.

Web

Textile Machinery

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

Air-Jet Loom Sales• Broad product lineup both in the spinning andweaving machinery fields• Global, well-developed service network(Thousand units)	Use of an Electrified Vehicle as a Power
SourceIn recent years, there has been a growing public attention to
the use of high-capacity batteries of electrified vehicles as a
power source.
Toyota Industries recognized early on the use ofelectricity stored in vehicle batteries as a power sourceand developed an on-board AC inverter in 1995. It was
the world’s first model*10 to be mounted on a vehicle while
in production. Since then, production volume has been
increasing and reached a cumulative total of 30 million unitsin June 2019.
The 1.5-kW type, inparticular, can operateappliances that require more
power, such as rice cookers
and hot plates, and has
drawn much attention as an
emergency power source
in a disaster in addition to
camping, outdoor eventsand other applications.
1.5 kW AC inverter
Immediately following
Typhoon Faxai in 2019,many vehicles fitted with this inverter were put to use acrossJapan to supply electricity during prolonged power outages.
We will continue to promote the development of
inverters as a key component that adds new value toelectrified vehicles, along with other products such as
vehicle-to-load (V2L) systems*11 capable of supplying alarge amount of electricity.
*10: Survey by Toyota Industries Corporation*11: S ystems and equipment designed to use the power accumulation and generation
capabilities of HVs, PHVs, EVs and FCVs to feed power to electric appliances

8

Opportunities

6• A rise in textile demand in line with an increase in • Further increasing applications in industrial textile
the world population
products• Increasing need for high-quality and highly functional yarn and textile products, following the economic
growth of emerging countries420• World-leading market share* in unit sales of air-jet
looms• Ability to develop products that excel in reliability,
energy-saving performance and versatility

Risks
(FY)

16

17

18

19

20

• Changes in each government’s policies concerning • Weaker sales due to intensifying competition
promotion of the country’s textile industry• A decline in capital investment due to economic slowdown and raw cotton and/or yarn price fluctuations

FY2019Net Sales¥76.3 billion

FY202061.7 billion¥

Medium-Term Direction of BusinessWith growing environmental consciousness worldwide,
needs are expected to increase further for textile
machinery offering superior environmental performance.
Toyota Industries’ products are highly acclaimed bycustomers for their excellent reliability and productivity
as well as energy-saving performance. We will continue
to develop energy-saving and other innovativetechnologies and seek to achieve further growth andevolution as a leading manufacturer of textile machinery.

Business Overview in Fiscal 2020

The textile machinery market was weak in Asia,
including China, our primary market. Unit sales of
air-jet looms decreased 2,200 units, or 24% year on
year, to 6,800 units. Combined with a decrease insales of quality measurement instruments for fiber,yarn and fabric, net sales were down ¥14.6 billion, or
19%, from the previous fiscal year to ¥61.7 billion.

Operating
Profit

FY2019¥7.3 billion

FY2020

2.9 billion¥	Taking Part in the Largest International
Textile Machinery Trade Show in the WorldIn June 2019, Toyota Industries participated in ITMA 2019
international textile machinery trade show held in Barcelona,
Spain.
We exhibited the JAT810 air-jet loom, for which we
enjoy the world’s top share in unit sales, and demonstrated
high-speed weaving of complex-patterned fabrics using ouroriginal electronic shedding device. We also showcased ournext-generation air-jet loom that captures the future needsof textile plants for automation, use of IoT and environmental
response. These products received favorable feedback
from many visitors. At the booth of Uster Technologies AG,
a Switzerland-based consolidated subsidiary manufacturing
quality measurement instruments for fiber, yarn and fabric,
we exhibited the latest measurement instruments, whichdrew much attention from visitors. Through various textile
machinery exhibitions, we will continue to appeal tocustomers our technological capability to meet their needs
and reinforce our brand strength.

Growing Needs for Air-Jet Looms

V2L
Evacuation shelters,
school gymnasiums, etc.

TMC’s SORA FC bus and V2L

10Toyota Industries’ air-jet looms are adopted by customers
in China, India and many other countries. Produced fabrics
are used broadly for towels, shirts and other clothing
purposes as well as in industrial products such as materials
for electronic substrates and vehicle airbags. Recently, an
increase in mobile electronic devices has driven the need for
fabrics of woven glass fiber for use in electronic substrates,
and it is anticipated that applications for air-jet looms will
expand further.

Staff who participated in the trade show

Uster’s booth37