Toyota Industries Report
Year ended March 31, 2017

Message from the Chairman and President
Firstly, we would like to extend our sincere appreciation foryour continued support of Toyota Industries Corporationand the Toyota Industries Group.
In fiscal 2017 (ended March 31, 2017), the global
economy mildly expanded, driven by monetary andfinancial policies in respective countries despite adeceleration of the Chinese economy and the anticipatedimpact of the U.K.’s decision to leave the EU. Althoughmodestly, the Japanese economy continued to grow due
primarily to increases in capital investment and exports inaddition to a recovery in consumer spending.
In this business environment, Toyota Industries
Corporation and its Group companies (“Toyota Industries”)
undertook efforts to ensure customer trust through a
dedication to quality first as well as to expand sales by
responding flexibly to market trends. As a result, unit sales
were strong in each business division; however, net sales
in fiscal 2017 decreased owing mainly to the impact of
exchange rate fluctuations. In terms of profit, despite cost
reduction efforts throughout the Toyota Industries Group,sales efforts and declines in depreciation costs, werecorded a decrease in profit because of the impact of
exchange rate fluctuations and an increase in labor costs.
With regard to the future economic outlook, the global
economy is expected to continue growing. However,uncertainties surrounding the business environment
preclude optimism, as the future trend in monetary easing
in respective countries, protectionist policies spreading indeveloped countries, a further deceleration of the Chinese
economy and the occurrence of terrorism and conflicts
around the world require close monitoring.
Under these circumstances, Toyota Industries is further
strengthening its business foundation and addressing key
management issues to raise corporate value by leveraging
the Group’s comprehensive strengths.
As immediate tasks, we will endeavor to bolster ourmanagement platform to respond quickly to changes in thebusiness environment that are accelerating year by year.
Specifically, based on our quality first approach, we aim tobuild a stronger production foundation by maintaining andimproving productivity on a global basis. Furthermore, wewill strive to build a lean corporate structure by thoroughly
eliminating waste, by pursuing excellence in quality, costand product lead time throughout the global supply chain
and by improving productivity in administrative functions.
Moreover, we will strengthen risk management in orderto quickly and appropriately respond to changes in theworld situation.

Besides these approaches, we will work to hone ourmanufacturing capabilities, which are one of our corestrengths, and further bolster product competitiveness.
To this end, we will differentiate Toyota Industries not
only through the development of technologies based on
the keyword of the 3Es, which we define as “energy,”“environmental protection” and “ecological thinking,” butalso through our production engineering technologies.
In addition, we aim to leverage new growth potentials
through several measures. They include taking advantage
of such structural changes as progress in electrificationand the rapid growth of e-commerce in the automobile andmaterials handling equipment markets on a global scale;creating and providing customers with new values; andutilizing the Internet of Things (IoT) and artificial intelligence(AI). To support such business development, we willcontinue our efforts to create a workplace environment thatenables diverse human resources to fully demonstrate theirabilities and develop personnel who can play active roles in
the global arena.
In other areas, Toyota Industries will create a workplaceenvironment that places top priority on safety; thoroughly
enforce compliance, including observance of laws
and regulations; and proactively participate in social
contribution activities. By carrying out these initiatives,
we aim to broadly meet the trust of society and growharmoniously with society. With regard to protection of
the global environment, we will undertake Group-wide
initiatives in seeking to realize “a zero CO2 emissions
society in 2050.”
Through these initiatives, we aim for sustainable growthof each business and strive to contribute to an enriched
lifestyle and comfortable society around the world as
described in Toyota Industries’ Vision 2020 plan.
In closing, we would like to sincerely ask for your continued
understanding and support.
July 2017

Tetsuro Toyoda
Chairman

Akira Onishi
President
Chairman Tetsuro Toyoda (left)/President Akira Onishi (right)

1

Continuous Value Creation of the
Toyota Industries Group

Materials Handling
Equipment

2000—

P32

[ Strengthening Businesses
Utilizing Strategic M&A andOther Measures ]Based on the Basic Philosophy, Toyota Industries has provided products and services truly needed bysociety by leveraging the technologies and know-how cultivated for more than 90 years since ourfoundation. We will continue to strive for the sustainable growth of our businesses by further
contributing to the realization of an enriched lifestyle and comfortable society.

Primarily in the Materials Handling Equipment
Business, which grew to become one of ourcore businesses, we have pushed forward withexpanding the value chain and making advancesfor global business development through suchmeasures as strategic M&A,
thereby continuing our efforts
to further strengthen ourbusinesses.

1988—[ Becoming a Global Company ]Basic Philosophy[Respect for the Law]

Toyota Industries is determined to comply with the letter and spirit of the law, in Japan and overseas,
and to be fair and transparent in all its dealings.
[Respect for Others]
Toyota Industries is respectful of the people, culture, and traditions of each region and country in which
it operates. It also works to promote economic growth and prosperity in those regions and countries.
[Respect for the Natural Environment] Through its corporate activities, Toyota Industries works to contribute to regional living conditions andsocial prosperity and also strives to offer products and services that are clean, safe, and of high quality.
[Respect for Customers]
Toyota Industries conducts intensive product research and forward-looking development activities tocreate new value for its customers.
[Respect for Employees]
Toyota Industries nurtures the inventiveness and other abilities of its employees. It seeks to create aclimate of cooperation, so that employees and the Company can realize their full potential.

Amid an expansion in demand for lift trucks
in North America and giving consideration
to trade frictions and impacts fromfluctuations in exchange rates, weestablished a manufacturing company for
lift trucks in the U.S. state of Indiana in
1988. This move was subsequently
followed by global production of car
air-conditioning compressors, foundryparts and textile machinery, and Toyota
Industries made great strides toward
becoming a global company.

Fuel cell lift truck

Key cart

Automobile

P37

Aerial work platform

Low lift order picker
GD diesel engine

1953—

Electric compressor

Electric lift truck[ Diversification and Expansion of Businesses ]We encapsulated the spirit offounder Sakichi Toyoda in the
Toyoda Precepts, which serve as
Toyota Industries’ corporate creed
and upon which our Basic
Philosophy is based.

We began production of engines andassembly of vehicles in 1953 andproduction of lift trucks in 1956 in ourefforts to diversify our businesses,
followed by production of car
air-conditioning compressors in 1960.
We continued to engage in research anddevelopment to nurture new businesses
and build the foundation for future growth.

RAV4LA-type internal-combustion
lift truck

DC-DC converter

Vitz (Yaris outside Japan)
Variable-displacement
type compressor

S-type gasoline
engineAfter putting a lot of effort into research and trials, Sakichi
Toyoda finally invented and completed the Type G
automatic loom. Toyoda Automatic Loom Works, Ltd.
(now Toyota Industries Corporation) was established to
manufacture the loom in 1926. Carrying on his spirit ofbeing studious and creative, we embarked on a path toundertake the development and production ofJapanese-made spinning machinery and automobiles.

Toyota Industries’
CSR Activities

P43

Towing tractor

1926—[ The Beginning ]Textile Machinery

Automated storage
and retrieval system

JAT810 air-jet loom

Publica pickup truck
RX300 ring spinning frame

Yarn quality measurement
instrument

Fixed-displacement
type compressor

RX100 ring spinning frame
JA air-jet loom

Type G automatic loom

[Main Scope of CSR Activities]
Contribution asa corporate citizen

Contribution in
non-business areas

Ethical responsibility /ComplianceFairness, transparency,
respect for human rights
and cultures, environmental
conservation

Foundation ofbusiness activities

Economic responsibility(business responsibility)

Continuous provision of
products and services
that contribute to society

Contributions throughbusiness activities

Corporate social
responsibility• Adhering to a quality first approach, we ensure monozukuri (manufacturing) that quickly responds tothe diverse, ever-changing needs of customers. (Relationship with Our Customers)• We encourage open procurement and seek co-existence and co-prosperity with our business partners(suppliers) based on mutual trust. (Relationship with Our Business Partners)• We strive for timely and appropriate information disclosure while promoting good communications withshareholders and investors. (Relationship with Our Shareholders and Investors)• We aim to create safe and secure workplaces where each and every associate can exercise theirdiverse potentials and play active roles. (Relationship with Our Associates)• We fulfill our role as a good corporate citizen and actively undertake social contribution activities.
(Relationship with Our Local Communities)

Our ContinuousCommitment

Society (company’s raison d’etre)

2

Toyota Industries Report 20173

Toyota Industries’
Value Creation Process
Toyota Industries divides its diverse businesses such as materials handling equipment,
textile machinery, car air-conditioning compressor, car electronics, vehicle and engine
into three units: solution, key components and mobility. We aim to contribute to ourstakeholders by making the most of the core assets and strengths we haveaccumulated to date and by engaging in value creation in each unit.

Core Assets and Strengths

Value
Creation[Human Resources]• Diverse human resources comprised of more than
50,000 employees

Unit

Main
products

Providing products and services that anticipate customers’ needs by leveraging
synergies among businesses

Development

Production

Sales

Product development
leveraging synergies among
businesses

Highest-level SEQCD*
that keeps evolving by
sharing best practices inmanufacturing

Accurately identifying
diverse customer needs
and reflecting them inproduct development• Human resources development that underpins sustainable growth

After-Sales
Services•Comfortable andattractive automobiles

Finely tuned aftersales services thattakes advantage ofextensive networkand technologicalcapabilities

Mobility[Product Development & Manufacturing Capabilities]
Materials
handling
equipment• Product development capabilities that leverage the advantages ofengaging in diverse businesses• Manufacturing capabilities and production engineering that support
high-quality and stable production

Solution●•Fuel-efficient engineswith cleaner emissions●

Textilemachinery●●●

Offering unique solutions by engaging in everything from development to production, sales and after-sales services

Car airconditioning
compressor[Global Network]• Solid supply chain built on mutual cooperation with business partners●

For end-users• Know-how on in-house development of production equipment that
contributes to the differentiation of product appeal• Production bases around the world

Keycomponents

Carelectronics• Extensive lift truck sales and service networks in respective regions●

Solution●
For automakers
around the world●•Comfortable vehicle interior●• Sound financial foundation

EngineMobility●

Contributing
to OurStakeholders•Textile machinery that
produces high-quality fabrics
and yarns with soft texture

Key Components

Providing key components of various products for automakers around the world by leveraging our technological capabilities•Better fuel efficiency
of automobiles[Financial Foundation]• High rating bestowed by rating agencies(fund procurement capability)•Support for customers’
greater logistics efficiencies●
For Toyota Motor
Corporation●

VehicleContributing to further improving competitiveness of Toyota cars by leveraging our strengths in manufacturing capabilities* Safety, environment, quality, cost and delivery

4

Toyota Industries Report 2017

6

7

CONTENTS

Message from the Chairman and President
Inside cover–1
Continuous Value Creation of the Toyota Industries Group
2–3
Toyota Industries’ Value Creation Process4, 6–7
Contents
5
Outline of Businesses
8–9
Consolidated Eleven-Year Summary
10–11
Consolidated Financial and Non-Financial Highlights
12–14
Top Message
15–23
Special Features
1 Development and Production of Car Air-Conditioning Compressors Geared
toward the Age of Electric-Powered Vehicles Ahead of the World
24–27
2 K
 aizen (Improvement) Activities across Diverse Business Domains—
A Force to Drive Constant Evolution
28–31

Business Activities Materials Handling Equipment
Automobile
Textile Machinery

32–36
37–42
43

Corporate Social Responsibility 
Corporate Governance
Relationship with Our Customers
Relationship with Our Business Partners
Relationship with Our Shareholders and Investors
Relationship with Our Associates
Relationship with Our Local Communities

44–49
50–51
52
53
54–57
58–59

Environmental Initiatives 
Vision for Environmental Activities
Structure to Implement Environmental Management
Sixth Environmental Action Plan
Establishing a Low-Carbon Emission Society
Establishing a Recycling-Based Society
Reducing Environmental Risk and Establishing a Society inHarmony with Nature
Environmental Management
Environmental Impact Flow and Environmental Accounting
Third Party Assurance of Environmental Performance Data

60
61
62–63
64–65
66–67
68–69
70–73
74
75

Financial Section / Corporate Information 
Financial Section
Primary Impacts on Financial Results Accompanying Transition to
International Financial Reporting Standards (IFRS)
Consolidated Statements of Financial Position
Consolidated Statements of Profit or Loss
Consolidated Statements of Comprehensive Income
Consolidated Statements of Changes in Equity
Consolidated Statements of Cash Flows
Corporate Information
Board of Directors, Audit & Supervisory Board Members andManaging Officers
Major Production Bases
Investor Information

77
78–79
80
81
82–83
84–85

86–87
88
89

Editorial policy

In aiming to realize a deeper understanding of the Toyota Industries Group among a broad spectrum of
stakeholders, the Annual Report and Social and Environmental Report have been combined into the Toyota
Industries Report from the fiscal year ended March 31, 2008.
In addition to the Toyota Industries Group’s management policies, the report provides easy-to-understandinformation regarding its business, social and environmental activities over the past year as well as its future direction.

Period covered by the report

This report focuses on activities carried out in fiscal 2017 (April 1, 2016 to March 31, 2017), but also includes some
information outside this period.

Organizations covered in the report Toyota Industries Corporation and its consolidated subsidiaries
Reference guidelines• Global Reporting Initiative (GRI) Sustainability Reporting Guidelines 4th edition (G4)• ISO 26000• Japan’s Ministry of the Environment Environmental Accounting Guidelines (2005 Version)• Japan’s Ministry of the Environment Environmental Reporting Guidelines (2012 Version)

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 and estimatesof the Toyota Industries Group 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 noobligation to publicly update or revise any forward-looking statements in this report, whether as a result of new information, future events or otherwise. Therefore, it is advised that you
should not rely solely upon these projections and forward-looking statements in making your investment decisions. You should also be aware that certain risks and uncertainties could
cause the actual results of Toyota Industries to differ materially from any projections or forward-looking statements discussed in this report. These risks and uncertainties include, but
are not limited to, the following: (1) reliance on certain customers, (2) product development capabilities, (3) intellectual property rights, (4) product defects, (5) price competition,(6) reliance on suppliers of raw materials and components, (7) environmental regulations, (8) success or failure of strategic alliances with 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.
The fiscal year ended March 31, 2017 is referred to as fiscal 2017 and other fiscal years are referred to in a corresponding manner.

5Outline of Businesses
Materials Handling Equipment
The smooth flow of goods links the world and enriches the
lives of people and society. Toyota Industries meets diverse
customer needs in logistics by providing a diverse range ofmaterials handling equipment such as lift trucks and offering
advanced and efficient logistics services. Through thesebusinesses, Toyota Industries helps customers the world over.

■ Operating Profit■ Net Sales(¥ Billion) JGAAP*1

IFRS

1,200
1,000

IFRS

100

■ Percentage of Net Sales(FY2017/IFRS)

80

800

60

600

59.0%

40

400

20

200
0

(¥ Billion) JGAAP(FY) 1516170(FY) 15

16

17

Internal-combustion lift truck

Reach-type electric lift truck

Aerial work platform*1: Generally accepted accounting principle in JapanThe Materials Handling Equipment Segment develops, produces, sells and provides services for a broad range of products, from industrial vehicles
centered around a full lineup of lift trucks (0.5- to 43-ton capacities) to materials handling systems. Lift trucks, which capture the top global market
share*2, are delivered to customers around the world under the TOYOTA, BT, RAYMOND and CESAB brands. Toyota Industries also strives to provide finely tuned after-sales services so that customers can always use our products in the best possible condition. While raising the level of aftersales services for developed countries, we are reinforcing our sales and service networks as well as enhancing service training for emerging countries.
*2: Survey by Toyota Industries Corporation

Automobile
Get behind the wheel with a solid, reassuring feel andenjoy comfortable driving. Besides vehicle assembly, Toyota
Industries produces various components such as engines andcompressors, the latter of which comprises the heart of car air
conditioners to keep the vehicle interior comfortable, as wellas car electronics. From vehicle assembly to parts production,
the Automobile Segment engages in a wide range of car-related
businesses, leveraging synergies among its business divisions
in development and production.
VehicleEngineCar Air-Conditioning
Compressor
Car Electronics

New electric lift truck

Automated storage
and retrieval system

Low lift truck■ Operating Profit■ Net Sales(¥ Billion) JGAAP

IFRS

1,200
1,000

IFRS

40
30

800

■ Percentage of Net Sales(FY2017/IFRS)

33.6%

20

600
400

10

200
0

(¥ Billion) JGAAP

Simple AGV(automatic guided vehicle)(FY) 1516

17

0

RAV4 (hybrid model)(FY) 15

16

Diesel engine

Gasoline engine

Electric compressor

17

With its strengths as an industry leader in safety, the environment, quality, cost and delivery, the Vehicle Business produces compact to midsize automobiles.
In addition to diesel engines produced under a comprehensive structure ranging from planning and development to production, we also produce gasoline
engines.
Toyota Industries’ car air-conditioning compressors are highly acclaimed in terms of their reliability at high operating speeds and quiet operation in addition tosuch excellent environmental performance features as compactness, light weight and fuel efficiency. The Car Air-Conditioning Compressor Business captures
the world-leading market share in unit sales*3.
The Car Electronics Business develops and produces electronics products primarily for electric-powered vehicles such as hybrid vehicles.

Vitz (Yaris outside Japan) (hybrid model)
Variable-displacement
type compressor

Fixed-displacement
type compressor

Oxygen-supplying air
compressor for fuelcell vehicles

Hydrogen circulation
pump for fuel cellvehiclesDC-DC converter*3: Survey by Toyota Industries Corporation

Textile Machinery
A soft texture caressing your skin and gently enveloping yourbody. Toyota Industries produces spinning machinery thatspins high-quality yarns and high-speed, energy-saving
weaving machinery that produces fabrics. We deliver textile
machinery to customers around the world that incorporates
advanced technologies and is imbued with our dedication
to quality.

■ Operating Profit■ Net Sales(¥ Billion) JGAAP

IFRS

80

(¥ Billion) JGAAP

8

60

6

40

4

20

2

0

IFRS

(FY) 1516170(FY) 15■ Percentage of Net Sales(FY2017/IFRS)
4.0%

Ring spinning frame
16

The Textile Machinery Division, our original business, began with the invention of the automatic loom by founder Sakichi Toyoda. Presently, we
undertake fully integrated operations from development and production to sales and after-sales services for spinning machines that spin twisted fiber
bundles into yarn and weaving machines that weave spun yarn into fabrics. Our textile machinery is supplied to markets worldwide. Thanks to superb
reliability and high productivity, our air-jet looms have won extensive acclaim from customers around the globe, capturing the world-leading market
share in terms of unit sales*4.
*4: Survey by Toyota Industries Corporation

8

Toyota Industries Report 2017

Roving frame

Comber

17

JAT810 air-jet loom

Cotton classing instrument

Yarn testing instrument9Consolidated Eleven-Year Summary
Toyota Industries Corporation
Years ended March 31

Millions of yen

International Financial
Reporting Standards (IFRS)Generally Accepted Accounting Principles in Japan (JGAAP)

2017

2016

2015

2014

2013

2012

2011

2010

2009

2008

2007

¥1,675,148¥1,696,856¥2,166,661¥2,007,856¥1,615,244¥1,543,352¥1,479,839¥1,377,769¥1,584,252¥2,000,536¥1,878,398

Operating profit (loss)

127,345

137,026

117,574

107,691

77,09870,092

68,79822,002(6,621)

96,853

89,954

Profit before income taxes*1

181,986

191,386

170,827

138,133

86,83680,86673,911

31,756

14,343

126,488

108,484

Profit (loss)*2

131,398

194,270

115,263

91,705

53,11958,59447,205(26,273)(32,767)

80,46059,46875,418¥ 126,395¥ 109,479

26,963¥ 104,495¥ 104,205¥ 129,023

For the YearNet sales

Investments in tangible assets*3¥

77,393¥¥89,459¥58,404¥

38,254¥

Depreciation*3

73,25378,25370,78264,153

57,954

59,83062,372

73,23887,21983,74474,449Research and development expenses

69,52465,43247,78546,32639,05732,07027,78826,826

33,64636,75034,548Per share of common stock (yen):
Earnings (loss) per share*2, *4
Basic

¥

420.78¥618.34¥367.06¥292.76¥170.36¥188.02¥151.51¥(84.33)¥(105.16)¥257.50¥189.88420.78618.33366.99292.57170.35188.02151.51(84.33)(105.16)257.43189.66

7,125.37

6,678.80

7,500.16

5,640.08

4,719.66

3,662.26

3,300.17

3,390.02

2,987.16

4,483.32

5,612.11

125.00120.00110.00

85.00

55.00

50.00

50.00

30.00

40.00

60.00

50.00

Total assets¥4,558,212¥4,317,282¥4,650,896¥3,799,010¥3,243,779¥2,656,984¥2,481,452¥2,589,246¥2,327,432¥2,965,585¥3,585,857

Share of equity attributable to owners of the parent

2,240,293

2,098,658

2,425,929

1,829,326

1,524,933

1,197,841

1,075,939

1,104,929

977,670

1,453,996

1,810,483

Capital stock

80,46280,46280,46280,46280,46280,46280,46280,46280,46280,46280,462

Number of shares outstanding (excluding treasury stock) (thousands)

310,489314,226

314,155

313,730

312,207311,687

311,564

311,570

311,577

311,589

312,075¥ 239,094¥ 248,049¥ 182,191¥ 155,059¥ 151,299¥ 101,718¥ 153,661¥ 203,452

65,768¥ 188,805¥ 177,467(86,925)(532,238)(160,769)(118,483)(274,210)(9,403)(187,574)(36,855)(114,217)(138,789)(164,446)

789

124,495(8,918)

6,183

7,050

10,279(85,728)(38,230)

120,971(33,992)(19,749)

243,685

92,399248,706

226,406

179,359

296,811

195,566

317,590

188,011

121,284

108,569

Operating profit ratio (%)

7.6

8.1

5.4

5.4

4.8

4.5

4.6

1.6

(0.4)

4.8

4.8

EBITDA (millions of yen)*5

71,608¥ 222,125¥ 191,007

DilutedShare of equity attributable to owners of the parent
Cash dividends per share
At year-end

Cash flows
Net cash provided by operating activities
Net cash used in investing activities
Net cash provided by (used in) financing activities
Cash and cash equivalents at end of year¥

Indices¥ 276,193¥ 279,444¥ 248,854¥ 216,175¥ 155,234¥ 161,876¥ 150,481

Return on equity (ROE) (%)*6

6.1

8.7

5.6

5.7

4.1

5.4

4.5

(2.6)

(2.8)

5.1

3.5

Return on assets (ROA) (%)*7

3.0

4.3

2.7

2.6

1.8

2.3

1.9

(1.1)

(1.2)

2.5

1.7

D/E ratio (%)*8

43.6

43.0

32.0

39.9

45.4

53.8

56.8

60.3

68.6

37.4

29.9

Ratio of share of equity attributable to owners of the parent*9
Number of employees (persons)¥

90,521

¥

49.1

48.6

50.7

46.6

45.4

43.0

41.4

40.8

40.0

47.1

48.8

52,62351,45852,52349,33347,41243,51640,82538,90339,91639,52836,096*1: The figures prior to fiscal 2016 are ordinary income under JGAAP.
*2: Profit (loss) attributable to owners of the parent*3: Investments in tangible assets and depreciation apply to property, plant and equipment. They do not include materials handling equipment leased
under operating leases.
*4: Earnings (loss) per share is computed on the average number of shares for each year.
*5: P rofit before income taxes + Interest expenses – Interest and dividends income + Depreciation and amortization (including assets other than property,
plant and equipment)*6: P rofit (loss) attributable to owners of the parent / Average share of equity attributable to owners of the parent at the beginning and the end of the
fiscal year
*7: Profit (loss) attributable to owners of the parent / Average total assets at the beginning and the end of the fiscal year
*8: Interest-bearing debt / (Share of equity attributable to owners of the parent – Subscription rights to shares)*9: (Share of equity attributable to owners of the parent – Subscription rights to shares) / Total assets
Note: T oyota Industries has adopted IFRS beginning from the end of fiscal 2017. The figures in fiscal 2016 have been reclassified in accordance with IFRS.

10

Toyota Industries Report 201711

Consolidated Financial and Non-Financial Highlights
Financial Information
Net Sales¥

Operating Profit

1,675.1 billion

Depreciation¥¥

127.3 billion¥

Net Sales

69.5 billion

JGAAP(¥ Billion)

IFRS

JGAAP

150
2,166.6

5.4

2,000

120
1,696.8

7.6

137.0
127.3

117.5

1,675.1

1,500

90

1,000

60

500

30

Ratio of Non-Japanese Employees

Consolidated Subsidiaries

77.3 billion

52,623 persons

60.4 %

207 companies

Ratio of New Female Graduates in
Administrative Positions (Non-Consolidated)

Ratio of New Female Graduates inEngineering Positions (Non-Consolidated)

Ratio of Employees with Disabilities(Non-Consolidated)

2,240.2 billion

40.7 %

14.3 %

2.27 %

Profit before Income Taxes

Consolidated Number of Employees/Ratio of
Non-Japanese Employees

¥

IFRS

8.1

(%)

(¥ Billion)

10
8
6
4

200

JGAAP

IFRS

191.3

0
2016

2017

(Companies)

70

250

50,00052,523150

51,45852,623

60.1

60.4

60

0
Operating Profit

1,000

2015

2016

(FY)

2017

*1: The figure for ordinary profit is presented.

1,187

1,180

2016

2017

1,011

800
600

100
400
50

0

(FY)

Operating Profit Ratio (right)

207

30,00010,000

2017

200

214

150

20,000

2016

1,200
214

50

50

2015

(Persons)

(%)

54.2

(FY)

Participants of Japan’s Subcontracting
Law Seminar

60,00040,00002015

Consolidated Subsidiaries(Persons)
181.9

170.8*1100(FY)(FY2017)

Consolidated Number of Employees

Share of Equity Attributable to Owners of
the Parent

Operating Profit/Operating Profit Ratio

2,500

Non-Financial Information (CSR)

Investments in Tangible Assets¥

Research and Development Expenses

73.2 billion(¥ Billion)(FY2017/IFRS)

200

0

2015
2016
Consolidated Number of Employees

2017

0

(FY)

2015

2016

2017

(FY)

2015

Ratio of Non-Japanese Employees (right)

Profit*2

Investments in Tangible Assets

Depreciation(¥ Billion)(¥ Billion)(¥ Billion)

JGAAP

200

IFRS

JGAAP

IFRS

150

194.2

120

150

JGAAP

80

IFRS

Participants of Age-Based Health Education(Non-Consolidated)

Persons Having Completed Guidance Programon Prevention of Lifestyle Diseases(Non-Consolidated)(%)(Persons)(Persons)

0.10

0.10

78.2

2,157
0.08

60

90
77.3

75.4

0
2015

2016

2017

(FY)

0.04

1,000

0.02

500

2016

2017

0.00

0

0
2015

556

400

20

30

0
(FY)

507

1,500

40

60
50

600
1,654

0.06

0.06

100

717

2,142

2,000

131.3
115.2

800

2,500

73.2

70.7

126.3

Frequency Rate of Lost Workday Injuries(Non-Consolidated)

(FY)

2015

2016

2017

(FY)

2015

2016

200

0

0
2017

(FY)

2015

2016

2017

(FY)

2015

2016

2017

*2: The figures for profit attributable to owners of the parent are presented.

Research and Development Expenses(¥ Billion)

JGAAP

(¥)

IFRS

JGAAP

IFRS

150

80
65.4

69.5
120

60
47.7*3

Total Assets/Share of Equity Attributable to
Owners of the Parent/Ratio of Share of
Equity Attributable to Owners of the Parent

Cash Dividends Per Share/
Dividend Payout Ratio/Total Return Ratio*4

90

30.0
30.0

110

28.7
120

29.7
29.7
125

(%)

(¥ Billion)

35

5,000

30

JGAAP

4,650.8

4,317.2(Persons)(%)(Persons)

60

30

50

150

50

3,000

48.6

49.1

40

40

20

20

2,000

2016

2017

(FY)

Cash Dividends Per Share

2016

2017
Dividend Payout Ratio (right)
Total Return Ratio (right)

(FY)

26

26

27
40
40.7

20

34.6

2,240.2

2016

2017

Total Assets
Share of Equity Attributable to Owners of the Parent
Ratio of Share of Equity Attributable to Owners of the Parent (right)

128

138

14.3

133

90

20

26.9

8.6

8.7

Ratio of Employees with Disabilities(Non-Consolidated)

(%)

(%)

15

2.5

12

2.0

9

1.5

6

1.0

2.21

2.24

2.27

2015

2016

2017

10
30

5

2015

30

120

60
2,098.602015*4: The figure for FY2016 includes the acquisition of treasury stock of 3,737
thousand shares in the amount of ¥17.99 billion.

Toyota Industries Report 2017

2,425.9

1,000

0
2015

*3: Excluding expenses for commissioned R&D, etc., as well as mass
production-related expenses by engineering departments

12

19.4

30

0
(FY)

25

15
60

Number of New Graduates in Engineering Positions/
Ratio of Females (Both Non-Consolidated)(%)
4,558.2

4,000
50.7

25

IFRS

Number of New Graduates in Administrative Positions/
Ratio of Females (Both Non-Consolidated)

0
(FY)

0.5

0
2015

2016

2017

(FY)

0
2015

2016

2017

Number of New Graduates in Administrative Positions

Number of New Graduates in Engineering Positions

Ratio of Females (right)

Ratio of Females (right)

(FY)

13

Consolidated Financial and Non-Financial Highlights

Non-Financial Information (Environment)(FY2017)

Energy Consumption (Consolidated)

CO2 Emissions (Consolidated)

Water Consumption (Consolidated)

16,520 TJ

939,753 t-CO

4,661 km

Discharge of Treated Wastewater(Japan Consolidated)

Raw Material Consumption (Consolidated)

Waste Generation (Consolidated)

2,370 km712,293 t

87,917 t

2

3

3

Top Message

Energy Consumption (Consolidated)

CO2 Emissions (Consolidated)

Water Consumption (Consolidated)(TJ)(t-CO2)(km3)

20,0001,000,000
926,376
16,52015,00010,00010,852

11,4035,000

939,753

5,000

800,000

4,000

600,000

3,000

400,000

2,000

200,000

1,000

0
(FY)

909,436

2016

2017

2015

(FY)

4,661
4,087

4,136

Akira Onishi President

2016

2017

2015

(FY)

2016

2017

Discharge of Treated Wastewater(Japan Consolidated)

Raw Material Consumption (Consolidated)

Waste Generation (Consolidated)

(km3)

(t)

(t)

2,500

800,000

2,000

2,370
2,029

700,628

2,169

In this section, I would like to talk about how Toyota
Industries, which commemorated its 90th anniversary in
2016, intends to achieve sustained growth by responding
to changes in social structure and customer needs whileremaining loyal to our founding spirit and set of values.

0

0
2015

Remain Loyal to theFounding Spirit and Take
Up Challenges More ThanEver in This Age of Change

745,407

100,000
90,775712,293

600,000

87,917
79,68880,00060,0001,500
400,000

40,0001,000
200,000

500

0

0
2015

(FY)

20,000

2016

2017

(FY)

0
2015

2016

2017

2015

(FY)

2016

PRTR*1 Law Designated Substances(Japan Consolidated)

Emissions/Transfer of PRTR Law DesignatedSubstances (Japan Consolidated)

VOC*2 Emissions (Consolidated)

(t)

(t)

(t)

2,000

600

1,500

1,579
1,340

1,370

500

571
463

2017

2,000

503

1,662
1,500

1,489

1,460

2016

2017

400

1,000

1,000

300
200

500

500
100
0
(FY)

2016

2017

*1: Short for Pollutant Release and Transfer Register, the PRTR law is ascheme whereby businesses measure the release and transfer of PRTR
designated pollutants and report their performance to the government.
The government then compiles this data and releases it to the public.

14

0

0
2015

Toyota Industries Report 2017

(FY)

2015

2016

2017

(FY)

2015

*2: Short for Volatile Organic Compounds

15

Top Message

1 Learning from Our Own History■“Open the window. It’s a big world out there!”(Words by Sakichi Toyoda)

Toyoda Precepts that reflect the spirit of founder Sakichi
Toyoda, serving as our corporate creed andbecoming the basis of our Basic Philosophy

16

Toyota Industries Report 2017

Looking back on our history, I feel fortunate that Sakichi Toyoda was our founder, bothin business and spiritual aspects.
Let us first look at the business aspect. We were founded in 1926 to manufactureand sell the Type G automatic loom, which was invented and completed by Sakichi
Toyoda, and celebrated 90 years in business in 2016. In 1933, then Managing Director
Kiichiro Toyoda, who was Sakichi’s eldest son, decided to enter into the automobile
business based on his conviction and future vision and established the Automobile
Department within the Company. This department was later spun off and evolved into
Toyota Motor Corporation (TMC) and the Toyota Group. Some of our stakeholders
may well know about this story, as TMC and its founder Kiichiro were featured in TV
drama series in Japan. Not contenting himself with the success of the textile machinery
business, he decided to advance into the automobile industry, which was still in its
early stage of development, and turned the seed into a concrete business. I think thissuccessful attempt to extend the reach from the core industry in one era to another coreindustry in the succeeding era may well be called a miracle. The success provided great
encouragement to Toyota Industries to embark on full-fledged business diversification in
the postwar period.
Next, let us talk about the spiritual aspect. The spirit of Sakichi Toyoda has been
captured in the five articles of the Toyoda Precepts, which serve as Toyota Industries’
corporate creed. The Toyoda Precepts, which were announced in October 1935 on thefifth anniversary of his passing, have not become dated, maintaining their universality.
With many companies struggling to confirm their raison d’etre, we are extremely gratefulto have this distinct set of values to which we can always go back and find inspiration.
Now, I would like to look back on our history from the perspective of businessdiversification. We started diversifying our business on a full scale in the postwar period
in 1953, when demand for spinning and weaving machinery dropped sharply on therebound to special procurements during the Korean War. We had focused almost
solely on textile machinery up until then but began to seek business diversification in aneffort to stabilize our business foundation and make a leap forward in the future. In theprocess, we launched production of engines, vehicle assembly and development andproduction of lift trucks and car air-conditioning compressors, all of which have become
our mainstay businesses now.
For us, business diversification was a necessity because relying only on textile
machinery provided a limited opportunity for growth. However, business diversification isnever easy, often accompanied by many “lights” (fruits of success) and “shadows” (risks
of failures). We were no exception and experienced several setbacks.
In 1954, with the aim of finding a new market, we made a major investment andestablished a company in Mexico to produce textile machinery. This was our first fullscale advancement into a market outside Japan, but the business environment turned
difficult and forced us to withdraw from the country in 1959. We also initiated production
and sales of tillers, farm tractors and other agricultural machinery in 1956. Again,
products’ unstable performance and cash-flow problems of sales dealers compelled
us to totally withdraw from the field in 1969. More recently, we have withdrawn fromconsumer electronics-related businesses, such as liquid crystal displays (LCD),
electronic substrates and organic electroluminescence (EL) products, and sold our
stakes in several subsidiaries since 2000.
These withdrawals were as a result of painful decisions based on many factors, suchas changes in the business environment. Each had a certain impact but fortunately did
not cause a devastating blow to our management. This was because Toyota Industries,
then led by our predecessors, had implemented thorough risk management to prepare
for worst-case scenarios. Also, I believe that our efforts have not been in vain because
we have learned many lessons from the process leading to the failures. In particular, welearned a great lesson in that we accumulated important insight and know-how whenengaging in risks involving business diversification and the startup of new businesses.
2 Business Management Based on Our Uniqueness■
Employees assigned to Toyoda de Mexico S.A.

Here, I’d like to highlight some of the various characteristics of Toyota Industries.
Each has been formed through our more than 90 years of history and represents
our uniqueness.
1) The Origin of the Toyota GroupAs mentioned earlier, Toyota Industries was founded to manufacture and sell the TypeG automatic loom invented by founder Sakichi Toyoda and is considered the originof the Toyota Group. That we are able to collaborate with Toyota Group companies
and encourage positive competition in quality, cost and other areas provides us with atremendous advantage.
Also, we hold a significant number of stocks in TMC and other Toyota Group
companies. Such a capital connection is one means to ensure even closer collaboration
among Group companies, which is essential in prevailing over ever-intensifying
competition in the automobile industry. Financial stability facilitates investments for
future growth.

Type G automatic loom2) Balanced Business Portfolio
A large portion of our business portfolio is accounted for by non-automobile businesses,
mainly materials handling equipment, reflecting one of our characteristics of not
exclusively relying on automobile-related businesses. This diversified business portfolio
has translated into the dispersion of management risks and a more stable businessperformance, as underperforming results in one business segment can be covered

FY2017 Net Sales
Others: ¥58.0 billion
Textile machinery: ¥66.2 billion
Electronic equipment,
foundry parts and others: ¥64.7 billion
Car air-conditioning compressor:¥334.7 billion
Automobile: ¥562.6 billion
Engine: ¥90.0 billion

Net sales¥1,675.1
billionMaterials handling equipment:¥988.1 billion

Vehicle: ¥73.1 billion

17Top Message

by favorable results of the remaining segments. Indeed, in our more than 90 yearsof history, we recorded an operating loss only once in fiscal 2009, in which results
were negatively affected by the collapse of Lehman Brothers and the subsequentglobal financial crisis. This is proof of our strengths derived from engaging in diverse
businesses.
3) The Name Did Not Speak for Itself
Our original company name was TOYODA AUTOMATIC LOOM WORKS, LTD. However,as we moved forward with business diversification, the ratio of textile machinery in total
sales dropped to around 4%, causing a mismatch between the company name and its
business portfolio. To reflect the actual portfolio and with a view to globalizing business,the company name was changed to TOYOTA INDUSTRIES CORPORATION in 2001.
Our company name in Japanese still retains the “automatic loom” part in respect for our
original business and founding spirit.

BT Brand Products4) Aggressive M&A
Since acquiring BT Industries AB, the world’s leading manufacturer of warehouse trucks
based in Sweden, in 2000, we have been proactively conducting M&A. We are one of
the few companies in the Toyota Group to seize such opportunities, and expandingor reinforcing business by creating synergies through M&A is another of our uniquecharacteristics. We do not, however, place priority on M&A. Our basic stance is todevelop business on our own and leverage M&A to accelerate business transformationand complement areas in which we are lacking or weaknesses.
5) Holding the World’s No. 1* Share for Three Products
We boast the world’s No. 1 share for lift trucks, car air-conditioning compressors andair-jet looms. Holding the top share for these unrelated products is perhaps anotherproof of our strengths originating from engaging in diverse businesses.
* Survey by Toyota Industries Corporation

3 Overview of the Characteristics and Potential of Each■Business

Here, I would like to provide an overview of our businesses along with the potential ofeach.
1) Materials Handling Equipment
We position materials handling equipment as one of our mainstay businesses andhave implemented a range of initiatives to promote growth. For example, we madeBT Industries into our subsidiary in 2000 and unified manufacturing and marketing
operations by taking over TMC’s Industrial Equipment Sales Division in 2001, thereby
establishing a structure to undertake comprehensive operations from development andproduction to sales and after-sales services. As a response to the global financial crisis
that started in 2008, we worked to reinforce our management platform further in order
to compensate for a drop in sales of lift trucks during the financial crisis and promoted
sales expansion initiatives in the post-crisis market recovery period.
Since 2013, we have conducted M&A in rapid succession and expanded ourvalue chain. These include U.S.-based Cascade Corporation, the world’s leading
manufacturer of lift truck attachments; Tailift Co., Ltd., a Taiwan-based lift truck
manufacturer with a strong presence in emerging countries; and the materials handling18

Toyota Industries Report 2017

equipment division of TMC’s U.S.-based sales financing subsidiary. As a result, we havesteadily increased our global market share and expanded revenues. In the future, we willseek synergies with these companies for an even greater outcome.
We see modest but sustained growth of the lift truck market mainly in emerging
countries. In recent years, needs for automated and more efficient logistics have been
growing in line with increasing e-commerce transactions, and we expect that a decline
in the labor force in Japan and other countries will accelerate this trend. Under thesecircumstances, we have decided to further strengthen the Logistics Solutions Businessthat provides packaged system solutions to customers’ logistics-related issues as a newpriority area. In April and May 2017, we acquired a 100% stake in two logistics systems
companies, U.S.-based Bastian Solutions LLC and Netherlands-based Vanderlande
Industries Holding B.V., by investing approximately ¥29.0 billion and ¥144.0 billion,
respectively. While the aim of the acquisition of BT Industries was to complement
our product lineup, the acquisition of the two companies was to extend the businessdomain to peripheral areas and facilitate a qualitative change of the Materials Handling
Equipment Business.
In the Materials Handling Equipment Business, we engage in the full spectrum ofoperations from development and production to sales and after-sales services. This
gives us a great deal of strategic leeway and allows us to conduct business with asense of speed. We intend to accelerate business growth on a global scale by drawing
on our strengths in the field of lift trucks, for which we hold the top market share, and by
responding to all logistics needs of customers.

n Market Share of Lift Trucks

ToyotaIndustries

No.1

World market:
1,180,000
units

The size of the world market and market share are
surveys by Toyota Industries Corporation (2016).

2) Automobile
We engage in automobile-related businesses while utilizing our strengths we gained

Overview of Vanderlande’s Business for
Warehouses and Parcel/Postal Services

Sorters
Conveyors

Distribution center designs for specific business categories(Food retail, apparel, e-commerce, parcel services)
Warehouse management system (WMS)

Purchased
goods

Picking/palletizing

Automated storage andretrieval system
Multi-shuttles

Automated lift truck
Automatic
guided vehicle

Provide a total system for distribution centers, from receiving of deliveries to shipment
Propose solutions targeting industry’s leading companies

19Top Messagen Market Share of Car Air-Conditioning
Compressors
ToyotaIndustries

No.1

World market:
76,000,000
units

The size of the world market and market share are
surveys by Toyota Industries Corporation (2016).

On-site inspection at an engine
production base in India (TIEI)

Local design operations at a car air-conditioning
compressor production base in Germany (TDDK)

20

Toyota Industries Report 2017

through our involvement in every aspect of an automobile, from vehicle assembly
to such key components as engines, car air-conditioning compressors and car
electronics products.
In the field of vehicle assembly, we have sought ways to achieve higher productivity
and profitability in the smallest plant space as compared with other automobile bodymanufacturers in the Toyota Group and have accordingly implemented thoroughgoingkaizen (improvement) activities. Through these endeavors, we have achieved a lean
production structure and higher quality. Our quality, in particular, is highly regarded by
TMC, and we received a Special Award from TMC in 2016 as a token to celebrate
our winning the Superior Award for Quality Performance for five consecutive years.
By applying these strengths in other business fields, we have augmented our overall
manufacturing capabilities. The Vehicle Business is also at the core of our manufacturing
operations in that it assumes the role of disseminating the Toyota Production System toother business divisions.
In the Engine Business, we expect continued demand for diesel-engine automobiles
for use as commercial vehicles and sports utility vehicles (SUV) mainly in emerging
countries, where an expansion of the automobile market is anticipated. We will work
to ensure the smooth transition and consolidation of diesel engine development andproduction functions from TMC into our operations and strive to cultivate expertiseand set up an efficient business structure. We also plan to increase our competitiveedge and subsequently expand sales of turbochargers mounted in diesel engines.
As for gasoline engines, we will hone our already superior level of quality and flexible
production structures to expand our product lineup.
In the Car Air-Conditioning Compressor Business, another mainstay businessbesides the Materials Handling Equipment Business, we hold a more than 40% share in
the world market. With increasingly stringent automobile fuel efficiency regulations being
enforced worldwide, we have always been leading the industry in the development of
products with excellent fuel efficiency and environmental performance. At the sametime, we have been meeting a broad range of customer needs with our extensive
lineup of products for both internal-combustion vehicles and electric-powered vehicles.
In terms of manufacturing, we are differentiating ourselves from the competition withsuperior production engineering capabilities that enable us to manufacture high-quality
products as well as the ability to produce and supply products stably on a global basis.
Moreover, we have expanded production outside Japan and reinforced our businessin each region, staying close to our customers. As an example, we have increased theratio of locally procured parts through such measures as producing key components in
the United States. We will continue to take on the challenge of achieving a 50% world
market share on the back of growing global automobile sales and an increase in thenumber of vehicles equipped with air conditioners due to global warming, and at thesame time, by leveraging our strengths to expand sales.
With accelerated vehicle electrification, we expect an expansion in sales of hybrid
vehicles (HV), plug-in hybrid vehicles (PHV), electric vehicles (EV) and fuel cell vehicles(FCV) in accordance with regional characteristics and user needs.
Amid this environment, the Car Electronics Business serves to capture the generaland market trends in the field of automobile electrification through the provision of
products to TMC and other automakers around the world. Going ahead, we will step up
our efforts in our specialty fields in the respective business domains of drive systems,
auxiliary power source devices and charging infrastructures. In addition, we aim todevelop proprietary electrification technologies not only for products of other companies
but also for our own lift trucks, car air-conditioning compressors and textile machinery.

This strategy will in turn serve to provide even greater competitiveness to these top
share products.
3) Textile Machinery
In the Textile Machinery Business, we expect continued expansion of demand foryarns and fabrics for clothing and other daily essentials on the back of such factors as
an increase in the world population and further economic growth mainly in emerging
countries. The use for industrial purposes, such as circuit boards in IT products, is also
expected to increase.
In the textile machinery industry, many players, including leading European
manufacturers, are fiercely competing for survival. Our comprehensive corporate
strengths are superior to these competitors, and we believe we are well positioned
to benefit as a survivor of the competition. Additionally, Uster Technologies AG, a
Swiss-based yarn quality measurement instrument manufacturer we acquired in 2012,
excels at formulating effective brand strategies and is expected to contribute to an
improvement of our profitability over the medium to long term.

Kariya Plant, a mother plant of car air-conditioning
compressors

As indicated above, we have been undertaking business by drawing on thestrengths of each business and responding to changes in the market environment.
Since 2000, we have also promoted our strategy of “concentration and selection.”
More specifically, we have withdrawn from LCD and other consumer electronicsrelated businesses and sold our stakes in logistics-related subsidiaries while proactively
promoting business partnerships and M&A to add greater strengths to our mainstay
businesses. As a result of channeling management resources in a well-focused manner,
we have been able to build a unique and distinct business portfolio.
4 Human Resources—Always the Most Important■
Management Resource

The first article of the Toyoda Precepts that encapsulate the spirit of founder Sakichi
Toyoda starts with the phrase “Always be faithful to your duties.” The article signifies
the importance of encouraging joint efforts and faithful execution of duties among all
members of Toyota Industries regardless of their rank. The second article refers to“studious and creative,” which represents Sakichi’s personal conviction. I find it animportant message that the precepts put the value of employees’ joint efforts first andforemost. There may be different interpretations for this, but I personally think it implies
the importance of nurturing people and encouraging cooperation, because it is people
who make a difference, inventing new things and realizing innovation.
We often say human resources are the most important asset of a company. People
ultimately create value in every company operation, be it development, manufacturing or
sales. Only when a company strives to nurture employees and ensure their own as wellas their families’ happiness, can they exert their full potential, find their work rewarding
and vitalize the company.
We also recognize that utilization of diverse human resources is another important
issue. Toyota Industries is based in a rural area called Mikawa in Aichi Prefecture, andour corporate culture has inherently valued uniformity, unfaltering integrity and humility.
However, our business and human resources became suddenly and increasingly
diversified as we proceeded with rapid globalization of operations through such efforts
as business diversification and M&A. Of the Toyota Industries Group’s total workforceof more than 50,000 employees, slightly over 30,000 are now non-Japanese. Rapid

Global Learning Center (Nishio, Aichi Prefecture)

In-house skills contests

21

Top Message

globalization of operations poses a risk of causing insufficiencies in human resources
development, but looking at the situation from a different angle reveals an opportunity tonurture globally capable human resources in an optimum environment. The environment
allows many employees to interact with people of different backgrounds and value
perceptions and to have a satisfying experience of extending their potential. Withsubsidiaries outside Japan, we intend to facilitate people-to-people interaction on asteady basis through personnel exchanges and joint projects in order to cultivate humanresources who possess diverse values and play active roles in a global environment.
In fact, after the acquisition of BT Industries, many of those involved have accepted
cultural differences, and through patient, repeated communications, have generated
a significant outcome both in terms of business and human resources development.
These steady efforts during this time have become an important asset of Toyota
Industries.
5 The Environment■

In his book, Sapiens: A Brief History of Humankind, Israeli historian Yuval Noah Hararistates: “We are more powerful than ever before, but have very little idea what to do with
R&D meeting of the
all that power.” About 70,000 years ago, we gained an ability to imagine, talk about
Materials Handling Equipment Businessand believe in things that do not physically exist (the Cognitive Revolution). From theStone Age, when we began to spread from East Africa throughout the world, up until
the present age, we have changed the ecosystem in a way that is beneficial to us, andin the process, have driven many living things to extinction. According to Harari: “We areconsequently wreaking havoc on our fellow animals and on the surrounding ecosystem,seeking little more than our own comfort and amusement, yet never finding satisfaction.
Is there anything more dangerous than dissatisfied and irresponsible gods who don’tknow what they want?” In the urgent task of curbing global warming, the international
community has failed to make concerted efforts. It is depressing to think of this as
another example of the selfish actions of humankind. On the other hand, Harari admiresthe power of humans to believe tomorrow will be better
than today. We should start by doing whatever we can
Product Development Supporting
now and make constant and unwavering efforts.
Electrification
In 2015, the Toyota Industries Group announced the(Products Mounted in the
New Prius PHV)
Sixth Environmental Action Plan, a five-year plan covering
the period from fiscal 2017 to fiscal 2021, in accordancewith the Global Environmental Commitment that articulates
our basic approach to environmental initiatives. Under
the plan, we take on the challenge of establishing a zeroCO2 emissions society in 2050 and seek to create an
ESBG27 electric compressor
enriched lifestyle in harmony with the natural environment.
The plan’s keywords are “eliminating CO2 emissions,”“recycling resources” and “protecting nature.”
As a corporate citizen, the Toyota Industries GroupNew Prius PHV
will proactively promote development of energy-saving,
electrification and other technologies mainly in the fields
of materials handling equipment and automobiles whiledeveloping and providing eco-friendly products. In thisway, we will contribute to the realization of a zero CO2
DC-DC converter
On-board charger
emissions society.

22

Toyota Industries Report 20176 Our Future Direction■

As described earlier, we have a balanced business portfolio, not relying on one businessbut encompassing the Materials Handling Equipment Business (including the Logistics
Solutions Business) and automobile-related and other businesses.
The Materials Handling Equipment Business is obviously a growth field. Also as partof this business, we need to respond flexibly to various forms of logistics. Reinforcementof the Logistics Solutions Business, in particular, represents our most significant“offensive” effort, and we regard this segment as a driver of our future growth. For thetime being, our highest priority is to create a common vision with Bastian Solutions
and Vanderlande, which we have acquired by making substantial investments, andto maximize synergies through collaboration between the two companies and ourexisting businesses of materials handling equipment and logistics systems in Europe,
North America and Japan. We will regard it as a Company-wide effort and rotate theplan-do-check-act (PDCA) cycle toward achieving these goals. Early development ofa relationship of trust and a structure of cooperation is important, and based on the
resulting framework, we aim to produce steady and concrete outcomes.
Just as important is to implement “defensive” action (i.e., risk management) when
conducting successful M&A. Building on our past experience, we will increase oursensitivity to impairment risk and take steady steps to ensure governance in thecompanies we have acquired by taking measures such as setting up an appropriate
reporting system.
Contribute to an enriched lifestyle and
The automobile industry is also a growth
comfortable society for people around the world
industry, if we look at it from a global perspective,
Creation of corporate value
including emerging countries. Amid the severe global
competition of many companies, we will forge ahead
with R&D in such areas as the environment, safety,
fuel efficiency and electrification while maintaining
and improving our existing, stable business
Environment Society
foundation. With several seeds of growth, we will goon the offensive by intensively focusing management
resources, including the know-how we have
Governanceaccumulated at the company level, into this area.
These represent the direction we will pursue forthe next few years. Each is a challenging task, and we will likely encounter difficulties
in undertaking these tasks. Fortunately, our existing businesses are showing relatively
stable business performance at the moment. By further increasing profitability of eachbusiness through such means as cost reductions, we are preparing for anticipateddifficulties. Our stable financial foundation, which is another unique characteristicof Toyota Industries, and other factors will surely support overcoming the difficult
challenges.
We will define our future course of action and implement a balanced mix of offensive
and defensive initiatives in accordance with changes in the business environment. All
members of Toyota Industries will make joint efforts toward steadily implementing these
initiatives regardless of their rank.

23

Special
Feature1

Development and Production of Car Air-Conditioning
Compressors Geared toward the Age of ElectricPowered Vehicles Ahead of the World

The new Prius Plug-in Hybrid (PHV) released by Toyota Motor Corporation (TMC) in
February 2017 is fitted with the ESBG27 car air-conditioning compressor newly
developed and produced by Toyota Industries. The compressor enables the vehicle’s
air conditioner to demonstrate sufficient heating capability under sub-zerotemperatures while in EV mode that does not run the engine. It contributes to an
improvement in both in-vehicle comfort and environmental performance.

n How a Car Air-Conditioning System Works

Heating

CoolingWarming up
vehicle interior

We have always remained the leader of the global electriccompressor market, with our products constantly evolving
with time. In the first-generation Prius hybrid vehicle (HV), ourcompressor was powered by the vehicle’s engine, which wasa cause of lower fuel efficiency because the engine had to bealways turned on to operate the air conditioner. For the secondgeneration Prius, we took advantage of the HV’s high-capacity
battery and developed a compressor that was powered by a
motor instead of the engine. This was the world’s first electriccompressor mounted on a mass-produced car. Following that,
we released a compressor integrated with an inverter, which
controls the motor’s revolutions, and achieved reduced size,
lighter weight and significantly easier vehicle mounting. Then,as HVs became ever more popular, we considerably improved
the compressor’s heating and cooling capability and operational
quietness, for which we have earned high acclaim among many

Heart of a car airconditioning system,
powered by theengine or a motor tocompress refrigerant
used for coolingvehicle interior

Refrigerant absorbing
heat in vehicle interior

Expansion valve
Gas injection

Cooling unit
(expansion, evaporationand heat absorption)

Condenser(heat release andliquefaction)

Cooling vehicle interior

Releasing heat from refrigerant
into vehicle interiornn Toyota Industries’ Electric Compressors Sought
after in the Age of Electric-Powered Vehicles

What is a car
air-conditioning
compressor?

Compressor(compression)customers. Consequently, in April 2016, our cumulative unit
sales reached a milestone of 10 million electric compressors.

Expansion valve

Compressor
compressing
refrigerant

Compressor
compressing
refrigerantnn ESBG27 Offering Much Higher Heating
Performance in EV Mode

Refrigerant absorbing heatfrom vehicle exterior

Releasing heat from refrigerant
to vehicle exterior

Absorbing heat from the atmosphere

Releasing heat into the atmosphere

A conventional electric-powered vehicle needs to operate both
its air conditioner and electric heater to warm up the vehicle
interior when the engine is not operating, such as in EV mode.
This consumes a considerable amount of electricity, resulting ina shorter EV driving range.
The new Prius PHV has adopted an air conditioner with a heatpump, which can efficiently warm up the interior on its own in acold climate, even at –10ºC, without using heat from the engine
or an electric heater. This was made possible by our originallydeveloped ESBG27, the world’s first electric compressor with a
gas injection function to be installed in a mass-produced car. The
product has contributed to a longer EV driving range, greater fuelefficiency and higher in-vehicle comfort.

Throttle

Toyota Industries Continuously Meeting Changing Customer Needs

ESBG27 electric compressor

World Market Shares ofElectric Compressors

Electric Compressor Sales(Million units)

2.0

Toyota Industries offers a range of car air-conditioning compressors, from a compact, lightweight fixeddisplacement type and a variable-displacement type with greater fuel efficiency for internal-combustion vehicles toan electric type for electric-powered vehicles. With this broad product lineup, we have satisfied the diverse needsof customers.
In recent years, enforcement of more stringent environmental regulations around the world and growing
environmental consciousness among users have encouraged an increasing number of governments to implement a
tax break program for electric-powered vehicles, including PHV, electric vehicles (EV) and fuel cell vehicles (FCV).
These trends have spurred electrification of vehicles by automakers. Amid this environment, we have been
leveraging our accumulated strengths in developing electric compressors that meet customer needs at a higher
level and providing these compressors to automakers worldwide.

1.5

Toyota Industries Report 2017

ToyotaIndustries
holding more than
70% share

1.0

0.5

0

(FY) 2009

24

No.1

2010

2011

2012 20132014 2015

2016

2017

Survey by
Toyota Industries Corporation (FY2017)25

Special Feature 1 Development and Production of Car Air-Conditioning Compressors Geared

Development and Production of a New Electric Compressor
Effectively Utilizing Our Accumulated Technologies and Know-How
Matched to the Age of Electric-Powered Vehicles
The launch of production of the new ESBG27 electric compressor presented the world’s first challenge for us to ensurestable mass production of the product that has become more complex with the addition of a gas injection function while
maintaining a high level of quality.
Design, production engineering, quality assurance and manufacturing departments utilized their expertise in respective
fields and closely collaborated to overcome issues one by one. As a result of their concerted efforts, mass production of the
ESBG27 successfully commenced as planned in September 2016.
In this section, four key project members talk about efforts undertaken in each department and about the strengths ofToyota Industries underpinning its development capability.

nn Development Targets of the New ESBG27
Electric Compressor
Tsubai: Even though thedevelopment of the ESBG27
was officially launched in 2012,
we actually started developing
an electric compressor utilizinga heat pump for better heating
performance in 2010, along withresearch into a gas injection
Shinji Tsubai
Group manager, Group No. 31, Engineering
method, anticipating market
Office No. 3, Engineering Department,
needs and more stringent
Compressor Divisionenvironmental regulations.
The overall goal was to achieve sufficient heating capability at
sub-zero temperatures by using only an air conditioner. Thisobjective was made in response to customer complaints that theconventional heating technique requires the engine to run andthus consumes more fuel. While keeping that goal in mind, we
set high targets from a comprehensive viewpoint for operational
quietness, power saving, compactness, weight reduction andcost benefits in developing this compressor.

Okagawa: In the area of
production engineering, ourwork was to integrate two setsof additional processes into an
existing electric compressor
production line: one for mounting
new structures and functions
added to the ESBG27 and one
Yoshihiro Okagawa
Group manager, Electric Products Assemblyfor inspecting these. I rememberGroup, Assembly Production Engineeringthat in the very initial stage of
Office, Production Engineering Department,
Compressor Divisiondevelopment when the productspecifications were not yet finalized, project members from thefour departments got together and examined every detail ofthe design drawings of the production line. It had to be easy
for operators to work with, both in terms of assembly andinspection, and less prone to errors.
Maeda: Our objective in the field of quality assurance was toestablish processes to assemble components into a productin the simplest possible manner for reducing quality risks andpreventing defects. Initially, the ESBG27 had a rather complex
shape and structure, so we worked closely with members of theother three departments to make it simpler.

Heating by a Heat Pump with Gas Injection Function

Vehicle interiorElectricity

Vehicle exterior

Compressor

Absorbingheat from theatmosphere

Evaporator

Gas injection

Condenser

The conventional heat pump heating technique shows lower
heating performance in a cold climate, as it absorbs less heat fromthe atmosphere. The gas injection function serves to expand thepossible heating temperature range by recompressing a portion ofcompressed refrigerant by a compressor.

Releasingheat into
vehicle interior

Expansion
valve
Refrigerant (gas)26

Toyota Industries Report 2017

Refrigerant (liquid)

Heat

Energy input into compressor

Car air conditioner of the Prius PHV

toward the Age of Electric-Powered Vehicles Ahead of the World

Takayama: In terms of manufacturing, we also dealt with theaddition of new processes resulting from an increase in thenumber of components in the ESBG27 through collaboration
among the four departments. As a result, we were able toensure that the new line allows operators to work easily andefficiently, eliminating the need for increased staffing.

nn Characteristics of the ESBG27 and Issues
Associated with its Development andManufacture
Tsubai: The adoption of a new “gas injection” mechanism in the
ESBG27 imposed challenges such as creating a route in which
refrigerant flows. But ultimately, we were able to achieve thetargeted heating capability. The ESBG27 contributed to a nearly
30% increase* in the heating capability of the car air-conditioning
system of the new Prius PHV in a cold climate. In recognition,
we received the Technology Development Award from TMC.
Of course, this was not an accomplishment of the design
process alone; we all faced and overcame difficulties.
Okagawa: The most difficult challenge in the area of productionengineering was to deal with an increase in the numberof components used in the ESBG27 compared with ourconventional electric compressors and integrate corresponding
processes into a production line. We had to come up with thebest way to incorporate processes to mount new functional
components and inspect the proper functioning of thesecomponents. Working with the Quality Assurance Department,
we devoted considerable efforts to determine reliable inspection
conditions in order to assuredly perform a quality check during
the limited time that components flow on the line and to define amethod and level of inspection that can satisfy automakers.
Maeda: We should obviously
challenge ourselves in pursuing
higher performance in ourcompressors whether it is a new
structure, new mechanism or
new assembly process. On theother hand, new things always
entail quality risks and likely
Hiroki Maeda
create more defects. In resolving
Working group leader, Electric ProductsGroup, Quality Assurance Office No. 3, Quality
this contradiction and finding a
Assurance Department, Compressor Division
trade-off, we sought to faithfully
follow the concept of “jikoutei-kanketsu (build in quality withownership)” to ensure that no defective products are sent topost-processes, along with measures to prevent defects in thefirst place.
Takayama: The mass production line of the new compressor
went into operation in September 2016, and currently wemanufacture around 5,000 units each month. We meticulously
created a robust line and were able to meet the performanceand quality targets and the scheduled launch of production.
A very important point was to devise standardized proceduresfor processes that had relied on operators’ experience and skills,
so that anyone can perform the task.
* Compared with the conventional heat pump heating system at the temperature of –10ºC.
Surveys by Toyota Industries Corporation and DENSO Corporation.

nn Strengths Underpinning Toyota Industries’
Development Capabilities That Generate a
Number of World Firsts
Maeda: While I was working on this project, I realized that our
process from the launch of product design to mass production
has become increasingly mature. This can be attributed tomany factors. One of them is our accumulated know-how fromthe development of previous models. Thus, we did not have tostruggle with anything that was unexpected. Our strengths stemfrom activities to carefully identify defects in each process andeliminate various risks. I think we should continue to hone ourstrengths in the future as well.
Okagawa: In the field of production engineering alone, we havean advanced set of proprietary technologies derived from thein-house development of production equipment. We also haveachieved higher degrees of speed, precision and automation
throughout the entire production lines. These enable us to excel
in swiftly manufacturing products that demand extremely highquality and at the required quality level.
Tsubai: We hold the world’s top share in the compressor
market. As such, we do business with various automakers andare well positioned to capture information on what their next
goals are and what kind of vehicles they envision, which allows
us to provide designs finely matched to these needs. With
demand for electric compressors expected to progressively
increase, I hope to start development of a next-generation
model soon, which is quieter to operate and demonstrates
better heating performance at even lower temperatures with lessenergy consumption.
Takayama: Setting oursights higher, those of us atmanufacturing departments
would like to promote humanresources development, engage
in improvement activities andenhance our manufacturing
Hideki Takayama
capabilities further. Our goal isSupervisor, Assembly Section, Manufacturing
Department No. 1, Compressor Division
to combine the comprehensive
strengths of Toyota Industries to gain greater customer
satisfaction and continue to win out over the global competition.
Tsubai: Exactly. We will continue to develop compressors withgreater product appeal.

27

Special
Feature2

Kaizen (Improvement) Activities acrossDiverse Business Domains—A Force toDrive Constant Evolution

Aozora Ichiba, a Cross-Organizational Exhibition to Globally Share Kaizen Examples
Generated in a Horizontally Aligned Manner across All Business Domains

Kaizen Embedded in Our DNA
Underpinning Aozora Ichiban Activity Approach of Each Loss Reduction Team

Since its foundation, Toyota Industries’ spirit of kaizen has been passed
down in its DNA. We have been promoting various types of kaizen
initiatives that include QC circle activities by each workplace and Toyota
Production System Jishu Kenkyu Kai (autonomous Toyota Production
System study groups) in manufacturing departments. Our Aozora Ichiba,
which is one such initiative, held its 16th exhibition in fiscal 2017.

Efficient Allocation Increasing the ratio of value-adding work throughof Personnel Loss ingenuity in production processes■ Aozora Ichiba Framework

Development of
human resources

Horizontally Aligned Activities
Exhibitionin Oct.

Reinforcement ofmanagement
platform

AozoraIchibaBusiness Divisions

VehicleQuality

Plant 1EngineOperational
Availability

Plant 2Compressor

Efficient Allocationof Personnel

Plant 3

Electronics

Horizontallyalignedactivities
from Apr.

Materials Handling
Equipment
Textile Machinery

Logistics
Skills Building &Work Training

AozoraIchibaGlobal Application

Plant 4

Materials, 3Rs andProcurement

Subsidiaries
in Japan

Subsidiaries inand outside Japan

Karakuri

Subsidiaries
outside Japan

Partner companies

CO2 Emissions

Partner companies

Die Engineering

Strengthening of
monozukuri(manufacturing)capabilities

Sharing ofBest Practices

・
・
・
・

Sharing ofbest practices
from Nov.
to Mar.

Exhibition

Loss Reduction
Teams

Toyota Industries Report 2017

Upgrading equipment and other maintenance activities

Logistics Loss

Improving in-plant logistics flows of products and parts

Skills Building &Increasing efficiency and standardizing work training
Work Training Loss
Materials Loss

Reducing secondary materials and other costs

In addition to the above, Aozora Ichiba also exhibits examples of various topics,
including kaizen by karakuri, kaizen of business operations and sales expansion.

Aozora Ichiba, which has been evolving every year, is organized
as follows. First, heads of manufacturing departments of eachbusiness division (Materials Handling Equipment, Vehicle,
Engine, Compressor, Electronics and Textile Machinery, etc.)
and the Aozora Ichiba administration office together select 10
n Numbers of Exhibited Cases and Shared Best Practices

n Number of Visitors

Aozora Ichiba started in 2002 for the purpose of reducing costs
associated with the purchasing of secondary materials used in
production activities, such as cutting tools, work gloves, hard
hats and other supplies utilized within a plant. Business divisions
gathered to compare secondary materials they had purchased
individually and successfully cut costs by switching to lessexpensive products or making bulk purchases. Later, with thelaunch of emergency profit improvement activities following
the global financial crisis triggered by the collapse of Lehman
Brothers in 2008, the Aozora Ichiba project changed drastically.
Under the strong leadership of top management seeking a morerobust management platform, we expanded the area of activities
and quickly transformed it into a Group-wide initiative.

Continued Evolution of Aozora Ichiba, Becoming
a Place to Share Kaizen Ideas on a Global Basis(Number of
exhibitedcases)
459
300

718

711

746

453

(Number of shared best practices)
1,000
800
863
740
753
600
400

(Persons)
5,000
4,000
3,000

200

2,000

100

0

1,000

(FY) 10

11

12

Exhibition (loss reduction)

28

Preventing both occurrence and recurrence of defects

Operational
Availability Lossto 15 members to form six loss reduction teams in the areas ofquality, operational availability, efficient allocation of personnel,
logistics, skills building & work training and materials. Then, eachteam leads loss reduction efforts, which are horizontally aligned
across business divisions, in its responsible area and works togenerate kaizen ideas for a half year from April in accordancewith its annual action themes. Their efforts culminate with theannual Aozora Ichiba exhibition, which displays a number ofkaizen ideas, small ingenuities, more efficient work methods
and other initiatives at production sites. The event literally serves
as a market, in which participants from the Company as wellas our consolidated subsidiaries and business partners fromaround the world earnestly look for and bring back applicable
improvement examples toemulate in a way best suited fortheir respective workplaces andcompanies.
Tetsuji Ono, who is
responsible for the handling of
Aozora Ichiba, further explains:“Each team selects its own
objectives and action themes
Tetsuji Ono
Project general manager, Operations
at the beginning of a fiscal year
Management Consulting Office, Production
under Toyota Industries’ Vision
Control Department, Production Headquarters

Starting Out as a Small Project

Building a robust, streamlined management platform is crucial for a company to survive and sustain growth in theever-changing economic environment. Just as essential is constant business evolution that allows the company
to flexibly respond to changes in customer needs and desired technologies, such as those resulting from theenforcement of more stringent environmental regulations, accelerated electrification and autonomous vehicle
operations in the fields of vehicle and materials handling equipment businesses.
This Special Feature highlights an initiative called Aozora Ichiba (“open-air market”), which aims to share kaizen
efforts globally among our consolidated subsidiaries and business partners and to reinforce the management
platform of the entire Toyota Industries Group.

Quality Loss

13

14

15

Exhibition (other)

16

17

0

(FY)

10

11

12

13

14

15

16

17

Sharing of best practices

29Special Feature 2 Kaizen (Improvement) Activities across Diverse Business Domains—A Force to Drive Constant Evolution

2020 and works toward the Aozora Ichiba exhibition held in
October. During the event, we present kaizen ideas throughexhibiting panels, actual items, videos and demonstrations ofmock production lines to help visitors understand how wellthese ideas work and to promote the sharing of best practices
in their respective workplaces. Presentations are conductedby persons in charge, not by managers at a higher level, which
serves to raise motivation. In recent years, we receive moreparticipants from our bases outside Japan and see more casesof best practices in Japan shared around the world. This is proof
that the initiative has been growing steadily on a global basis.”
The number of visitors attending the event has been growing
each year, exceeding 4,700 visitors in three days in fiscal 2017.
Ono continues: “We regard the event simply as a place topresent our efforts. More important is the process, in which
teams work for a year and absorb the kaizen approach andtechniques through the sharing of examples and problem
solving. One-year team activities also give members a chance
to grow as they draw inspiration from ideas and techniques thatare different from those in their respective business divisions.
These activities also present a valuable opportunity to build
relationships with colleagues from other business divisions. At
the same time, sharing both best practices and issues has taken
our Company-wide kaizen approach to a higher level.”
The following presents specific kaizen examples of the
Skills Building & Work Training Loss team and Quality Lossteam from Aozora Ichiba in fiscal 2017.

Contributing to Shorter Skills Building Time andImproved Skills by Creating a Training Simulator
That Reproduces Actual Work Environment
Sayuri Ishikawa of the Engine
Division has participated in Aozora
Ichiba’s Skills Building & Work
Training Loss team ever since
fiscal 2015. She recalls: “Theexperience has been a series of
discoveries, while getting to know
the different ways of doing thingsin other business divisions andSayuri Ishikawa
Human Resources Development Working
plants.”Group, Management and Development
The team conducts activities
Group, Administration Office, Manufacturing
under three loss reduction themes Department No. 1, Engine Division

Achieving Zero Defects Based on Kaizen Learned
from Another Business Division

Practical training using hand-built assembly line training simulator

every year. Koichi Kawata, who
had served as the head of theteam, explains: “The first theme
is to shorten the time required
to build skills of workers new
to manufacturing operations
so that they can work on theirown without supervision. This
will reduce lost time for both
Koichi Kawata
trainers and trainees. The second Assistant general manager, Administration
Office, Manufacturing Department No. 1,
is to prevent loss associatedEngine Division
with quality defects or industrial
accidents by acquiring good skills among workers. The third
theme involves the elimination of waste caused by redundant or
insufficient training and education.”
From fiscal 2015 to fiscal 2017, the team exhibited a
training simulator that uses an automatic guided vehicle (AGV)
to reproduce an assembly line process. The simulator has
evolved over the course of three years. “A training environmentthat closely replicates the actual work site has contributed toreducing the time required for building and improving skills,”
explains Ishikawa. Trainees have regarded the simulator
favorably, noting its ability to provide realistic, “moving” training
not possible in the conventional fixed-type training equipment.
The sharing of the practice has been proceeding well, withplants in Japan and India adopting similar training simulators.
The team holds regular meetings, and members bringissues raised in the meeting back to their respective workplaces
to generate kaizen ideas with their superiors and colleagues
for the next meeting. Ishikawa recalls: “We have been adding
improvements to the AGV training simulator every year, suchas increasing the types of work it can train. This has been ameaningful experience for me to have in-depth discussions withmembers from other business divisions about the themes we had
to tackle as a team, while incorporating views of many colleagues
in my office.” Recognizing the positive results of their activities,
Kawata adds: “We have achieved significant kaizen in terms of
on-site education and training. Besides that, I think Ms. Ishikawa
has grown since she joined the team, and communication has
become more activated within our office as well. The Aozora
Ichiba initiative has generated combined results.”

For the Aozora Ichiba exhibition
held in fiscal 2017, Tsutomu Katoof the Electronics Division served
as the head of the Quality Lossteam. He points out: “Different
business divisions manufacture
different products, but analysis
methods used to reduce andeliminate defects are the same.
Tsutomu Kato
Since divisions use theseManager, Manufacturing Section,
Manufacturing Department, Electronics Division
methods in their unique, specificways, we can learn and notice many things every time we seeother divisions’ approaches. That’s why I find activities to reduce
quality loss interesting.”
Kato continues: “Our team presented a kaizen example in

Tablet device of the Engine Division, which the Electronics Division applied to its own kaizen

Tablet devices introduced by the Electronics Division

fiscal 2017 that applied a shipping inspection method employedin the Engine Division, which uses tablet devices to checkproducts, to an assembly process of the Electronics Division.”
Conventionally, the assembly process had been conductedusing a procedure manual in paper form. The team developed
a tablet device that displays instructions linked to the progressof the work. Using these devices installed at production lines,
workers select parts and tools as instructed on the screen, andwhen that particular step is completed correctly, the system
automatically switches the screen to the next step. “We justinstalled the devices recently, but we have already achieved zero
defects in this assembly process,” adds Kato.
Another initiative in theElectronics Division alsosignificantly contributed to the
reduction of quality loss in fiscal
2017. Kato proudly explains:“We had been checking thequality of small printed circuitboards (PCB) both visually and
PCB inspection at the Electronics Divisionby using automatic appearance
testers, but sometimes defects
had passed through these inspections. To reduce such defects,
we started filming products with a video camera and displaying
highly magnified images on a monitor. This has helped us
increase our ability to detect defective products and reducethe inspection time to one-fourth of the time needed previously,
while also reducing workers’ eye fatigue.”
Kato also adds: “Aozora Ichiba means a lot, as its activities
actually generate positive results and serve to extend anddeepen relationships with members of other business divisions.
It offers the chance to grow, and in turn enables us to recognize
new things, and achieve better kaizen.” The team will follow
its roadmap and continue to tackle issues for the next Aozora
Ichiba exhibition in fiscal 2018.

Promoting Activities Group-Wide and Aiming for Further Growth
The Aozora Ichiba initiative has now extended its scopefrom manufacturing operations improvements to business
operations improvements and sales expansion, becoming awidespread initiative deeply rooted within Toyota Industries.
Masanori Shirahama sums up the Aozora Ichiba activities todate: “I think the entire Toyota Industries Group, promoted
under the leadership of top management, now understands
the importance of standardizing and maximizing kaizen.
Aozora Ichiba has now become a very good opportunity for us
to explore and take back ideas for the next improvements.”
Shirahama also stresses the significance of the initiative:“On a global scale, the number of participants from our bases
outside Japan has been increasing steadily. For example, ourconsolidated subsidiaries in China have jointly held their own
Aozora Ichiba, while subsidiaries engaging in the manufactureof materials handling equipment in North America and Italy
have brought back best practices of kaizen examples andadopted them. The initiative has also shown positive effects
in terms of human resources development, as it presents achance for diverse people from different business divisions towork as a team. They gain new knowledge by visiting otherdivisions’ production sites, which facilitates out-of-the-box

thinking. People, experienced andyoung employees alike, from all
departments in Toyota Industries
and from our consolidated
subsidiaries and business
partners from around the world
are now involved. As a result,the numbers of improvements
and the sharing of best practices
have been increasing every year.
Masanori Shirahama
Senior technical executive, Production Control
I believe that the Aozora Ichiba
Department, Production Headquarters
initiative has certainly raised thelevel of our monozukuri capabilities.”
Looking ahead, Shirahama explains: “We intend to
facilitate more active collaboration between production
sites and their upstream processes, which include design
and production engineering, to enhance our workplacecapabilities. By doing so, we aim to further strengthen ourmanagement platform and support the Group’s growth fromthe aspects of quality, productivity and human resources
development.”

Manufacturing staff supporting loss reduction activities

30

Toyota Industries Report 201731

Business Activities
Materials Handling Equipment

P32–36

Automobile

P37–42

P43

Textile Machinery

Vehicle / Engine / Car Air-Conditioning Compressor / Car Electronics

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.

• An extensive logistics-related product lineup both in the fields of materials handling equipment (internalcombustion lift trucks, electric lift trucks, fuel cell (FC) lift trucks, etc.) and materials handling systems(automated storage and retrieval systems, automatic guided vehicle (AVG) systems, automated lift trucks, etc.)• High technological capabilities, including those linked to environmental and safety performance• In-house development and production of key components, including engines and motors• Production know-how that ensures high levels of quality and production efficiency• Global, well-developed production, sales and service networks• Total support services encompassing IT-based maintenance and inspection as well as operational management• No. 1*1 in lift truck unit sales in the world*1: Survey by Toyota Industries Corporation

Opportunities • Growing need for products with high energy savings and low environmental impact, driven by a rise ineco-consciousness• An increase in logistics volume resulting from such factors as an expansion of e-commerce transactions,accompanied by a rising need for higher logistics efficiencies

Risks

FY2016Net Sales(IFRS)¥1,019.4 billion

Materials Handling Equipment Sales(Thousand units)

250

200

150

100

50

0

(FY)

13

14

15

16

17

• Restrained capital investment due to a slowing economy• Weaker sales caused by intensifying competition• Change in business environment triggered by entry of competitors from different industries

FY2017¥988.1 billion

Operating Profit(IFRS)FY2016¥91.7 billion

Business Activities in Fiscal 2017
With the continued growth of the world’s lift truck market in2016, we carried out model changes of our mainstay lift
trucks and worked to expand our lineup, while offeringsolutions designed to achieve greater logistics efficiencies,
enhancing responsiveness to large-order customers andensuring reliable after-sales services.
In quickly responding to growing environmental
consciousness among customers and more strict emissions
regulations, we released products such as a high-capacity
internal-combustion model that satisfies the latest emissions

Telematics (operational management system)

FY2017¥89.4 billion

Business Overview in Fiscal 2017
The materials handling equipment market in 2016 as a whole continued to expand
globally due mainly to increases in unit sales in Europe and North America as well asa recovery in China, although unit sales in Japan were on par with the previous year.
Amid this operating climate, Toyota Industries strengthened production and sales
activities matched to respective markets and rolled out new products such as thesales launch in Japan of the new 1.0- to 3.5-ton electric lift trucks, “gene B.” As aresult, unit sales of our mainstay lift trucks for fiscal 2017 improved in Europe andJapan, and increased by 14,000 units, or 6%, to a total of 253,000 units over theprevious fiscal year. Net sales totaled ¥988.1 billion, a decrease of ¥31.3 billion, or
3%, attributable mainly to the impact of exchange rate fluctuations despite anincrease in unit sales. In addition, in order to respond to structural changes in thelogistics industry and reinforce its Logistics Solutions Business on a global scale,
Toyota Industries acquired two major materials handling systems operators in the
United States and the Netherlands in April 2017 and May 2017, respectively.

Materials Handling Equipment

Strengths

As a market leader in the materials handling equipment andlogistics fields, Toyota Industries assists customers
worldwide in attaining greater logistics efficiencies by
delivering logistics solutions optimally tailored to their
specific needs.
Under the TMHG management structure, we engage inbusiness under the TOYOTA, BT, RAYMOND and CESAB
brands. Mutually utilizing the development and sales
strengths of each brand, TMHG is promoting businessexpansion on a global scale.
We basically carry out product development in three
regions, namely Japan, the United States and Europe.
Based on this structure, we develop and manufacture
products in each region, which are matched to the specificlocal needs and characteristics, and ensure quick productdelivery to customers. At the same time, we seek greater
product appeal by conducting in-house development andproduction of key components of lift trucks, including
engines and motors.
In addition to supplying such high-quality products, weplace special emphasis on sales and services through our
extensive networks. On the sales front, we respond to
demands of customers who conduct business globally byaugmenting our consultation team dedicated to handlingcross-border and cross-regional matters. In terms ofservices, we assign a total of more than 10,000 experienced
and knowledgeable service personnel to Japan, North
America and Europe, our mainstay markets, to provide finely
tailored services to customers. Our service personnel visit
customers on a periodic basis and provide maintenanceservices to prevent troubles from occurring. When aproblem does occur, they swiftly make a visit to thecustomer and promptly take appropriate action.
In the field of logistics solutions, in which we provide
systems to solve customers’ logistics-related issues,sustainable market growth is expected globally due to therecent, rapid expansion of the e-commerce market. Amid
this environment, our operations extend beyond providing lift
trucks and other materials handling equipment. We intend to
reinforce our Logistics Solutions Business by leveraging our
production and logistics know-how accumulated in
manufacturing operations. At the same time, we aim to
meticulously respond to customer needs both in terms ofhardware and software by making effective use of thestronger value chain that includes sales financing,component production and after-sales services.

Business Activities

Materials Handling Equipment

Toyota Material Handling Group (TMHG)nT
 oyota Industries’ Global
Lift Truck Market Sharen Toyota Material Handling Group Brands(Survey by Toyota Industries
Corporation, 2016)

Top: Region Bottom: Brand
Japan

ToyotaIndustries

North America

EuropeChina

21%

ALOMA*2*2: ALOMA stands for Asia, Latin America, Oceania, Middle East and Africa.

32

Toyota Industries Report 2017

33

34

Toyota Industries Report 2017

aerial work platform

Business Activities by Regional Market
Japanese Market
With the Japanese lift truck market showing steady growthin 2016, Toyota Industries released eco-conscious products,
undertook activities to expand sales of existing models andenhanced responsiveness to large-order customers. As aresult, unit sales in fiscal 2017 increased 4% year-on-year to
42,000 units. Unit sales of Toyota Industries’ lift trucks
maintained the top position*6 in calendar 2016 for the 51st
consecutive year.
In the field of lift trucks, we released a high-capacity
internal-combustion model that clears the most current
emissions standards. With the release of this product, we
became the first manufacturer in the industry*7 to satisfy thelatest 2014 standards in all models of our diesel-poweredinternal-combustion lift trucks. Regarding electric lift trucks,
for which needs have been expanding in line with growing
environmental consciousness among customers and anincreasing number of larger warehouses, we initiated salesof the gene B, a new series of 1.0- to 3.5-ton electric lift
trucks, in November 2016. In addition to operator comfort
and safety, which have already gained high customer
recognition in the previous model, the gene B offers greater
performance and functionality, such as a longer uptime andhigher water resistance. We also offer TOYOTA T_Site*8, an
operational management system based on Internet ofThings (IoT) technology, as an option to assist customers inachieving greater logistics efficiencies. Moreover, welaunched sales of electric lift trucks equipped with lithium-ion
batteries and FC lift trucks, thereby responding tocustomers’ growing environmental consciousness anddiversifying needs.

In the field of logistics solutions, we are working to
expand sales by leveraging our comprehensive strengths.
We received an order from a leading delivery company for a
total logistics support solution, covering everything from theestablishment and operation of a distribution center to its
continued improvements. Our solution meticulously meetsthe specific needs of the customer, such as a large volume
shipment in a short time, and offers an IoT-based featurethat combines smartphones and transmitters to monitor thework progress in real time. After the operation launch of the
distribution center, we have been conducting follow-up
activities to propose continued efficiency improvements andhelping the customer achieve better logistics operations.
In September 2016, we participated in Logis-Tech Tokyo
2016. Under the concept of “building the future of logistics
together with our customers,” we exhibited our extensive
product range, including internal-combustion lift trucks,
electric lift trucks and FC lift trucks. Utilizing the largest-everexhibition space, we also operated parts of a distribution
center and an automobile production line to demonstrate
our logistics solutions in an easy-to-understand manner.
*6: Calculated by Toyota Industries Corporation, using data published by the Japan
Industrial Vehicles Association*7: Survey by Toyota Industries Corporation*8: Telematics service (operational management system) for lift trucks, sales of which werelaunched on March 29, 2016

High-capacity internal-combustion lift truck

contribute to customer lift truck management and efficient
operations. Through iWAREHOUSE Evolution, Raymondintegrates lift truck and operator data providing scalable
solutions for measurable warehouse improvement. Toyota
also introduced a similar system under the name of
T-Matics, which helps customers maximize their fleet
utilization, control costs and optimize operations.

Materials Handling Equipment*3: A form of business upon customer request that
conducts logistics systems engineering anddelivers a total solution package incorporating
equipment mainly procured from outside sources*4: A form of business to provide solutions to customer logistics issues through a logistics
system that includes both equipment and software*5: Survey by Aichi Corporation

Business Activities

standards and an electric model with a longer uptime.
The extended lineup of such eco-friendly products enables
us to accommodate customers’ widely varying usage
environments. In addition, to help customers achieve evenhigher logistics efficiencies, we responded to an increase in
number and size of warehouses following an expansion of
the e-commerce market and the resulting rise in logistics
volume worldwide. We also enhanced the lineup of models
equipped with telematics, which allows customers tomanage the operational status of lift trucks on tablet
devices.
Along with the enhancement of our lift trucks, we are
stepping up our efforts to reinforce our capability to offer
total solutions for logistics improvements. As part of these
efforts, we made Bastian Solutions LLC, a major U.S.
materials handling systems integrator*3, a subsidiary in April
2017. Bastian is a turnkey contractor that offers an all-inone service package from the selection of hardware andsoftware best matched to customers’ logistics issues tosystem development, network building and maintenance.
In May 2017, Netherlands-based Vanderlande Industries
Holding B.V., a major materials handling systems provider*4,
became a subsidiary. Vanderlande is a global market
leader in the fields of materials handling systems for retailbusinesses and parcel/postal services as well as passenger
baggage handling systems used in airports. It develops
and manufactures materials handling equipment andrelated software in-house and has a particularly outstanding
capability to start up large-scale projects in a short period.
By strengthening our ties with these two companies, we
intend to offer logistics solutions desired by customers on a
global basis. Additionally, in the field of automated storage
and retrieval systems and automatic guided vehicle (AGV)systems, we initiated feasibility tests of our experimental
container transport AGVs and have been collecting data
geared toward achieving efficient storage yard operations
and building a safe working environment through fullautomation.
Meanwhile, Aichi Corporation, which possesses the
top brand*5 in the field of aerial work platforms in Japan,
witnessed strong demand for equipment renewal by theelectric power, telecommunication
and railway industries as wellas continued demand for social
infrastructure work despite acautious stance toward capital
investment by certain companies
in the leasing industry. Amid thisenvironment, Aichi introduced
new products and augmented
its service structure. As a result,sales of aerial work platforms, its
mainstay product, expanded, andAichi posted sales exceeding theprevious fiscal year’s level.
Aichi Corporation’s

Logis-Tech Tokyo 2016

iWAREHOUSE Evolution

North American Market

New gene B electric lift truck (released in November 2016)

In the expanding North American lift truck market, Toyota
Industries remained the market share leader in 2016*9 withcombined unit sales of TOYOTA and RAYMOND brands ofapproximately 83,000 units, down 2% from the previous
fiscal year.
Toyota expanded its product offering with the launch ofa high-capacity internal-combustion lift truck to meet theneeds of customers handling heavy materials such as ports
and lumber mills. Raymond introduced various products
including a counterbalanced electric lift truck with enhanced
performance and ergonomics, such as visibility andboarding, while adding an automated model tow tractor.
Toyota and Raymond work to enhance logistics
solutions such as fleet management systems which

Toyota and Raymond will continue to develop products
leveraging both brands’ strengths, while further enhancing
materials handling systems and logistics solutions tocontribute to customers’ efficient logistics. Through these
initiatives, we aim to further solidify our leadership position.
*9: Survey by Crist Information & Research, LLC, 2016

European Market
The European lift truck market expanded in 2016, withstrong growth in most major markets (except the U.K.) anda recovery in the Russian market. Amid this condition,
Toyota Industries posted sales of 91,000 units, up 23% fromthe previous fiscal year, as a result of an enhanced product35

Automobile

In the area of sales activities, Toyota Industries promotes
sales expansion activities leveraging our extensive networks
and support structures, broad range of products, andlogistics solutions systems and know-how. Each sales
and marketing company in Europe actively organizedand participated in sales promotional events in themarket, aiming to increase contacts with customers while
demonstrating our total logistics capability. In June 2016,
we exhibited such environmentally superior products as an
FC lift truck, electric lift truck equipped with a lithium-ion
battery and internal-combustion lift truck with improved fuelefficiency at CeMAT 2016 held in Germany. In addition, we
presented our operational management system that utilizes
information and communications technologies as well as ourlift truck automation technology for more efficient logistics

In the fields ranging from vehicle assembly to engines, car air-conditioning
compressors and car electronics, Toyota Industries continues to meet the
expectations and trust of its customers.
• Highest-level production efficiency and quality among all Toyota-affiliated automobile body manufacturers(Vehicle assembly)• Know-how on the development and production of diesel engines and turbo chargers (Engine)• Ability to develop excellent products with greater fuel efficiency, quieter operation, compactness, weight
reduction and easiness to mount on vehicles (Car air-conditioning compressor)• Global top-share* products for use in a full range of vehicles, from internal-combustion vehicles to hybrid
vehicles (HV), plug-in hybrid vehicles (PHV), electric vehicles (EV) and fuel cell vehicles (FCV)(Car air-conditioning compressor)• Global production structure based on the concept of local production and local consumption(Car air-conditioning compressor)• Higher technological capabilities cultivated through the development and production of products for Toyota
Motor Corporation (TMC) for external sales and for internal use (Car electronics)• Development, production and top-level quality of electronic parts and devices for electric-powered vehicles(Car electronics)

Strengths

ALOMA*10 and Chinese Markets
Toyota Industries covers the ALOMA markets of 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 and RAYMOND brands.
In 2016, while the ALOMA market was weak, theChinese market expanded. Amid this market condition,although Toyota Industries enhanced its sales structure andafter-sales service capability, unit sales declined 6% from theprevious fiscal year to 37,000 units in fiscal 2017.
In China, needs for internal-combustion lift trucks
increased amid robust investment in the public sector while
demand for electric lift trucks was strong mainly at
distribution centers for retail industries. In this businessenvironment, we responded to diversifying customer needs
by enhancing sales and after-sales service networks,
promoting sales of warehouse trucks and engaging in otheractivities. We will strive to meet needs for wider price range
in collaboration with Tailift Co., Ltd., a consolidated
subsidiary.
The lift truck market in India was strong thanks to its
robust economic environment. New product launches aswell as various sales expansion and service activities led tostrong business performance. We will aim to further expand
sales by accurately identifying specific customer needs bybusiness type and engaging in finely tuned marketing
approaches.
Toyota Industries will continue to enhance sales
networks and structures in ALOMA and Chinese markets,
while strengthening marketing capabilities by setting up
regional offices in major countries along with other efforts,
and pursue further sales expansion. In addition, we willfurther bolster relationships with distributors in each country
through such efforts as distributor conferences and workwith distributors to offer products and services that satisfy
customer needs.
*10: ALOMA is a Toyota Industries term for Asia, Latin America, Oceania, Middle East
and Africa.

* Survey by Toyota Industries Corporation

Opportunities • Increasing needs for energy-saving products due to stricter environmental regulations and growing
environmental consciousness• Sales expansion of energy-saving products in line with growth of the automobile market• Shrinking of the automobile market caused by economic slowdown• Customers becoming reluctant to buy energy-saving products following less stringent environmental regulations• A drop in product competitiveness due to the yen’s appreciation or a rise in raw material costs

Risks

FY2016Net Sales(IFRS)FY2017¥556.5 billion¥

562.6 billion

Operating Profit(IFRS)FY2016FY2017¥32.7 billion

Vehicle Sales

Engine Sales

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

350

700

35

300

600

30

250

500

25

200

400

20

150

300

15

100

200

10

50

100

5

0

(FY)

13

14

15

16

17

0

(FY)

13

14

15

16

17

0

(FY)

13

Materials Handling Equipment / Automobile

BT Staxio stacker-type electric lift truck

operations. Through these efforts, a major French cold chain
logistics supplier reached a fleet management agreementwith Toyota Industries to manage their lift trucks throughout
Europe in high recognition of our products and services.
We will continue developing products that meet diverse
needs of customers, while further improving our proposal
capability, thereby contributing to the efficiency of ourcustomers’ logistics operations.

Business Activities

lineup and proactive sales promotion activities.
Toyota Industries launched various new models in
Europe including a counterbalanced internal-combustion lift
truck with improved environmental performance, electric
stacker truck featuring enhanced agility and usability, as well
as a new AGV. In November 2016, Toyota Industries
acquired a majority stake in SIMAI S.p.A., an Italian leading
manufacturer of various industrial vehicles with strength inproducing tow tractors for outside usage. With SIMAI, we
further improved our capability to meet diverse customer
needs.

14¥15

24.9 billion

16

17

Toyota Industries booth at CeMAT 201636

Toyota Industries Report 201737

Vehicle
Business Overview in Fiscal 2017

Development and Production of Plastic
Glazing
Toyota Industries’ plastic glazing has been used in thepanoramic roof of TMC’s hybrid vehicle Prius a (Prius + in
Europe and Prius v in North America) and in rear and quarter
windows of the 86 GRMN, a limited-edition model releasedby TMC.
Our plastic glazing retains the beautiful surface quality
typical of a glass roof yet is approximately 40%* lighter thanits glass counterpart, improving vehicle fuel efficiency, which
has become increasingly important, and thus contributing to
the reduction of CO2 emissions.
Toyota Industries will continue to develop attractive new
products that leverage the distinctive characteristics ofplastic glazing.

Vitz at the opening competition of the 2017 Japanese Rally Competition Association

TOPIC
The Nagakusa Plant in Aichi Prefecture, currently
engaging in production of the Vitz and RAV4, marked amilestone reaching cumulative production of 10 million
automobiles in October 2016, after 49 years and fivemonths since its commencement of operation as a
dedicated vehicle assembly plant in May 1967.
Commemorating its 50th anniversary in 2017, theNagakusa Plant intends to make a further leap forward
by extending its business lines from production ofquality automobiles to include product planning anddevelopment.

* Survey by Toyota Industries Corporation
Ceremony to commemorate cumulative production of 10 million automobiles

38

Toyota Industries Report 2017

Business Overview in Fiscal 2017
Despite a decline in sales of KD diesel engines, anincrease in sales of GD diesel engines pushed up unit
sales in fiscal 2017 by 67,000, or 15%, over theprevious fiscal year to 501,000 units. Net sales
increased by ¥11.4 billion, or 15% year-on-year, to¥90.0 billion.

Toyota Industries’ Diesel Engines Highly
Acclaimed by Customers Worldwide

Highest-Level SEQCD to Contribute to
Production of Attractive Toyota Cars
Toyota Industries’ comprehensive strengths lie in the highest
level of safety, quality, cost and delivery among all Toyotaaffiliated automobile body manufacturers. In 2016, wereceived the Special Award from TMC in recognition of
earning the Toyota Quality Control Award program for fiveconsecutive years.
In January 2017, following a minor model change of theVitz, we initiated production of a hybrid model of the Vitz inaddition to the conventional internal-combustion models.
We are further strengthening our already superior level ofsafety, the environment, quality, cost and delivery (SEQCD).
We also are working to leverage our ability to quickly start
up production and a flexible structure in terms of vehicle
models and production volume to contribute to productionin Japan of Toyota vehicles.

EngineToyota Industries’ diesel engines, mounted in a variety of
Toyota vehicles sold around the world, have gained highmarket recognition for their clean emissions, fuel efficiency
and high performance. The V-type 8-cylinder VD diesel
engine is installed in the Land Cruiser for markets outside
Japan, including Australia, Russia and the Middle East. As asuccessor model of KD diesel engines, we commenced
production of GD
diesel engines inJune 2015. These
engines, which areinstalled in TMC’s
Land Cruiser Prado
and other vehicles,
are equipped with aturbocharger, forwhich weparticipated in thedevelopment andstarted production
in-house, and boast
GD diesel engine
significantly higher
performance.
An additional production
line went into operation in
January 2016 at our Hekinan
Plant in Aichi Prefecture to
manufacture the turbocharger
to be mounted on GD diesel
engines. In March, Toyota
Industries Engine India Pvt. Ltd.
Turbocharger(TIEI), a consolidated subsidiary(mounted on GD diesel engines)
in India engaging in the
manufacture of engines, also initiated production of GD
diesel engines. Going forward, we will seek to increase theratio of locally procured parts and further improve
productivity at this production base in India.

Ceremony to commemorate the opening of TIEI

Developing Competitive Diesel and Gas/
Gasoline Engines in Non-Automotive Fields
Toyota Industries’ engines are highly renowned for their
excellent environmental performance in non-automotive
fields as well. These engines are used for a wide variety of
applications, including our lift trucks, and adopted by GHP*1
manufacturers in Japan and CHP*2 manufacturers worldwide.
We expanded our lineup of industrial engines with theaddition of the Toyota 1KD industrial diesel engine, which isequipped with a turbocharger developed in-house, and the
Toyota 1FS gas/gasoline engine in March 2013, followed in
December 2013 by the Toyota 1ZS industrial diesel engine
also equipped with a turbocharger developed in-house.
These three engines offer downsized displacementcompared with conventional models with equivalent output,
which results in higher fuel efficiency, cleaner emissions anda reduction in size.

Automobile

As the sole producer of the Vitz in Japan and with the aim ofturning the vehicle into a long-selling series, Toyota
Industries collaborates with TMC and its dealers to makevarious suggestions under the banner “Taking the Lead in
Making Our Cars More Attractive.” In 2016, we co-produced
the Vitz Shine, a regionally limited premium model. Similarly,
to boost the appeal of the RAV4, we plan and develop
special-edition vehicles that directly reflect the voice of ourcustomers. Through these endeavors, we seek ways tocreate more appealing and satisfying vehicles for customers
worldwide.
At the same time, we also undertake activities to expand
our customer base by enhancing the appeal of the Vitz
through our support to motorsports events.

Business Activities

The automobile market expanded on a global basis,
with Europe, North America and Japan registeringstrong sales among developed countries and China
posting an increase among emerging countries.
In fiscal 2017, unit sales of the Vitz (Yaris outside
Japan) and the RAV4 increased by 14,000 units, or
5%, over the previous fiscal year to 307,000 units.
Various factors, including the addition of hybrid
versions of the Vitz following the RAV4, served
to push up net sales by ¥3.0 billion, or 4%, to¥73.1 billion.

“Our Vitz and RAV4” Initiative forEnhancing Appeal of the Two Car Models*1: Short for gas heat pump; air conditioner driven by a gas engine*2: Short for combined heat and power; co-generation system

For the Creation of Better Engines
Fuel efficiency and emissions standards are becoming more
and more strict, as called for in the twenty-first session of theConference of the Parties (COP21) held in Paris, France, inNovember 2015 and as evidenced by India imposing
increasingly severe regulations on diesel engines. On theother hand, we expect a continued and constant level ofdemand for powerful diesel-engine automobiles for use ascommercial vehicles and sports utility vehicles (SUV) mainlyin emerging countries. Under these circumstances, even
before such trends toward more strict standards became
prevalent, Toyota Industries has been carrying out
development of next-generation automobile engines that canclear Euro 6 and other stringent emission standards, as wellas engines for materials handling equipment and general
purposes featuring greater fuel efficiency and lower costs.
While gradually consolidating diesel engine development andproduction functions from TMC into the operations of Toyota
Industries, we will further improve our development efficiency
and reduce the time required for development in seeking todevelop and manufacture more competitive diesel engineswith higher environmental performance.
For our gas/gasoline engines, we will strive to develop
and manufacture products with higher efficiency and greater
fuel economy to bring satisfaction to customers worldwide.

39

Car Air-Conditioning
Compressor
Business Overview in Fiscal 2017

More stringent fuel efficiency standards have been enforcedin the United States, Europe, Japan and China, requiring
automobiles to provide extremely high fuel efficiency
performance.
Against this backdrop, in the field of car air-conditioning
compressors to be mounted in internal-combustion
vehicles, needs for greater fuel efficiency have been growing
in both fixed-displacement and variable-displacement typeproducts. In the United States, in particular, there was anaccelerated shift from fixed-displacement type products tomore fuel efficient variable-displacement type products.
Our variable-displacement type compressors, which arerenowned for high fuel efficiency and reduced weight, havebeen adopted by the world’s leading automakers, including
TMC, Daimler AG, General Motors Company (GM),
Volkswagen AG and Hyundai Motor Company.
In the United States, our SES series became the firstcompressor to be approved under the country’s off-cycle
credits program. The program gives off-cycle credits totechnologies that can effectively improve fuel efficiency
under its emissions regulations.

SVE08 (fixed-displacement, vane type)

Since initially being installed in the second-generation
Prius, our electric compressors for HVs and EVs have been
mounted in all of TMC’s HVs from the fourth-generation
Prius to the LS600h.
To offer attractive products to the growing number of
automakers worldwide now actively engaged in thedevelopment of HVs, we developed the ESB series, which iseven more compact, fuel efficient and lighter weight. The
ESBG27 compressor mounted in the new Prius Plug-in
Hybrid uses a Gas Injection Cycle to improve its heating
capability in cold regions by roughly 30%* and help thevehicle extend its electric motor driving range. It is the firsttime in the world that a compressor with the Gas Injection
Cycle has been adopted in a mass-produced car. (See
Special Feature 1 on pages 24–27 for details.)
Besides TMC, Ford Motor Company, Renault S.A.S.,
Honda Motor Co., Ltd., Nissan Motor Co., Ltd. and otherautomakers, which are already using our electriccompressors in their respective HVs, PHVs and EVs, we willcontinue to ramp up our efforts to expand sales to otherautomakers.
* Compared with conventional heat pump heating system under -10°C environment.
Survey by Toyota Industries Corporation and DENSO Corporation

Establishing Optimum Global Productionand Supply Structures
To respond to growing demand for variable-displacement
type compressors triggered by the enforcement of more
stringent fuel efficiency standards, we are proceeding withaugmentation of corresponding production capacities andcommenced local production of key functional parts at our
production bases in North America. In Europe, ASEAN
countries and China as well, we are expanding production
capacities and increasing the ratio of locally procured partsto accommodate growing demand for car air-conditioning
compressors.

TOPIC
TDDK initiated operation as a production base outside
Japan for Toyota Industries’ car air-conditioning
compressors for Europe in April 2000, and its
cumulative production reached a milestone of 40
million units in June 2016. Currently, TDDK mainly
manufactures variable-displacement type products withhigh efficiency and fuel economy as well as low
environmental impact. In March 2015, TDDK moved
ahead of its competitors and obtained ISO 50001
certification, an energy management system standard
that has been drawing much attention recently. By
conducting energy reduction activities at a higher level,
TDDK is contributing to the curbing of global warming.

Enhancing Development Capability by
Creating Evaluation Facilities In-HouseWe are creating more evaluation facilities in-house forachieving even higher superiority in terms of technology
development.
Our mother plants in Japan have been reinforcing theirevaluation functions by designing and creating evaluation
facilities in-house that simulate more realistic vehicle
environments. With the goal of executing swift and detailed
evaluations jointly with local automakers, we are globalizing
our evaluation functions in a phased manner.

TDDK’s plantn Worldwide Bases of Car Air-Conditioning Compressors (As of March 31, 2017)

TDDK
DNDE

Germany

Germany

YST

DICH

MACI

China

China

U.S.A.

DIAM

U.S.A.

DSIT

Italy

TICO

DNTS

Japan

Italy

6SES14 compressor (variable-displacement type)

We are also focusing on an optimum balance between
performance and prices of fixed-displacement type products
targeting emerging countries while concentrating on
development of a variable-displacement type compressor
with considerably greater fuel efficiency.

40

Toyota Industries Report 2017

SUBROS

TACK

India

China

TACG

U.S.A.
TICA

U.S.A.

TACI

ESBG27 compressor (electric type)Indonesia

DNBR

BrazilAugmenting Technical Support Capabilities
We station our sales engineers in the United States,
Germany, Italy and China and provide technical support
locally, promoting sales expansion and activities to prevent

Automobile

Development Efforts Based on 3Es(Energy, Environmental Protection and
Ecological Thinking)quality issues fromoccurring.
In fiscal 2014,
two of ourconsolidated
subsidiaries, namely,
Michigan AutomotiveCompressor, Inc.
(MACI) in the UnitedStates and TD
Deutsche
Local design operations at TDDK
Klimakompressor
GmbH (TDDK) in
Germany, began to conduct design operations locally. A
reduction in development lead time resulting from our local
design operations has been received favorably byautomakers. We plan to continue this initiative in the future.
Through these and similar initiatives, we aim to improve
the quality of our compressors through faster evaluation
processes and better evaluation techniques while preventing
external leaks of our development and evaluation know-how.

Business Activities

In fiscal 2017, unit sales of car air-conditioning
compressors rose 2.18 million units, or 7%, over theprevious fiscal year to 32.55 million units as we
posted an increase in sales globally, including Japan,
Europe, China and North America. However, affectedby exchange rate fluctuations, net sales dropped¥8.2 billion, or 2%, from the previous fiscal year to¥334.7 billion.

In the field of fixed-displacement type compressors, wenewly developed the SVE series vane type compressor forcompact vehicles. We successfully improved air-conditioning
capability by 20% without increasing its size and made it thelightest among other compressors in the same class. It has
been adopted in Suzuki Motor Corporation’s new Swift. We
aim to promote unit sales by increasing the number ofmodels fitted with the compressor.

Consolidated 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* position in global sales.
* Survey by Toyota Industries Corporation

41

Textile Machinery
Car Electronics
Business Overview in Fiscal 2017

Core Components for Drive Systems
Performance and Significant Role inElectric-Powered Vehicle Field

Auxiliary Power Source Devices
An on-board charger converts AC voltage from the power
grid into DC voltage of high-voltage batteries in vehicles.
We developed an on-board charger for the new Prius
Plug-in Hybrid. The product realized better battery charging
output that is 1.7 times higher than that of conventionalmodels and has improved charging efficiency thanks to our
proprietary control system. By integrating acharging system electronic control unit
(ECU) and by increasing cooling
performance, we succeeded in reducing its
size by 50%, thereby making it easier tomount on a vehicle.
A DC-DC converter converts the highvoltage of HV batteries into a lower voltage
On-board charger mounted level to supply power to standard electricalin the new Prius PHV
devices such as ECUs, lights and wipers.
For the fourth-generation Prius, bydeveloping the world’s first thick copper
substrate with excellent heat dissipation
capability and highly integrated
components on the circuit board, wereduced the volume by 50% and weight by
60% compared with the product used in
the third-generation Prius.
DC-DC converter mounted
Backed by our technologies acquired inin the new Prius
the field of DC-DC converters for HVs, in2013 we successfully developed and started sales of a
DC-DC converter for start-stop systems, which cancompensate for a voltage drop at the time of engine restart,and have been promoting its sales to automakers.
A DC-AC inverter is equipped to use home electric
appliances in a vehicle and has drawn a great deal of publicrecognition for its use as an emergency power source after
the Great East Japan Earthquake. Since commencing
production in 1995, we have achieved total production of 20
million units in March 2017.

42

Toyota Industries Report 2017

Charging Infrastructure
Toyota Industries sells public-use charging
stands and home-use charging units for PHVs
and EVs, which have been jointly developedwith Nitto Kogyo Corporation. Cumulative unit
sales reached 13,000 units in March 2017.
Our new public-use charging stand, which
was released in October 2015, consists of one
main control stand that offers charging
functionality as well as such features ascommunication, IC card-based user
authentication and billing, and low-cost,
Main control
Sub-standstand
charging-only sub-stands. One main control
stand can control up to 10 sub-stands, thereby
Charging stand for
PHVs and EVs
reducing the initial costs of installing multiple
charging stands. We are positioning this new charging standas a standard model of the charging infrastructure.

Accelerating Development Activities toContribute to a Low-Carbon Society
Electrification is expected to become more widespread withthe enforcement of more stringent fuel efficiency standards
by many countries and higher environmental consciousness
among customers. Targeting the high-growth, electricpowered vehicle market not only in the field of automobiles
but also in the field of materials handling equipment andother non-automotive products, we will accelerate ourdevelopment efforts to enhance the appeal of our productsin the fields of HVs, PHVs, EVs and FCVs and will also work
to augment our production structure with the aim ofcontributing to a low-carbon society.

Air-Jet Loom Sales(Thousand units)

10*1: Survey by Toyota Industries Corporation• Global, well-developed service network• Ability to develop products that excel in high-speed operations, reliability and energy-saving performance• Broad product lineup both in the spinning and weaving machinery fields• World-leading market share in unit sales of air-jet looms

Strengths

86Opportunities • A rise in textile demand in line with an increase in the world population

4• Increasing need for high-quality and highly functional yarn and textile products, following the economic
growth of emerging countries

20• Changes in each government’s policies concerning promotion of the country’s textile industry• Economic slowdown• A decline in capital investment due to a drop in raw cotton and yarn prices• Weaker sales due to intensifying competition

Risks
(FY)

13

14

Net Sales(IFRS)

1516

17

FY2016¥65.6 billion

Business
Overview in
Fiscal 2017

FY2017¥66.2 billion

Operating Profit(IFRS)FY2016¥6.5 billion

FY2017¥

6.8 billion

The textile machinery market was on a recovery path mainly in the primary markets of China andother emerging countries in Asia. While sales of spinning machinery declined, sales of weaving
machinery expanded with unit sales of air-jet looms increasing 700 units, or 10% year-on-year, to
6,900 units. As a result, net sales were on par with the previous fiscal year at ¥66.2 billion.

Model Change of Water-Jet LoomIn October 2016, Toyota Industries
participated in ITMA ASIA + CITME
2016, an international textile
machinery exhibition held in
Shanghai, China, and launchedsales of the LWT810 water-jet loom.
This product utilizes the
LWT810upgraded version of our
beating-up*2 technology, which we have accumulated in
the past, and enables more stable production of complex
textiles. Customer reviews have been favorable for its
greater ease of use through a new function panel and lessspace requirement realized by adopting a new SC inverter.
*2: A process in weaving of pushing the last weft yarn inserted through the warp yarn tothe fell to keep it securely in place

Participation in India ITME 2016
Toyota Industries participated in India International Textile
Machinery Exhibition (India ITME) 2016 held in Mumbai,
India, in December 2016, jointly with Kirloskar Toyota Textile
Machinery Pvt. Ltd. (KTTM), a consolidated subsidiary
producing textile machinery in India. Toyota Industries
exhibited the JAT810 air-jet loom to showcase its wide
electronic shedding device that allows the weaving of abroader range of fabrics and demonstrated the weaving of
denim. KTTM displayed the RX300 high-speed ring spinning

Automobile / Textile Machinery

Toyota Industries develops and produces electronic
components and devices for electric-powered vehicles,
including HVs, PHVs, EVs and FCVs. In addition to TMC,
we are promoting new business to other automakers acrossthe world.

The new fourth-generation Prius offers afour-wheel drive (4WD) model for the firsttime in the series and is fitted with our rear
inverter for 4WD. This product converts theDC voltage of HV batteries to AC voltage
and feeds power to the 4WD rear motor. The
adoption of a forced air-cooling systemeliminates the need to install cooling water
4WD rear inverter
piping, thereby providing greater ease inmounted in the new Prius
mounting the inverter on vehicles. The
inverter also features quieter operation as it is mounted near
the cargo space.

Carrying on the philosophy of founder Sakichi Toyoda, which reflects his strong
commitment to manufacturing, Toyota Industries responds to a broad range of needs
with its extensive product lineup, from air-jet looms, for which we enjoy the worldleading market share*1 in unit sales, to ring spinning frames and roving frames.

Business Activities

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

In addition, we develop and produce inverters for electric
car air-conditioning compressors for HVs and other electricpowered vehicles. These inverters have been contributing toincreasing the product appeal of our car air-conditioning
compressors.
We have also leveraged our inverter technologies related
to electric car air-conditioning compressors and successfully
developed a highly efficient, low-cost inverter for hydrogen
circulation pumps. The new inverter has been adopted in
TMC’s MIRAI FCV.

frame and demonstrated the spinning of mosaic yarn*3. The
exhibition provided an opportunity to appeal the Toyota
Industries Group’s broad range of technologies.
*3: A special yarn newly developed by Toyota Industries, which is made by alternating or
mixing two rovings in different colors, offering a considerable degree of freedom in colorand design choices

KTTM boothToyota Industries booth

Uster’s Product Winning a Red Dot Award
Uster Technologies AG, a Swiss-based consolidated
subsidiary producing yarn quality measurement instruments,
received a Red Dot Award*4 in the product design category
for its yarn evenness tester, USTER® TESTER 6. The award
recognized the product’s
excellent functionality andbeautiful exterior design.
*4: One of the world’s largest design competition
hosted by Design Zentrum Nordrhein
Westfalen of Germany

USTER® TESTER 6

43

Corporate Social Responsibility
Corporate GovernanceP44−49Relationship with Our Customers

P50−51
P52

Relationship with Our Business Partners

Audit & Supervisory Board System

Relationship with Our Shareholders andInvestors

P53

Relationship with Our Associates

P54−57

Relationship with Our Local Communities

P58−59Toyota Industries strives to enhance its corporate value ina stable manner over the long term and maintains society’s
trust by earnestly fulfilling its social responsibilities inaccordance with its Basic Philosophy. To that end, Toyota
Industries endeavors to further enhance its corporate
governance in its efforts to maintain and improve
management efficiency and the fairness and transparencyof its corporate activities.

nn Corporate Governance Structure
Implementation Structure
Toyota Industries convenes monthly meetings of the Boardof Directors to resolve important management matters andmonitor the execution of duties by directors. We also
appoint outside directors who have a wealth of experienceand knowledge concerning business management. They
attend meetings of the Board of Directors and give opinions
and ask questions as deemed necessary. Through thissupervisory function of outside directors, we ensure thelegality and validity of the Board’s decisions as well as
directors’ execution of duties from an objective perspective.
The Management Committee, which is composed ofShareholders’ Meetings
Selection/
Dismissal

Selection/
Dismissal

Reporting

Independent Auditors

Reporting

Audit & Supervisory Board
ReportingAccounting
Audit

Selection/
Dismissal

Cooperation

Executive Compensation
Committee

Exchange ofOpinions

Executive Appointment
Committee

Management Committee(Deliberates on important matters from management’s perspective)

Board of Directors
Appointment/
Monitoring

Discussion/
ReportingMonitoring
Selection/Dismissal
Cooperation

Audit & Supervisory
Board Office

Monitoring

Cooperation*1: Functional
Meetings

President

Human Resources

Business Operation Committee(Follows up on the execution of business operations)Management Council

Direction/
Supervision

Audit Dept.
Internal Audit

Functional Meetings*1, Committees*2
Managing Officers

Business Divisions/In-House Company/Departments
Subsidiaries/Affiliates(As of June 9, 2017)
Toyota Industries’ Corporate Governance Reports are available at: https://www.toyota-shokki.co.jp/ (in Japanese)

44

Toyota Industries Report 2017

CSR

Quality

Environmental

Production

Export Transaction
Controls

Procurement

Safety and HealthTechnologies

As a publicly listed company, Toyota Industries
strives to ensure the fairness and transparencyof management. Following the Securities Listing
Regulations stipulated by the Tokyo Stock Exchange
and Nagoya Stock Exchange, respectively, tofurther enhance our corporate governance Toyota
Industries has appointed as independent members ofmanagement two outside directors and two outside
audit & supervisory board members who are deemed
to have no conflicts of interest with our shareholders.

nn Internal Control System
In accordance with the Companies Act, in May 2006 Toyota
Industries’ Board of Directors adopted the Basic Policies
for the Establishment of an Internal Control System (Basic
Policies) to ensure compliance, risk management as well as
the effectiveness and efficiency of business operations by
incorporating these policies into each business segment’s
annual policies and day-to-day routine management. The
CSR Committee, at its meeting held in March, assesses the
progress made in implementing the Basic Policies in theyear under review and determines actions for the coming
year, including reviewing the implementation structure andenhancing day-to-day operational management.
Furthermore, based on the Financial Instruments andExchange Law (so-called Japanese Sarbanes-Oxley Act(J-SOX)), we have established and appropriately operated
an internal control system to maintain the reliability offinancial reporting. The system’s status and progress

Profit Improvement

We believe that compliance means both adhering to laws
and regulations and observing ethics and social norms. In
order to ensure compliance, it is vital to instill an awarenessof compliance in each and every employee.
Under the strong leadership of top management, we
promote compliance throughout the Toyota Industries
Group, including consolidated subsidiaries in and outside
Japan, by formulating a Code of Conduct and thoroughly
informing employees together with checking and monitoring
compliance.
n Four Pillars of Compliance Activities

Spiral Up

1

2

3

4

Leadership/
Organization

Formulating
Rules

Declaration by
the president

Employee Codeof Conduct

Thoroughly
Informing
Employees

Checking
andMonitoring

Compliance
Subcommittee

Internal rules

Education on
relevant laws
and regulations

CSR selfassessment
Audit

Manuals

Establishment and Reinforcement of
Implementation Organization
To promote compliance throughout the Toyota Industries
Group, we have established the Compliance Subcommittee(led by an executive in charge of the Legal Department) as asubordinate organization to the CSR Committee. Every year,
the subcommittee formulates an action policy and conductsa follow-up check on the progress of corresponding
activities twice during that year.
n Organization for Promoting Compliance
CSR Committee
Activity reports*2: Committees

Reporting(Reports on and confirms execution of business operations)Appointment of Independent Members ofManagement

Four Pillars of Compliance Activities

n Internal Control Assessment System (Based on J-SOX)
Internal control activities undertaken by eachdepartment and consolidated subsidiary(Establishment and operation of internal controls)

Annual financial report

Internal Control Report
Review of internal
Improvement of Detection ofcontrols byinternal controls deficiencies Audit Department

These entities deliberate andfollow up on issues in respective areas.

Corporate Governancedirectors at the executive vice president level and above as
well as relevant managing officers and audit & supervisoryboard members, deliberates on a variety of issues
concerning important management matters such as our
corporate vision, management policies, medium-termbusiness strategies and major investments.
Toyota Industries has a divisional organization system,with significant authority delegated to each businessdivision. For especially crucial matters, however, we haveestablished the Business Operation Committee to enable
the president to meet with the heads of each businessdivision regularly to monitor and follow the status of theirbusiness execution. At meetings of the Management
Council, directors, managing officers and audit &supervisory board members convene to report and confirm
the monthly status of business operations and share overall
deliberations at Board of Directors meetings and othermanagement-related information.
In addition, issues pertaining to human resources,quality, production, procurement and technologies are
discussed at the corresponding functional meetings. We
have also put in place committees to deliberate on more
specific matters, such as corporate social responsibility(CSR), the environment and export transaction controls.
These functional meetings and committees discuss
important matters and action themes in respective areas.

nn ComplianceCorporate Social
Responsibility

Corporate GovernanceToyota Industries has adopted an audit & supervisoryboard system. Two full-time audit & supervisory board
members and three outside audit & supervisory board
members attend meetings of the Board of Directors tomonitor the execution of duties by directors. At the sametime, meetings of the Audit & Supervisory Board are held
once a month to discuss and make decisions on importantmatters related to auditing. The full-time audit & supervisoryboard members carry out auditing by attending primary
meetings and receiving reports directly from directors.
Additionally, we have assigned dedicated personnel, while
audit & supervisory board members monitor the legality
and efficiency of management through collaboration withindependent auditors and the Audit Department.

are reviewed by the Audit Department and audited byindependent auditors. We determine which Toyota Industries
Group companies fall within the scope of J-SOX based on
the degree of impact on the reliability of financial reporting.
We determined that our internal controls over financial
reporting as of the end of fiscal 2017 were effective, andaccordingly, submitted an Internal Control Report in June
2017. The report was reviewed by independent auditors andjudged fair in their Internal Control Audit Report.

Policies

Compliance Subcommittee
Departments in charge of legal compliance: 12
Supporting department: 1

Toyota Industries
Corporation

Consolidated
subsidiaries in Japan

Consolidated subsidiaries
outside Japan

Compliance committees

Compliance officers

Internal Control Audit Report
Audit on internal controls by independent auditors

45

Formulation of Code of Conduct andDissemination

Toyota Industries provides required legal knowledge toemployees according to their job ranks or positions,familiarizing them with the initial responses that should be
followed upon the occurrence of a problem and educatingthem on risk management. Through new employee
education, rank-based education and workplace meetings,
we provide easy-to-understand guidance on “what to do”
and “what not to do” in order to improve their complianceawareness based on laws and corporate ethics, using then Example Topics of e-Learning Materials

Courses started up to fiscal 2016
•Environment (water quality and waste) •Japan’s Personal Information
Protection Law •Compliance hotline •Prevention of bribery •Insider
trading regulations •Copyrights •Japan’s subcontracting law (general
overview) •Sexual harassment and abuse of power in the workplace•Product liability •Basics of contracts •Export/import transaction
controls •Management of confidential information •Illegal activities•Response to industrial accidents, etc.

Courses established and revised in fiscal 2017
•Compliance •Traffic safety •Japan’s subcontracting law (prevention ofdelay in payment) •Human rights •Environmental risks •Coping withstress, etc.
*Provided to all employees of Toyota Industries Corporation and its consolidated
subsidiaries in Japan. Additional and revised courses are under consideration.

46

Toyota Industries Report 2017

Japanese-language Code of Conduct
video material

English-language Code of Conduct
video material

Compliance Hotline
The Toyota Industries Group has in place a whistle-blower
system for employees to report and seek consultationon compliance-related issues. In Japan, North America,
Europe and China, in particular, we operate a compliancehotline (external helpline) that allows employees and theirfamilies to seek advice from external experts on compliancerelated matters without being exposed to negative
consequences, as well as to ensure the early discovery
and prevention of issues. In fiscal 2017, we received 70
reports and inquiries from within Toyota Industries and fromits consolidated subsidiaries in Japan on such matters aslabor management, working environment and ethics. Afterverifying each report and inquiry, we have taken appropriate
action regarding each case. We also started operating a
hotline for our major business partners to report and inquire
about possible compliance violations by Toyota Industries
employees. Through this initiative, we ensure the early
discovery and prevention of issues and intend to becomea “company on which society places greater trust.” We plan
to make this hotline available to more business partners in
the future.

We have set up compliance committees at subsidiaries inJapan and appointed compliance officers at subsidiaries
outside Japan in our efforts to promote autonomous
activities in respective communities in collaboration with theCompliance Subcommittee. In fiscal 2017, we continued tocarry out activities in line with local needs.
n Activities in Japan 
We held a conference of compliance personnel from 31
consolidated subsidiaries in Japan to share the latest
information on applicable laws, introduce tools for employee
education and exchange views on responses when a caseof misconduct occurs.
n Activities in North America We held the Compliance Officer Conference in North
America with participation of compliance officers from 20
bases. A lecture by a lawyer and a presentation on required
actions were given about often changing legal systems
in the United States, including obligations imposed on
government contractors and response to labor law changes.
After the conference, these 20 bases have been fully
implementing coordinated measures.
n Activities in Europe 
In Europe, the regional headquarters have been promoting
employee education on the Code of Conduct at respective
bases. In terms of preventive legal measures, theseheadquarters have been identifying and assessing
compliance risks and implementing appropriate measures
for selected priority matters.
n Activities in China 
In China, compliance officers from seven bases attended
the Compliance Officer Conference. In fiscal 2017, thefocus of activities was placed on “moral (education)” and“labor laws,” and we created and disseminated relevant
educational materials for use at all bases in China. Eachbase conducted education using these materials. We also

held a legal seminar for managers in the procurement
department of each base to increase their knowledge on
legal matters related to daily operations and improve theirawareness of compliance.
n Activities in Asia, Oceania and South America We have been providing compliance officer training with theaim of upgrading compliance activities. In fiscal 2017, we
provided guidance on how to conduct employee educationand held case studies on responses to misconduct forcompliance officers from five bases in India, Indonesia andVietnam.
n Cross-Regional Activities 
We held the Four Regions Compliance Conference in the
United States attended by 19 compliance personnel fromfour regions (Japan, North America, Europe and China) toshare information on and discuss the establishment of awhistle-blower system appropriate for each region. We also
selected a new compliance logo of the Toyota Industries
Group. Using this logo, we will strive to further increase
compliance awareness.

Corporate GovernanceThoroughly Informing Employees about
Applicable Laws and Regulationsn Promoting Education on Code of Conduct
In fiscal 2017, we developed a video material describing theCode of Conduct, which employees of the Toyota Industries
Group should observe, in seven languages (Japanese,
English, Chinese, Spanish, Portuguese, Indonesian and
Vietnamese) to assist relevant education in our consolidated
subsidiaries in and outside Japan. The material has been
distributed to the corresponding subsidiaries and used intheir respective education programs.

Activities in the Toyota Industries Group

Corporate Social
Responsibility

Toyota Industries has formulated and distributed to
executives and all employees the Toyota Industries
Corporation Employee Code of Conduct, which serves asconduct guidelines that should be observed by employees,
and has been providing familiarization training. Subsidiaries
in and outside Japan have formulated their own Code of
Conduct appropriate to their respective business lines
and corporate cultures. Toyota Industries’ 31 consolidated
subsidiaries in Japan and 74 consolidated subsidiaries
outside Japan have already created their own Code of
Conduct and have been working to instill an awarenessamong their employees.
Simultaneously, to prevent significant risks of bribery
and violations of antitrust laws, in addition to the Code of
Conduct we have formulated corresponding regulations
and been undertaking activities to familiarize employeeswith these regulations. Regarding bribery, Toyota Industries
formulated the Global Guidelines for Bribery Prevention.
Particularly, in countries with a high risk of bribery, eachbase has developed internal rules in accordance with theapplicable laws in respective countries and been conducting
activities to familiarize employees with them. As for antitrust
laws, we have put in place a system to conduct a checkand review before and after employees of Toyota Industries
contact competitors. We are also familiarizing all employeesthat they are prohibited from any acts that may possibly
constitute a violation of antitrust laws. Since fiscal 2016, wehave set up antitrust law compliance month and have been
conducting enlightenment activities at relevant departments.

Toyota Industries Corporation Employee Code of Conduct
as an instructional material.
Over the four years since fiscal 2014, we have created
and disseminated 39 e-learning materials (including revisions
to the existing materials) in order to cultivate a deeper
understanding of compliance among employees of Toyota
Industries Corporation and its consolidated subsidiaries inJapan and to create an environment in which employees
foster compliance consciousness on their own.
In addition, in fiscal 2017 we invited external lawyers
to hold executive legal seminars on “management ofsubsidiaries in China” and “post-acquisition managementof subsidiaries” for directors, managing officers and audit &supervisory board members.

Four Regions Compliance Conference

New compliance logon Compliance Committees (in Japan) and Compliance Ofﬁcers (outside Japan) (As of March 31, 2017)
Compliance officer
in Europe (TMHE)

Compliance officer
in China (TIMC)

Andreas Lundh

Europe:37 companies

Zhu Lingling

Compliance officer
in North America(TINA)

North America:
19 companies

China:
7 companies

Sheena Seger

Japan:
31 companies
Compliance officer
in Australia (TMHA)

Robert Watkins

Asia, Oceania and South America:
11 companies

TINA: Toyota Industries North America, Inc.
TMHE: Toyota Material Handling Europe AB
TIMC: Toyota Industries Management (China) Co., Ltd.
TMHA: Toyota Material Handling Australia Pty Limited47

nn Management of Confidential
Information
Basic Perspective
We recognize that the personal information of customers,
employees and business partners as well as information
concerning our technologies and sales activities are assetsthat need to be protected. Accordingly, we are making ourutmost efforts to safeguard confidential information andstrengthen its management as one of the CSR areas.

n Activity Examples

Activities up to fiscal 2016
Activities by Toyota Industries• Rank-based group education• Restrictions on taking photographs on company premises• Attaching a security cable with a lock to all PCs to prevent
unauthorized removal off the premises• Restricting the copying of electronic data on recording media• Monitoring of email correspondence• Requiring employees to sign a confidentiality agreement andchecking the history of electronic data being taken off the premises
upon retirement
Activities in collaboration with other Toyota Group companies• “Information Security Awareness Month” activities in May andOctober to raise employee awareness and conduct auditing by
checking off-the-premises removal of personal computers andrecording media, etc.

Basic Perspective
Based on the Basic Policies for the Establishment of anInternal Control System in compliance with the Companies
Act, Toyota Industries is working to strengthen regulations
and a structure to promote risk management. We regard
the following aspects as the basics of risk management andimplement initiatives accordingly.
(1)	Incorporating measures to prevent and reduce potential
risks into daily routines and following up on the progressof implementation(2)	Ensuring quick and precise actions to minimize theimpact on business and society when a risk becomesapparent

Implementation Structure
Business divisions and other departments at the Head Officedevelop and promote annual action policies that integrate
measures to prevent and control risks related to quality,
safety, the environment, personnel, export transactions,disasters and information security. Progress is assessed
and followed up by each functional management entity suchas the CSR Committee and the Environmental Committee.
At the same time, functional departments at the Head
Office such as those responsible for quality, safety and theenvironment formulate rules and regulations and manuals
from a Group-wide perspective, including consolidated
subsidiaries. By confirming and following up on the progress
through operational audits and workplace inspections, they
provide support for raising the level of risk management at
each business division and consolidated subsidiary.
We have also formulated the Crisis Response Manual,
which defines our initial response to a problem or a crisis.
This manual lays out basic rules to be followed when a risk
becomes evident and a problem or crisis occurs. The aim isto ensure quick reporting to top management, perform an
accurate assessment of the impact on society and businessactivities and minimize damage through appropriate actions.
The content is reviewed and revised as deemed necessary
in response to changes in businesses and the surrounding
environment.

Disaster Prevention Structure
We strive to reinforce our disaster prevention structure toenable smooth transition from the initial response stage tothe production restoration stage.
The Disaster Prevention Response Headquarters,
led by the executive vice president and consisting ofrepresentatives from the functional departments at the
Head Office, is responsible for collecting information fromplants and other relevant parties and making Company-widedecisions based on the information collected.
n Disaster Prevention Structure
Disaster Prevention Response Headquarters (Established in Kariya Plant)
Plant Response
Headquarters
Kariya Plant
Obu Plant
Kyowa Plant
Nagakusa Plant &Morioka Works
Takahama Plant
Hekinan Plant
Higashichita Plant
Higashiura Plant
Anjo Plant

Key Facility
e-Lab (information
systems headquarters)

Remote Sites

Educational Sites
Company dormitories
Company resort
facilities

Our consolidated subsidiaries in and outside Japan
also appoint respective information security managers andinformation security administrators. We have also developed
common guidelines concerning management of confidential
information, which have been distributed among thesesubsidiaries, and follow up on their activities on a periodic
basis in our efforts to raise the level of confidential information

Tokyo Office
Toyota L&F Customers
Center (Chiba)
TMHG Training Center(Handa)48

Toyota Industries Report 2017b) Tabletop Exercise
We provide training to the head (plant manager) andmembers of each Plant Response Headquarters to ensurethat we promptly make an initial response, offer support
to local communities and launch restoration activities incase of a disaster. In fiscal 2017, we added training on theprocedures to formulate a restoration plan to further raiseawareness of each member for disaster prevention.

Determining whether to stop operations
and how to provide support activities

Efforts to Cultivate Human Resources throughTraining
1. Training at Disaster Prevention Response
Headquarters
As one important role assigned to the Disaster Prevention
Response Headquarters that oversees Company-wide
disaster response, we conduct simulation training in which
employees collect information on damages to both inside andoutside the company premises, swiftly make decisions anddisseminate these decisions throughout Toyota Industries.
Since fiscal 2015, assuming the occurrence of a disaster
during nighttime and on a weekend or holiday, we havebeen providing training to members selected from thefunctional departments who live close to the Head Office inorder to further enhance our real-time response capabilities.

Reviewing policies on resumption ofoperations and how to return home

Identifying inadequacies and items to
be improved

Suppliers

Response to Possible Major Earthquake
We consider the occurrence of a major earthquake as oneof the most significant risks. Since fiscal 2011, we havebeen implementing disaster prevention measures that focus
on three basic policies, namely placing maximum priority
on human life; placing top priority on the recovery of local
communities; and ensuring the quickest possible recovery.
Furthermore, we divide these measures into the three
categories of “precautionary, pre-disaster mitigation,” “initial
response to be followed immediately after the disaster” and“restoration of production,” and are respectively making

Discussion at a workshop

Affiliated Companies

New activities in fiscal 2017
• Checking the history of hard copies being taken off the premises
upon retirement• Reviewing the content of security incident or accident training at theheadquarters, etc.

response capabilities by reviewing and revising our disasterprevention structure and flow of activities, thereby ensuring
a quick and smooth transition from initial response activities
to restoration activities.

Disaster response meeting

2. Training at Plant Response Headquartersa) Workshops
In fiscal 2017, the major topic of our Company-wide
discussion was the “creation of a structure that is truly
functional in an emergency.” We worked to increase our

Corporate GovernanceToyota Industries has set up the Information Security
Subcommittee (led by an executive in charge of the General
Administration Department) as a subordinate organization
to the CSR Committee to promote proper management ofconfidential information, taking appropriate actions against
the risk of leakage of confidential information and complying
with laws such as the Unfair Competition Prevention Act andthe Act on the Protection of Personal Information.
To thoroughly implement the initiatives adopted by thesubcommittee, we appoint information security managers*1
and information security administrators*2 at eachdepartment. We strive to raise awareness about information
security among their staff by holding workplace meetingsand conducting self-checks regarding their information
security practices.
In fiscal 2017, to counter an increase in risk for leakageof confidential information we decided to perform a morethorough check of the history of data being taken off thepremises upon retirement as well as reviewed the content of
security incident or accident training at the headquarters.

nn Risk Management

Company-wide efforts.
In fiscal 2017, based on the results of a review of ourefforts in the previous fiscal year, we conducted training
such as disaster drills in more realistic settings. We intend tocontinuously upgrade our activities.

Corporate Social
Responsibility

Implementation Structure

management throughout the Toyota Industries Group.
*1: Head of each department*2: A person within the department, appointed by the head

Discussing a restoration plan

3. Training for Restorationa) Power Restoration Drill
Each plant has developed procedures to restore power
supplies, including electricity and gas, which are essential
in restoring production activities. Starting from fiscal 2015,
each plant conducts genchi genbutsu (go and see foryourself) training on a periodic basis. Through the training
we are identifying problems and making improvements tostep up our efforts to ensure quick restoration activities.
Since fiscal 2016, we have selected a model businessdivision and standardized
restoration procedures.
We are conducting
phased implementationof the initiatives taken
at the model businessdivision throughout Toyota
Drill to restore a primary power source
Industries.
b) System Restoration Drill
The e-Lab, responsible for managing Toyota Industries’
data servers, has created procedures to restore critical data
after a disaster. We conduct annual restoration drills jointlywith Toyoda High System, Incorporated, a consolidated
subsidiary engaged in development and operation of
information infrastructures and systems, and work to
improve our readiness for quick restoration.
4. Training for Identifying Disaster Damage
We repeatedly conduct drills jointly with our affiliatedcompanies and business partners in order to familiarize
them with the use of IT tools to quickly identify the damage
status during a disaster.

49

Relationship with Our Customers
Adhering to a quality first approach, Toyota Industries
practices monozukuri (manufacturing) that quickly
responds to the diverse, ever-changing needs of customers.

Quality forms the basis of our operations and is essential
in attaining the goals of our Vision 2020. As such, weformulated our Quality Vision 2020, which defines ourphilosophy in ensuring quality.
Quality Vision 2020
All members in the Toyota Industries Group ensure
quality first and build in quality with ownership at theirown workplaces and positions in an effort tocontinuously supply attractive products/services that
anticipate global customers’ needs.
To achieve the goal of this vision, we issue the Quality
Guidelines, which identify priority quality-related issues tobe implemented in each fiscal year, to all production basesin and outside Japan and engage in quality assurance
activities accordingly. The implementation status of theseguidelines is reviewed by top management at the Quality

n Types of Quality Sought by Toyota IndustriesnQ uality Assurance Activities Based on the Quality Guidelines
ent
em
nag
lity
g
Ma lity
qua
turin
qua
ufac
ting
Man lity
r ke
Ma
qua

Quality levels that
customers truly
expectProduct quality●Safety●Eco-friendliness●Durability●Ease of use

Designquality●Brand strength●Corporate image●Sales●Service●Logistics

Implementing
Company-wide
guidelines

Quality GuidelinesP

A

PDCA*1cycle C

Quality Functional
MeetingCompany-wide Council of Heads of
Quality Assurance Departments

D

Quality assurance activities atall bases in and outside Japan

Manufacturing capabilities(from Toyota Industries’ Quality Guidelines)
Placing top priority on our “Customer First” philosophy,
Toyota Industries undertakes product development thatmeets customer expectations.
At Toyota Industries, development of a new productentails defining specific goals to incorporate quality in every
stage from product planning and design to production
preparation, production, sales and after-sales services. We
perform a design review (DR), which allows a product toproceed to the next stage only when a responsible businessdivision head examines and approves whether the producthas reached the target quality level.
Should a defect occur after the product launch, thequality assurance departments of each business division

Genchi genbutsu
inspections by
the president

Quality Vision 2020
•Quality roadmap●Workmanshipnn “We should express our gratitude to
our customers by providing them ourbest quality products.”

Checking and identifying issues ofCompany-wide quality status and progressin implementing the guidelines

Quality Guideline 1
Product development

Quality Guideline 2
Prevention of occurrence
and recurrence

Quality Guideline 3
Quality assurance atbusiness partners

Quality Guideline 4
Human resources
development

Company-wide,
horizontallyaligned activities
Activities to increase
quality awarenessQualityeducation

Toyota Industries Report 2017

nn Initiatives to Prevent Defects
To achieve a level higher quality control and assurance,heads of all business divisions, quality assurance
departments and engineering departments share
information on defect prevention activities upon new productdevelopment or launch of mass production at the Quality
Confirmation and Defect Prevention Meeting. Additionally,
we provide education on a periodic basis not only toemployees of Toyota Industries but also to our business
partners to improve work procedures and mechanisms fordefect prevention.
If a defect is found in a product after its launch, we
implement thorough measures to prevent a recurrence andapply the results to other business divisions.
We have been strengthening measures to prevent theoccurrence of similar defects in all products we develop andmanufacture in the future.

nn Initiatives to Raise Quality AwarenessTo ensure that we live up to our customers’ expectationsin terms of quality, we believe it is important to have ahigh degree of quality awareness on an individual level.
That is why we engage in various activities to raise quality
awareness, including organizing various events during
Quality Month. As a new initiative in fiscal 2017, wepublished two quality-related booklets to promote higher
quality awareness.
One of the booklets, which is for all employees, reaffirms
the origin of our quality assurance activities and includes
such topics as the introduction of a Company-wide quality
management structure in 1982 and details of the Deming
Prize we received in 1986. This booklet was translated into
English and distributed to major production bases outside
Japan.
Based on the results of quality awareness questionnairesthat have been conducted since fiscal 2016, we also
created a booklet for engineering departments to facilitate
the application of statistical quality control methods.

nn Promoting Human Resources
Development
Toyota Industries provides systematic quality education to
all employees to help them acquire quality assurance skills
needed in actual operations.
Our production bases outside Japan also promotekaizen efforts and human resources development throughquality control (QC) circle activities. We visit subsidiaries
outside Japan to give hands-on instructions for promoting
QC circle activities and train QC circle instructors. As avenue for presenting activity results, we hold the Global QC
Circle Convention and Regional QC Circle Convention every
year and provide workshop sessions to raise skills.
We are working to reinforce our foundation for quality
assurance based on the belief that manufacturing starts withnurturing excellent personnel.

Global QC Circle Convention

Quality Confirmation andQuality audit at
Defect Prevention Meeting business partners*1: PDCA (Plan, Do, Check, Act)

Booklets to raise quality awareness
Genchi genbutsu inspection by the president

50*2: As of March 31, 2017

Since improving the quality of our products requires
concerted efforts with our business partners in and outside
Japan, we are strengthening joint quality assurance activities
with major business partners.
In each quality audit, we determine priority areas,
confirm the improvement status of the previously identified
deficiencies and provide quality education on items
that should be reinforced in order to cultivate a deeper
understanding of kaizen (improvement). As a result of these
activities, in fiscal 2017 we successfully reduced the quantityof defective products delivered to us by about 30% from theprevious fiscal year.
These activities enable our business partners to attainthe level of quality assurance that Toyota Industries requires
and establish a culture to foster quality assurance on theirown.

Relationship with Our Customers(from 80 Years of Toyota Industries through Photos)
Carrying on the spirit of founder Sakichi Toyoda, Toyota
Industries strongly believes that quality is the lifebloodof a company. Focusing on quality first and ensuring
customer safety and reassurance are our most important
responsibilities to our customers and form the basis of ourapproach to CSR.
Toyota Industries strives to maintain and improve thetotal quality of our corporate activities, which encompasses
not only “product quality” but also “marketing quality” and“management quality.” “Product quality” is embodied in
the safety, eco-friendliness, durability, ease of use andworkmanship of our products, while “marketing quality”
entails excellent sales and service in addition to these
attributes and “management quality” further enhances ouroverall corporate image and brand strength in terms of all ofthese attributes.

nn Activities Based on the Quality
Guidelines

nn Providing Support to Business Partners

Corporate Social
Responsibility

nn “A product should never besold unless it has been carefully
manufactured and fully tested in thecommercial trial, with completely
satisfactory results.”

immediately devise necessary measures. At the sametime, a probable cause is identified from both technicaland structural aspects, and if deemed necessary, the new
product development system itself is reviewed to prevent a
recurrence in the successor model.

Functional Meeting chaired by the head of the Production
Headquarters*2 for identifying additional issues anddevising countermeasures. Issues raised are followed up
at meetings of the Company-wide Council of Heads of
Quality Assurance Departments chaired by the head of the
Quality Control Department*2. The president also checks
on the outcome of these activities through genchi genbutsu
inspections.

Regional QC Circle Convention in China

51

n Participants of Japan’s
Subcontracting Law Seminar

Relationship with Our Business Partners

Affiliated companies
Toyota Industries(Persons)

1,200

Toyota Industries encourages open procurement andseeks co-existence and co-prosperity with our business
partners (suppliers) based on mutual trust. We also facilitate
environmentally preferable purchasing, CSR-oriented
procurement practices, human resources development anddisaster prevention activities for a possible major earthquake.

nn Basic Perspective
Toyota Industries continually carries out timely andappropriate information disclosure for shareholders andinvestors. In this way, we raise management transparency
so that we obtain an appropriate company valuation instock markets. We proactively provide not only information
required under disclosure laws and regulations but also
information on our management policy and businessactivities. Also, we engage in various investor relations
activities to facilitate productive dialogue with shareholders
and investors.

sessions mainly in regions in Japan where our bases arelocated to promote an understanding of our businessand management policies. Our Website also provides
descriptions of our business details and strengths in aneasy-to-understand manner.
Opinions and requests we collect through various meansof communications with shareholders and investors are fed
back to executives and relevant business divisions to reflect
them in our future business activities.
n Major IR Activities
For institutional investors and securities analysts in Japan•Quarterly financial results briefings •Individual interviews/visits•Small meetings •Teleconferencing •Company-hosted business information
sessions/plant tours •Issuing/delivering Toyota Industries Reports
For institutional investors outside Japan•Individual interviews/visits •Teleconferencing •Participation in conferences
hosted by securities companies •Issuing/delivering Toyota Industries Reports
For individual shareholders and investors

nn Co-Existence and Co-Prosperity
Based on Mutual Trust
We work hard to realize co-existence and co-prosperity withour business partners based on mutual trust. Every year,
we hold procurement policy meetings and top manager
seminars for major business partners to facilitate mutual
understanding and cooperation. In addition, we provide
such programs as quality management and technical skills
training, guidance directed toward kaizen at their production
sites and safety and health education throughout the year.

nn Reducing Environmental Impact
through Environmentally Preferable
Purchasing
In order to create environmentally friendly
products, we aim to procure parts, raw materials
and equipment from business partners that give
sufficient consideration to the environment.
In October 2016, we published the sixth
edition of our Environmentally Preferable
Purchasing Guidelines, which we haveformulated to enforce “green” purchasing.
In the sixth edition, we responded to theEnvironmentally Preferable increasing global call for stricter environmental
Purchasing Guidelines
requirements throughout the product lifecycleby adding to the guidelines the goals we are pursuingfor the year 2050 as well as provisions to ensure greater
environmental management in our entire supply chain.

nn Localization of Business for Good
Corporate Citizenshipnn Efforts toward Future-Oriented Trade
Practices
In September 2016, the Ministry of Economy, Trade andIndustry released Basic Policies for Future-oriented Trade
Practices, requesting all industries in Japan to “formulate
voluntary-based action plans toward the further introductionof fair trade and the improvement of added value acrosswhole supply chains.” Accordingly, we conducted a review ofour payment conditions for subcontracting business partners
and decided to entirely switch from payment in bills andnotes to payment in cash starting from fiscal 2018. As part ofour efforts to become a “company on which society places
greater trust,” we established a business partner hotline,
through which we receive their opinions and inquiries andexternal lawyers take appropriate action for each case.

nn Business Continuity Plan (BCP)
Activities for Possible Major
Earthquake
In the wake of a series of earthquakes that hit Kumamoto in
2016, we reviewed our previous BCP activities and identified
deficiencies. In further promoting our BCP activities, we aremaking concerted efforts with business partners to reduce
associated risks by implementing specific measures. In fiscal
2017, as a new initiative to ensure the smooth launch of a
production restoration phase after a disaster, we provided
production restoration workshops (tabletop exercises) to ourmajor business partners.
n BCP Activities
Topic

In view of increased local production outside Japan, we
promote procurement from local business partners in order
to contribute to the local community through consolidated
subsidiaries as a good corporate citizen.

We proactively provide education to enhance procurement
knowledge both internally and externally. In fiscal 2017,52

Toyota Industries Report 2017

FY2014FY2015FY2016FY2017

Reinforcing disaster mitigation
Production
restoration
Hoeikai (business partners)

Scope of activities
Supply chain surveys
Mitigation workshops
Activities

nn Promoting Human Resources
Development

Action policy

FY2013
Determining
current status

Disaster mitigation plans
Genchi genbutsu confirmation
Training for determining
extent of damage
Production restoration
workshops

Suppliers of major parts
Improving accuracy through periodic surveys
Tabletop exercises
Formulation, aggregation and review
Confirmation
Periodic training
Tabletop
exercisesnn General Shareholders’ Meeting
We hold our annual general shareholders’ meeting
early to avoid the date on which many companies holdtheir respective shareholders’ meetings so that moreshareholders can attend. We are further facilitating theexercise of voting rights of our shareholders by allowing
them to exercise such rights via the Internet and by joining
the electronic voting platform for institutional investors.
We held our 138th General Shareholders’ Meeting on
June 10, 2016, in which a record-high 475 shareholders
participated. To foster a better understanding of ourbusiness activities, we invited our shareholders for a lift truck
plant tour following the general shareholders’ meeting.
n Number of Participants•Company information sessions •Company-hosted plant tours•Issuing/delivering notice of general shareholders’ meeting•Issuing/delivering business reports

Company-hosted information session for the Materials Handling Equipment Business(September 2016)(Persons)

134th

135th

136th

137th

138th

Shareholders’ meeting

363

396

348

418

475

Plant tour

132

185

144

163

198

nn Investor Relations Activities
For institutional investors and securities analysts, ourmanagement conducts briefing sessions to explain ourquarterly financial results, including business performance,
progress achieved at each business division and future
initiatives. In addition to accepting individual interviews
and making visits to institutional investors, in fiscal 2017
we hosted information sessions for the Materials Handling
Equipment Business and car air-conditioning compressor
plant tours. These events serve to showcase our business
policies, our approach to manufacturing and on-site
initiatives and facilitate a deeper understanding of
Toyota Industries.
As for institutional investors outside Japan, we visit
some of them to explain our management policies andbusiness overview. We also participate in conferences
hosted in Japan by securities companies and hold individual
meetings.
For individual investors, we hold company information

Q&A session after a car air-conditioning compressor plant tour hosted by Toyota Industries(December 2016)

Relationship with Our Business Partners / Relationship with Our Shareholders and Investors

To achieve open procurement, we provide fair and equal
opportunities to all potential business partners on our Website.
We comprehensively evaluate our business partners
based on such factors as quality, price, adherence todelivery times, technological capabilities and management
information. We also assess their initiatives for safety, theenvironment and compliance as we strive for the timely andstable procurement of excellent products at lower costs
based on fair business transactions.

We aim to obtain an appropriate company valuation instock markets through timely and appropriate information
disclosure while promoting good communications withshareholders and investors.

Corporate Social
Responsibility

nn Fair Business Transactions Based on
an Open Door Policy

we provided training on
Japan’s subcontracting law to 1,000800
strengthen compliance, with600
seminars attended by 1,030
Toyota Industries employees
400
and 150 participants from200
affiliated companies. We
0(FY) 13 14 15 16 17
also held seminars for
those who have missed previous ones, and all applicable
individuals have completed this training. Along with sharing
a model to develop procurement professionals across all
procurement departments of Toyota Industries with the aimof improving the knowledge of procurement personnel, we
have started providing basic education on procurement aswell as financial education. We also work with Hoeikai, anorganization consisting of our business partners, to provide
support to strengthen the management platforms of member
companies through Toyota Production System (TPS)
activities in manufacturing and QC circle activities.

Relationship with Our Shareholders and Investors

nn Returning Profits to Shareholders
We strive to continue paying dividends from retained
earnings at the consolidated dividend payout ratio of roughly
30% and meet the expectations of shareholders upon
comprehensively taking into consideration such factors as
business results and demand for funds.
For fiscal 2017, Toyota Industries increased annual cash
dividends by ¥5.0 over the previous fiscal year and paid
annual cash dividends per share of ¥125.0 (interim cash
dividend per share of ¥60.0 and year-end cash dividend pershare of ¥65.0).

53

n Frequency Rate of Lost Workday Injuries (Non-Consolidated)

Our ultimate goal is to create safe and secure workplaces
for everyone, where each and every associate can exercise
their diverse potentials and play active roles.

1.0

0.4
0.2

Toyota Industries
(FY)

13

14

15

16

(Source: Survey on Industrial Accidents, Japan’s Ministry of Health, Labour and Welfare)

Health and safety inspection by central
general safety and health supervisor

Inspection of gas-fired equipment by
top management

Overseas, we again held a health and safety regional
meeting at bases in Europe and North America.
These meetings focused on increasing collaboration
among bases in each region and aimed to ensure legal
compliance, build a safety-oriented culture and improvehealth and safety technology and measures. Participants
exchanged views on how to apply cause analysis methods
to prevent a recurrence of an industrial accident and how
to ensure safety in logistics operations while using vehicles
within a plant. For the former, in particular, we created amanual that compiles issues found so far to deepen anunderstanding of the importance of cause analysis and ourapproach to preventive measures.

Toyota Industries Report 2017

As a task for the medium term, we are promoting healthimprovement of associates, mainly focusing on preventionof lifestyle diseases and mental health support activities, tocounter risks associated with aging and greater stress.
For prevention of lifestyle diseases, we conduct periodic
age-based health education for all associates. We also
feed back to associates the results of an annual healthcheckup and measurements conducted on the same day,including physical fitness, body fat percentage and amountof fat around internal organs, along with advice to improve
lifestyle habits. Our health checkup is designed to provide
motivation for better health by letting associates think about
their health over the course of the one-day program.
In addition, we conduct enhanced follow-up activities
after annual health checkups. As one effort, we provide
health promotion guidance to associates below the ageof 40 in addition to specific health guidance required by
the Japanese government. By doing so, we encourage
associates to improve lifestyle habits early on in order toprevent or ameliorate symptoms of metabolic syndrome.
Our company cafeterias also offer healthy meals to help
associates maintain and promote their health.
As part of mental healthsupport activities, we havein place a system to offer
early consultation through ahealth-related hotline. Other
activities include upgrading
our self-care/line-care

nn Enhancing Team Strength
Toyota Industries believes that it is essential to enhanceteam strength so that each associate can work with vitality
and the Company can achieve sustainable growth.
We believe that team strength is made up of “technicalskills” that form the basis of manufacturing operations,“management skills” to make maximum use of technicalskills and a “spirit of harmony” that supports both. Whilefurther enhancing our team strength, we are striving toextend and hand it down beyond all business domains,
generations and geographic regions.
Technical Skills

Expertise/skills/know-how

LeadershipTo pursue improvements
thoroughly and continuously

Spirit of Harmony

Participants of age-based health education (non-consolidated)(2,142 persons)
Persons having completed guidance program on prevention oflifestyle diseases (non-consolidated)(717 persons)
Stop smoking enlightenment events•World No Tobacco Day: One-day no smoking (May 31)•No Smoking Days: Half-day no smoking (for nine days)
Participants of stop smoking campaigns (held jointly with healthinsurance association)(29 persons)Participants of walking events (held jointly with health insurance
association)(5,025 persons)

Return-to-work support* Skills competition for determining
Japan’s top young engineers

Workplaces

Preventing
relapses

Improving support via the introduction of a stress check system
Encouraging associates Raising awareness of
to be more aware ofhealth-related hotline
their health and offering
advice on healthimprovement measures

Interviews as partof health checks

Technical Skills<Consultation
system>• Industrial healthstaff (in-house)• External institutions

Individuals

Providing information on mental healthEarly
detection/
early
resolution

Teamwork
Well-roundedhumanity

To develop skills to support manufacturing, the Technical
Learning Center, one of our training facilities, plays thecentral role in associate education, offering basic skills
training at the Technical Training School and facilitating
efforts to enhance the skills of young technical staff throughin-house skills contests. We also work to cultivate highly
skilled specialists through participation in the national andinternational skills competitions.
At the 54th National Skills Competition* held in 2016, theToyota Industries teamwon one gold medal in
the “electrical welding”
category and received
prizes in various othercategories, thereby
attaining medals forthe 16th consecutive
competition.

n Improving Mental Health Support Systems(Introducing a Stress Check System)

Health and safety regional meeting at a base in North America

TPS, QC, SQC, etc.

Team Strengthn Major Health Promotion Activities in Fiscal 2017

Preventive
measuresManagement Skills
Ability to identify and resolve issues
Ability to merge multiple levels of skill

Age-based health education

Objective

Relationship with Our Associates

among associates to achieve zero industrial accidents.
There was an industrial accident at another company,
which involved an explosion in a heating furnace thatuses combustible gas. Following the accident, ourtop management conducted focused inspections on
gas-fired equipment used within the Toyota Industries
Group. Using the information released by public offices
and other organizations, we performed checks on theventilation setting at the time of ignition, safety devices
used to check the combustion conditions, functions of
the automatic and emergency gas shut-off valves andthe contents of operational manuals, and confirmed thatour procedures and equipment ensure safety in all of ourassumed scenarios. We will continue to seek the latest
safety technology for increasing safety and endeavor to
curb industrial accidents by repeatedly conducting risk
assessments.

Health and safety regional meeting at a base in Europe

54

17

nn Initiatives for Health Management
and Improvement

education to prevent new cases of mental health problems
and operation of a return-to-work support program forpersons on long-term leave for prevention of relapses. We
have successfully achieved positive results through these
activities.
In fiscal 2017, we introduced a stress check system andconducted a check on all associates. The results were fed
back to all participants with suggestions for improvement,
and we set up an individual interview with a doctor for thosewishing to do so. We also provided feedback of group
analysis results to each workplace, as encouraged by
the Ministry of Health, Labour and Welfare. We promoted
effective data utilization in improving working environments
by feeding back the results along with tips for improvement
to all department heads. Our in-house industrial health staff
and external institutions also provided improvement support
to departments needing to implement countermeasures.

Corporate Social
Responsibility

In accordance with our fundamental policy of “creating
people capable of autonomously maintaining occupationalsafety and health,” Toyota Industries strives to prevent
industrial accidents and occupational disorders as well as
realize better work environments.
Based on the idea of building “a homelike atmosphereat work that is warm and friendly” as stated in the Toyoda
Precepts, we clarified the “true meaning of safety” and“optimal safety we seek” and formulated the Safety Visionin fiscal 2014. Under this vision, all associates of the Toyota
Industries Group are undertaking the task of establishing asafety-oriented culture.
Safety Vision
In fiscal 2017, we
continued to promote
Each and every associate in the Toyota Industries Group,
guided by the spirit of our corporate creed,primarily “activities
aims to create a corporate culture
aimed at establishing athat places a top priority on maintaining safety in all areas
and focuses on mutual courtesy and safety
safety-oriented culture”
as well as realizing workplaces
where associates work each day
and “safety measureswith a sense of happiness and pride.
from human, object
July 1, 2013
and administrative
standpoints based on risk assessment.”
For a safety culture to firmly take hold, strong awarenessamong all associates is vital. It is equally important thatthey recognize health and safety issues in the workplace
and plan and sustain their own activities to reduce
industrial accidents under the leadership of managers andsupervisors.
To this end, managers and supervisors observe
workplaces from a viewpoint of workers and strive to
visualize issues through genchi genbutsu dialogue, sharegoals with workers and cultivate a sharper sensitivity to
problems.
Since many of the issues that have become apparent
often show trends specific to individual business divisions,
we hold sessions to report the results of work observations
to encourage matching response actions within eachbusiness division.
As typical examples of safety culture activities, we
encourage point-and-call practices to check safety, instructassociates to use hand rails when going up or down stairs
and let associates remind each other to mutually raiseawareness. As a result of these activities, we have increased
opportunities to hold safety dialogue within Toyota Industries
and cultivated stronger awareness among all associates,making steady progress toward zero industrial accidents.
In fiscal 2017, we continued to record no accidents
caused by production facilities. However, as there were
human-induced accidents, such as injuries while handlingheavy objects and while walking, the frequency rate of lost
workday injuries rose to 0.06. We will continue to implement
and expand unfaltering initiatives to instill a safety culture

Manufacturers of transportation Good
machinery and equipment

0.60nn Building a Safety-Oriented Culture
That Aims for Zero Industrial
Accidents

Manufacturing industry

0.8

We will continue to reinforce ties among bases within
Japan and among bases in each region, with the ultimate
goal of establishing the highest level of health and safety
culture in respective regions.

Mental health education

Relationship with Our Associates

(%)
1.2

Understanding thecauses of stress in theworkplace andimproving working
environments

54th National Skills Competition (electrical welding)55

n Number of Medals Won at the National Skills Competition
FY2013

FY2014FY2015FY2016FY2017

Gold medal

—

1

1

1

1

Silver medal

1

2

3

2

3

Bronze medal

4

3

1

3

1

Total

5

6

5

6

5

Management Skills

Spirit of Harmony

nn Establishing Work Environments
Where Diverse Human Resources
Can Play Active Roles
We are implementing a variety of measures to create work
environments where a diverse range of human resources
can fully exercise their capabilities. These include promoting
active roles of female associates, supporting the employmentof persons with disabilities and creating an environment inwhich older associates can work more actively.
Promoting Active Roles of Female Associates
We have been formulating plans to harness a more diverse
range of human resources and continuing to carry out
activities since 2008.
We have been working to enhance support systems
through such measures as introducing “a shorter work-hoursystem for child care.” We also introduced a telecommuting
system in April 2014. As a result, the average length ofservice increased overall in administrative and engineering
positions, with a significant rise for female associates.
n Average Service Years by Male and Female Associates(Administrative and Engineering Positions, Non-Consolidated)(Years)20

Menn Action Plan

Implementation
FY2016FY2017FY2018(1) Launch, message from president

Changing
mindsets (2) Awareness seminar for managerial staff
amongmanagerial (3) Follow-up on individual developmentplans
staff and (4) Getting spouses involved inacross all
pre-maternity leave seminars
associates(5) Lectures by male role models(Ongoing)(1) Sending associates overseas for training
at an early stage in their careers
Career(2) Career training and interviews forsupport for
female assistant managers
female(3) Role model exchange meetings
associates(4) Early return-to-work support(pre-maternity leave seminars)(Ongoing)

Promoting (1) Expanding telecommuting options
flexibleworking (2) Establishing satellite offices
practices (3) Installing refrigerated delivery lockers~ FY2010

FY2011FY2012FY2013•Extending the period of child care leave•Introducing a leave system to allow
parental care of children with illnesses•Establishing on-site day care center•Introducing a “welcome-back” system*[Administrative position](Persons)
40

(%)
50

(Persons)
150

40

Cultivating career consciousness•Individual interviews with female assistant managers and their superiors•Formulating individual•Sending trainees•Training for career development for assistant managers
development plansoverseas

Setting targets for the number of female associates in managerial positions
Tripling the number of female associates in managerial positions by 2020
Toyota Industries [25 (2014); 31 (2017); 75 (target for 2020)]

are working and to raise awareness of human resources
development that takes into account their life events.
In order to create an environment to allow associates whoare balancing work and child/nursing care to work with higher
motivation and pursue career development, we expanded our
telecommuting system in October 2016, which promotes theearly return to work from a break in their career.
Rather than merely appointing more female associates
to managerial positions, we are working to improve
workplaces so as to offer females a wider range of jobs andhigher quality of work and to enable female associates tofulfil their individual potential.
We were certified by the Aichi Labour Bureau asa “Female-Friendly Company” in January 2016 andreceived “Eruboshi (“L Star”: L stands for Lady, Labourand Laudable)” certification from the Ministry of Health,Labour and Welfare in October of the same year. The latter
certification is given to companies making excellent efforts inpromoting active female roles in the workplace.
In March 2017, we were selected as a
Semi-Nadeshiko Brand, a status investors
may find appealing when making investment
decisions. The designation is granted to publicly
listed companies that are outstanding in termsof encouraging the empowerment of women.
We will continue to promote activities
aimed at creating more active roles for female
associates.

30

Training for career development for female assistant managers

100

50

56

Toyota Industries Report 2017

0Female•“Eruboshi” certification•Selected as Semi-Nadeshiko Brand* A system to enable reinstatement under certain preconditions

20

10

Male

•Female associate exchange meetings•Project for promoting active roles
among 6 Toyota Group companiesof female associates•Seminars for female associates in•Message from president
managerial positions•Seminars for female students in science track•Starting to recruit main career track female associates (for engineering positions in fiscal 1987 and administrative positions in fiscal 1997) •Increasing recruitment of female associates from non-engineering university departments

20

Mar. 31, ’17•Expanding telecommuting options•Installing delivery lockers

Increasing the ratio of female associates

(%)
40

20

Mar. 31, ’07•Introducing a telecommuting system•Opening a Diversity Navi page on the intranet•Holding exchange meetings and lectures to share experiences of female associates in balancing work and family[Engineering position]

30

Mar. 31, ’97

FY2017

Female associate exchange meeting among six Toyota Group companies

Employment of Persons with Disabilities
We respect the idea of people with and without disabilities
working together and sharing life and work values. Under
this basic policy, we continue to employ persons withdisabilities every year. They are assigned to a variety ofsections and work with other members to perform theirdesignated tasks. In fiscal 2017, the ratio of associates withdisabilities on a non-consolidated basis was 2.27%.
■ Ratio of Associates with Disabilities (Non-Consolidated)
(%)
2.3
2.2
2.1
2.0
0

(FY)

13

14

15

16

17

Creating a Work Environment for Older Associates

150

FY2016

Cultivating corporate culturen Hiring of New Graduates (Non-Consolidated)

305FY2015•Introducing a shorter work-hour system for child care

Women

10

FY2014

Enhancing support systems

Relationship with Our Associates

We are creating a bright, energetic and caring work
environment that fosters a dynamic workforce and allows
every member to demonstrate his or her capabilities both as
an individual and as a team. We are proactively encouraging
communication not only during work hours but also throughsocial gatherings, sports days, summer festivals, Groupwide ekiden long-distance relay races and cheer squads forvarious sports events.

n Initiatives for Promoting Active Roles of Female Associates

Corporate Social
Responsibility

We conduct TICO Business Practices (TIBP) training
targeting associates in administrative and engineering fields,with the aim of mutually sharing the thinking and values that
the Company gives importance to, as well as to improve
our associates’ problem-solving capabilities. TIBP training
programs are also provided at subsidiaries outside Japan in
our efforts to raise the level of management skills throughout
the Toyota Industries Group.

In addition, by introducing “a return-to-work (“welcomeback”) system,” which allows associates who have left work
to care for children and family members or to accompany
their spouse for a job transfer to get reinstated under certain
preconditions, we provide an environment for associates towork at Toyota Industries for longer years with peace of mind.
In terms of measures to promote more active roles forfemale associates, we have set the target of increasing theratio of female graduate recruits to 40% in administrative
positions and 10% in engineering positions, and tripling thenumber of female associates in managerial positions by
the year 2020 compared with 2014, and intend to step up
activities to achieve our goal.
In 2015, we set up a project to promote more activeroles for female associates, comprising 11 males andfemales from different departments.
This project was key for the identification of issues andformulation of policy proposals in promoting the increased
active roles of female associates through discussions andexchanges among project members and stakeholders.
The results of these discussions formed the basis for thedevelopment of a Company-wide action plan in clarifying theinitiatives for this project.
In carrying out the action plan, we specifically focus on
the initiatives to change the mindset among managerial staff
and across all associates, provide female associates career
support and promote flexible working practices.
In fiscal 2017, we held a seminar for about 1,000
managerial staff members who directly engage in thementoring and development of associates. The aim was topromote an understanding of how female associates regard
their career paths as well as the environment in which they1010(FY) 13

14

15

16

17

0

0

(FY) 13

Female

14
Male

15

16

17

0

Ratio of females

We focus on creating a better work environment for older
associates by adjusting the height of jigs in production lines
and modifying processes to compensate for deterioration ofvision so that they can work with less stress.
Moreover, since the introduction of a re-employment
system for associates who reach the mandatory retirement
age of 60, the number of associates who choose tocontinue working has been increasing. In response, we hold
“55 Career Training” for associates reaching the age of 55 togive them an opportunity to envision life and work after theage of 60 and think about how they should work during theremaining pre-retirement period.

Seminar for managerial staff members

57

Relationship with Our Local Communities
With a view toward creating an enriched and healthysociety and ensuring its sustainable growth, we fulfill ourrole as a good corporate citizen and actively undertakesocial contribution activities in every region where we
do business.

* Voluntary organizations formed by employees at each job levelnn Structure for Promoting Social
Contribution Activities
The CSR Committee deliberates on policies of our social
contribution activities while the Social Contribution Group
within the General Administration Department at the Head
Office takes the initiative in carrying out activities.

Activities

SocialwelfareEvents to interact with persons with disabilities• “Walk Rally (orienteering),” harvest festival, festival
Support for welfare facilities• Support for charity bazaars at facilities by providing goods• Volunteer work for facility cleanup/repair/pruning/weeding•S upport for sales of products from facilities for persons withdisabilities by providing opportunities to set up stalls• Volunteer listening activities at elderly care facilities
Donation to a breast cancer enlightenment NPO througha charity running event (Belgium) (P59)
Support for feeding the homeless and needy (Australia)
Donating Christmas presents for less fortunate children (U.S.A.)

Support for Youth Invention Clubs•M onozukuri workshops for elementary school children
during summer vacations•H olding handmade kite-flying competitions
Youth•R unning craft corners at local events
development Providing plant-hosted environmental education to elementary
school children
Holding mini concerts at elementary schools
Donation to an organization supporting sound youth
development (U.S.A.) (P59)

Participation in local traditional event (Mando Festival)
Road cleanup activities in areas around plants
Activities to raise awareness for traffic safety
Crime prevention patrols
Community
Holding a drill on how to use fire extinguishers at ancontribution
elementary school (P58)
Highway cleanup activities (U.S.A.)
Donating toilets and desks to elementary schools andconducting health and hygiene education (India) (P59)
Other

Holding charity concert
Support for international NGO in collecting spoiled postcards,
bell marks and others
Periodic blood donation drives

Activity Examples of Toyota Industries and Consolidated Subsidiary (Japan)
Environmental
Protection

58

Consolidated SubsidiaryCommunity
Contribution

Donating Benches Made of Thinned Wood

Holding a Drill on How to Use Fire Extinguishers at an
Elementary School

In collaboration with Aste, a public interest foundation
engaging in forest conservation, Toyota Industries donated
12 benches made of thinned Japanese cypress tokindergartens and children’s day care centers. This initiative
aims to promote the sound development of forests andeffectively utilize thinned wood. At a donation ceremony
held at a kindergarten, we
performed a skit to explain
what is happening tosatoyama (village forests)
in an easy-to-understandmanner and convey theimportance of conserving
forests to children.

SKM Corporation, engaging in building management,
security services for facilities and management andbrokerage of real estates, conducted a drill on how to use
fire extinguishers for about 90 fourth graders at a nearby
elementary school, utilizing the skills accumulated throughroutine training by its security department. On the day of thedrill, after a lecture on
fires and a Q&A session,
each child actually shot
off a fire extinguisher. We
will continue to contributeto local communities
through these and similar
activities.

Skit by employees participating ina donation ceremony
Toyota Industries Report 2017

Social Welfare

Donation to a Breast Cancer Enlightenment NPO through a
Charity Running Event

Toyota Material Handling Belgium NV/SA (TMHBE)
Subsidiary engaging in sales and servicing of materials
handling equipment

From TMHBE, 18 employees participated in a charity
running event to support the Susan G. Komen®
organization, an NPO fighting against breast cancer. The
event solicits donations from runners according to the
distance they run, and the company donated the matchingamount to the NPO. The funds raised through the eventare used to support efforts to increase the breast cancer
examination rate, help patients find a job and promote
therapeutic research.

Environmental
Protection

Indonesia

Cooperating in a Government-Led Environmental Program

P.T. TD Automotive Compressor Indonesia (TACI)
Subsidiary producing car air-conditioning compressors

TACI cooperated in the Adiwiyata Program, anenvironmental program for the sustainable growth of society
run by the Ministry of Environment and Ministry of Educationof Indonesia. The program encourages respective schools
to address environmental issues and convey to children theimportance of environmental conservation. At a school in
Cikarang, 20 TACI employees supported the developmentof a system to produce a fertilizer from organic waste.

Initiatives for forest conservation•T ree thinning activities for conservation of prefecture-owned
forests
Environmental • P roducing and donating benches made of thinned
wood (P58)
protection•T ree-planting activities for reforestation
Cooperating in a government-led environmental program(Indonesia) (P59)(Activities without country designation were conducted in Japan.)Toyota Industries Corporation

Belgium

Drill for children to practiceusing a fire extinguisher

Employees who cooperated in the environmental program

Employees who participated in the charity running event

U.S.A.

Youth
Development

Donation to an Organization Supporting Sound Youth
Development

Community
Contribution

India

Donating Toilets and Desks to Elementary Schools andConducting Health and Hygiene Education

TD Automotive Compressor Georgia, LLC (TACG)

Toyota Industries Engine India Pvt. Ltd. (TIEI)

Subsidiary producing car air-conditioning compressors

Subsidiary producing engines

In September 2016, TACG employees collected snacks
and beverages and raised donation funds for the Boys &Girls Clubs of America. The organization offers a variety of
support programs for economically or socially challenged
youth having difficulty leading a stable life to help themachieve sound growth.

Employees who participated in the donation drive

Relationship with Our Local Communities

Based on “Respect for Others” as described in our Basic
Philosophy, we strive to fulfill our role as a good corporate
citizen in every region where we do business and actively
engage in social contribution activities to realize an enriched
and healthy society. In our activities that emphasize social
welfare, youth development, environmental protection andcommunity contribution, we not only provide cooperationand support through personnel, facilities, funds and knowhow but also strive to closely connect with participants.
To foster employees’ awareness of their ties to society
and raise their interest in contributing to society, we
make enlightenment efforts such as providing a venue forvolunteer activities and sharing information on volunteer
activities that encourage the participation of all employees.
Employee associations* are actively undertaking various
activities to contribute to local communities, mainly in theareas of supporting welfare facilities and protecting thenatural environment.

Theme

Activity Examples of Consolidated Subsidiaries (Outside Japan)

Corporate Social
Responsibility

nn Activities as a Good Corporate
Citizenn Major Social Contribution Activities of Toyota Industries andGroup Companies

TIEI constructed girls’ restrooms at an elementary schoolin the Krishna district, which is located near its plantand had been in need of more girls’ restrooms. TIEI also
donated desks and chairs to and conducted health andhygiene awareness education at other elementary schools.
Along with these efforts, TIEI conducted a variety ofcommunity contribution activities, including planting trees forbeautification of areas surrounding its plant.

Employees who participated in awareness education

59

Environmental Initiatives
Vision for Environmental Activities
P60
Structure to Implement Environmental Management
P61
Sixth Environmental Action PlanP62–63
Establishing a Low-Carbon Emission Society
P64–65
Establishing a Recycling-Based Society
P66–67Structure to Implement Environmental Management
Reducing Environmental Risk andP68–69Establishing a Society in Harmony with Nature
Environmental Management
P70–73
Environmental Impact Flow and Environmental Accounting
P74
Third Party Assurance of Environmental Performance Data
P75

Positioning environmental response as one of its most
crucial management issues, Toyota Industries is enhancing
its environmentally oriented corporate management ona global basis through the promotion of consolidated
environmental management.

Vision for Environmental
Activities
We have defined our aspirations in 2050 and launched the
Sixth Environmental Action Plan in fiscal 2017.

As one tenet under our Basic Philosophy, Toyota Industries
works to contribute to regional living conditions and social
prosperity and also strives to offer products and services
that are clean, safe and of high quality. Accordingly, inFebruary 2011, we established the Global Environmental
Commitment, a specific environmental action guideline,
to be shared and implemented throughout the Toyota
Industries Group. The entire Toyota Industries Group will
dedicate concerted efforts to realizing a prosperous life inharmony with the natural environment.

1 Establishing a low-carbon emission society
Globally take on challenge of establishing a zero CO2emissions society Establishing a recycling-based society
Take on challenge of minimizing the use of resources Reducing environmental risk and establishing a society inharmony with nature
Generate positive influence on biodiversity Promoting environmental management
Enhance consolidated environmental management andpromote enlightenment activities

As a milestone toward achieving our aspirations in 2050,
we have formulated the Sixth Environmental Action Plan, a
new five-year plan for the period from fiscal 2017 to fiscal
2021, and will resolutely undertake activities in accordancewith the plan.
(See the Sixth Environmental Action Plan on pages 62–63 for details.)

TOPIC
Aiming at realizing a prosperous life inharmony with the natural environment

n Environmental Management Structure
Environmental Committee

PresidentInternal audit
Responsible internal auditor

Specialized committees•Team leader•Supervising auditors•Auditors

Product Environment Subcommittee

Chief environmental administrator

Head Office
Corporate Planning
R&D
Purchasing
Quality Assurance
Human Resources
General Administration

Production Environment Subcommittee

Admin office

Company-Wide CO2Emission Reduction Conference

Divisions
Materials Handling Equipment
VehicleEngineCompressor
Electronics
Textile Machinery

Company-Wide CO2 Zero
Emissions Challenge Subcommittee

Division-Based
Promotion Committees

Environmental Conservation Organization by manufacturing plants(environmental risk management overseen by plant managers)

We created a panel summarizing our newly formulated
aspirations in 2050 and the Sixth Environmental Action Plan.
Each Group company has posted this environmental panel
to raise employee awareness and appeal our approach tooutside parties.

Environmental risk
reduction
Society in harmony
with nature
Low-carbon
emission society

Sharing Environmental Vision acrossthe Toyota Industries Group

Toyota Industries has positioned environmental response
as one of its most crucial management issues. To quickly
reflect top management’s decisions on business operations,Toyota Industries has established and been operating a
Company-wide integrated environmental management
system (EMS), with the president at the top. In August
2016, another specialized committee, the Plant CO2 Zero
Emissions Challenge Subcommittee, was established.

Recycling-basedsociety

Introductory course for environmental auditsn Main Companies Subject to Consolidated Environmental Management (As of March 31, 2017)

Environmental Management

Notional Diagram of Global Environmental Commitment

nn Aspirations in 2050 and the Sixth
Environmental Action Plan

Tokyu Co., Ltd.

The Global Environmental Commitment, which represents
our basic approach to environmental activities, specifies thefour action themes, namely, 1) establishing a low-carbon
emission society; 2) establishing a recycling-based society;3) reducing environmental risk and establishing a society
in harmony with nature; and 4) promoting environmental
management. For each action theme, we have defined ouraspirations in 2050.

EuropeJapan

Toyota Material Handling Manufacturing Sweden AB (Sweden)
Toyota Material Handling Manufacturing Italy S.p.A. (Italy)
Toyota Material Handling Manufacturing France SAS (France)
L.T.E. Lift Truck Equipment S.p.A. (Italy)
TD Deutsche Klimakompressor GmbH (Germany)
Uster Technologies AG (Switzerland)n Non-consolidated: 10 plants
n Consolidated subsidiaries in Japan

Asia
Toyota Industrial Equipment Vietnam Co., Ltd. (Vietnam)
Toyota Industries Engine India Private Limited (India)
Kirloskar Toyota Textile Machinery Pvt. Ltd. (India)
P.T. TD Automotive Compressor Indonesia (Indonesia)
Toyota Industry (Kunshan) Co., Ltd. (China)
TD Automotive Compressor Kunshan Co., Ltd. (China)
Yantai Shougang TD Automotive Compressor Co., Ltd. (China)
Tailift Material Handling Taiwan Co., Ltd. (Taiwan)

Aichi Corporation (Saitama)
Nishina Industrial Co., Ltd. (Nagano)Takeuchi Industrial Equipment ManufacturingCo., Ltd. (Aichi)
HANDA Casting Company (Aichi)
Unica Co., Ltd. (Aichi)
Tokaiseiki Co., Ltd. (Shizuoka)
Altex Co., Ltd. (Shizuoka)
IZUMI MACHINE MFG. CO., LTD. (Aichi)
Nagao Kogyo Co., Ltd. (Aichi)
Miduho Industry Co., Ltd. (Aichi)
Iwama Loom Works, Ltd. (Aichi)
Tokyu Co., Ltd. (Aichi)
Hara Corporation (Gifu)

Vision for Environmental Activities / Structure to Implement Environmental Management

nn Global Environmental Commitment

Aspirations in 2050

Following the revision of the international standard ISO
14001 in September 2015, we reviewed our Environmental
Management Manual and redefined its regulations. In
August 2016, we initiated activities based on the new
regulations and have been working to thoroughly inform
employees in each business division.
We are enhancing our environmental managementby conducting introductory educational courses to foster
knowledge for environmental management.
As for knowledge and techniques of internal audits, weoffer an introductory educational course for environmental
audits with a view to developing auditors. In relation, we
provided education on the 2015 regulations to those
persons who have already been qualified as auditors. By
having these auditors who have taken the course perform
internal audits, we monitor the progress of each department
in conforming to the revised standard.

Environmental Initiatives

nn Promotion of Environmental
Management Systemnn Response to the Revised ISO 14001
Standard

North America
Cascade Corporation (U.S.A.)
Indiana Hydraulic Equipment, Corp. (U.S.A.)
North Vernon Industry Corp. (U.S.A.)
Raymond-Muscatine Inc. (U.S.A.)The Raymond Corporation (U.S.A.)
Toyota Industrial Equipment Mfg., Inc. (U.S.A.)
Michigan Automotive Compressor, Inc. (U.S.A.)TD Automotive Compressor Georgia, LLC (U.S.A.)
Toyota Industries Compressor Parts America, Co. (U.S.A.)

Latin America
Toyota Material Handling Mercosur Indústria Comércio deEquipamentos Ltda (Brazil)

TOYOTA L&F Shizuoka Co., Ltd.

60

Toyota Industries Report 201761

Sixth Environmental Action Plan
The results of our activities in fiscal 2017 showed steadyprogress across the board toward achieving respective
targets for fiscal 2021.

n Product Related
Sixth Environmental Action Plan Targets
Segments

Action Policies

Establishing a
Implement initiatives to promote 3R
Recycling-Based (reduce, reuse and recycle) design forSocietyeffective resource utilization• Reduce use of resources through longer productlife• Reduce use of resources through standardization,
modularization and reduction of components• Reduce use of resources through development oftechnologies to enable weight reduction anddownsizing• Promote reuse of components and resources• Developed 4-wheel counterbalanced electric
lift truck• Developed DC-DC converter for plug-in hybrid
vehiclesn Production Related

Reduce emissions to improve air
quality in urban areas in all countries
and regions• Develop engines that meet future regulations• Developed engine compliant with AustralianEURO 5 emissions regulations

FY2017 Achievements
Segments

Establishing a
Low-Carbon
Emission Society

Action Policies/Specific Actions

Reduce CO2 emissions from production
activities• Develop and introduce productionengineering technologies with lower
CO2 emissions• Reduce CO2 emissions by fully
implementing improvement activities
on a daily basis• Develop innovative CO2 reduction
technologies that utilize clean energy• Manage greenhouse gases other than
CO2

Reduce CO2 emissions from productionrelated logistics• Improve transportation efficiency
through such measures as modal shift
and better cargo loading efficiency

Establishing a
Recycling-BasedSociety

Promote measures against resource
depletion by recycling waste• Reduce the volume of discarded
materials by taking action at thesource, such as improving yields andother measures• Promote internal reuse
Promote effective resource utilization in
production activities• Reduce use of packaging materials• Monitor water input and output in eachcountry/region and develop andpromote appropriate measures

Subject

FY2021 Targets

Scope

Control Items

Base Year(FY)

Achievements

Targets

Manage chemical substances
contained in products• Investigate chemical substances contained in
products and manage switching over of SVHC*3
and other substances of concern to othersubstances• Supported chemical substance management
at consolidated subsidiaries• Conducted survey on chemical substances
contained in products

Nonconsolidated

Total
emissions

2006

–20%

–10%

–22%

–26%

Reducing
Environmental
Risk and
Establishing aSociety inHarmony with
Naturen Others
Sixth Environmental Action Plan Targets

GlobalCO2emissions
Nonconsolidated

CO2
emissionsfromlogistics

Nonconsolidated

Emissionvolume perunit ofproduction*1

Emissionvolumeper unit ofproduction

2006
–27%

2007

–29%
Emissionvolume perunit ofproduction

Reducing
Environmental
Risk and
Establishing aSociety inHarmony with
NatureAction Policies

Augment activities related toprotection of biodiversity–28%
Augment and promote consolidated
environmental management

Japan
consolidated
Waste
generation
volume–35%–30%

Segments

–27%

2006

Nonconsolidated

–30%

–29%

Promoting
Environmental
Management

62

Toyota Industries Report 2017

Further reduce emissions of substancesof concern• Minimize the use of substances ofconcern by promoting efficient
production activities

VOC*2
emissions

Nonconsolidated(automobile
body)

Emissionvolume perunit ofproduction

2006

–36%
(24g/m2)–36%(24g/m2)

FY2017 Achievements• Share the biodiversity guidelines across all Toyota
Group companies and contribute to the expansionof a habitat for living organisms• Participated in All Toyota Green Wave Project• Formulate and promote plans to link activities and• Devised plans for biodiversity protection
bring more greenery by undertaking activities for
activities within company premises
conservation of biodiversity throughout the Toyota
Industries Group, including at consolidated
subsidiaries in and outside Japan• Build a global environmental management systemand promote related activities to:Comply with environment-related laws in eachcountry and region
Formulate a medium-term plan based on
visualization of environmental risks and conduct
activities to prevent risks from occurring
Enhance risk communication with relevantorganizations and local residents
Achieve the highest-level environmental
performance in each country and region• Implemented measures for wastewater risks• Diagnosed environmental risks at nonproduction bases• Promoted activities to familiarize the Sixth
Environmental Action Plan among
consolidated subsidiaries in and outside Japan• Enforce strategic environmental management that
integrates environmental activities and businessactivities
Enhance education and enlightenment
activities• Extend the scope of Toyota Industries’
enlightenment activities to consolidated
subsidiaries in and outside Japan• Give back to society the outcomes ofenlightenment activities• Posted environmental panels at Toyota
Industries Group companies• Conducted environmental awareness survey
among employees

Promote environmental activities incollaboration with business partners• Ensure compliance with laws and regulations andimprove environmental performance based on theEnvironmentally Preferable Purchasing Guidelines• Revised the Environmentally Preferable
Purchasing Guidelines• Pursue higher brand image through proactive
information disclosure• CDP*4 climate change: ranked B (on aperformance band of A to F)• CDP water: ranked C (on a performance bandof A to F)• Nikkei’s Environmental Management Survey:
ranked 36th (out of 1,733 target companies)

Improve eco-conscious brand image
Reducing
Environmental Risk
and Establishing aSociety in Harmony
with NatureSpecific Actions

Sixth Environmental Action Plan

Establishing a
Reduce CO2 emissions throughLow-Carbon
product and technology development
Emission Society• Developed electric towing tractor• Developed next-generation electriccompressor• Developed plastic glazing rear window• Developed air-jet loom
• Developed next-generation air compressor forfuel cell vehicles

Environmental Initiatives

and are promoting activities according to the plan. Throughactivities undertaken during fiscal 2017, we made steadyprogress toward achieving respective targets for fiscal 2021.

FY2017 Achievements• Develop technologies that contribute to an evengreater level of energy efficiency• Develop products and technologies that respondto electrification• Develop technologies to enable weight reduction• Reduce energy loss
• Develop technologies for the realization of ahydrogen-based society

nn Progress of Sixth Environmental
Action Plan
With an eye to realizing a prosperous life in harmony with
the natural environment through the establishment of asustainable society, we formulated the Sixth Environmental
Action Plan for the period from fiscal 2017 to fiscal 2021

Specific Actions*1: We manage emissions in each business by using either unit of production or unit of sales as a basic unit of emissions. The weighted average of reduction rates of all businesses is used as
our management index.
*2: Volatile Organic Compounds*3: Substances of Very High Concern*4: An international NGO undertaking a project through collaboration among institutional investors to call for disclosure of strategies against climate change issues and greenhouse gas
emissions data to leading companies around the world† Details of the Sixth Environmental Action Plan are available at:https://www.toyota-industries.com/csr/environment/management/plan_6/index.html

63

Establishing a Low-Carbon Emission Society
We position the curbing of global warming as our most
crucial environmental task. We have been working to reduce
CO2 emissions in our global business activities and at thesame time accelerate our efforts to develop moreenvironment-friendly products.

CO2 Emissions (Production Activities)
FY2017 Results
Total emissions (non-consolidated)
10% reduction% reduction (vs FY06 level)(vs FY06 level)

Emission volume per unit of production (global)

22

FY21 target:

26% reduction% reduction (vs FY06 level)(vs FY06 level)

Under the Sixth Plan, we are working toward achieving
fiscal 2021 targets of reducing total non-consolidated
CO2 emissions from production activities by 10%
and global emission volume per unit of production by
26%, both from the fiscal 2006 level. In fiscal 2017, we
attained the specified targets by continuing to undertake
Company-wide activities to reduce the amount of air
used in production activities and encouraging energy justin-time (JIT) efforts in production processes. In addition,
we established the Plant CO2 Zero Emissions Challenge
Subcommittee and embarked on a discussion as to how
we should contribute to the realization of a zero CO2emissions society.

n Blowing Air Intermittently at a Washer
Continuous air blow

Before improvement

A production process of foundry parts uses a die castand a casting sand core to be fitted inside the die cast.
To mold the core, the die cast has to be preheated to andmaintained at an appropriate temperature.
In the conventional process, the preheating of the next
die cast had been initiated immediately after the start ofproduction of a preceding foundry part, which means aconsiderable amount of energy had been consumed tomaintain its temperature before actual use.
In countering the situation, we first surveyed thetime required to preheat each die cast in order to allow
management of an overall preheating schedule. Then, we
started adjusting the preheating timing of each die castaccording to a daily production plan and successfully reduced
the extra time required to keep the preheated temperature. As
a result, we achieved some 97% reduction in the amount ofenergy used for temperature maintenance, and consequently,
reduced annual CO2 emissions by about 96 tons.
This project won an Excellent Practice Award in fiscal
2017 under our internal award program to recognize
excellent environmental improvement activities as an
outstanding day-to-day improvement example for theenergy JIT efforts currently promoted by Toyota Industries.
n Reducing Time to Maintain Preheated Temperature of a Die Cast
Before improvement

Air pipingnC
 O2 Emissions (Non-consolidated/Consolidated subsidiaries
in and outside Japan)
Consolidated subsidiaries outside Japan
Consolidated subsidiaries in Japan
Non-consolidated
Reduction rate (non-consolidated)
Reduction rate (consolidated)
Reduction rate

Toyota Industries has been proactively promoting
development and design of eco-conscious products. As
part of the efforts, we launched the Environmentally Friendly
Product Certification System in fiscal 2007, which certifies
products that possess exceptionally high environmental
performance, and have been showcasing these products tothe public. With the addition of one product in fiscal 2017,a total of 20 products have obtained certification under thissystem since its launch.
We will continue to promote the development of
eco-conscious products in the future as well.
Product Certified in Fiscal 2017
gene B (8FB10 – 8FB30 and 8FBJ35) electric lift truck
with 1.0- to 3.5-ton capacity

Key features to reduce environmental
impact
The lift truck is equipped with a new AC motor andmotor driver and features an improved rate of recovering
energy generated when the brake is applied, whichlead to a significant reduction in power consumption
compared with our previous models.

Part
Compressed air(Uses a LARGE amount)

Die cast 1

Mold a core

Replace

In preparation

Intermittent air blow

Die cast 2

After improvement

Die cast

Power Consumption

12% lower
Approx.17% lower

Approx.

Start preheating

Die cast

Mold a core

Device to blow
air intermittently

Initiatives for Establishment of a Low-Carbon
Emission Society

nn Certification of Environmentally
Friendly Products

Establishing a Low-Carbon Emission Society

20

FY21 target:

In its ongoing effort to reduce the amount of compressed
air used in production activities, Toyota Industries worked
to reduce the amount of air used by a washer in an engine
processing line in fiscal 2017.
Conventionally, water droplets left on a part after washing
had been removed by continuously blowing air. This caused
a drop in air pressure, which in turn required a large amountof air to compensate for the pressure drop.
To solve the problem, we installed a device that
automatically blows air intermittently and succeeded insaving energy while keeping the air pressure at a sufficientlevel. The results were reductions in the amount of air usedby about 25% and in annual CO2 emissions by around fourtons.
The same washer is used in a number of otherproduction lines within Toyota Industries. As the applicationof a similar device Company-wide can offer profoundenergy-saving effects, the project won a Best PracticeAward in fiscal 2017 under our internal award program torecognize excellent environmental improvement activities.

nn Reducing CO2 Emissions by
Reducing the Time to Maintain
Preheated Temperature of a Die Cast

Environmental Initiatives

Summarynn Saving Energy by Adding a Device ata Washer to Blow Air Intermittently

power consumption(1.0- to 2.5-ton capacity)

power consumption(3.0- to 3.5-ton capacity)(Compared with previous models)Part

PreheatCompressed air(Uses a SMALL amount)

Maintain hightemperature level

Waste

1.0
1.00
1.00

0.81
0.80

0.78

0.77

0.76

0.76

0.78

0.78

0.72

0.73

Total
emissions
(kt)

888

926

909

940

785

800
667
600
400
200
0

(FY) 06

64

0.6
Good

1,000

Good

After improvement

0.8

Toyota Industries Report 2017

13

14

15

16

17

Munenori Sato (left)
Takato Morishita
Planning Group No. 2,
Planning Office, Plant
Engineering & Environment
Department, Head Office(As of December 31, 2016)

Through collaboration with related departments, weachieved an improvement that ensures quality andsaves energy. We plan to spread the information
about this improvement so that it will be adopted inmany more equipment.

Die cast 1

Mold a core

ReplaceStart preheating
In preparation
Die cast 2

Die cast

Mold a core

Developa schedule
Preheat

Maintain hightemperature
level

65

Establishing a Recycling-Based SocietyWith a view to establishing a recycling-based society,
we have been striving to reduce resource consumption.

Summary

FY2017 Results
Waste generation volume per unit of production(non-consolidated)30

FY21 target:% reduction (vs FY06 level)

29% reduction(vs FY06 level)29

FY21 target:% reduction (vs FY06 level)

27% reduction(vs FY06 level)

In seeking to minimize resource consumption in 2050,
we are making efforts to reduce our waste generation
volume by implementing measures to reduce resource
consumption at the source and promoting internal reuseof waste.
In the Sixth Plan, we set out targets of reducing waste
generation volume per unit of production compared withthe fiscal 2006 level by 29% on a non-consolidated basis
and by 27% for Toyota Industries and its consolidated
subsidiaries in Japan. Accordingly, we have beenpromoting activities toward these targets.

n Efforts to Extend the Life of Cutting Tools
Without cooling

Cutting tool edge
(where temperature becomes high)ExhaustAir
supplyWorkpiece
Air motorn Waste Generation(Non-consolidated/Consolidated subsidiaries in Japan)
Consolidated subsidiaries in Japan

Reduction rate (non-consolidated)

1.00
1.00
0.70

Total
generation
(kt)

100

81

High
temperature

Reduction rate

Reduction rate (Non-consolidated/consolidated subsidiaries in Japan)

0.71

0.73
0.71

Exhaust

1.00
0.80

Air
supply0(FY)

Prototype Production
Section, Manufacturing
Department No. 1, Hekinan
Plant(As of December 31, 2016)

nn Recovering Used Cutting Fluid with
Improved Discharge Plate
The Kariya Plant, a production base of textile machinery in
Aichi Prefecture, created a discharge plate to better recoverused cutting fluid generated in a cutting process of foundryparts and to reuse the recovered fluid.
The plant had already been recycling used cutting fluid
but had discarded the fluid containing metal chips. In orderto more finely remove metal chips from used fluid, the plant
worked to modify the discharge plate, on which used fluid
containing metal chips flow down.
The improvement involved placing magnets on the backof the plate to slow down metal chips while allowing used
cutting fluid to slide down the plate. After a number of trials
and errors, appropriate magnetic power and optimum
locations of magnets were determined.
The improved discharge plate has allowed the plant
to reuse 20 tons of used cutting fluid annually. It has been
adopted by other Toyota Industries plants in their cutting
machines, and they have added their own improvements,
such as changing the shape of the discharge plate, forbetter results. The project won a prize in the Creativity
category in the Fiscal 2017 Commendation for Science andTechnology by the Minister of Education, Culture, Sports,
Science and Technology.

Lowtemperature

2006

2017

2021

High
temperature
ExhaustAir
supplyAir motor

Lowtemperature
Improved discharge plate

Discharge plate

Metal chips

Magnet to slow down
metal chips
Cutting fluid

The Prototype Production Section makes resourcefulefforts and improvements in order to provide better
technologies for use in production lines. We willcontinue to contribute to production activities while
promoting communication within our section andwith other relevant departments.

Cool air generator

The Hekinan Plant, an engine production base in Aichi
Prefecture, has been conducting improvement activities toachieve a longer life for cutting tools used in production lines.
Their latest effort was to extend the tools’ life by lowering
the high temperature generated at the edge of a rapidly
Toyota Industries Report 2017(team leader)

Cooling by using cool air of a cool air generator

65

nn Extending the Life of Cutting Tools

66

Air motor

0.60 Good

50
Good

Low
temperature

Cooling by using the air motor’s exhaust only

Initiatives for Establishing a Recycling-BasedSocietyNon-consolidated

High
temperaturenM echanism of the Improved Discharge Plate

Cutting fluid tankContainer to collectmetal chips

FilterBack to the cutting machine

Shinya Kakehi
Manufacturing Planning,
Manufacturing Section,
Production Department(As of December 31, 2016)

Establishing a Recycling-Based Society

Waste generation volume per unit of production(non-consolidated/consolidated subsidiaries in Japan)

Akio Nakamura (left)
Taishi Matsuda

Environmental Initiatives

Waste Generation Volume (Production Activities)

rotating tool with the contact with a workpiece.
Previously, the plant’s production lines adopted a dry
cutting technique that does not use a cutting fluid. This
caused cutting tools to turn hot easily and reach their life
early. In this dry cutting technique, the plant endeavored toachieve the level of cooling performance equivalent to thatattained with the use of a cutting fluid. They consideredseveral cooling methods, including the one to utilize exhaustof an air motor used to rotate a tool, collaborated with
relevant departments to accumulate necessary data andfound out that a commercially available cool air generator
that can take in air and discharge cool and warm air
separately is fit for the purpose. Installing the generator
enables the cooling of cutting tools via the air motor’s coolexhaust and made it possible to achieve our original target.
Cutting tools now last about 1.8 times longer than before.
This improvement has already been applied to otherToyota Industries plants, and the generator has been proveneffective both in terms of cooling (using its cool air) andwarming (using its warm air). We will continue our activities
to generate excellent ideas under the motto “Continue
improvements, however small.”An improvement of the used cutting fluid recovery
process had already been done before, but it did not
become widespread due to a workability problem.
So, it was the second trial. We are very satisfied with
the improvement we came up with this time because
it works great without imposing an extra burden on
workers. We will continue our improvement activities
while gathering seeds of improvements on-site.

nn Conducting Water Risk Assessment
Toyota Industries uses water in many processes, forexample, for washing products and cooling production lines.
Globally, consumption of water, which is one of the mostimportant resources, is increasing in line with growth in theworld’s population. Flooding and other water-related natural
disasters due to climate change cause serious impact.
We duly consider that these factors present risks to ourbusiness activities.
In fiscal 2017, we assessed water risks at each baseas part of efforts to identify and mitigate risks associatedwith water resources to our business activities. We used
Aqueduct, a global water risk mapping tool developedby the World Resources Institute (WRI), and various
public databases available in corresponding regions. The
assessment revealed no “extremely high” water risks forany of our bases. Based on the assessment results, we will
implement appropriate measures in our bases, starting withthose found to have higher risks. Simultaneously, we will
work to assess and mitigate water risks in our supply chain
as well while seeking ways to conserve water resources.

67

Reducing Environmental Risk and Establishing a Society inHarmony with Naturesystem to manage chemical substances.

Summary
VOC Emissions (Production Activities)
FY2017 Results
Emissions per unit of production(non-consolidated/automobile body)% reduction (vs FY06 level)(vs FY06 level)

Under the Sixth Plan, we set a target of reducing
emission volume per unit of production for volatile organic
compounds (VOC) from the automobile body painting
process by 36% from the fiscal 2006 level and have been
striving to reduce VOC emissions. In fiscal 2017, we
continued our efforts to increase the recovery rate andenhance maintenance and management of thinner,a solvent used for cleaning. Consequently, we were able
to cut down emission volume per unit of production in
fiscal 2017 by 36%.

nn Strengthening Management ofChemical Substances at Consolidated
Subsidiaries Outside Japan
Many of the chemical substances needed for our production
activities may cause adverse effects on the environment.
Thus, appropriate management of chemical substances is
crucial in ensuring safe handling and minimizing potential
harmful effects.
To appropriately manage chemical substances containedin raw materials and products, we have been assisting ourconsolidated subsidiaries outside Japan in establishing ann Initiatives for Conservation of
Biodiversity
We believe that it is important to undertake businessactivities while continuously paying attention to the impactof these activities on the natural environment. Based on
this belief, we have formulated the biodiversity policy andbeen promoting initiatives accordingly. The policy clearlystipulates that we seek to reduce the impact of our businessactivities on biodiversity and work with local communities forconservation of biodiversity.

nn Participation in the Aichi Prefectural
Government Ecological Network
Forum
Toyota Industries has been collaborating with the Aichi
prefectural government in its initiative to foster thedevelopment of ecological networks for the realizationof biodiversity-conscious local communities. In January
2017, we participated in the Aichi Prefectural Government
Ecological Network Forum through a poster exhibition.
The exhibition showcased our Biotope at the East of Obu
Station, which we have developed on Company-owned
idle land in Obu City, Aichi Prefecture, in collaboration
with diverse organizations and individuals, including theprefectural government, companies, NPOs, expert bodies
and local community members, with the aim of forming
a link to the local natural environment. We will continue
to cooperate with other organizations and contribute to
the development of ecological networks within the entire
prefecture.

various activities, including development of a wooded
area within the plant premises and conservation of natural
habitats of living organisms, and aims to extend its reachfrom Toyota Group companies to local communities andgovernments.
Our activities under the project in fiscal 2017 included
participation in the Fujimae Tideland Cleanup Campaign,
which was an All Toyota event; publication of a booklet thatcompiles initiatives of each company in the Toyota Group;and hosting study group sessions for development of aquantitative environmental assessment method. We plan toexpand the project throughout the Toyota Industries Groupto form a broader circle of collaboration.

pond and looking up their names in picture books, anddrawing pictures of these organisms.
We will continue to develop our biotope in the hope ofcontributing to conservation of the local ecosystem.

nn Conducting WET*1 Testing
For effluents released from its production bases, Toyota
Industries sets and endeavors to comply with voluntarystandard values, which are more stringent than those
stipulated under law.
In fiscal 2017, in addition to complying with thesevoluntary standard values, we conducted WET testingat two production bases in Japan to evaluate theenvironmental impact of their effluents on organisms.
*1: Short for Whole Effluent Toxicity, a WET test is used to assess the aggregate toxic
effect of a facility’s wastewater by using bioresponse of algae, crustacea and fish.

Logo used in Green Wave Project activities

nn Environmental Learning Using Our
Biotope
In August 2016, we invited local children to our Biotope atthe East of Obu Station and held a nature observation event
to explore aquatic organisms.
On the day of the event, the children closely interactedwith nature, learning about non-native species as well as
about the biotope itself, catching organisms living in the

Water sampling for WET testingnn Revisions to the Environmentally
Preferable Purchasing Guidelines
Toyota Industries defined its aspirations in 2050*2 in its
environmental vision in March 2016, and accordingly, revised
the Environmentally Preferable Purchasing Guidelines in
October 2016.

Reducing Environmental Risk and Establishing a Society in Harmony with Nature36

FY21 target:

36% reduction

In fiscal 2017, we started providing such support to threecompanies.
We will continue to provide support and undertake
activities to prevent violations of chemical substances
regulations at production bases outside Japan.

Environmental Initiatives

We have been making efforts to reduce the use of
substances of concern while carefully monitoring the latest
trends in environmental laws and regulations on a global
basis. At the same time, we have been promoting activities
for conservation of biodiversity toward realizing a society inharmony with nature.

Key Revisions

Children drawing organisms caught in the pond

Environmentally conscious practices throughout the
product lifecycle, from the purchase of raw materials to
end use by customers and disposal
Strengthening environmental management of the entire
supply chain, including secondary and tertiary business
partners
Augmenting initiatives in such areas as greenhouse gas(GHG) emissions, resource recycling and biodiversity

Poster exhibition

We will continue to collaborate with our business
partners toward the implementation of appropriate
environmental management within the entire supply chain.

nn All Toyota Biodiversity Conservation
Activities*2: Our aspirations in 2050 represent our goals under the four action themes (establishinga low-carbon emission society; establishing a recycling-based society; reducing
environmental risk and establishing a society in harmony with nature; and promoting
environmental management) as declared in our Global Environmental Commitment.

Toyota Industries has been taking part in the Green Wave
Project, a biodiversity conservation initiative undertaken
jointly by Toyota Group companies. The project conducts
Study group session at a production base in India

68

Toyota Industries Report 2017

Participants of the nature observation event

69

Environmental Management
nn Conducting Environmental Risk
Diagnosis at Non-Production Sites

Toyota Industries proactively discloses its initiatives for
reduction of environmental risk and other environmental
information.

nn Measures to Prevent Irregular
Effluent Discharges from a Rainwater
Drainage System
In order to prevent water contamination by irregular effluent
discharges, we have been implementing a measure to
avoid external leakage from rainwater discharge outlets
throughout Toyota Industries since fiscal 2012.
More specifically, we have been installing a system toconstantly monitor rainwater quality at rainwater discharge
outlets, and if there is a problem in the quality, to stop therelease of rainwater into public areas at a water gate or
reroute it back to a wastewater treatment facility.
In fiscal 2017, we installed water quality monitoring
equipment and a water gate at the rainwater discharge
outlet of the Higashiura Plant in Aichi Prefecture, thereby
completing the implementation of the measure against
the risk of undesirable external leakage of rainwater in all
production bases in Japan.

■ Oil and chemical tank
Leakage■ Water purifier tank
Odor

Discharge

Legally required
inspection

nn Running an Environmental Booth at
the Shokki Festa

Diagnosis
results(sample)Inspection

Routineinspection

nn Adding More Monitoring Tanks to
Wastewater Treatment Facilities to
Reduce Risk of Irregular Effluent
Discharges
From fiscal 2015 to fiscal 2017, we undertook the taskof reducing the risk of irregular effluent discharges at
the Kyowa Plant in Aichi Prefecture. Our specific efforts
were: 1) implementing the aforementioned measure at the
rainwater discharge outlets to prevent external leakage;and 2) separating drainage systems for wastewater fromproduction processes, non-industrial wastewater andrainwater to apply appropriate treatment depending on
respective water qualities.
In fiscal 2017, we added two more monitoring tanks to
the wastewater treatment facility of the plant. We now havethree separate monitoring tanks, one each for the reception
phase, monitoring phase and discharge phase, whichallow us to reliably stop external leakage of irregular effluent
discharges into public areas when the water quality is foundunfit for release.
These measures have led to not only lower risk ofirregular effluent discharges from our plants but also better
energy and resource savings through less burden on thewastewater treatment facility.

Environmental seminar

We run an environmental booth at the Shokki Festa, anannual event jointly held by Toyota Industries and its labor
union.
In fiscal 2017, under the theme of “people and nature inharmony” we hosted various environment-related events atthe booth. They included handing out flower seedlings andcompost made from branches from pruned trees on the
Company premises and fallen leaves, creating eco-friendly
shopping bags and holding a quiz rally on nature andorganisms.
Attended by many visitors, including employees andtheir families as well as local community members, thebooth provided an opportunity for them to think and get toknow more about biodiversity in a fun way while drawing
their favorite animals and flowers on eco-friendly shoppingbags and answering quizzes on the blessings of nature.

Environmental Management

Measurement results are available at:https://www.toyota-industries.com/csr/environment/

Water gate

Oil and chemical tanks, storage warehouses,
Facilities andwaste storage yards, kitchens,equipment
car wash stations, piping, manholes,
subject towater purifier tanks, power generators, boilers,
assessment
small compressors and air conditioners

Environmental Initiatives

Toyota Industries has been striving to reduce environmental
risks not just in production bases but also in Company
housing and dormitories, Company-owned welfare facilities
and other non-production sites.
In fiscal 2017, we conducted a genchi genbutsu (go andsee for yourself) environmental risk diagnosis at 23 suchsites in Japan. Specifically, we performed a quantitative
assessment by checking equipment installation measures atfacilities, the boundary and the discharge outlets within eachsite and by examining their operational status.
We will continue to prioritize necessary countermeasures
based on the assessment results and formulate a mediumterm action plan.

nn Status of Compliance withEnvironmental Laws
Toyota Industries carries out soil and groundwater surveys
at its plants and performs purification when the survey
results reveal that soil or groundwater contains substances
exceeding standard values. We also disclose the progressof purification efforts in the corresponding Toyota Industries
Report and at local community meetings.
In a voluntary soil and groundwater survey conducted at
the Kariya Plant in Aichi Prefecture, we have confirmed thatcertain substances were above their standard values. We
reported the incident to the Aichi prefectural government
on June 1, 2016 and disclosed the relevant information to
the public.
In accordance with the results of the survey, we are
implementing purification measures under the guidance ofAichi Prefecture while placing the highest priority on not tocause any inconvenience to local residents.
In fiscal 2017, there were no incidents of violations ofenvironmental laws.

lecture to deepen their understanding of the possibility ofhydrogen as a driver of a sustainable society.

On-site risk diagnosis

nn Holding Environmental Seminars
We hold environmental seminars to raise employees’
environmental awareness. In fiscal 2017, we selected“taking on the challenge of establishing a zero CO2emissions society” as the lecture’s main theme and invited
Mr. Kou Sakata of the Institute of Applied Energy to talkabout “a scenario for spreading the use of CO2-freehydrogen.” From Toyota Industries and its consolidated
subsidiaries, 182 employees and executives attended theEnvironmental booth

Water quality monitoring equipment

70

Toyota Industries Report 201771nn GHG Emissions in the Supply Chain

Activity Examples of Consolidated Subsidiaries (Outside Japan)

Our subsidiaries engaging in production or sales andservicing of materials handling equipment in Europe havebeen promoting the use of renewable energy, such as solar,
wind and hydraulic power, as part of their efforts to reduce
CO2 emissions.
Two of our sales and servicing subsidiaries, namely,
Toyota Material Handling Deutschland GmbH (TMHDE)in Germany and Toyota Material Handling Nederland B.V.
(TMHNL) in the Netherlands, have installed a rooftop solar
panel system that respectively generates 28% and 5% of
their annual electricity consumption.
Moreover, Toyota Material Handling Manufacturing
Sweden AB (TMHMS) and Toyota Material Handling
Manufacturing Italy S.p.A. (TMHMI), production subsidiaries
in Sweden and Italy, respectively, and TMHNL havepurchased renewable electricity certificates, which as a totalof the three companies are equivalent to approximately
28,005 MWh of annual electricity consumption and about
2,927 tons of CO2 emissions. Through the purchase of
these certificates, the three companies have contributed tolower CO2 emissions.

Our consolidated subsidiaries outside Japan have beenpromoting reduction of CO2 emissions by proactively
switching to LED lighting. For example, Yantai Shougang
TD Automotive Compressor Co., Ltd. (YST), a subsidiary
producing car air-conditioning compressors in China, has
replaced all plant and office lights with LED lighting.
Elsewhere, Toyota Industry (Kunshan) Co., Ltd. (TIK),
a subsidiary producing automotive parts and materials
handling equipment in China, has switched 90% of its lights
to LED lighting. At Toyota Industrial Equipment Mfg., Inc.
(TIEM), a subsidiary producing materials handling equipmentin North America, 85% and 50% of lights in its plant area
and office area, respectively, are now using LED lighting.
TIEM plans to complete the replacement in its plant area infiscal 2018.

Scope 1
(0.6%)

Scope 3 /Other
(0.7%)

Scope 2
(1.6%)
Scope 3 /Category 1(5.0%)

nn Recycling All Wastewater
In India, Toyota Industries Engine India Pvt. Ltd. (TIEI),a subsidiary producing automotive parts, and Kirloskar
Toyota Textile Machinery Pvt. Ltd. (KTTM), a subsidiary
producing textile machinery, have been recycling andeffectively utilizing all wastewater.
For example, the two companies apply purifying
treatment to wastewater from production processes, suchas liquid waste of coolants and used cooling water, andreuse it in production processes. Non-industrial wastewateris also treated in-house and used to water trees and flush
toilets.

nn Local Community Event Held during
Environment Month

Renewable electricity certificate and TMHMS staffn GHG Emissions in Supply Chain (FY2017)

During Environment Month held in every June, YST hosts anenvironmental event for local community members.
In the fiscal 2017 event, YST exhibited posters andmaterials to highlight the importance of activities for savingenergy and curbing global warming. YST also handed out
original paper fans to visitors to increase their energy-saving
awareness.

Scope 3 / Category 11(92.1%)

Direct emissions from Toyota Industries through the
Scope 1
use of fossil fuels, etc.
Emissions from Toyota
Industries’ businessIndirect emissions from the use of purchased energy
activities
Scope 2 resulting from generation of electricity by power
plants, etc.
Emissions other thanEmissions associated with purchase of raw materials,
from Toyota Industries’ Scope 3 end use of Toyota Industries’ products by customers
business activities
and disposal of products

Detailed data is available at:https://www.toyota-industries.com/csr/environment/
process/scope3/index.html

nn Proactive Disclosure ofEnvironmental Information
Toyota Industries
fosters environmental
communication with
our stakeholders
through proactive
disclosure ofenvironmental
information. In fiscal 2017, Toyota Industries was evaluatedto be in the performance band of B in the CDP* climatechange survey.
Since fiscal 2015, we have been participating in the
Ministry of the Environment’s project for the establishmentof a framework for disclosure of environmental informationand examining the ideal way to disclose our environmental
information. We will continue to upgrade our method of
disclosure and contents to be disclosed.

Environmental Management

nn Reducing CO2 Emissions by
Switching to LED Lighting

Scope 3 emissions reaching 97.8%. The largest source ofemissions, which accounted for 92.1%, was Category 11(Use of sold products) under Scope 3, followed by Category
1 (Purchased goods and services) also under Scope 3,
which accounted for 5.0%.
Going forward, we will continue to monitor GHG
emissions within the entire supply chain and accordingly
promote CO2 emissions reduction activities.

Environmental Initiatives

nn Reducing CO2 Emissions by Using
Renewable Electricity

We recognize that measuring the three scopes defined by
the GHG Protocol and turning the results into specific efforts
to reduce CO2 emissions are important in creating a lowcarbon society. Scopes 1 and 2 are GHG emissions fromour business activities, the former being direct emissions
from our use of fossil fuels and the latter being indirectemissions from the use of purchased energy resulting fromgeneration of electricity by power plants and other facilities.
Scope 3 emissions are indirect emissions associated witheach product from the purchase of raw materials to end use
by customers and disposal.
In the fiscal 2017 results, combined Scope 1 and 2
emissions accounted for 2.2% of the total emissions, with

* An international NGO undertaking a project through collaboration among institutional
investors to call for disclosure of strategies against climate change issues and GHG
emissions data to leading companies around the worldnS
 cope 3 Emissions by Category (FY2017)
Purchased goods and services
Capital goods
Fuel- and energy-related activities not included in Scope 1 or 2
Upstream transportation and distribution
Waste generated in operations
1

Business travel
Employee commuting

Included in Scopes 1 and 2

Upstream leased assets

Included in “Upstream transportation and distribution”

Downstream transportation and distribution

Not applicable

Processing of sold products
Use of sold products
End-of-life treatment of sold products

Environmental event

Downstream leased assets

Not applicableFranchises

Not applicable

Investments

Not applicable
1

10

100

1,000

10,000100,000

Calculated by using the emissions associated with employee business travel as the baseline set at 1
Renewable electricity certificate and TMHMI staff

72

Toyota Industries Report 201773

Environmental Impact Flow and Environmental Accounting

Third Party Assurance of Environmental Performance Data

In this section, we provide an overall picture of environmental
impact resulting from our global business activities andreport the results of environmental accounting (environmental
conservation cost, environmental conservation benefits andeconomic benefits of environmental conservation initiatives).

In order to ensure the transparency and accuracy of theinformation we disclose, the Toyota Industries Groupobtained third party assurance for its GHG emissions(Scopes 1, 2 and 3) and waste generation volume data forfiscal 2017.

Environmental
Impact Flow

■ Energy [consolidated]
Energy consumption■ Into the Air [consolidated]
CO2 emissions

16,520 TJ*1

City gas

76,229 km3N

LPG

9,709 tPetroleum products

5,399 kl

Coal products

6,675 t

LNG

5,503 tR&D/Design

Procurement

Production*1: Terajoule is a unit used to measure heat. 1 TJ = 1012 joules■ Raw Materials [consolidated]

Greenhouse gases other than CO2

5,391 t-CO2

CO2 from logistics

27,180 t-CO2

SOx (Sulfur oxides)

412 kgNOx (Nitrogen oxides)

137 t

VOC (Volatile organic compounds)

571 t■ Waste [consolidated]
87,917 t

Waste generation■ Water [consolidated]
Water consumption

Usage

4,661 km3

■ Into Waterways[Japan consolidated]■ Chemical Substances

33 t

Water pollutants[Japan consolidated]
PRTR law*2 designatedsubstances

1,460 t■ Chemical Substances[Japan consolidated]
Emissions/transfers of PRTR
law designated substances

Transportation/Sales
712,293 t

Raw material consumption

939,753 t-CO2

Recovery/Recycling

1,579 tDischarge of treated wastewater

2,370 km3

*2: Short for Pollutant Release and Transfer Register, the PRTR law is a scheme whereby businesses measure the release and transfer of PRTR designated pollutants and report theirperformance to the government. The government then compiles this data and releases it to the public.

nn Environmental Accounting
Fiscal 2017 Environmental Accounting*3
Scope of data collection: Toyota Industries Corporation
Period of data collection: April 1, 2016 – March 31, 2017
*3: Environmental accounting data is collected in compliance with the Ministry of theEnvironment’s Environmental Accounting Guidelines 2005 Edition.

n Environmental Conservation Cost
Category
Pollution prevention costs
Business Global environmental
area costs conservation costs
Resource recycling costs

FY2017

Environmental Impact

833

120

525

147

450

2,335

716

3,156

129

140

113

193

Upstream/downstream costs

0

568

0

71

0

276

6

166

Research and development costs

7

2,398

6

309

Social contribution activity costs

0

92

0

89

Environmental remediation costs

16

0

50

0

1,435

5,929

1,416

4,131

Toyota Industries Report 2017

7,364

n Environmental Conservation Beneﬁts

FY2016

Investment Expenses Investment Expenses

Management costs

Total

74

(Millions of yen)

5,547

Comparison with Previous Fiscal Year
1,414 t decrease

CO2
Generation of waste products

469 t decreasen Economic Beneﬁts of Environmental Conservation Initiatives(Millions of yen)

Revenue

Details

AmountReturns from sale of recycled waste products

3,299

Energy cost reductions
Cost reduction Cost reduction by resource savings(including reductions in amount of water use
and wastewater treatment costs)
Total

Toyota Industries obtained third party verification of its GHG
emissions and waste generation volume data for fiscal 2017.
On-site verification was performed by the verification
organization at two of our production bases in Aichi
Prefecture, namely, the Higashichita Plant and Nagakusa
Plant, and the transparency and accuracy of ourenvironmental data have been confirmed through theverification.
The organization is also sequentially conducting
verification at the remaining eight production bases ofToyota Industries as well as 12 consolidated subsidiaries inJapan and 15 consolidated subsidiaries outside Japan.

We will continue to utilize this third party verificationin making continuous improvements in our environmental
activities and disclose data to our stakeholders in a moretransparent manner.

On-site verification conducted at the Higashichita Plant and Nagakusa Plant

23,317 m3 increase

Water

Item

The verification statement of the third party organization is available at:https://www.toyota-shokki.co.jp/csr/environment/process/items/Verification_ENG.pdf

129
87
3,515

n Bases Subject to Verification
Category

RegionToyotaIndustries
Corporation

Names of Bases and Subsidiaries

Japan

Kariya Plant, Takahama Plant, Nagakusa Plant, Kyowa Plant, Obu Plant, Hekinan Plant, Higashichita Plant, Higashiura Plant, Anjo Plant,
Morioka Works (10 bases)

Consolidated
subsidiaries in
Japan

Japan

Tokaiseiki, Tokyu, Altex, Iwama Loom Works, IZUMI MACHINE MFG., Miduho Industry, Nagao Kogyo, Nishina Industrial, HANDA Casting,
Unica, Hara, Aichi (12 companies)

Consolidated
subsidiaries
outside Japan

North
America,
Asia andEurope

NVIC, Raymond, TIEM, MACI, TACG, TICA, TIK, TIEI, KTTM, TACK ,YST, TDDK, TMHMF, TMHMS, TMHMI (15 companies)

Environmental Impact Flow and Environmental Accounting / Third Party Assurance of Environmental Performance Data

1,242,408 MWh

OUTPUTINPUTElectricity

Environmental Initiatives

nn Verification by a Third Party

nn Environmental Impact Flow75

Financial Section / Corporate Information

Primary Impacts on Financial Results Accompanying Transition
to International Financial Reporting Standards (IFRS)

Comparison of FY2017 Results (Japanese GAAP) and FY2017 Results (IFRS)Primary Impacts on Financial Results Accompanying Transition
to International Financial Reporting Standards (IFRS)
Consolidated Statements of Financial Position(¥ Billion)

P77
P78–79P80

Consolidated Statements of Comprehensive Income

P81

Consolidated Statements of Changes in Equity

P82–83

Consolidated Statements of Cash FlowsP84–85† Toyota Industries has adopted IFRS beginning from the end of fiscal 2017.
The figures in fiscal 2016 have been reclassified in accordance with IFRS.

P86–87

Major Production Bases

P88

Investor Information

P89

Note:
For details on the consolidated financial statements, please refer to the financial results andsecurities report, which are posted on the following Website: https://www.toyota-industries.com

Difference

2,250.4

1,675.1–575.3<Primary Differences> • Offsetting supply-for-a-fee transactions: –¥561.9 billion
		 Net amounts equivalent to value-added sales are recognized as revenue.
		 (Breakdown) Vehicle:–¥484.1 billion
				Engine:–¥77.6 billion, etc.
–¥13.1 billion• Deduction of sales incentives:		Sales incentives are recognized as the actual discount and deducted from net sales.

2) Impact on Operating Profit(¥ Billion)

Corporate Information
Board of Directors, Audit & Supervisory Board Members andManaging Officers

IFRS

JGAAP

IFRS

Difference

122.9

127.3

+4.4

<Primary Differences> • Discontinuation of amortization of goodwill: +¥7.5 billion
		The Company no longer amortizes goodwill on a regular basis and determines whether
to conduct an impairment loss every fiscal year.
• Change in depreciation method:–¥1.7 billion
		The depreciation method has been changed to the straight-line method, the same asamortization.
		The useful lives of machinery have been standardized throughout the Toyota Industries
Group.
–¥2.3 billion• Reclassification:				Among non-operating profit/expenses, line items other than financial profit/expenses
are reclassified into operating profit/expenses.

3) Impact on Total Assets(¥ Billion)

JGAAP

IFRS

Difference

4,428.6

4,558.2+129.6<Primary Differences> • Fair market valuation of unlisted stock:+¥57.7 billion• Change in depreciation method:+¥34.3 billion• Discontinuation of amortization of goodwill: +¥14.7 billion• Recognition of development assets:+¥12.0 billion

76

Toyota Industries Report 2017

Primary Impacts on Financial Results Accompanying Transition to International Financial Reporting Standards (IFRS)

Consolidated Statements of Profit or Loss

JGAAP

Financial Section /Corporate Information

1) Impact on Net Sales

Financial Section

77

Consolidated Statements of Financial Position
Toyota Industries Corporation
For the years ended March 31, 2016 and 2017

Millions of yen
2016

2017

Assets20162017¥ 354,643¥ 355,882¥ 387,333

Liabilities and Equity
Liabilities

Current assets
		 Cash and cash equivalents

Transition date
(April 1, 2015)¥ 248,706¥

92,399¥ 243,685

Current liabilities

475,415624,240

646,542

		 Trade payables and other payables

		 Other financial assets

92,189273,410

174,301

		 Corporate bonds and loans

146,789

190,844

311,663

		Inventories

192,947

195,982

194,427

		 Other financial liabilities

138,667

75,44071,807

		 Income tax receivables

8,640

7,170

21,106

		 Accrued income taxes

15,22548,051

11,163		 Other current assets

37,926

38,95842,356

		Provisions

5,653

9,336

7,397

Total current assets

1,055,825

1,232,161

1,322,420

		 Other current liabilities

19,072

20,186

21,237

Total current liabilities

680,051

699,741

810,603

		 Corporate bonds and loans

625,382

711,424

665,890

		 Other financial liabilities

121,632

106,248

79,375

		 Net defined benefit liabilities

88,062

88,942

92,552

		Provisions

6,245

6,888

6,479

Non-current assets
		 Property, plant and equipment

740,171815,399

833,329		 Goodwill and intangible assets

203,042

189,207

185,813

999

1,005

149

14,332

13,593

8,673

2,677,218

2,028,284

2,161,509

		 Net defined benefit assets

22,283

11,651

18,129		 Deferred tax liabilities

756,584

517,854

567,803

		 Deferred tax assets

31,812

22,59923,800		 Other non-current liabilities

14,927

16,86819,039		 Other non-current assets

3,729

3,379

4,386

Total non-current liabilities

1,612,834

1,448,227

1,431,140

Total non-current assets

3,693,589

3,085,121

3,235,791

Total liabilities

2,292,886

2,147,969

2,241,744

Total assets¥4,749,415¥4,317,282¥4,558,212

Equity		Capital stock

80,46280,46280,462

		Capital surplus

105,592

105,517

105,417

		Retained earnings

705,521855,317954,503

		Treasury stock(41,509)(41,266)(59,272)

1,541,262

1,098,627

1,159,181

2,391,330

2,098,658

2,240,293

65,19870,65576,174

Total equity

2,456,528

2,169,313

2,316,467

Total liabilities and equity¥4,749,415¥4,317,282¥4,558,212

		 Trade receivables and other receivables
		 Investments accounted for by the equity method
		 Other financial assets

Non-current liabilities

Consolidated Statements of Financial Position

		 Trade receivables and other receivables

Financial Section /Corporate Information

Transition date
(April 1, 2015)

Millions of yen

Share of equity attributable to owners of the parent

		 Other components of shareholders’ equity
Total share of equity attributable to owners of the parent
Non-controlling interests

78

Toyota Industries Report 201779

Consolidated Statements of Profit or Loss

Consolidated Statements of Comprehensive Income

Toyota Industries Corporation
For the years ended March 31, 2016 and 2017

Toyota Industries Corporation
For the years ended March 31, 2016 and 2017

Millions of yen

Millions of yen

2017

2016

¥199,956¥137,565¥1,675,148

Cost of sales(1,291,859)(1,278,378)

404,997396,769

		 Items not to be reclassified into profit or loss

(266,894)(268,354)

			 Profit (loss) from FVTOCI financial assets(409,198)

77,802Other profit

10,87911,411

			 Remeasurements of defined benefit plans(7,022)

4,862

Other expenses(11,956)(12,480)			Other comprehensive income of affiliates
accounted for by the equity method

(18)

21

Operating profit

137,026

127,345

		 Total items not to be reclassified into profit or loss

(416,239)

82,686

Financial income

67,26463,734

		 Items that can be reclassified into profit or loss

Financial expenses(13,536)(10,067)

			 Foreign currency translation adjustment(35,492)(18,913)632

974

			Cash flow hedges

(556)

1,242

191,386

181,986

(689)

162

(52,865)(44,420)

			Other comprehensive income of affiliates
accounted for by the equity method

Profit from continuing operations

138,521

137,565(36,737)(17,509)

Profit from discontinued operations

61,435—(452,977)

65,177

199,956

137,565(253,021)

202,743

		 Owners of the parent

194,270

131,398

		Non-controlling interests

5,685

6,167

			Continuing operations(316,549)

197,355

			Discontinued operations

61,475—

		 Total owners of the parent(255,074)

197,355

		Non-controlling interests

2,053

5,387

Selling, general and administrative expenses

Share of profit (loss) of investments accounted for by the equity method
Profit before income taxes
Income taxes

ProfitProfit attributable to:Earnings per share
Basic
Continuing operations¥

422.80¥420.78195.54—618.34420.78Continuing operations

422.79—

Discontinued operations

195.54—618.33—

Discontinued operations
Earnings per share—basic (yen)Other comprehensive income:		 Total items that can be reclassified into profit or loss
Total other comprehensive income
Comprehensive income
Total comprehensive income attributable to:		 Owners of the parent

Consolidated Statements of Profit or Loss / Consolidated Statements of Comprehensive Income¥1,696,856

Financial Section /Corporate Information

2017

Net sales

Gross profit

Profit2016

Diluted:Earnings per share—diluted (yen)80

Toyota Industries Report 201781

Consolidated Statements of Changes in Equity
Toyota Industries Corporation
For the years ended March 31, 2016 and 2017

Millions of yen

Millions of yen

Share of equity attributable to owners of the parent

Share of equity attributable to owners of the parent

Capital stock

Balance at April 1, 2015

Profit (loss) from Remeasurements
FVTOCI financial of defined benefit
assetsplans¥105,592¥705,521¥(41,509)¥1,541,869¥—

Profit——194,270———

Other comprehensive income

—

—

—

—

(409,158)(6,830)Total comprehensive income——

194,270—(409,158)

Repurchase of treasury stock

—

—

—

(20)

Disposal of treasury stock

—

(30)

—

Dividends———

Foreign currencytranslation
adjustment
Balance at April 1, 2015

Subscription
rights to shares

Total

Total equity

Total

—

¥ (679)

—

—

—

—

194,270

5,685

199,956

Other comprehensive income(32,799)(556)—(449,344)(449,344)(3,632)(452,977)(6,830)Total comprehensive income(32,799)(556)—(449,344)(255,074)

2,053(253,021)——

Repurchase of treasury stock

—

—

—

—

(20)

—

(20)

263

—

—

Disposal of treasury stock

—

—

—

—

232

—

232

(37,699)———

Dividends

—

—

—

—

(37,699)(1,670)(39,369)

(44)

—

—

—

—

—

—

—

—

(44)

117

72

—

—

—

—

—

—

—

—

—

—

—

5,059

5,059

Reclassified into retained earnings——(6,774)

—

(56)

6,830

Reclassified into retained earnings

—

—

—

6,774

—

—

—

Other increases (decreases)

—

—

—

—

—

—

Other increases (decreases)

—

—

(65)

(65)

(65)

(103)

(168)

Total transactions with owners

—

(75)

(44,474)

242

(56)

6,830

Total transactions with owners

—

—

(65)

6,709

(37,597)

3,403(34,193)¥80,462¥105,517¥855,317¥(41,266)¥1,132,655¥(32,799)¥(1,235)

Profit——131,398

—

—

—

—

—

—

—

131,398

6,167

137,565

Other comprehensive income

—

—

—

—

77,521

4,811

Other comprehensive income(17,618)

1,242—

65,95765,957(779)

65,177

Total comprehensive income——

131,398—

77,521

4,811

Total comprehensive income(17,618)

1,242—

65,957

197,355

5,387

202,743

Repurchase of treasury stock

—

(36)

—

(18,011)——

Repurchase of treasury stock

—

—

—

—

(18,048)—(18,048)

Disposal of treasury stock

—

(0)

—

5

—

—

Disposal of treasury stock

—

—

—

—

5

—

5

Dividends——(37,609)———

Dividends

—

—

—

—

(37,609)(2,290)(39,899)

—

(62)

—

—

—

—

—

—

—

—

(62)

30

(31)

—

—

—

—

—

—

—

—

—

—

—

30

30

Reclassified into retained earnings

—

—

5,395

—

(584)

(4,811)

Reclassified into retained earnings

—

—

—

(5,395)———

Other increases (decreases)

—

—

—

—

—

—

Other increases (decreases)

—

—

(6)

(6)

(6)

2,360

2,354

Total transactions with owners

—

(99)

(32,213)(18,005)(584)(4,811)

Total transactions with owners

—

—

(6)

(5,402)(55,721)131(55,589)¥80,462¥105,417¥954,503¥(59,272)¥1,209,592¥

Balance at March 31, 2017

Balance at March 31, 2016

Changes in ownership interest of
subsidiaries
Changes in non-controlling interests
as a result of changes in scope of
consolidation

Balance at March 31, 2017

Toyota Industries Report 2017

¥

—

—

ProfitChanges in ownership interest of
subsidiaries
Changes in non-controlling interests
as a result of change in scope of
consolidation

Balance at March 31, 2016
ProfitChanges in ownership interest of
subsidiaries
Changes in non-controlling interests
as a result of changes in scope of
consolidation¥  

Cash flow
hedgesNon-controllinginterests¥(50,417)¥

6¥72 ¥1,541,262 ¥2,391,330¥ 6 ¥1,098,627 ¥2,098,658¥ — ¥1,159,181 ¥2,240,293¥65,198 ¥2,456,528

Consolidated Statements of Changes in Equity¥80,462

Changes in ownership interest of
subsidiaries
Changes in non-controlling interests
as a result of change in scope of
consolidation

82

Capital surplus Retained earnings Treasury stock

Other components of shareholders’ equity

Financial Section /Corporate Information

Other components ofshareholders’ equity¥70,655 ¥2,169,313¥76,174 ¥2,316,467

83

Consolidated Statements of Cash Flows
Toyota Industries Corporation
For the years ended March 31, 2016 and 2017

Millions of yen
2017

2016

Profit before income taxes from discontinued operations

93,025—

Depreciation and amortization

143,836

148,957

2,034

2,136

Interest and dividends income(66,367)(62,862)Interest expenses

10,588

8,111

(632)

(974)

(Increase) decrease in inventories(7,602)(3,010)(Increase) decrease in trade receivables and other receivables(25,448)(16,249)

9,189

28,589Others(112,404)(16,772)

Subtotal

237,607269,912Interest and dividends income received

66,364

63,186

Interest expenses paid

(10,401)(8,374)

Income taxes paid

(45,521)(85,630)

248,049

239,094(150,598)(164,225)

10,044

10,167

Payments for purchases of investment securities(716)(30,612)

Proceeds from sales of investment securities

375

7,591

(9,717)(2,855)140,097—

Payments for loans made

(570)

(607)

Proceeds from collection of loans

914

958

Payments for bank deposits(358,634)(373,122)

Proceeds from withdrawals of bank deposits

120,735

480,742

Payments for transfer of business(277,643)(3,269)(6,523)(11,691)(532,238)(86,925)

Share of (profit) loss of investments accounted for by the equity method

Increase (decrease) in trade payables and other payables

Net cash provided by operating activities
Cash flows from investing activities:
Payments from purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment

Payments for acquisition of subsidiaries’ stock resulting in change inscope of consolidation
Proceeds from sales of subsidiaries’ stock resulting in change in scope of
consolidation

OthersNet cash used in investing activities

84

Toyota Industries Report 2017

Payments for acquisition of subsidiaries’ stock not resulting in change inscope of consolidation
Proceeds from sales of subsidiaries’ stock not resulting in change inscope of consolidation

(155)

(131)

524

463

Net increase (decrease) in short-term loans (within three months)

23,83916,384

Proceeds from short-term loans payable

127,11036,921

Repayments of short-term loans payable(68,105)(114,087)

Proceeds from long-term loans payable

153,980

63,242

Repayments of long-term loans payable(38,574)(36,084)

Proceeds from issuance of corporate bonds

25,48180,068

Repayments of corporate bonds(46,965)(20,000)(20)(18,048)

Cash dividends paid

(37,699)(37,609)

Cash dividends paid to non-controlling interests(1,670)(2,290)

102

2,245

(13,352)

29,714

124,495

789

Translation adjustments of cash and cash equivalents

3,386(1,672)

Net increase (decrease) in cash and cash equivalents(156,307)

151,286

Cash and cash equivalents at beginning of period

248,706

92,399Cash and cash equivalents at end of period¥ 92,399¥243,685

Payments for repurchase of treasury stock

Proceeds from payments by non-controlling interests
OthersNet cash provided by (used in) financing activities

Consolidated Statements of Cash Flows¥181,986

Financial Section /Corporate Information

Cash flows from financing activities:¥191,386

Impairment losses

2017

2016

Cash flows from operating activities:
Profit before income taxes

Millions of yen

85Board of Directors, Audit & Supervisory Board Members andManaging Officers(As of June 30, 2017)

Directors
Chairman

Tetsuro Toyoda
Joined Toyota Motor Sales Co., Ltd.
Vice President of Toyota Motor Sales, U.S.A., Inc.
Director of Toyota Industries Corporation (TICO)Managing Director of TICO
Senior Managing Director of TICO
Executive Vice President of TICO
President of TICO
Chairman of TICO (current)
Chairman of the Central Japan Economic Federation (current)

Executive Vice President

Joined Toyota Industries Corporation (TICO)
Director of TICOManaging Officer of TICO
Senior Managing Officer of TICO
Director of TICO
Senior Managing Director of TICO
Executive Vice President of TICO (current)

Executive Vice President
Apr. 1976
Jun. 2008
Jun. 2011
Jun. 2016

Director

Masaharu Suzuki

Joined Toyota Industries Corporation (TICO)Managing Officer of TICO
Senior Managing Director of TICO
Executive Vice President of TICO (current)

Kan Otsuka

Apr. 1977 Joined Toyota Motor Co., Ltd.
Jun. 2008 Managing Officer of Toyota Industries Corporation(TICO)
Jun. 2012 Senior Managing Officer of TICO
Jun. 2013 Director of TICO
Jun. 2016 Director and Senior Managing Officer of TICO (current)

Outside Director

Shuzo Sumi

Apr. 1970 Joined The Tokio Marine & Fire Insurance Co., Ltd.
(Tokio Marine)
Jun. 2000 Director and Chief Representative in London of Tokio
MarineJun. 2002 Managing Director of Tokio Marine
Oct. 2004 Managing Director of Tokio Marine & Nichido Fire
Insurance Co., Ltd. (Tokio Marine & Nichido)
Jun. 2005 Senior Managing Director of Tokio Marine & Nichido
Jun. 2007 President and Chief Executive Officer of Tokio Marine & Nichido
Jun. 2007 President and Chief Executive Officer of Tokio Marine Holdings, Inc. (Tokio
Marine Holdings)
Jun. 2013 Chairman of the Board of Tokio Marine & Nichido
Jun. 2013 Chairman of the Board of Tokio Marine Holdings (current)
Jun. 2014 Director of Toyota Industries Corporation (current)

Outside Director
Apr. 1975
Jun. 2004
Jun. 2006
Jun. 2006
Jun. 2007
Jun. 2010
Jun. 2010
Jun. 2011
Jun. 2012
Jun. 2015
Apr. 2016
Apr. 2017
Jun. 2017

86

Joined Toyota Industries Corporation (TICO)
Director of TICOManaging Officer of TICO
Senior Managing Officer of TICO
Senior Managing Director of TICO
President of TICO (current)

Executive Vice President
Apr. 1977
Jun. 2005
Jun. 2006
Jun. 2008
Jun. 2010
Jun. 2015

Shinya Furukawa

Joined Toyota Motor Sales Co., Ltd.
Director of Toyota Industries Corporation (TICO)Managing Officer of TICO
Senior Managing Officer of TICO
Senior Managing Director of TICO
Executive Vice President of TICO (current)

Director

Takuo Sasaki

Apr. 1980
Jun. 2009
Jun. 2011
Jun. 2011
Apr. 2013
Apr. 2015
Jun. 2015
Jun. 2016

Joined Toyota Motor Co., Ltd.
Managing Officer of Toyota Motor Corporation (TMC)
President of Toyota Financial Services Corporation
Advisor of TMC
Managing Officer of TMC
Advisor of Toyota Industries Corporation (TICO)
Senior Managing Director of TICO
Director and Senior Managing Officer of TICO (current)

Director

Taku Yamamoto

Apr. 1979
Jun. 2007
Jun. 2012
Jun. 2014
Jun. 2016

Joined Toyota Industries Corporation (TICO)Managing Officer of TICO
Senior Managing Officer of TICO
Director of TICO
Director and Senior Managing Officer of TICO (current)

Outside Director

Full-Time Audit &Supervisory Board Member
Apr. 1976
Jun. 2006
Jun. 2010
Jun. 2012
Jun. 2013
Jun. 2016

Toshifumi Ogawa

Joined Toyota Industries Corporation (TICO)Managing Officer of TICO
Senior Managing Officer of TICO
Director of TICO
Senior Managing Director of TICO
Audit & Supervisory Board Member of TICO (current)

Full-Time Audit &Supervisory Board Member
Apr. 1980
Jun. 2007
Jun. 2010
Jun. 2014

Outside Audit &Supervisory Board Member

Oct. 1978 Assistant Professor of Faculty of Literature, Nanzan
University
Apr. 1 986 Professor of Faculty of Literature, Nanzan University
Apr. 1993 President of Nanzan University
Apr. 2000 Professor of Faculty of Humanities, Nanzan University
Apr. 2008 Chairman and Director of Nanzan School Corporation
Jun. 2010 Audit & Supervisory Board Member of Toyota
Industries Corporation (current)
Apr. 2017 President of Fuji Women’s University (current)

Apr. 1976
Jun. 2004
Jun. 2008
Jun. 2011
Jun. 2013
Jun. 2013
Jun. 2015
Jun. 2015
Jun. 2015
Jun. 2015
Apr. 2017
Jun. 2017

Kohei Nozaki

Joined Toyota Industries Corporation (TICO)Managing Officer of TICO
Senior Managing Officer of TICO
Audit & Supervisory Board Member of TICO (current)

Outside Audit &Supervisory Board Member Hans-Juergen Marx

Takahiko Ijichi

Joined Toyota Motor Co., Ltd.
Managing Officer of Toyota Motor Corporation (TMC)
Senior Managing Director of TMC
Director and Senior Managing Officer of TMC
Advisor of TMC
Director and President of Towa Real Estate Co., Ltd.
Audit & Supervisory Board Member of Toyota
Industries Corporation (current)
Retired from Advisor of TMC
Executive Vice President of TMC
Retired from Director and President of Towa Real Estate
Director of TMC
Senior Advisor of TMC (current)

Outside Audit &Supervisory Board Member Akihisa Mizuno
Apr. 1978 Joined Chubu Electric Power Co., Inc. (Chubu
Electric Power)
Jun. 2008 Director, Senior Managing Executive Officer andGeneral Manager of Corporate Planning & Strategy
Div. of Chubu Electric PowerJun. 2009 Representative Director and Executive Vice Presidentof Chubu Electric Power		 General Manager of Corporate Planning & Strategy
Div. and General Manager of Affiliated Business Planning & Development Dept.
Jun. 2010 President & Director of Chubu Electric PowerJun. 2015 Chairman of the Board of Directors of Chubu Electric Power (current)
Jun. 2016 Audit & Supervisory Board Member of Toyota Industries Corporation (current)

Kenichiro Yamanishi

Apr. 1975 Joined Mitsubishi Electric Corporation (Mitsubishi
Electric)
Apr. 2006 Executive Officer of Mitsubishi Electric
Apr. 2008 Senior Executive Officer of Mitsubishi Electric
Apr. 2010 Representative Executive Officer and President & CEO
of Mitsubishi Electric
Jun. 2010 Director, Representative Executive Officer andPresident & CEO of Mitsubishi Electric
Apr. 2014 Chairman of Mitsubishi Electric (current)
Jun. 2015 Director of Toyota Industries Corporation (current)Managing Officers
Senior Managing Officers

Takuo Sasaki*
Toshifumi Onishi
Kan Otsuka*
Taku Yamamoto*Keiichi Fukunaga
Junichi Harada

Mitsuhisa Kato

Joined Toyota Motor Co., Ltd.
Managing Officer of Toyota Motor Corporation (TMC)
President of Toyota Technocraft Co., Ltd.
Advisor of TMC
Retired from Advisor of TMC
Retired from President of Toyota Technocraft
Senior Managing Director of TMC
Senior Managing Officer of TMC
Executive Vice President of TMC
Director of Toyota Industries Corporation (current)
Chairman of Toyota Central R&D Labs., Inc. (current)
Director of TMC
Senior Advisor of TMC (current)

Toyota Industries Report 2017

Apr. 1981
Jun. 2005
Jun. 2006
Jun. 2008
Jun. 2010
Jun. 2013

Akira Onishi* Concurrently serving as directors

Board of Directors, Audit & Supervisory Board Members and Managing Officers

Apr. 1977
Jun. 2003
Jun. 2006
Jun. 2008
Jun. 2010
Jun. 2011
Jun. 2013

Kazue Sasaki

President

Financial Section /Corporate Information

Apr. 1970
Feb. 1991
Jun. 1991
Jun. 1997
Jun. 1999
Jun. 2002
Jun. 2005
Jun. 2013
Jun. 2016

Audit & Supervisory Board Members

Managing Officers

Yukihisa Tsuchimoto
Takashi Ito
Toshiya Yamagishi
Mikihiko Okamoto
Yojiro Mizuno
Masahiro Kawaguchi
Yuji Ishizaki
Keizo Hara
Kiyotsugu Kurimoto

Masafumi Kunito
Toshihiko Shimizu
Koichi Ito
Yasushi Kawai
Hiroaki Kayukawa
Toru Inagawa
Hiroshi Matsumoto
Kota Otoshi
Norio Wakabayashi

Kazunari Masuoka
Kazunari Kumakura
Hiroaki Matsuda
Hisashi Ichijo
Nobutomo Yasui
Shunji Sugimoto
Hisanori Miyajima87Major Production Bases

Investor Information(As of March 31, 2017)n Major Plants (Parent Company)
Plant

LocationStart of
Operations

Main Products

Kariya-shi, Aichi

Textile machinery, compressors

1927

Obu PlantObu-shi, Aichi

Compressor parts

1944

Kyowa Plant

Obu-shi, Aichi

Electronic equipment, automotive press dies, production facilities, engine parts

1953

Nagakusa Plant

Obu-shi, Aichi

Vehicles1967

Takahama Plant

Takahama-shi, Aichi

Materials handling equipment, materials handling systems

1970

Hekinan Plant

Hekinan-shi, Aichi

Diesel engines, gasoline engines

1982

Higashichita Plant

Handa-shi, Aichi

Foundry parts, diesel engines

2000

Higashiura Plant

Higashiura-cho, Chita-gun, Aichi

Compressor parts

2002

Anjo Plant

Anjo-shi, Aichi

Electronic equipment

2007

Corporate Head Office

Stock Exchange Listings

TOYOTA INDUSTRIES CORPORATION
2-1, Toyoda-cho, Kariya-shi, Aichi, 448-8671, Japan
Telephone: +81-(0)566-22-2511
Facsimile: +81-(0)566-27-5650

Tokyo and Nagoya (Ticker Code: 6201)

Date of Establishment

Independent Accountant

November 18, 1926

Common Stock

PricewaterhouseCoopers Aarata LLC
Sumitomo Fudosan Shiodome Hamarikyu Bldg.
8-21-1 Ginza, Chuo-ku, Tokyo, 104-0061, Japan

No par value
Authorized: 1,100,000,000 shares
325,840,640 shares
Issued:Transfer Agent
Special Account Management Institution(including treasury stock)

Share unit:

17,102

Mitsubishi UFJ Trust and Banking Corporation
1-4-5, Marunouchi, Chiyoda-ku, Tokyo, 100-8212, Japan

100 shares

Capital Stock80,462 million yen

Major Shareholders

5
■
8
■
9
7■
■
6
■

2
3 ■
■
1
■
4
■

14
■
12 ■
13
■
10 ■
11
■
15
■

16
■

Company Name

88

Country

Location

Main Products

Year ofFoundation

1 Toyota Industrial Equipment Mfg., Inc.

U.S.A.

Columbus, Indiana

Materials handling equipment

1988

2 The Raymond Corporation

U.S.A.

Greene, New York

Materials handling equipment

1922

3 Michigan Automotive Compressor, Inc.

U.S.A.

Parma, Michigan

Compressors

1989

4 TD Automotive Compressor Georgia, LLC

U.S.A.

Pendergrass, Georgia

Compressors

2004

5 Toyota Material Handling Manufacturing Sweden AB

SwedenMjölbyMaterials handling equipment

1946

6 Toyota Material Handling Manufacturing Italy S.p.A.

Italy

Bologna

Materials handling equipment

1942

7 Toyota Material Handling Manufacturing France SAS

FranceAncenisMaterials handling equipment

1995

8 TD Deutsche Klimakompressor GmbHGermany

Bernsdorf

Compressors

1998

9 Uster Technologies AG

Switzerland

Uster

Textile machinery

1875

10 Toyota Industries Engine India Private Limited

India

Bengaluru

Diesel engines

2015

11 Kirloskar Toyota Textile Machinery Pvt. Ltd.

India

Bengaluru

Textile machinery1995

12 Toyota Industry (Kunshan) Co., Ltd.

China

Kunshan, Jiangsu

Automotive parts, materials handling equipment, etc.

1994

13 TD Automotive Compressor Kunshan Co., Ltd.

China

Kunshan, Jiangsu

Compressors

2005

14 Yantai Shougang TD Automotive Compressor Co., Ltd. China

Yantai, Shandong

Compressors

2012

15 P.T. TD Automotive Compressor Indonesia

Indonesia

BekasiCompressors

2011

Toyota Material Handling Mercosur Indústria e
16
Comércio de Equipamentos Ltda

BrazilSão Paulo

Materials handling equipment

2004

Toyota Industries Report 2017

Number of Shares Held(Thousands)

Percentage of Total
Shares in Issue (%)

Toyota Motor Corporation

76,60023.51

DENSO Corporation

29,647

9.10

Towa Real Estate Co., Ltd.

16,291

5.00

Toyota Tsusho Corporation

15,294

4.69

The Master Trust Bank of Japan, Ltd. (Trust Account)

10,852

3.33

Japan Trustee Services Bank, Ltd. (Trust Account)

9,731

2.99

Nippon Life Insurance Company

6,580

2.02

Aisin Seiki Co., Ltd.

6,578

2.02

Aioi Nissay Dowa Insurance Co., Ltd.

4,903

1.50

Toyota Industries Corporation Employee Ownership Program

4,160

1.28

180,640

55.44

Name

Total

Major Production Bases / Investor Informationn Major Plants (Outside Japan)

Number of Shareholders
Financial Section /Corporate Information

Kariya Plant(As of March 31, 2017)

Notes: 1.	Toyota Industries Corporation also holds 15,351 thousand shares of treasury stock but is excluded from the above list.
2. Shares held for the purpose of trust services of respective banks are as follows:		 The Master Trust Bank of Japan, Ltd. (Trust Account)
10,852 (Thousands)
		 Japan Trustee Services Bank, Ltd. (Trust Account)
9,731 (Thousands)

Distribution of Shares
0.9%
4.7%
6.6%
Japanese corporate entities

19.5%

Japanese financial institutions

48.4%

Foreign corporate entities and others
Individuals, etc.
Treasury stock

19.9%

Japanese brokerages

892-1, Toyoda-cho, Kariya-shi, Aichi 448-8671, Japan
Telephone: +81-(0)566-22-2511 Facsimile: +81-(0)566-27-5650
www.toyota-industries.com/

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