Section 3. Development and Sales of New Models-Promotion of Comprehensive Product Lineup
Item 1. Corolla
As a result of a rapid rise in personal income thanks to the high growth of the Japanese economy, the prices of vehicles in the 1,000-cc class fell to 1.4 times per-capita income beginning around 1965. A momentum was created that led to wide-ranging motorization founded on economy passenger cars, and the dream of actually owning a car became a reality for the many "drivers on paper", people who possessed a driver's license but no car.
Toyota launched the Publica economy passenger car in 1961, but the sales volume did not increase as expected. To trigger full-fledged motorization required a new economy car that was low in price yet still fulfilled people's dreams.
Therefore, Toyota proceeded to develop the Corolla, a new luxury economy car positioned between the 800-cc Publica and the 1,500-cc Corona, targeted at the family car segment. Eiji Toyoda recalls the particulars:
While some are of the opinion that the Corolla rode the wave of motorization, I think it's the other way around. We worked to create popular demand with the Corolla and in my opinion that's just what we did. We built an engine plant (Kamigo) and an assembly plant (Takaoka) for the Corolla. It's only because we succeeded that I can afford to say so now, but had motorization not caught on in Japan, Toyota would most likely have been strapped down with surplus facilities.
(Eiji Toyoda, Toyota: Fifty Years in Motion, p. 134)
The engine for the Corolla was the newly developed K engine. This water-cooled, 4-cylinder, 1,077-cc engine possessed an "extra 100 cc" over competitors' 1,000-cc economy cars. Its engine with "power to spare" created a sensation in the market.1 Tatsuo Hasegawa who was involved as a project general manager recalls the development of the Corolla:
For a car to be used widely as a family car, it must satisfy the needs of ordinary users. For example, a midsize car may offer nearly perfect performance, riding comfort, and feel. However, such a car fails as an economy car if it scores only 50 points out of 100 in maintenance cost and price, making it unaffordable to ordinary users. An economy car must score 80 points or higher in all aspects. The key selling point will then become what aspect is lifted above 80 using unique technologies or special features.
The 1,100-cc engine is the manifestation of such an effort.
We incorporated many other selling points in the Corolla. In particular, we aggressively introduced many new technologies.
One example was the strut-type front suspension.2 This was extremely attractive in terms of riding comfort, space, weight, and cost. At the same time, however, we also faced many difficulties because this was an entirely new mechanism. For example, we were flustered when the first strut bar prototype became unusable after only 500 kilometers. We eventually perfected it after many design changes. This mechanism was later adopted in many other Toyota cars.
We also took some steps that were considered bold back then. For example, we adopted a 4-speed transmission in all versions at a time when the 3-speed transmission was common, and we changed from a column shift to a floor shift.
To create the Corolla prototype, we adopted a resident engineer system in which engineers from the engineering division stayed at the plant to handle any problems that might arise between the production floor and the engineering division.3
Furthermore, to ensure easy post-purchase routine maintenance for the economy car, Toyota adopted many maintenance-free mechanisms. The chassis was completely lubrication-free, the engine oil needed to be changed only every 5,000 kilometers, the cartridge-type engine filter needed to be replaced only every 10,000 kilometers, and the air filter element needed to be replaced only every 30,000 kilometers.
The new family car Corolla was announced in October 1966 before the 13th Tokyo Motor Show. On November 5 and 6 that year, Corolla launch events were held across Japan, attracting more than 1.3 million visitors from a wide range of generations from young to old. Sales of the highly promising Corolla took off to a good start.
While the Corolla was first introduced as a two-door sedan, a four-door sedan and a station wagon were added in May of the following year, further increasing its popularity. Corolla sales volume (excluding commercial-use vehicles) exceeded 10,000 units in May 1967, and then continued growing at a healthy pace. Sales climbed to 167,000 units in 1968 and then to 248,000 units in 1969, letting the Corolla monopolize the lead position in the economy-car market.
The arrival of the Corolla caused an economy car boom, placing privately owned passenger cars in the center of the car market.