Section 2. European Operations Become Autonomous
Item 3. Expansion of Production Bases
Local production structures created-TMUK and TMMF established
TMC investigated local production in Europe as a way to address the voluntary export restraints imposed since the late 1980s and the high value of the yen. The first move was production of the Hilux in West Germany in collaboration with Volkswagen starting in 1989. Next, TMUK, Toyota's first production base in Europe, began producing the Carina E in 1992.
In 1998, TMUK began production of the Avensis as the successor to the Carina E and at the same time began producing the Corolla liftback at its No. 2 plant. As a result, TMUK's production capacity reached 200,000 vehicles annually, and engine production was increased to 200,000 units in 1999. When the Avensis was redesigned with European tastes in mind in 2003 it was positioned as a vehicle for all of Europe, but grew to be exported to more than 60 countries around the world including Japan and countries in Africa and Latin America.
A joint venture in Turkey, Toyotasa Toyota-Sabanci Automotive Industry & Trade Inc. (Toyotasa), began producing the Corolla in 1994 and became Toyota Motor Manufacturing Turkey Inc. (TMMT) in 2000 when Toyotasa's manufacturing and sales operations were split into separate companies. TMMT began exporting the Corolla to various European countries in 2002. TMMT's manufacturing quality was among the best of Toyota production bases outside Japan and TMMT came to occupy a key position as a supply base for the European market.
In the late 1990s, TMC set a European sales target of 800,000 vehicles in 2005 and further expanded local production. To achieve this target, Toyota Motor Manufacturing France S.A.S. (TMMF) was established on the outskirts of Valenciennes in northern France in 1998. The Yaris was set as the production vehicle, development of which was progressing, and in combination with the Avensis and Corolla produced by TMUK, Toyota now had a three vehicle series local production system in place.
The decision to build a new plant in France was made because of strong and sustained solicitations from the French government, the proximity to Southern Europe, a major Yaris market, and the relatively good access to TMUK, which had merits in terms of procurement and production. TMMF began producing the Yaris in January 2001.