Section 4. Global Vision

Item 1. Announcement of the Global Vision

President Akio Toyoda announced the Toyota Global Vision at a press conference in Tokyo on March 9, 2011. The Toyota Global Vision is a statement of the vision to be shared by Toyota's 300,000 employees worldwide concerning what kind of organization Toyota should be and what kind of values it should honor, determined by learning from and reflecting on TMC falling into the red in the fiscal year 2008 (ended March 2009) as a result of the global financial crisis that broke out in the autumn of 2008 and the series of quality-related problems that later surfaced.

The Toyota Global Vision was prepared not in Japan alone, but through deliberations with teams set up in North America, Europe, Asia-Oceania, China, Latin America, Africa, and the Middle East. Earlier corporate visions were first prepared in Japanese and then translated into English and other languages. But this time, the original text was prepared in English, based on a greater sense that it should be shared globally. With the happiness of its customers first and foremost, Toyota established "Rewarded with a smile by exceeding your expectations" as the slogan of the Toyota Global Vision, with an awareness toward clearly conveying the thinking that pervades the vision.

In addition, TMC employed a tree metaphor focusing on the roots, trunk, and fruit of a tree to express the how the Toyota Global Vision is to be put into practice. The roots correspond to the founding values of Toyota found in the Toyoda Precepts, the Guiding Principles at Toyota, and the Toyota Way, as an expression of the Toyota spirit of conscientious manufacturing. The fruit is what Toyota provides customers by putting the Toyota Global Vision into practice and consists of making "ever-better cars" and contributing to host communities.

Producing this type of fruit requires a solid trunk, and the trunk is the stable base of business. Repeating the cycle of producing ever-better cars and contributing to improving communities and society to secure a stable base for business and achieving sustainable growth are positioned as the foundation of management under the Toyota Global Vision.

In addition to these principles and concepts, the Toyota Global Vision sets medium-term action policies and quantitative targets through 2015. It sets forth that TMC will actively engage in emerging markets with the goal of shifting the ratio of global sales in industrialized nations and emerging countries from 6:4 in 2010 to 5:5 by 2015, thereby establishing a well-balanced business structure. The Toyota Global Vision also sets a target of establishing a solid earnings base with the resilience to withstand the risk of market contractions and fluctuations in currency exchange rates so TMC can build a stable management foundation.

The Toyota Global Vision is premised on consolidated Group sales of 7.5 million units (Toyota and Lexus) under a business environment with the yen trading at high values of 85 yen to the U.S. dollar and 110 yen to the euro, under which circumstances TMC intends to achieve a ratio of consolidated net revenues to operating income of 5 percent and operating income in the range of 1 trillion yen. At the press conference in which he announced the Toyota Global Vision, President Toyoda explained that an operating profit margin of 5% is the minimum necessary for sustainable growth and that he hopes to rapidly establish structures that can generate operating income of about 1 trillion yen even under a harsh management environment.

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