Section 2. Automobile Prototypes
Item 2. Construction of Prototype Plant and Steelworks
Having established the Automotive Production Division, Kiichiro Toyoda set about building a prototype plant and a steelworks. At the time, acquiring parts and materials suited for automotive manufacturing was difficult, and there was particular difficulty finding a steelmaker who would develop steel for automotive use, as the demand volume was small. The company was forced to manufacture the required parts by itself. Looking to construct a steelworks, Kiichiro sought the advice of Dr. Kotaro Honda, and enlisted Benzo Fukuda, plant manager of the Tsukiji plant of Daido Electric Works (now Daido Steel Co., Ltd.) as an advisor.
Toyoda Automatic Loom Works held an extraordinary general shareholders meeting on January 29, 1934, and passed a resolution to increase the company's capital from one million yen to three million yen in order to fund expansion in to the automotive business. At the same time, Article 2 of the company's articles of incorporation was revised, adding "manufacture and sale of motors and powered transportation machinery" and "manufacture and refining of steel" to the stated business purposes. The Automotive Department and the Steelmaking Department were thus approved as official organizations within the company, and future production of aircraft was also planned.1
The Automotive Department's prototype plant was completed in March 1934, comprising of a sheet metal and assembly plant, a machining and finishing plant, a warehouse, and a materials testing and research office. The sheet metal and assembly plant and the machining and finishing plant had a floor area of 3,600 square meters 2 each, the warehouse was 1,700 square meters in size, while the materials testing and research office covered 700 square meters. The German and American machinery purchased the previous year by director Risaburo Oshima began arriving and was installed, and the prototype plant commenced operation from June to July that year.
Following this, the Steelmaking Department's steelworks building was completed in July 1934, and operation commenced in November after installation of electric melting furnaces and mills. The Steelmaking Department, which also operated the forging division, increased its forging facilities by using the steam hammer forges from Toyoda Automatic Loom Works, and created prototype forged parts for automotive use.
During this time, Takatoshi Kan visited the United States from January to July 1934 to plan the mass production processes used to build automobiles. Kan visited 130 plants, seven research facilities and five universities to study the automotive and machine tool industries.