Section 9. Preparations for Mass Production and Mass Sales

Item 2. Automobile Exports and APA Special Demand

Resumption of automobile exports and Toyota in Okinawa

Toyota Motor Co., Ltd.'s overseas expansion at the time of its establishment focused primarily on China in accordance with national policy. Based on its own policies, the company investigated and made preparations for vehicle development with an eye towards Southeast Asia, but these plans were not implemented because of the war.1

President Kiichiro Toyoda stated in 'Automotive Technology under a Free Economy'2, a paper submitted in November 1949 to the Society of Automotive Engineers of Japan, "In order to export to foreign countries and withstand domestic competition, is it necessary not just to match foreign automobiles in quality and features, but to surpass them". He also described the vehicles that should be developed as "economical vehicles that can withstand poor roads and are more practical for the peoples of East Asia". Kiichiro consistently placed importance on other Asian countries, which had road conditions similar to Japan, as an export destination.

The Foreign Exchange and Foreign Trade Act and the Export Trade Control Order came into effect on December 1, 1949, and normal exports by private businesses resumed. When the price controls regarding automobiles were abolished in April 1950, all restrictions and controls on automobile production, automotive materials, sales (rationed allocation), prices, and so on were eliminated. As a result, automobile exports also became unregulated. In preparation for the resumption of free trade, the Automobile Exports Promotion Association was established in April 1949 and President Kiichiro was appointed chairman.

When automobile exports resumed, the focus was placed on Asia in accordance with President Kiichiro's policies. With the exception of the Korean War boom from 1950 to 1951, the main export destinations until 1954 were Okinawa (before its reversion to Japan), Taiwan, Thailand, and Brazil, with annual exports of about 300 units. Starting in 1955, Toyota began entering Middle Eastern markets.

Toyota vehicle exports from 1955 to 1961 are shown in Table 1-47. In 1957, exports jumped from 880 units the previous year to 4,116 units. That year, domestic sales slumped, and an attempt was made to make up the difference through exports. It is noteworthy that exports of the Land Cruiser increased by nearly 2,000 units. The Land Cruiser was esteemed for its off-road performance as a four-wheel drive vehicle equipped with high horsepower and a rugged suspension. At that time, there were few competitors, and overseas demand continued to grow steadily.

Table 1-47. Toyota Motor's Export Results (1955-1961)


Ordinary vehicles
Small truck
Passenger vehicle
Total
1955
233
(98)
47
1
281
1956
736
(518)
126
18
880
1957
3,311
(2,502)
504
301
4,116
1958
3,932
(2,815)
424
1,167
5,523
1959
3,714
(2,689)
597
1,822
6,133
1960
3,707
(2,403)
864
1,822
6,393
1961
6,071
(3,812)
1,672
3,932
11,675
Note:
The figures in parentheses under ordinary vehicles are for Land Cruisers.
Source:
History of Toyota Motor Sales Co. Ltd., p. 196, November 1962.

In February 1962, Toyota Motor Co., Ltd. established the Export Department and Toyota Motor Sales Co., Ltd. created the Export Group with the aim of bolstering export organizations. The Export Group reinforced its workforce by hiring personnel from Toyota Motor Co., Ltd. and outside the group. In addition, Toyota Motor Co., Ltd. and Toyota Motor Sales Co., Ltd. established the Production and Sales Joint Export Conference in August 1963 to further develop export structures.

Meanwhile, Okinawa Toyota Motor Sales Co., Ltd. (now Okinawa Toyota Motor Co., Ltd.)3 entered into a distribution agreement with Toyota Motor Sales Co., Ltd. on April 9, 1951. Okinawa Toyota Motor Sales sold the Model BM and Model FA60 large trucks and the Model SB and Toyoace small trucks manufactured by Toyota Motor Co., Ltd. and also handled the Henry J passenger car manufactured by U.S.-based Kaiser-Frazer Corporation and, starting in 1956, the Toyopet Crown; but sales were poor.

When small taxis were approved in Okinawa in June 1957, the Model RSD Toyopet Crown Deluxe was imported and used as the first domestically-produced left-hand-drive taxi. As a result of the switch to small vehicles by the taxi industry-which had been devoted to large foreign vehicles-Okinawa Toyota's sales that year were 368 vehicles, an increase of 3.5 times from the previous year. With this development, the company's management was finally on track.

Toyota Corolla Okinawa Co., Ltd. was established on December 13, 1962, and Toyota Auto Okinawa (now Netz Toyota Okinawa Co., Ltd.) was created on April 1, 1972. In addition, following the reversion of Okinawa to Japan on May 15, 1972, Toyota Okinawa Rental & Leasing Co., Ltd. was established on January 11, 1973, and Okinawa Toyopet Co., Ltd. was founded on October 2, 1979.

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