Volkswagen wants to catch up with Toyota in 2018, but the Japanese is determined to rest on his laurels. Toyota CEO Katsuaki Watanabe wants the company to save £300 billion/£1.3 billion annually.
Toyota has targeted cost reduction as an essential contributor to a sustained 10% operating profit margin while it nearly reached this target last year with 9.3%. Dubbed “VI” for Value Innovation, the new cost saving strategy will focus on lumping components into modules or systems. The first car to The first car to incorporate the new scheme will be the Crown saloon expected to be launched on February 18 next year. Volkswagen also plans to use the strategy to cut cost.
The Japanese carmaker had already realised a similar plan under the leadership of Watanabe when he was Toyota’s purchasing director. called CCC21 for Construction of Cost Competitiveness in the 21st Century, it achieved £4.5 billion of cost savings over five years.
In the meantime, Toyota plans to invest ¥1.5 trillion/£6.5 billion in future models and production facilities. It’s less than the amount invested by Volkswagen, but still enough to give headaches to American carmakers.
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