Toyota’s interiors affiliate plots profit course

The oldest company in the Toyota conglomerate, older than Toyota Motor itself, is positioning itself to be one of the group’s crown jewels in perpetuity.

ToyotaBoshoku, the automaker’s interiors specialist, expects to report a ¥63Bn ($5.7Bn) profit in fiscal 2017 on near-record sales of ¥1.3Tn ($11.7Tn).

Although operating margin will fall from the prior year’s record level, from 5.3% to 4.7%, the supplier in its midterm business plan has committed to achieving a sustainable profit of more than 5% and a 10% return on equity from fiscal 2020 onwards. The three-year plan was announced in November 2016.

Yoshimasa Ishii, Toyota Boshoku’s president, tells WardsAuto it is his job “to start streamlining the organisation and strengthen our competitive advantage and management foundation. We didn’t want to devise a midterm plan that merely contained numbers. We purposely added the word ‘implementation.’”

Ishii, who served as president of Toyota Financial Services before assuming the presidency in June 2015, declared the supplier’s management structure could not keep pace with the growth of its business since October 2004, when Toyota engineered a merger of three group companies – Toyoda Boshoku (Toyoda spelled with a ‘d’), seating supplier Takanichi and the seating division of Araco. This article first appeared in WardsAuto.

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