Toyota wants to work with European suppliers to develop local solutions for the high-volume models it builds here.
'We want to allow them to submit design and performance concepts,' said Rob Johnson, general manager of purchasing at Toyota Motor Europe.
Toyota wants to use European component designs in its European vehicles to make best use of local technologies, Johnson said.
'There is a lot of difference in the vehicle at the detailed engineering level, compared with Japan and North America,' he added.
For example, suppliers developed noise insulation components as a system for the new Europe-built Toyota Corolla and introduced new manufacturing approaches.
'That has been really successful on costs, but also in terms of [a reduction in] noise [levels],' he said.
Toyota benchmarks European suppliers on cost and quality against Japanese and North American suppliers. When necessary, Toyota works with suppliers to maintain a globally competitive supply base in Europe.
'Similarly, we are gradually starting to develop components for European suppliers to [sell] elsewhere in the world,' said Johnson. 'But the share of European components on Japanese and North American products will be very low in the next five years.'
Johnson said quality at European suppliers is much improved. But he said European suppliers are still weak in managing new product introductions compared with their Japanese counterparts. On the contrary, Europeans are strong on design technology, 'particularly in safety and fuel efficiency,' he said.
'For future models, we are incorporating many more ideas from European suppliers at the concept stage,' said Johnson.
By the end of 2003 Toyota could be buying components worth E3.5 billion for its European operations.
With full production this year of the Yaris at Valenciennes, France, and the new Corolla alongside the Avensis in Burnaston, England, Toyota's annual European production will be about 400,000 units.
Toyota is also expanding engine production at its plant in Deeside, Wales, and by late 2003 could be producing 250,000 transmissions a year at its new plant in Walbrzych, Poland.
Toyota will increasingly integrate Corolla production in Adapazari, Turkey, into its European operations.
'Corollas built in Turkey will be exported for the first time to the European Union,' said Johnson. 'There is also the opportunity to commonize parts and suppliers with the UK.'
Adapazari will still source bulky parts such as stampings and some electrical parts from Turkish suppliers, but with the new Corolla 'we have a high overlap in terms of supply base,' Johnson said.
Toyota has about 230 suppliers to its UK and French operations.