Toyota Motor Corp. counts itself among a small and elite group of companies when it comes to spending money with minority suppliers in the United States. But as the Japanese automaker vies for greater market share and name recognition in the Big 3's home market, Toyota still lags the Detroit automakers on minority spending.
This year, Toyota became one of 14 companies to join the Billion Dollar Roundtable, a group of companies in the United States that are recognized for spending more than $1 billion a year with Tier 1 suppliers owned by minorities and women. The Roundtable was created by Minority Business News magazine of Dallas.
Last week, Toyota officials said they had achieved their goal of devoting 7.5 percent of their annual Tier 1 spending with minority companies a year sooner than the 2006 target set in 2002.
That was helped by Toyota's surging production in North America, says Sigmund Huber, assistant general manager of supplier relations for Toyota Motor Manufacturing North America Inc. The company will build about 1.2 million cars and trucks in North America this year, up from 885,719 in 2002, the year the target was set.
Toyota's results still trail the Big 3. Last year, the Chrysler group bought $3.3 billion in minority parts and services, up from $3.0 billion in 2003.
General Motors spent $4.2 billion last year. Ford Motor Co. spent $3.4 billion in 2004 and will spend $3.7 billion this year. Ford expects to spend about $4 billion next year.
"I'm not so sure we're that far behind them on a percentage basis," Huber said. "The Big 3 are in the range of 10 percent."
Toyota has increased its minority procurement from $40 million in 1997.
The Kentuckiana Minority Supplier Development Council in Louisville, Ky., which represents about 350 minority-owned companies in the Ohio Valley, is benefiting from Toyota's procurement efforts, CEO Greg Huelsman says.
"The impression I've gotten from talking to Toyota is that they're not out to catch up with Ford and Chrysler," Huelsman says. "They have their own mission, and they simply want to do business the way they think they should."