Half a century ago, when a fledgling Toyota Motor Co. wanted to become a serious player in the world auto industry, company managers traveled to Dearborn, Mich., to seek help from a much larger and more sophisticated competitor, Ford Motor Co.
Toyota leaders have long acknowledged Ford's assistance in helping Toyota shape itself.
But today Ford is looking to Toyota for fresh ideas to make itself more competitive.
Alan Mulally, who took over as Ford CEO in September 2006, has been candid in his appraisal of Toyota and what it can teach Ford as the U.S. automaker tries to rebuild itself and regain lost market share.
"They're arguably the finest manufacturing company in the world," Mulally said of Toyota soon after taking command of Ford after a long career with Boeing. "I've been a student of the Toyota Production System for my 37 years at Boeing. I've been to Japan 47 times."
Last December, Mulally visited Toyota's current chairman, Fujio Cho, in Tokyo.
In recent months, Ford has kept its cards close to the vest on the specific changes it will make. But Mulally indicated in his early days on the job that his study of Toyota while at Boeing would influence the way Ford builds vehicles for different world markets, and the way Ford's supply chain works.
Mulally was instrumental in bringing Toyota production practices to Boeing's airplane manufacturing operations, such as the Boeing production center in Renton, Wash.
"When we were first learning the Toyota Production System," he recalled, "one of the engineers matter-of-factly came up to me and said, 'Alan, do you understand that an airplane is much more complicated than an automobile?'
"I said, 'Yeah. An automobile has maybe 10,000 parts, and maybe 200 in subassembly. And a 737 has 4 million parts, generally flying in close formation.'"
His point: The bigger the operation, the greater the need for coordinating parts and suppliers through a formal system that prizes waste reduction and supply-line communication. He said Boeing and the rest of the aerospace industry had convinced itself that common Toyota practices like just-in-time delivery and smaller numbers of suppliers wouldn't work in complex airplane production.
"There were all these reasons why you couldn't have just-in-time (delivery), or you couldn't have fewer, more capable suppliers or you couldn't have partnerships," he says.
But Boeing pressed ahead. "And right now in Renton, there's a moving line with a 737 on it. And every day, a 737 comes out at the end of that factory. Four million parts — perfect. It takes one test flight for 35 minutes and it's in the revenue service."
Mulally said Ford's global vehicle planning would also become more similar to Toyota's.
"We have been very regional, with different products in each region," he said of Ford. Toyota, he said, has been focused on common platforms, with the variation that is needed or wanted in the regions. And those have been two different business models."
In the future, he said, "Ford's going to move to a lot more commonality on the frames and the powertrains." Ford will try to reduce the number of its platforms by 40 percent and, like Toyota, pursue global vehicles with regional variations.
— Lindsay Chappell