It's not just the right thing to do; it's savvy business strategy,
by Stephen Beatty
Managing Director,
Toyota Canada Inc.
The state of our environment and what we should be doing about it has become one of the most hotly contested issues in Canada in recent memory. Some continue to debate whether climate change and global warming are real. But increasingly, consumers, businesses, policy-makers, environmentalists, economists and others have stopped wondering "Is this really happening?" and instead are asking, "What can we do about it?" And that's important, because as with anything that requires a change in how society conducts itself, efforts to reduce our environmental footprint will be most effective when we all work together.
Rather than waiting for a scientific consensus on climate change, Toyota has been working to reduce our environmental footprint for many years. We decided the responsible approach was to examine the environmental consequences of our products and our operations, and then minimize our impact. These environmental goals were easy to build into our business activities because our corporate blueprint, known as The Toyota Way, contains principles that encourage this.
The first is well known. "Kaizen," a term meaning continuous improvement, has revolutionized manufacturing and other businesses around the world. The second principle is equally important. It is the elimination of waste, or "muda" as it is referred to in Japanese. Muda encompasses everything from over-production and excess inventory to wasted time and unused employee creativity.
When we applied these principles to the question of environmental stewardship, we realized it was not just the right thing to do - it was also a savvy approach to doing business, as you will see.
Toyota started selling vehicles in North America in the 1950s, but real success came when OPEC members dramatically reduced the world's supply of petroleum in October, 1973. As a result, North Americans found an extremely attractive solution in the form of Toyota's more fuel-efficient - and therefore less wasteful - models.
Once behind the wheel of a Toyota, however, our customers found something else: a new level of quality and reliability resulting from our application of kaizen. This has turned many first-time Toyota owners into loyal, repeat customers.
While the oil crisis of the 1970s was unexpected, today's environmental challenges are ones for which we've been preparing for some time.
In the 1990s, Toyota Motor Corporation's chair warned that "There is no future for the automotive industry without the promotion of environmental technology." At the time, Toyota was convinced that only companies that succeed in this area would be acceptable to society. We are even more convinced of this today.
For many years now, we have been reducing energy consumption and eliminating waste from all of our operations around the world. This has to be a global commitment, since environmental issues do not confine themselves to one nation's borders. A global vision that enables co-ordinated action at the national, regional and local levels is the most effective way to deal with such issues.
Most of these initiatives also deliver real cost benefits to the company. For example, by applying the principle of muda to our energy, water and raw material consumption, we reduce our usage - and our costs. This makes our products less expensive, and more competitive.
It's equally important that environmental stewardship inform the design of our vehicles. This is why Toyota has invested so heavily to develop fuel-efficient engines, emission-reducing systems and advanced technologies.
Our most recognizable eco-technology is our range of gasoline-electric hybrid vehicles. In 2000, we introduced Canadians to this technology with the Toyota Prius, the world's first mass-produced hybrid. Since then, kaizen has helped us to greatly improve the hybrid system and introduce an additional five hybrid models to both the Toyota and Lexus product lines. With an aggressive hybrid program in place, even more are on the way.
We are pursuing several alternatives as we develop the ultimate eco-car, but we are convinced that the hybrid power system will play an important role in the future of the automobile for a number of reasons.
Hybrids are available today, use the existing fuel infrastructure, and look and drive like a conventional vehicle. This is important because our experience tells us the way to ensure people adopt a new technology is to make it familiar and comfortable to use.
The ability to re-use energy that would otherwise be wasted makes hybrid power systems more efficient, meaning hybrids consume less fuel. At the same time, hybrids produce almost no harmful tailpipe emissions, making them an environmentally responsible alternative.
But beyond this, Toyota's hybrid system is a platform ready to support new fuel alternatives as they become commercially ready. For example, we will be able to replace just the gasoline engine portion of the hybrid system once hydrogen fuel cell technology becomes a viable choice.
In Canada, environmental performance traditionally has been near the bottom of the list of factors that have driven competition in the automotive sector. However, Canadians are increasingly examining all aspects of their own lives to find new ways to minimize their environmental footprint - and this includes the vehicles they drive.
As a company that is an established environmental leader, Toyota welcomes this new reality. If the environment is the new battleground for the industry, the ultimate winner is the planet itself.
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