Situation at Toyota revealed by JCP investigation

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Situation at Toyota revealed by JCP investigation

While making a record-high profit, Toyota Motor Corporation is running into serious problems with product recalls and charges against illegal employment using "disguised contract labor" at its affiliate suppliers. The number of Toyota cars that had to be recalled jumped to 1,927,000 in 2005 from 45,000 in 2001.

The Japanese Communist Party on September 6 and 7 sent its investigation team of Diet members to several Toyota workplaces including its head office in Toyota City in Aichi Prefecture. The team found the following in its on-the-spot investigations:

Development period and delivery deadline shortened

Toyota has reduced the period for developing a new car to two years from four years in the 1990s. Today, in order to meet the delivery deadline, suppliers are forced to produce parts for a new car within three months after the completion of the car design. Even if the car design takes a longer time than expected, new parts are still expected to be delivered on time.

The tight schedule has brought about various adverse effects. From the factory floor, concerns are voiced over insufficient strength or mismatching of parts and frequent changes in parts design that are made even after the mold for the parts are delivered.

A Toyota engineer engaged in parts design said, "Toyota plans to design new cars relying only on the computer models and reduce real design tests to only once. But, manufacturing such a product is not that easy."

Cost-cutting

Toyota is conducting a campaign to reduce the prime cost by 30 percent in three years.

As a result, factories are cutting as much cost as possible by using South Korea-made steel materials that are widely regarded as less safe and by reducing the number of product inspections from once an hour to once a month.

"To reduce the cost they have slashed the safety factor (safety margin of material strength) from five percent to two percent," said an engineer.

An owner of a subcontracting parts maker said, "The unit price is set by Toyota. Toyota always tells us to cut every prime cost. So, if the price of raw materials goes up, I have to cut personnel costs."

Cuts in personnel costs

This structure causes the illegal employment of "disguised contract labor" as well as foreign workers without work permits to reduce personnel costs.

There is one factory in which half the workers on the assembly lines are from Brazil. Another factory relies on Chinese and Vietnamese trainees to meet increased targets in its production schedule. In this factory, cautionary statements taped to machines are written in Chinese and Vietnamese.

When the JCP investigation team inquired about the question of illegal "disguised contract labor," a Toyota official at its head office said, "We have requested subcontractors to comply with the law."

However, the automaker seems to deny its responsibility. The official said, "We have more than 1,000 primary subcontractors. We have asked them to convey our request to their subcontractors."

Long working hours

Toyota has set the maximum limit of overtime to 360 hours a year, but actual working hours are far longer than that. Even late at night, lights are on in most of the rooms at the Technical Center, a division that conducts research and development.

At a subcontracting factory, the average overtime is 720 hours a year. Small-scale subcontractors frequently work even on weekends.

At the Toyota head office, overtime work is now less than it used to be, but the long working hours at the R&D division and subcontract factories continues.
- Akahata, September 15, 2006