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Toyota Revamps Design, Manufacturing as Part of Restructuring

Bill Koenig
By Bill Koenig Senior Editor, SME Media

R&D facilities in Michigan Expand

A prototype vehicle being assembled at Toyota Motor Corp.’s R&D campus near Saline, MI. (Toyota photo)

SALINE, MI – Toyota Motor Corp.’s research and development operations in southeastern Michigan have emerged as a key piece in revamping the automaker in North America.

The company announced its One Toyota plan for North America four years ago. Since then, it established a new $1 billion North America headquarters in Texas, absorbing functions that had been based in California and Kentucky.

The Michigan R&D operation expanded as part of One Toyota. The automaker already had R&D complexes in Ann Arbor and Saline, MI. In early 2017, it opened a supplier center at Saline, part of a $154 million expansion. There are also design and prototype facilities in Saline as well. The Michigan facilities are Toyota’s largest R&D operations outside of Japan.

“The intent was to grow our engineering capability to support” Toyota’s North American operations, said Robert Young, a group vice president at Toyota Motor North America. His duties include purchasing, supplier engineering and cost planning.

One major priority of the expanded Michigan R&D facilities is to have the automaker work closer with its suppliers.

“We have to engage our suppliers earlier” in the development of vehicles, Young said. “We have to have deeper engagement 12 to 24 months earlier.”

With electronic systems, automakers and suppliers need to work together “even earlier than that,” said Gregory Laskey, a vice president for supplier engineering development.

Such systems are complex and “to get in front of that, it’s important” to have discussions with vendors, said Wayne Powell, vice president of electronic systems. “These are true collaborations before projects start.”


The need for deeper and earlier collaboration stems from various reasons. Automakers are looking to make their vehicles lighter to improve fuel efficiency. They need more input from suppliers to help make that happen as cars and trucks expand the range of materials they use.

What’s more, automakers are expanding their offerings of “electrified” vehicles (pure electric vehicles and hybrids).

Work being performed on a prototype vehicle at Toyota’s R&D complex near Saline, MI

Suppliers “are experts in their commodities,” said Deb Schroeder, vice president of purchasing for Toyota Motor North America.

The supplier center in Saline was designed so vendors could meet with Toyota personnel more often. The first floor has conference rooms. It also includes a hall, which can be configured as one large room or be subdivided into as many as 10. Suppliers have used the hall to set up displays of parts and systems for Toyota personnel to examine.

“We’re using it a lot more than I would have thought,” Young said of the hall.

Suppliers who come to the Saline facilities formerly went to a manufacturing center in Erlanger, KY, south of Cincinnati and near the Cincinnati airport. The Erlanger operation was closed as part of One Toyota, with some of its employees transferring to Michigan.

Toyota says expanding the Michigan operation has made it easier to suppliers to meet engineers in person. The company says it has 79 supplier manufacturing locations in Michigan.

“It’s proximity,” Young said. “We can meet with our suppliers daily. Here, we can pick up the phone at one o’clock and everybody’s in the room. It’s easier to be on the same page.”

Miniature Factory

The prototype area in Saline is like a miniature factory. It’s used for “confirmation builds” of new and redesigned models. There’s a body weld shop and paint shop and an assembly line. “We’re simulating the manufacturing process,” Laskey said.

It’s one of the last checks before a Toyota factory begins assembling a vehicle for real. The prototype operation also makes “show cars” for display at major auto shows. The facility has been working on vehicles for the upcoming Los Angeles auto show.

The complex also has facilities for tearing down cars and trucks of competing automakers. Recently, there have been teardowns of Ram and Chevrolet Silverado pickups as Toyota prepares for the next-generation of its large pickup, the Tundra.

Toyota has had R&D operations in Michigan since 1977, beginning in Ann Arbor. The Saline campus first opened in 2009. Toyota now has more than 1,700 employees in the state.

“We can optimize the solutions,” Young said of the expanded R&D operations. “Engagement (with suppliers) is very strong.”


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