Kibata says Toyo will continue to grow with independent tire dealers

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Some 700 people from more than 35 countries were on hand to celebrate the grand opening of Toyo Tire North America Inc.'s new consumer tire manufacturing facility in White, Ga. (See "Toyo holds grand opening for its first North American tire plant" in News Archives, Dec. 9, 2005.)

The wholly-owned automated tire plant features Toyo's new tire production system, the Advanced Tire Operation Module (ATOM), "which gives us the flexibility to adjust production to meet market demands," says Yoshio Kataoka, CEO and president of Toyo Tire & Rubber Co., the parent to Toyo Tire North America (TNA).

Prior to last Thursday's event, Carlos Kibata, TNA's CEO and president, spoke to the dealers at the customer banquet. Here are excerpts from his remarks.

"Let me talk about the current status of the TNA and its future plan. TNA will supply its products primarily to North America including Mexico. As the production is transferred from Japan to TNA, the Japanese production vacated capacity will be utilized for manufacturing other types of tires which are demanded in North America, so that we may better serve the North American market.

"The TNA project consists of three phases. Each phase's production is equivalent to two million passenger car tires, and therefore TNA's total production will be equivalent to six million passenger car tires when the third phase is completed. The building and production equipment... are those of the first phase.

"By June 2006 when the first phase is completed, 12 ATOM tire-building machines will have been installed. We have thus far installed four machines, which are to manufacture SUV tires. The next six machines will manufacture light truck tires such as Toyo's Open Country MT and Nitto's Terra Grappler. We intend to use the last two machines for the production of 20-inch ultra-high performance tires for the North American market and SUV tires specifically for the Mexican market.

"As the first phase is completed in June 2006, the supply of Toyo and Nitto products for the North American market will be substantially improved and stabilized.

"The first phase's total employment will be 350 including non-production employees. As ATOM is a highly automated production system, the number of employees required per production shift is fewer than 80 people. The ATOM production method is designed to accommodate a complex small lot manufacturing environment. This, in turn, enables us to flexibly respond to ever-changing market demands in a timely fashion.

"Although we focus on large lot production for the first year to improve TNA's productivity, we will transform our production to a more flexible one from the second year on, so that we may timely deliver orders to our dealers to help them reduce their inventories.

"Also, as the ATOM production method is highly automated, the quality of the products is consistent and the uniformity of the tires is unparalleled. Those tires manufactured with ATOM have been highly evaluated in the market; (an upcoming) issue of Consumer Report magazine ranked Nitto's Terra Grappler first and Toyo's Open Country AT fourth in the "Best Tires for Light Truck" category.

"Both of them were manufactured in Japan with the ATOM production method. I also want you to note that, in this year's SEMA show held in November, approximately 60% of Hummer H2 and Ford's F-Series light trucks were equipped with Toyo and Nitto tires. The tuners, who rank quality and attractiveness above anything else in their selections, chose Toyo and Nitto tires.

"Last but not least, I want to talk about our dealer policy. All of the dealers of Toyo and Nitto who joined us here today from 35 countries are independent tire dealers or distributors. I want all of you to rest assured that our policy of 'Grow with independent tire dealers' will remain unchanged...."

(Both Toyo Tire North America and Nitto Tire North America Inc. are subsidiaries of Toyo Tires International, itself a subsidiary of Toyo Tire & Rubber Co.)

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