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Toyota European

About the report


This is Toyota Motor Europe’s fourth Sustainability Report. It

Toyota European Sustainability Report 2010 I Introduction


covers our environmental, social and economic performance
for Financial Year 2009 (FY09) from the 1st April 2009 to 31st
March 2010. This report follows our 2009 Sustainability Report
which was published in September 2009.
This is the ninth year we have been reporting on our
environmental performance. We began publicly reporting on
our environmental performance in 2001 when we published
our first annual Environmental Report. In 2007, we broadened
the scope of the Environmental Report to include a wider
range of sustainability indicators and since this date publish
our Sustainability Report annually.
More than 100 people have contributed to this report. They
have made a great deal of effort to provide high-quality, accurate
Report Coordination Team : and transparent information. Without their contribution, this
Front left to right :
report would not be possible. Without the daily commitment
Gabrielle Lods, Colin Hensley, 35
Sharka Holler, Willy Tomboy, to sustainability of all our employees in Europe, sharing the
Maria Isabel Rodriguez Leon progress we have made would not be possible.

Data measurement and collection


The environmental performance data is gathered from procedures from previous years.
internal reporting procedures. The methodology used is in We have developed this report using the Global Reporting
line with the Greenhouse Gas Protocol of the World Business Initiative G3 Guidelines, which provide a useful framework
Council for Sustainable Development and for examining the environmental, social and economic
the World Resources Institute. aspects of our performance to be included in the report.
The social performance data is from formal The report applies the GRI framework to an A level,
statistics on customer relations, quality, which means that we have undertaken the G3 Profile and
safety, health and human resources. Management Approach disclosures and reported on all
The economic data is from our finance core indicators. The GRI Index is located on pages 86-91.
group and all financial data is in line with corporate annual Our internal and external stakeholder feedback processes
reporting procedures. (see pages 57-61) have also helped shape the content of
There have been no major changes in the reporting the report.

About Toyota Motor Europe


Toyota Motor Corporation is one of the world’s largest Toyota Motor Europe serves 57 territories through 30 National
automotive manufacturers and began selling cars in Europe Marketing and Sales Companies (NMSCs) that are either
in 1963. Toyota Motor Europe NV/SA (Toyota Motor Europe) Toyota-affiliated companies or are independently-owned.
is 100% owned by Toyota Motor Corporation. The head office A new National Marketing and Sales Company (one of the
of Toyota Motor Europe is located in Brussels, Belgium. 30) was established in Kazakhstan in FY09. Apart from this,
Toyota in Europe has operations in 17 countries with 9 there have been no significant changes to our structure in the
manufacturing plants, 9 vehicle logistics centres and 14 parts reporting period.
distribution centres. Caetano in Portugal (one of the nine We welcome your comments and opinions on this report
manufacturing plants) is a joint venture in which Toyota Motor and invite you to share them with us by emailing us at
Corporation has a 27% share. The data for this plant is not environment@toyota-europe.com. This report is also
included in this report. Similarly, Toyota Motor Manufacturing available online at www.toyota.eu and complements Toyota
Russia (TMMR) is fully owned by Toyota Motor Corporation. Motor Corporation’s Sustainability Report 2010, which can
The data for this plant is not included in this report, but in the be viewed at: www.toyota.co.jp/en/csr
Sustainability Report of Toyota Motor Corporation. We hope you enjoy reading this report.
Message from
the President
“ Tough times,
while preparing
Didier Leroy
for the future ”
President,
Toyota Motor Europe
Managing Officer,
Toyota Motor Corporation

In our 2009 Sustainability Report, we said that our company has part of our everyday commitment to excellence.
the ability and spirit to solve problems and to navigate through
the difficult times brought on by the global economic crisis. Since 2006, customer satisfaction as measured by Toyota
retailers has improved by 19% in sales and 13% in after sales.
Then, at the beginning of 2010, we were hit with another
crisis - product recalls. The recall crisis was unexpected given Looking to the future, the automotive industry can make
Toyota’s reputation for quality, durability and reliability - the a substantial contribution to the creation of a low-carbon
major characteristics of any Toyota car. society by improving fuel efficiency and developing and
introducing new technologies which reduce emissions and
Toyota Motor Corporation President Akio Toyoda suggested enable personal mobility. In FY09, according to JATO, our
going back to the basics and said “Let’s simply make better cars”. company’s average carbon dioxide emissions of cars sold
reduced by more than 10% from FY08 to 132.2 g/km (1).
For that purpose, Toyota Motor Corporation established a We will make continuous efforts to reduce C02 emissions
Special Committee for Global Quality. To represent Toyota of cars sold.
Motor Europe, I have been appointed Chief Quality Officer
and I am leading the European Quality Taskforce. Our technological leadership is further demonstrated by
the introduction of a fleet of 200 Plug-in Hybrid Vehicles
Our utmost priorities were fixing the problem, regaining that will be tested in 18 European countries. At the
customers’ trust, people’s respect and customer confidence same time, we are testing Fuel Cell Hybrid Vehicles in
in Toyota’s commitment to superior quality. The improvements Germany.
have been quicker than we initially anticipated.
Plug-in Hybrid technology will make an important
‘Customer First’ remains a landmark Toyota philosophy. contribution towards ensuring sustainable mobility. In our
Each member of our team in Europe aims to always deliver view, this hybrid technology is the best way of achieving
their best and our retailers are committed to providing the the major efficiency improvements needed and will pave
best overall customer experience. Customer satisfaction is the way towards a low-carbon future.

Didier Leroy
President, Toyota Motor Europe

(1) Toyota brand 2009 average : 130.1 g/km.


Executive summary
Immediate action has been taken with the A solar panel was installed on the roof of Toyota Parts Centre
Europe in 2009. Covering 80,000 m², it is one of the largest
product recalls thin-film solar panel rooftop installations in Belgium. The
A Special Committee for Global Quality was established. Didier installation will produce between 15% and 20% of the annual
Leroy was appointed Chief Quality Officer to lead the process electricity requirements of the facility. As a result, Toyota Parts
with this issue and to re-instate Toyota’s reputation for quality, Centre Europe will be able to make savings on its energy
durability and reliability and ‘Customer First’ attention. costs while reducing its CO2 emissions.

10% reduction in the average CO2 emissions An Integrated Approach is needed to real-
of Toyota and Lexus vehicles sold in 2009 ise the vision to de-carbonise automotive
The company’s average CO2 emissions of cars sold has been transport
reduced by more than 10% from 2008 to 132.2 g/km (1). The car industry, fuel companies, suppliers, regulators,
Full hybrid sales were 55,476 units or 6.28% of our total sales. infrastructure providers, and users of vehicles must work
We will continue to further reduce emissions. together to make significant contributions to reducing green-
house gas emissions from road transport.

The first rollout of full hybrid technology in


Europe (Toyota Motor Manufacturing UK) Maintaining stable employment
The start of production of the Toyota Auris Hybrid Synergy The crisis, while challenging, was an opportunity for Toyota
Drive® marks the first rollout of full hybrid technology in to demonstrate our commitment towards making every effort
Europe. The vehicle has category-leading fuel consumption to maintain stable employment and improve mutual trust
of 3.8 l/100 km and emissions of 89 CO2 g/km. The car’s and understanding with our employees through thorough
lifecycle CO2 emissions over a distance of 150,000 kilometres communication and long-term development.
are 33% less than the Auris petrol model and 25% less than
the Auris diesel model.
Engaging with the community
Beyond our core business of producing and selling environ-
Plug-in Hybrid Vehicle (PHV) programme mentally friendly cars, Toyota Motor Europe has a tradition
launched to serve the local communities it operates in. In 2009 our
employees and retailers were involved in over 150 projects,
The European PHV project is a part of a global Toyota project totalling a spending of €4.2 million in strategic community
involving more than 600 Prius Plug-in Hybrid Vehicles that are projects.
also being tested in Japan, the US, Canada and Australia. The
European project is leasing 200 (of the 600 vehicles) to selected
partners and customers in 18 European countries, who will road Engaging with business partners
test the vehicles. Toyota’s main objective is to further investigate
the technology and performance of the PHV with respect to the Toyota Motor Europe has a true 360° approach to the
environment. We aim to minimize the environmental footprint
customer’s needs.
involving all partners in the lifespan of our cars. With our retailers
we work closely together in the Sustainable Retailer programme
which will "green" the 3,000 retailer network in Europe by
Solar energy investment at Toyota Parts 2015. In the supply chain, we work in close cooperation with
Centre Europe all suppliers to promote Sustainable Purchasing Practices.

(1) Toyota brand 2009 average : 130.1 g/km.


Key figures
Environmental performance Fy07 Fy08 fy09
Toyota European Sustainability Report 2010 I Introduction

ISO14001 certified European Manufacturing Companies (EMC) 7 7 7


ISO14001 certified National Marketing and Sales Companies (NMSC) 22 26 28
Certified Environmental Management System Toyota and Lexus Retailers 185 724 918
ISO14001 certified Parts Distribution Centres(1) 13 (1) 14 14
ISO14001 certified Vehicle Logistics Centres 8 9 9
Percentage of Vehicle Parts Suppliers that are ISO14001/EMAS certified - 85% 85%
EMC energy usage (kWh/vehicle) 1,356 1,495 1,442
EMC CO2 (kg/vehicle) 417 443 419
CO2 emissions – EMC (t CO2) 339,000 261,000 228,000
EMC water usage (m3/vehicle) 1.98 2.11 1.90
EMC VOC emissions (g/m ) 2
19.9 18.9 18.4
EMC waste-to-landfill (kg/vehicle) 0.05 0 0
6 EMC number of fines 0 0 0
EMC number of prosecutions 0 0 0
EMC number of complaints 0 1 0
CO2 emissions – NMSC (t CO2) (2)
12,650 11,009 11,747
CO2 emissions – Production Parts Logistics (t CO2) 103,000 87,000 72,000
CO2 emissions – Vehicle Logistics (t CO2) 82,274 75,563 53,154
CO2 emissions – Service Parts Logistics (t CO2) 52,062 48,434 44,175
CO2 average emissions from Toyota vehicles – EU-27(3) 151 145 130
Sales of Remanufactured Parts (units) 58,381 63,635 58,601

Social performance Fy07 Fy08 Fy09


Employment (direct) – Head Office, NMSC, Logistics Group 7,432 8,496 4,587
Employment (direct) – EMC 18,920 18,702 15,464
Gender distribution – % of women in Head Office, NMSC, Logistics Group 26% 28% 32%
Gender distribution – % of women in EMC 10% 9% 11%
Injury frequency rate – EMC (No. of lost-time-injuries x 1 million / No. of hours
3.0 3.0 2.2
worked)
Injury frequency rate – Head Office, Zeebrugge, Zaventem (No. of lost-time-inju-
0.7 0.3 1.1
ries x 1 million / No. of hours worked)
Injury frequency rate – Regional Parts Centers and TPCE (Toyota Parts Center
35.29 28.56 27.77
Europe) (No. of lost-time-injuries x 1 million / No. of hours worked)
Suppliers – purchased local European content of core models >90% >90% >90%
European social contributions – total amount (million €) (Revised figures FY07) 10.5 7.8 4.2
European social contributions – % of total spending linked to strategic focus on
62% 66% 72%
education, road safety, environment

Economic performance Fy07 Fy08 fy09


Net revenue (million €) 24,651 20,925 16,390
Operating income (million €) 874 -995 -252
Number of vehicles manufactured 814,093 589,794 544,050
Number of engines and transmissions produced 1,396,106 1,210,913 1,108,694
Annual total sales of Toyota and Lexus (Calendar Year) 1,233,807 1,112,021 882,351
Annual hybrid sales (Calendar Year) 48,958 57,819 55,456
Market share (Calendar Year) 5.6% 5.3% 4.9%
Investment since 1990 (billion €) almost 7 >7 >7

(1) Excludes NMSC-owned Parts Distribution Centres.


(2) The figures for the CO2 emissions for NMSCs in FY07 and FY08 are different from the figures we reported in our Sustainability Report 2009
(respectively 12,585 and 13,585 tons CO2). We changed the emission factors to enable more accurate calculation.
(3) Based on JATO data, 26 Feb.2010.
Special feature

Toyota European Sustainability Report 2010 I Introduction


Toyota’s
approach
to quality
“  The strongest connection between our customers
and us is their trust in Toyota. This connection is the
foundation of our ‘Customer First’ approach to quality.
Recently, this connection was challenged with the
7
quality issues we faced. This situation has given us
the opportunity to improve our processes and our
Necdet Senturk understanding of our customers’ expectations. As a
Vice-President, Quality, result, we are reforming our operations to return to our
Toyota Motor Europe basic principle of ‘Quality First, Customer First’  „
Necdet Senturk

In response to the product recalls that affected


customers at the beginning of 2010, Toyota Motor
Corporation is providing leadership to its companies
around the world to understand what went wrong and
identify improvements for the future.

To do this, Toyota Motor Corporation’s President


Akio Toyoda has established a Special Committee for
irst :
QualitbyilitFy - Reliability
Global Quality and appointed a Chief Quality Officer in
each region to steer actions around the world.
ura
Safety – D
Improvement activities have been identified and
include:

ost
ty at A ffordable C Reviewing all processes that have an impact on
est Qua li quality: from the vehicle product planning stage
High
to the After Sales service we provide to our
customers.

Increasing our ability to identify and to solve


First: on
C ustomer cti atisfa
customer concerns: we are strengthening our entire

Trust & S
After Sales operation to better capture information
r
Custome and to provide faster and more effective solutions
to our customers.

Strengthening human resources development as a key


to quality assurance: we will further develop our peo-
ple to ensure their development is aligned with Toyo-
ta’s quick expansion and growth. We are establishing
a Customer First Training Centre in each region.
The product recalls have provided an opportunity for us to
improve the way we work.
Recurrence prevention
Toyota European Sustainability Report 2010 I Introduction

The Toyota Quality System looks at quality throughout followed through by field reports, warranty issues and
the complete vehicle lifecycle. The system seeks to customer feedback for improvement.
ensure quality from the first stage of the vehicle’s
development, with the aim of identifying and preventing In terms of the recent product recalls, we are now
potential problems in future vehicles. analysing potential problem areas to ensure the quality,
durability and reliability of critical vehicle components.
Additionally, our customer concerns are stringently The aim is to eliminate any risk for our customers.

8
Advanced
Quality
n
P eventio
r
happening
problem from
1 Stop the

Outflow
n
Preventio
Quality
ent
Improvem
fore
e problem be
Recurrencn 2 Stop the
e custo e
m r
Preven ti o it reaches th

roblem
enerate the same p
4 Do not g
ction &
Early Deteolution
Early Res
kly
roblem quic
problem: solve the p
3 M inimize the
Table of contents
Message from the President 4
Executive Summary 5
Key Figures 6
Special Feature : Toyota’s Approach to Quality 7
Table of Contents 9

Vision and Strategy 10


Vision 2020 11
Governance Structure 12
Measuring Environmental Performance 13
Measuring Corporate Social Responsibility Performance 14

Environmental Performance 16
Introduction 17
Special Feature : Moving towards a Global Climate Agreement after Copenhagen 19
Special Feature : Integrated Approach needed for de-carbonising transport 21
Research and Development 23
Manufacturing 32
Logistics 36
Sales and Marketing 44
Lexus 52
After Sales 54
End-of-Life Vehicles and Sustainable Recycling 55

Social Performance 56
Toyota : a Good Corporate Citizen 57
Engaging with Customers 63
Engaging with Employees 67
Engaging with Business Partners 75
Engaging with the Community 78

Economic Performance 82
Market Context 83
Vehicle and Market Share in Europe 84
Production Volumes 84
Investments 84
Vision &Strategy
“ Our vision is to be a leading player in the European automotive industry by
taking a ‘Customer First’ approach to safety, quality and environment and
ensuring we meet and exceed the expectations of our customers, partners
and communities. This gives our company and employees direction. To


achieve the vision, formal planning, target-setting process and governance
structure makes us responsive when faced with major issues.
Didier Leroy
Customer First

Toyota European Sustainability Report 2010 I Vision & Strategy


approach to safety,
quality, and the
environment
Didier Leroy
President,
Toyota Motor Europe 11
Managing Officer,
Toyota Motor Corporation

Vision 2020
Vision 2020 explains the path to ‘ Becoming a Leading Player ’
in Europe by focusing on four key pillars.

ro pe
Player in greater Eu
To be a Leading
Succe ss
r to Glo bal Toyota
b e a Key Contributo
To ce
Self Relian provides
on Our vision
with Focus d an direct
the Europe employees.
ion
orate du ce
ntal Good Corp locally pro
for all To yo ta
Environme Citizen Models
Customer Lea dership
Delight
(1)
hoshin
Regional
European t business
reflects th
e cu rren
t-term Vision
and shor
condition to advanc
e
chal le ng es
realising
towards
From vision to action
n
our vision
. Europea
eg io n a l
R (1)
hoshin
The Toyota European Vision 2020, distributed to our employ- n and
y, functio r
ees in May 2010, will drive our targets, decision making and Compan h in o
l hos
action plans. The pyramid shows how this vision is cascaded divisiona p la n
busin e s s
throughout the organisation.
Member
We, as a team, embrace this challenge and will translate this s
objective
vision to become a leading player and a key contributor to
global Toyota. cts
vision refle
tion and di
pany, func hoshin and their
Each com na l
an Regio anning.
the Europe to their pl
rre nt ch allenges in
own cu
r
fining thei
utes by de
dual contrib rtaking activities
Each indivi de
ives and un
own object on.
ort the visi
that supp

(1)
H oshin is an objective and target-setting process that enables the vision to be translated into action.
Governance structure
Toyota European Sustainability Report 2010 I Vision & Strategy

About Toyota Motor Europe’s Board of Directors Senior executives of Toyota Motor Corporation, the sole
shareholder of Toyota Motor Europe, review the performance
The Board of Director of Toyota Motor Europe is composed
of directors and of the Board as a whole. Executives are
of 6 members, all of whom are executive directors. The
compensated according to industry rates and performance.
company has processes in place to ensure there are no
conflicts of interest. These processes are consistent with the
Governing committees
Company Code of Conduct and include the obligation to
disclose conflicts of interest. Our governing committees help set our strategic direction
and monitor progress in reaching our goals.
The directors of Toyota Motor Europe are selected based on One of the tasks of the committees is to lead our corporate
their qualifications, experience, performance and industry social and environmental responsibilities. Each committee
knowledge and are appointed by Toyota Motor Corporation. has cross-functional representation.

12

cutive
TME Exe e
Co m m itte
sident
Chair: Pre
Quality
e
ication Committe t
Commun mittee air: Presiden
o m Ch
Mobility Strategy C
Electric e-Preside
nt
mmittee Co itte t
m m e Chair: Vic
Audit Co utive siden
c Chair: Pre
mittee Chair: Exe dent
CSR Com ent Vice-Presi
ent Chair: Presid Senior
Environm
itte e
Comm
air: President
Ch

und for
Toyota F ard
o
Euro B dent
p e
air: Vice -Presi
Ch

Toyota Motor Europe Head Office


Measuring environmental performance

Toyota European Sustainability Report 2010 I Vision & Strategy


In order to ensure environmental risk management and five-year plan runs from FY06 to FY10 and preparations are
compliance across all business activities, we have developed beginning for the next five year period.
a consolidated Environmental Management System (EMS). In
order to manage this activity across all business areas a Five The following table summarises our key environmental targets
Year Environmental Action Plan defines mid-term targets and and achievements against our Five Year Environmental Action
key activities to achieve the targets. The purpose of the action Plan. The table includes our performance in energy and clima-
plan is to set five-year goals and targets designed to help the te change, improving resource use, eliminating substances of
European operations achieve our overarching Environmental concern and expanding our environmental management system.
Policy and vision of ‘Environmental Leadership’. The current Please note that these results refer to the calendar year.

Five Year Environmental Action Plan

Page
Priority Area 2009 Achievements in this 2010 Direction/Target
report
13
I. Reduce Energy and Climate Change Impact

1. Carbon footprint of the


company reduced by 18% versus
2008. Further reduction of emissions and fuel consumption is
possible by advanced vehicle technology and by taking
2. C ompany average CO2 an Integrated Approach with all stakeholders including car
Reduce CO 2 emissions
emissions : 132.2 g/km. manufacturers, oil companies, public authorities and users.
and increase fuel 34-35
efficiency 3. F ull hybrid sales (CY09) : Expanding hybrid vehicles into mainstream models. In
Toyota : 42,712 2010 this includes introducing the Toyota Auris Hybrid
Lexus : 12,744 Synergy Drive ® (HSD).
Total : 55,456
(6.28% of total sales)

II. Effective Use of Resources

Continue to work towards achieving the 2015 recycling/


Fully compliant with European Union
Contribute to a recovery targets.
(EU) Directive 2000/53/EC on end-of-life 55
recycling-based society Further investigate recovery and treatment of hybrid
vehicle recycling (ELV).
batteries.

The Toyota Auris HSD shows


a 33% improvement in CO2 emissions
Continue to improve new model performance versus
Promote lifecycle analysis through its complete lifecycle versus 30-31
current/old model.
a comparable petrol model and a 25%
improvement versus a diesel model.

III. Reduce use of Substances of Concern

Fully compliant with EU Directive on Continue full compliance with EU Directives and REACH.
Reduce and eliminate
end-of-life vehicles, and with the EU Ensure compliance with the new Classification,
substances of concern
Chemical Regulation REACH. Labelling, Packaging (CLP) regulation.

IV. Expand Environmental Management

1. N ational Sales and Marketing Com- 3 Continue with actions.


panies added : 2, bringing the total to Prepare for next Five Year Environmental
28 out of 30. Action Plan (FY2011-15) to be introduced
2. L ogistic hubs added : Finland (TPCFI). 17 in April 2011.
3. Started with energy improvement 48-51 Hold a Green Month Campaign in 2010 with the theme
Strengthen consolidated audits at retailers.
environmental ‘Many Species, One Planet, One Future : Make a Smart
management based 4. Implemented Green Month Campaign 18 Choice.’
on ISO14001 in June 2009 with the theme ‘You Increase share of renewable energy.
control climate change.’
5. P romote the use of renewable 43
energy : introduced 80,000 m² solar
panels at Toyota Parts Centre Europe
in Diest, Belgium.
Measuring Corporate Social Responsibility (CSR)
performance
Toyota European Sustainability Report 2010 I Vision & Strategy

To be able to truly integrate CSR targets into our business, Using this measurement system, we identify kaizen (improvement)
we needed to develop a common understanding and projects and integrate them into our local planning cycles. The
measurement of what CSR Leadership means to our CSR Three Year Business Plan captures CSR targets and actions
company. We measure our CSR performance by conducting for the years to come, based on CSR Assessment results.
an annual CSR Assessment of our National Sales and
Marketing Companies, European Manufacturing Companies
and Head Office. The CSR assessment measures company
performance with respect to five stakeholders:

Customers
Shareholders
Employees
Community
Business Partners
14

CSR Three Year Business Plan


Our CSR Three Year Business Plan focuses on four key areas : Within these areas, each of our affiliates identifies areas for
improvement and sets targets which are entered into the
the integration of CSR management in our day-to-day three-year planning cycle.
business practices,
value-added contributions to society,
increased stakeholder engagement and
urban mobility.

Priority Area 2009 Plan 2009 Achievement 2010 Direction

Human resource management

By FY10, implement measures to reduce This action was not implemented as Focus on continuous two-way communi-
gender gap in employee recruitment there was a hiring freeze due to the cation, employee motivation and people
by 50%. global financial crisis. development.
By FY10 further realise multi-year action No additional measures were imple-
plan on work/life balance. mented.
Introduced measures to reduce working
hours in FY09 to maintain stable
employment.

Supply chain management


1. CSR
management fully Continue to communicate CSR policy to Reinforced business partnerships Continue to share manufacturing
integrated with suppliers. through consistent application of the experience by establishing an activity
business processes Communicate results of CSR supply founding business principles. calendar.
and planning chain survey to the purchasing Annual CSR was communicated at the Annual Intensify collaboration for quality
Business Meeting. Business Meeting. improvement with the aim of ultimate
Improved competitiveness by sharing customer satisfaction.
best practice and manufacturing Increase the total number of TEAM
experience. members to represent 75% of purcha-
Advanced the quality assessment sing spend ( see page 77).
process from the development phase to Broaden tools and methods for monito-
the design phase. ring SPG compliance.
Achieved successful three-year strategy
for Toyota in Europe Association of Ma-
nufacturers (TEAM), including a quality
improvement of around 90%.
Launched Sustainable Purchasing
Guidelines (SPG).
Toyota European Sustainability Report 2010 I Vision & Strategy
Priority Area 2009 Plan 2009 Achievement 2010 Direction

Support to affiliated companies

Increase internal and external CSR Support was provided for focused Ensure integration in 100% of Toyota
communication. communication on social contributions companies based in Europe.
Ensure definition of European CSR Action and Code of Conduct. Support development of local CSR gover-
Plan which sets targets for National Mar- European CSR Action Plan was defined nance structures.
keting and Sales Companies (NMSCs). in line with Vision 2020.
Integrate CSR activities into business Integrated CSR activities into business
plans of affiliated companies. plans of 60% of Toyota Motor Europe
companies.

Special mobility
15
Strengthen programme in UK and other This programme was discontinued due Not applicable.
countries. to the global economic crisis.

Increase alignment of social contribu- The percentage of total social contribu- Rebuild local admiration and respect by:
tions with overall business strategy. tions with a strategic focus increased to Increasing the involvement of retailers in
Enhance visibility of social contributions 72%, with 44% of contributions funding our social contribution activities.
in Europe. environmental activities.
Setting enhanced targets for employee
Focus on environmental programmes. Enhanced visibility of our social contribu- involvement in manufacturing plants and
2. Enhanced and tions through Toyota Fund website and
Increase retailer involvement in CSR. Toyota Motor Europe offices.
efficient system of newsletter.
social contributions Increase employee involvement in CSR. Continued to develop flagship projects
that create social
Eco-Driving and Eco-Schools.
and business value
Retailer involvement piloted in five
countries.
3% of our manufacturing and Head
Office employees were involved in our
social contribution activities.

3. Key stakeholders Conduct European Key Stakeholder Third European Key Stakeholder Survey Set up and implement continuous CSR
understand Toyota Survey on a bi-annual basis. completed, with Toyota Motor Europe communication with stakeholders.
performance and Design and implement a proactive achieving the number one ranking for Provide communication and stakeholder
have a positive stakeholder engagement strategy. corporate citizenship. relations templates to retailers.
image of the Develop Key Performance Indicators KPIs for stakeholder relations developed.
company (KPIs) for stakeholder relations.

Not applicable, as this was not included Electrical Mobility Committee esta- Implement PHV Limited Lease projects in
in the FY08 plan. blished. 18 European countries.
4. Urban mobility
Launch of Plug-in Hybrid (PHV) Limited
Lease project in Strasbourg, France.
Environmental
Performance
“ Our Environmental Policy, which was revised in 2009, sets out our aim to
reach environmental leadership throughout the whole vehicle lifecycle.
We take a holistic and Integrated Approach to reducing energy and


emissions throughout the lifecycle of our products and services, from the
sourcing of the materials to recycling end-of-life vehicles.
Hiroyuki Ochiai
Toyota European Sustainability Report 2010 I Environmental Performance
Our Aim :
Low Carbon
Company
Hiroyuki Ochiai
Executive Vice-President, Toyota Motor Europe
Managing Officer, Toyota Motor Corporation 17
Co-Chairman of Environmental Committee,
sions
Toyota Motor Europe S Zero Emis
Toyota EM

Challenge
Kaizen
nbutsu
Genchi Ge
Respect
k
Teamwor
S)
stem (EM
ement Sy
ronmen tal Manag
4001 Envi Energy
Base line – ISO1
CO2
y
Emergenc Emissions
Green Mon
th Response
REACH
Campaign
Waste
Work
ental Instructio
ns Batteries
Environm

Environmental Training Water


es ELV
Procedur
tailers
MSCs / Re

Management
Office / N
gistics / Head
D / Prod uction / Lo ce
rations –
R& Performan
pe
Toyota O mpl iance

System
Legal Co
agement
Risk Man
s
Awarenes

Addressing environmental issues is a management priority At the end of FY09, 91% of our operations were ISO14001
and we strive to address these issues in line with the Toyota certified. Our operations include all manufacturing sites, Parts
Way. In order to ensure environmental risk management Distribution Centres, Vehicle Logistics Centres and National
and compliance across all of our business activities, we Marketing and Sales Companies. In addition, more than 32%
have developed a consolidated Environmental Management of our retailer network is now certified to an EMS, with a
System (EMS), which sets specific requirements for each of number of markets achieving complete certification including
our various business activities. Adria, Poland and Denmark.
To implement our environmental management activities we
use the international environmental management standard Having a consolidated EMS enables us to reduce environ-
ISO14001. This standard outlines requirements for an mental impacts such as energy, waste and water and rai-
effective EMS based on the Plan, Do, Check, Act cycle. ses awareness across the organisation. The Green Month
campaign, held in June each year coinciding with the World
Plan : Establish an environmental policy, define environ- Environment Day, aims to raise environmental awareness
mental impacts and legal requirements and set objectives among our employees.
and targets The campaign uses the EMS as a platform to engage our
Do : Implement action plans, training and awareness employees in implementing specific environmental activities.
Check : Conduct audits to check the system is operating We held our first Green Month in 2004 at our Head Office in
according to the standard Brussels. Green Months are now held at more than 50 of
Act : Management review and recommendations for our sites in Europe. This activity has helped generate ideas to
improvement. further reduce our environmental impact.
Implementation of EMS 100%
anies
cturi ng Comp
n Manufa
Europea
93%
Toyota European Sustainability Report 2010 I Environmental Performance

ompan ies
g & Sales C
Marketin
National 100%
es
tr ibuti on Centr
Parts Dis
100%
entres
o gistics C
Vehicle L
100%
e
Techn ical Centr
Offices /
32%

Retailers

Green Month Campaign


18
at Toyota Spain
Lighting energy consumption evolution
MWh

45 42
41
39
40

35 33
32 32

30

25

20

15
June July August
2008
2009

Toyota Spain implemented a Green Month campaign in when they are not needed. Switching off lights resulted in
2009, which included hosting an Eco-Driving workshop and an 8% reduction in energy usage during three months from
encouraging employees to switch off computers and lighting June-August 2009.

Sustainability throughout
Sustainable
recycling Sustainable

the lifecycle
product
5 development

To create a low-carbon company we need to be pro-active


1
at each stage of vehicle manufacture and distribution. We
examine sustainability throughout the lifecycle by : Low
Sustainable

1- Developing energy-efficient, recyclable vehicles


retailers 4 Carbon
Company

2- Operating sustainable manufacturing plants and facilities 2


3- Bringing our vehicles to market via sustainable logistics
Sustainable
and operations
4- Selling and servicing our vehicles at sustainable retailers
3 manufacturing
plants
5- Recycling end-of-life vehicles Sustainable
logistics
and operations
Special feature

Toyota European Sustainability Report 2010 I Environmental Performance


Moving towards
a global climate
agreement after
Copenhagen

19
 We are pleased to include this contribution from
Mr Jos Delbeke, Director General for Climate
Jos Delbeke (left) Action, at the European Commission. As Europe’s
Director General for Climate Action, chief negotiator in the international climate change
European Commission
talks, Mr Delbeke expresses his strong conviction
Piet Steel (right)
Vice-President European and
Government Affairs, Toyota Motor Europe
for urgent global action on climate change.  „
Piet Steel

“ The participation of some 120 world leaders at the towards creating a level-playing field for business.
December 2009 United Nations (UN) Climate Change Though the Copenhagen Conference outcome did
Conference in Copenhagen, Denmark confirmed that not live up to expectations, it has nonetheless taken
climate change is now seen throughout much of the us a step closer to a global deal, and the international
world as an issue justifying attention at the highest community is now busy building on it.
political level. But the outcome of the conference was a
disappointment for Europe, and many other countries, Firstly, it produced the Copenhagen Accord, with
particularly when measured against the high hopes which more than 120 countries have associated
that it would clear the way for reaching a legally-binding themselves to date. The Accord provides important
global climate agreement this year. A global agreement political guidance to the UN negotiations on detailed
is crucial if the world is to prevent climate change from texts that will form the future global agreement.
reaching dangerous levels later this century which Secondly, negotiations on the UN texts themselves
could endanger the lives of millions of people and cause advanced well in a number of areas.
massive damage that could wreck our economies.
But perhaps most importantly of all, the Copenhagen
Forward-thinking companies have recognised the Accord brought an unprecedented momentum to
massive business opportunity that building a low- the willingness of the vast majority of countries to
carbon global economy represents. But progress act, even in the absence of a global agreement. This
towards this goal is not advancing fast enough or with is a message that has been confirmed in our many
sufficient ambition to address the enormous challenge contacts with European partners since the European
we face. A global agreement will reduce the cost Commission set up its Directorate-General for Climate
of action, enable us to act faster and go some way Action in February 2010.
Toyota European Sustainability Report 2010 I Environmental Performance

The Copenhagen Accord’s endorsement of the goal seems likely that some other big players will not. Much
of keeping global warming below 2°C compared with will depend on whether the US Congress can pass
the temperature in pre-industrial times represents a domestic climate legislation. Without US action it is
major step forward. This is the ceiling that much of hard to imagine that China will be willing to bring its
the scientific community warns we must stay within domestic actions into an international framework.
if we are to have a 50/50 chance of stopping climate
change from reaching dangerous levels. In the meantime, countries are not waiting for a global
agreement to work together internationally. Several
The Accord does not set any reduction targets for partnerships have been launched for example on
greenhouse gas emissions in order to meet this deforestation, adaptation and mitigation policies to
objective. Instead it invites industrialised countries to help progress discussions on specific issues.
notify their emission reduction targets and developing
countries to submit the actions they plan to address There is broad international recognition that, rather
emissions. Altogether more than 75 nations, than go for a ‘big bang’ as we did in Copenhagen, the
accounting for more than 80% of global emissions, international community has to make steps towards
20 have done so to date. a global deal. In practice, this means the Cancún
conference needs to deliver an action-oriented set of
This too is significant progress - it is the first time in decisions that will provide a solid basis for reaching
history that industrialised and developing countries an international agreement at the conference in South
together have accepted that they share responsibility Africa at the end of 2011.
for keeping warming below 2°C. Perhaps the Accord’s
most concrete breakthrough is on the issue of finance In parallel with the international negotiations, the EU
to help developing countries adapt to climate change will push forward with de-carbonising our economy,
and develop their economies along a low-carbon and in particular the energy and transport sectors.
path.
The European Commission has put the achievement of
The industrialised world has committed to provide greener, more resource-efficient, low-carbon growth
nearly US $ 10 billion a year in new and additional at the heart of our vision for the EU’s development
resources over 2010, 2011 and 2012 to get these over the coming decade and beyond. Building a low-
efforts off to a fast start. Around US $ 2.4 billion a carbon society is not only essential for controlling
year, or almost a third of the total, will come from the climate change – it is also a huge opportunity to
European Union. For the medium to long term, the modernise and rejuvenate our economies and
rich world has pledged to mobilise US $ 100 billion a develop new, future-oriented sources of sustainable
year by 2020. growth and jobs.”

So what are the prospects for reaching a


legally-binding global deal soon?
Jos Delbeke
The European Union would be ready to do so at the
Director General for Climate Action,
UN climate conference that will be held in the Mexican
European Commission
resort of Cancún at the end of 2010. However, it
Special feature

Toyota European Sustainability Report 2010 I Environmental Performance


Integrated
Approach
needed for
de-carbonising 21

Michel Gardel
Vice-President, External
transport
“ 
and Environmental Affairs,
Toyota Motor Europe We are committed to creating a low-carbon
company which will contribute to a low-carbon
society. To do this we need to take an Integrated
Approach by working with key stakeholders, such
as car companies, the oil industry, policymakers
and road users, to improve eco-driving, road
infrastructure, traffic management, fuel efficiency
and vehicle technology.  „
Michel Gardel

We would like to share three reports that have called for 2- European Environment Agency (EEA) report :
an Integrated Approach on de-carbonising transport Towards a resource efficient transport system (2)
and share our position.
In this report, Professor Jacqueline McGlade, Executive
1- European Commission report : A European Director of the EEA, says that a common vision for
strategy on clean and energy efficient sustainable transport and mobility is needed to reduce
vehicles (1) greenhouse gas emissions from transport.

European Commission President, José Manuel 3- McKinsey & Company : Roads toward a low-
Barroso, has made it clear that de-carbonising the carbon future: reducing CO2 emissions from
transport sector is a priority for the Commission. In passenger vehicles in the global road transport
this report, the Commission indicates it will “promote system (3)
additional measures that may help to decrease CO2
and pollution emissions from road transport – such This report states that automotive manufacturers cannot
as eco-driving, intelligent transport systems (ITS), solve the sector’s carbon abatement problem on their
including onboard technologies, infrastructure own. Suppliers, consumers, fuel and energy providers
measures and urban transport management”. and policymakers will all need to take action.

(1) European Commission (2010), A European strategy on clean and efficient vehicles – Communication.
(2) European Environment Agency (2010), Towards a resource efficient transport system, TERM 2009: Indicators tracking transport and environment in
the European Union.
(3) McKinsey & Company Inc (2009), Roads toward a low-carbon future: reducing CO2 emissions from passenger vehicles in the global road transport
system.
Our position
Toyota European Sustainability Report 2010 I Environmental Performance

The automotive industry agrees. At the World Econo- The letter states that “To find solutions to these
mic Forum in Davos, Switzerland, in January 2010, the challenges, we commit to a vision of de-carbonising
leaders of six major car manufacturers, including Toyota automotive transport.”
Motor Corporation President Akio Toyoda, signed a
letter to policymakers which identified four key challen- The leaders of the companies say that while technology
ges to the sustainability of automotive transport : is an important part of the solution, it alone cannot
achieve the changes required to address the threat of
Oil dependency : Automotive transport is 99% global climate change. We need to work together to
dependent on petroleum-derived fuel and 53% of the find solutions :
world’s annual oil consumption is used for transportation
(58% for the countries in the Organisation for Economic Governments need to implement consistent, long-
Co-operation and Development – OECD). term policies and incentives to assist in bringing
Contribution to climate change : Automotive trans- advanced technology vehicles to the market and
port accounts for 8% of CO2 emissions globally, but create the necessary infrastructure to facilitate
12% of CO2 emissions in OECD countries. Between widespread use of these technologies.
2006 and 2030, 80% of the increase of road transport Energy providers and utilities will need to provide
22 CO2 emissions is expected to come from non-OECD low-carbon fuels, such as hydrogen and electricity
countries. generated from clean renewable sources.
Strains of urbanisation : Urban areas, particularly in Consumers need better education to understand the
the developing world where the growth of vehicle use transport choices available.
is highest, urgently need to address both congestion
and air quality challenges. Research from Japan and Europe has already shown
Accessibility and affordability : For the solutions and that a combination of vehicle technology, low-carbon
technologies to address the first three challenges to be fuels, road infrastructure measures, and driving
effective, they need to be accessible and affordable to behaviour can significantly reduce the greenhouse gas
consumers in both the developed and developing world. emissions from road transport.

Our action
To implement significant greenhouse gas emission be indispensable if we are to make quick progress.
reductions, partnerships are needed. Building trust It seems to me that all stakeholders agree on the
and maintaining dialogue with all stakeholders will be principles of taking an Integrated Approach. What is
fundamental. The car industry, suppliers, regulators, missing is agreement on the content, and when and
fuel and infrastructure providers, and users of vehicles, how to implement the next steps. We commit with
can all make a significant contribution. An integrated other members of ACEA to spare no effort in seeking
approach, bringing together all stakeholders, will to secure that agreement.

User ed
e travell
•Distanc ty(1)
ali
low •Co-mod
Traffic F ts
Vehicle on p rove men
Technolo t
gy Low Carb Im
lo p men Fuel
D ev e

d Approach
Integrate

(1) Co-modality refers to using different types of transport in one trip.


Toyota European Sustainability Report 2010 I Environmental Performance
Research
and Development
Masato Katsumata “   More than ever we have to focus our research
and development efforts on developing cars
Senior Vice-President,
Research and Development, that suit European customer demands and
23
Toyota Motor Europe requirements. It is our responsibility to assure
the vehicle’s product power and quality reflects
passion for excellence in design, performance
and safety.  „
Masato Katsumata

The European market is the most competitive in the world. Drivers can also choose the electric-only mode, which is
For example, in the C-segment (small family car), which silent and emissions-free for short distances.
includes our Auris model, at least four new models are
launched each year. We are researching regional market solutions in line with local
regulations and incentive programmes for reduced emissions.
Within the global Toyota research and development This includes adapting our powertrains and vehicles for lower-
organisation, I believe that we, at the European Technical emission fuels, such as liquified petroleum gas (up to 10%
Centre, have a vital role to play. We are the closest to the lower CO2 compared to petrol) and compressed natural gas
local market and can quickly respond to market needs, (up to 25% lower CO2 compared to petrol).
ranging from performance to environmental and safety
requirements, and at the same time, keeping our products In addition, we continuously research new breakthrough
competitive. technologies with our European partners to maintain our
environmental leadership position.
For example, in terms of responding to environmental
needs, the Toyota Auris family now includes the Auris Diesel engines are popular in Europe and much of the
Hybrid Synergy Drive® (HSD). The Auris HSD has CO2 development of diesel technology occurs in Europe. This type
emissions of just 89 g/km and switches between petrol and of technology will continue therefore to be a key area for our
electric engines to suit the driving needs of each motorist. research and development team (see page 24).
Diesel engine development in Europe
Toyota European Sustainability Report 2010 I Environmental Performance

24

Engineers and technicians in the diesel application team

Diesel engines consume less fuel and emit less CO2 per Our diesel development group is comprised of three teams of
kilometre than petrol engines. They are popular in the engineers and technicians that specialise in diesel technology.
European market where they are suited to European driving, The group focuses on the development of the 1ND diesel
which typically includes highway driving and long-distance engine, which is installed in Toyota’s iQ, Yaris, Urban Cruiser
driving over weekends and holidays. In other markets, such and Auris models.
as Japan and the US, the number of cars with diesel engines
is lower due to different driving conditions and emission The application team adapts the Engine Control Unit to
regulations. ensure the injection system and emission systems, catalyst
and diesel particulate filter, work together in precisely-
controlled timing. This is necessary to provide smooth and
powerful driving performance while emitting the lowest
possible CO2 and exhaust emissions.

The design team then works with our suppliers to source the
required parts for the engine compartment for each model.
Intensive testing during the development process ensures the
quality of the parts.

Finally, the technology team focuses on future diesel


engine technology. Working with European universities and
engineering institutes, the team analyses the processes
involving air and fuel in the engine for improvement, using
computer-aided engineering.

Toyota Motor Industries Poland began manufacturing the


1ND engine in 2010, marking an important milestone in
1ND diesel engine
Toyota’s diesel engine development in Europe.
Special feature

Toyota European Sustainability Report 2010 I Environmental Performance


Plug-in Hybrid – A new step towards
sustainable mobility
What is PHV ?
A Plug-in Hybrid Vehicle uses Toyota’s full hybrid techno- Toyota expects the PHV to bring unsurpassed fuel
logy. In addition, the vehicle’s battery can be recharged efficiency and record low emissions compared to
using a standard electrical outlet. Toyota’s PHV is ‘the other mass-market vehicles on the road today.
best of both worlds’ : for short distances, it can be dri-
ven as an electric vehicle, resulting in nearly zero CO2 Based on the third-generation Toyota Prius, the new
emissions. For longer distances, the PHV works as a Prius Plug-in Hybrid is equipped with a lithium-ion
conventional hybrid vehicle, providing low emissions and battery and emits only 59 g CO2/km in combined cycle 25
fuel consumption, and excellent driving performance. of the New European Driving Cycle (1).

European PHV project launched in Strasbourg,


France
The European PHV project is part of a global Toyota with our partner, French energy provider EDF and the
project involving 600 Prius Plug-in Hybrid Vehicles City and Urban Community of Strasbourg (CUS), we
that are being tested in Japan, the US, Canada and launched the programme in Strasbourg in April 2010.
Australia. The European project is leasing 200 vehicles
to selected partners and customers in 18 European About 100 PHVs are being leased to selected fleet
countries who will road test the vehicles. Toyota’s customers and public bodies in Strasbourg, supported
main objective is to further investigate the technology by charging points in users’ homes, the offices of
and performance of the PHVs with respect to the business partners, public parking lots and on public
consumer’s needs. roads. The project has received support via the
Research Fund managed by the French Environment
France is at the centre of this project. In collaboration and Energy Management Agency, ADEME.

(1) CO2 emissions of Prius Plug-in Hybrid are measured according to the new official international regulation for plug-in hybrid electric powertrains, as
adopted by the United Nations Economic Commission for Europe.
Toyota Motor Corporation Executive Vice-President, provider EnBW Baden-Württemberg AG (which is part
Toyota European Sustainability Report 2010 I Environmental Performance

Takeshi Uchiyamada, said “Plug-in Hybrid technology of the EDF Group), is extending the programme to the
is key in our path towards sustainable mobility. Based German state of Baden-Württemberg by demonstrating
on Toyota’s full hybrid powertrain, PHV is the most ten PHVs and their dedicated charging infrastructure.
practical way of increasing the use of electricity for
personal transport today.” The Mayor of Strasbourg and Vice President of the City
and Urban Community of Strasbourg, Roland Ries, said:
The Chairman and CEO of EDF, Henri Proglio, said: “EDF “I am pleased to be able to host this unique experiment
is proud to engage in a great industrial adventure involving that will be taking place over the next three years. The
the expertise of a manufacturer, an energy provider and project shows how important it is nowadays to combine
public bodies.” EDF will evaluate different operational technological breakthroughs and innovative initiatives
options for the charging infrastructure of the vehicles. with sustainable development”. This project is part of
EDF, with the operational support of its subsidiary, ADEME’s Research Demonstrator Fund programme,
Electricité de Strasbourg (ES), will establish 150 charging which aims to test future technologies that reduce
points for the vehicles. In addition, German energy greenhouse gas emissions.

26 PHV in Belgium
Out of the 200 units that are being distributed to more 2010s. We are also studying the impact on electricity
than 18 European countries, five vehicles have been usage. Deficiencies in the energy market can then
allocated to Belgium. The five Belgian partners are Agoria- be raised with the authorities and the network
Vlaanderen, Colruyt, Telenet, the Federal Public Service operators.
for Mobility and Transportation, and the office of the Direc-
tor General for Climate Action, European Commission. We are also road testing two PHVs in our Head Office
and at our European Technical Centre. This includes
The partners will use the car for a period of three researching and monitoring the vehicles’ charging
years. Together with these partners, we are examining units. Currently the cars are charged by using a
how users adapt to PHV technology which will normal household plug. In the future, the charging
help facilitate increased market take-up and mass pole may be updated with the new EU-wide standard
commercialisation of this technology from the mid- plug, once it is available on the market.

Didier Stevens, Senior Manager, Environmental Affairs, using the recharging station at Toyota Motor
Europe’s office in Brussels
Our approach to global energy challenges

Toyota European Sustainability Report 2010 I Environmental Performance


“  Transport makes up 28% of the total gross energy
demand of the European Union (1). It is therefore
clear that the availability of energy should be a key
concern for car manufacturers. Working with our
stakeholders, we need to develop products that
can be powered with available and sustainable
energy and to ensure that this energy is used

27
efficiently. 
Muriel Desaeger,
Mikako Le Lay Akihito Tanke
Akihito Tanke
Energy Research Group, Toyota Motor Europe

The European energy framework


Although the energy sector is generally stable, major events
such as the oil crisis of the 1970s and the air pollution and
acid rain problems of the 1980s, have initiated a number of
energy shifts, first from oil to nuclear and then from coal to
gas. The latest concerns about energy security and climate
change will likely be the catalyst for a new shift: from fossil e
e Packag
fuels to non-carbon fuels. n C li m ate Chang
Europea
Security of energy supply is a significant issue for the European
vs 1990
Union. Today, the EU (27 member states) imports 55% of its reduction
20% GHG
energy needs. The EU imports more than 85% of oil, almost
60% of natural gas and 40% of coal. The energy we require
ase in
is expected to continue to grow. To limit the consumption of
l 20% incre iency
are in fina energ y e ff ic
fossil fuels and the resulting CO2 emissions, the EU has set 20% RE shmption
targets which include : consu
Transport
10% RE in
A 20% reduction in greenhouse gas emissions by 2020 y
Countr agriculture
compared to 1990. or t, ho usehold,
Transp 2005
A 20% reduction in primary energy use compared with Co mpanies 10% GHG
re duction vs em
Industrial on Trading Syst
Energy & Non-ETS:
Em issi
projected levels, to be achieved by improving energy 2005
duction vs
21% CO2 re Trading System
efficiency. ETS: Em is si on

20% of the EU’s energy consumption to come from re-


newable resources and a 10% binding minimum renewa-
ble energy usage in transport.

(1) Eurostat 2007 (published 2010).


Toyota European Sustainability Report 2010 I Environmental Performance

The transport sector’s contribution to climate


change
These commitments, called the 20-20-20 action plan, directly We have long considered energy efficiency and the develop-
affect the transport sector. ment of fuel-efficient vehicles a priority. We have introduced
technologies such as Dual-VVTi, Valvematic and D-4S dual
The transport sector, consuming about 28% of the total energy injection, as well as our innovative Hybrid Synergy Drive®
used in the EU, is an energy-intensive sector and a significant technology. Plug-in Hybrid solutions represent the next step
contributor to the manmade generation of CO2 emissions. in fuel-efficiency.
We need to balance the need for enhanced mobility with the
needs of our environment and society. To contribute to a low- To create a low-carbon society, we also need to switch
carbon society, we need to improve the energy efficiency of from fossil fuels to low-carbon fuels, preferably made from
our cars and to encourage low-carbon fuels usage. renewable energy sources.

Contributions to the EU CO 2 targets

28 180
170
Toyota
160
150 140
140
CO2 g / km

130 120
120
110
100
90
80
Year 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

Biofuels
We believe that biofuels can offer a sustainable and lower- 2- Biofuels must meet strict quality criteria to ensure the
carbon alternative, provided they meet certain criteria and fuel is fit for purpose and delivers expected performan-
are available in sufficient volume. Today, most biofuels used ce in the vehicle. Toyota supports the Committee of Euro-
in transport are made from agricultural feedstock and are pean Normalization’s work in drafting common fuel standards
referred to as first-generation biofuels. and calls for their introduction across EU member states.
Hydro-treated Vegetable Oil (HVO) is a promising low-carbon
Ethanol originates from sugar-based feedstock such as sugar biological alternative to diesel and is available on the market to-
cane, cereals or sugar beet, and is then blended into petrol. day. Made by a refinery-based process which converts vege-
Biodiesel originates from oil-seed based feedstock such as table oil to paraffin, HVO is a high-quality product that has the
rapeseed, and is then blended into diesel. potential to substantially reduce greenhouse gas emissions.

Regarding the use of biofuels, Toyota has three concerns: Toyota is also a member of the Alliance for Synthetic Fuels in
Europe that promotes the uses of synthetic fuels as a high-
1- B iofuels must be produced in a way that minimises quality alternative to diesel fuel. For more information please
CO 2 emissions and environmental impact. Toyota see www.synthetic-fuels.org/index_en.php
is involved in a number of initiatives to establish
criteria to guarantee that biofuels are produced in a 3- The production of biofuels should not compete with
sustainable way. food production. Toyota support second-generation
Toyota European Sustainability Report 2010 I Environmental Performance
biofuels, where the fuel comes from waste material from the All European Toyota and Lexus diesel models can run on diesel
forestry or agricultural industries, rather than from agricultural blended with up to 7% volume biodiesel (B7) in accordance
feedstock. Further, Toyota is involved in researching second- with the European diesel standard EN 590:2009.
generation biofuels made from wood or straw. These advan- Besides our support of biofuels, we are encouraging the
ced biofuels promise a number of benefits and could be used development of energy-efficient and low-carbon vehicles
in existing vehicles, with the potential of even greater green- by introducing cars that run on de-carbonised electricity
house gas emissions reductions. This technology, however, and hydrogen (see pages 45-47).
is still in its early stage of development and it may be several
years before these advanced biofuels become available on a
Multi-stakeholder engagement
commercial scale.
Advancing the best energy solution is not an easy task
For these reasons, we support low biofuel blends in Europe and the long-term impacts to the community and various
(E10 and B7) as a first step. We will support higher biofuel stakeholders must be considered. We have therefore started
blends in the future if they meet criteria on availability, to develop energy/fuel modelling capabilities and scenarios
sustainability, greenhouse gas performance and quality. that are tested and discussed with energy-related entities.
29
Most of the Toyota and Lexus petrol vehicles made for the We believe that engaging multiple stakeholders will be
European market after January 1998 can run on petrol essential in solving energy and environmental concerns. We
blended with up to 10% volume bioethanol (E10) (1). Since are therefore establishing links with energy industries, local
2008, all Toyota and Lexus petrol vehicles made for the authorities and the EU commission. The PHV project in
European market are compatible with E10. Strasbourg is an example of our approach (see pages 25-26).

Plug-in Hybrid Prius

(1) Detailed information on E10 compatibility of our vehicles can be found on our corporate website http://www.toyota.eu/pages/default.aspx.
Special feature
Toyota European Sustainability Report 2010 I Environmental Performance

Auris HSD-
Toyota’s first full
hybrid vehicle
made in Europe
30

Auris HSD

An eco car made in an eco factory, built by CO2 emissions in the vehicle lifecycle
eco-minded people
The diagram below shows the CO2 emissions per kilome-
Toyota Motor Europe celebrated a milestone in tre of the Auris HSD compared to the equivalent petrol and
2010 with the start of production of the Toyota Auris diesel models throughout the lifecycle - from material pro-
Hybrid Synergy Drive ® at our manufacturing plant in duction and vehicle production to driving, maintenance and
Burnaston, UK. This is Toyota’s first mass-produced disposal. The total CO2 emissions of the Auris HSD across
full hybrid vehicle to be manufactured in Europe. the lifecycle of the vehicle are 33% less than the Auris petrol
model and 25% less than the Auris diesel model.
Over and above the benefits of exceptional fuel
efficiency and low CO2 emissions inherent in Hybrid While the CO2 emissions related to the production
Synergy Drive®, the everyday usability, driving comfort phase are similar to the Auris petrol and diesel
and quietness of Toyota’s full hybrid powertrain vehicles, there is a substantial reduction of CO2
will offer the Auris HSD customer a smooth and emissions during the driving phase. The driving phase
sophisticated driving experience unique to the small of conventional engine types accounts for more than
family car (C-segment). 75% of the lifecycle CO2 emissions.

Features of the Toyota Auris Hybrid Synergy Life Cycle CO 2 emissions


Drive ® Index

1.0
Contributes to the reduction of greenhouse gas
0.8
emissions throughout the vehicle lifecycle -25% -33%

High air quality standards : Complies with Euro 5 0.6


emission standards, with few nitrogen oxide and
particulate matter emissions 0.4

Four driving modes including EV mode, which 0.2


enables driving using electric power alone
CO2
CO2 emissions of 89 g/km 0.0

Use of recycled plastic materials Petrol Vehicle Diesel Vehicle Hybrid Vehicle

More than 95% recoverability and 85% Material Production Driving Maintenance
Vehicle Production Disposal
recyclability
Toyota European Sustainability Report 2010 I Environmental Performance
Kilometres travelled and CO2 emissions
We have analysed the CO2 emissions of the Auris diesel vehicle) and 33% (compared to the equivalent
HSD when it is driven for 150,000 kilometres. Over petrol vehicle).
this distance, the Auris HSD shows a reduction in CO2 When driven more than 150,000 kilometres, the relative
emissions of between 25% (compared to the equivalent CO2 emissions savings of the vehicle will be even greater.

Ratio between distance and CO 2

Index X: Auris HSD = 25 % less CO2 than Diesel


Y: Auris HSD = 33% less CO2 than Petrol
1.4

1.2 Petrol Vehicle

1.0 Diesel Vehicle


Y
0.8 31
X
Hybrid Vehicle
0.6

0.4

0.2
4,800
0.0
50,000 100,000 150,000
Distance (km)
Hybrid Vehicle Diesel Vehicle Petrol Vehicle

A unique eco-driving experience


The Auris HSD has four driving modes, including alone, resulting in nearly zero fuel consumption
three that can be selected ‘on demand’ by the driver. and emissions. The ECO mode maximises hybrid
The EV mode runs on the electric motor power system efficiency and fuel economy, and the POWER
mode boosts system performance. In addition, the
Eco Drive Monitor helps drivers maximise the fuel
efficiency of Toyota’s Hybrid Synergy Drive ® system.

Drivers are also able to monitor the flow of energy


within the Hybrid Synergy Drive ® system for each
driving mode. This helps them develop fuel-efficient
driving techniques and maximise system efficiency. In
addition, a power consumption gauge shows how
much power is being used or generated at any
Eco-Drive Monitor
given time.
Manufacturing
“  Our European Manufacturing Companies
(EMCs) achieved strong environmental results in
what was another challenging year. As a result,
all our main environmental Key Performance
Indicators (KPIs) showed a marked improvement
from FY08. This is due to individual team members
across our European operations who have worked
hard to reduce unnecessary energy and water
Ikuo Kasahara usage in FY09. „
Vice-President, Production Engineering,
Toyota Motor Europe Ikuo Kasahara

We remain committed to our FY10 environmental targets We performed well against these targets in FY09 and achieved
which were originally adopted as part of the Toyota Global record consolidated performance in our manufacturing facilities
Fourth Environmental Action Plan covering FY06-10, but in water, volatile organic compound usage and at-cost waste.
were revised to be more challenging in FY07, before the This is waste which has a net disposal cost, but excludes scrap,
global economic crisis. project and recycled waste for which revenue is gained.

Manufacturing volumes
FY09 marked the second year of decreased vehicle decrease reported in FY08. Combined unit (engine and
production volumes in Europe although the 7.8% reduction transmission) volumes over the same period decreased by
to 544,050 vehicles was significantly less than the 27.6% 8.4% to 1,108,694 units.

Key Performance Indicators - Manufacturing


Sustainability report 2006 2007 2008 2009 2010

Absolute Emissions (1) FY05 FY06 FY07 FY08 FY09


Total energy usage (MWh) 956,686 1,075,240 1,103,859 881,854 784,735
Total gas & oil (MWh) 541,309 576,229 603,732 457,472 417,616
Total electricity (MWh) 415,377 499,011 500,126 424,382 367,119
Total CO 2 (1,000 tonnes) (2)
276 311 339 261 228
Total water usage (1,000 m³) 1,410 1,782 1,608 1,242 1,035
Total discharged water (1,000 m³) 1,025 1,166 1,095 845 689
Total VOC emissions (tonnes) 1,752 1,913 1,575 1,075 957
Total waste-at-cost (tonnes) (3)
17,256 26,329 23,728 15,061 11,038
Total waste-to-landfill (tonnes) 2,319 71 44 0 0.45
(1)
 or TPCA joint venture – Toyota
F
Total European production volume (vehicles) 622,907 807,134 814,093 589,794 544,050 includes 1/3 reporting of total
production volume & emissions
Number of plants covered by result 5 7 7 7 7 (2)
 his includes direct emissions
T
Legal compliance from fuels and indirect
emissions from purchased
electricity
Total number of fines 0 1 0 0 0
(3)
 ll production waste which has
A
Total number of prosecutions 0 0 0 0 0 net disposal cost (excludes
scrap steel, project waste
Total number of complaints 0 1 0 1 0 and recycled waste for which
revenue was gained)
Special feature

Toyota European Sustainability Report 2010 I Environmental Performance


Toyota Motor Manufacturing UK –
towards the ultimate Eco-Factory
Toyota in the UK has been recognised by Cleangreencars.
chnology
co.uk as the first automotive manufacturer in the UK to Productio
n Te
Innovative
achieve CO2 emissions averaging below 130 g/km across 1
vironmenta
l Kaizen
the model range, already meeting the 2013 European Union Leading Enmance
Perfor
target set for automotive manufacturers. TMUK began
manufacturing cars in 1992. Since that time, it has placed d, solar,
2 use of win
Increasings and geothermal
environmental considerations at the forefront of its business use of biom as
Increasing energy
planning and sought to minimise its environmental impact. renewable
action
33
The company was the first UK automotive manufacturer to bers to take
Inspire mem
achieve ISO14001 in 1996 for its manufacturing operations 3 ge
e and enga
and the first to achieve zero waste to landfill in 2002. its Encourag community
rmony with the local
Plant in ha rroundings
natural su e
and promot
Preserve ecosystem
Leading by example the local

This commitment is demonstrated by the following


reductions that have been achieved :

Reducing CO2 emissions

Reduction from
1993 to 2008 Engaging employees
Energy (kWh/vehicle) > 68% TMUK encourages its employees to reduce their
own environmental impacts through an Eco-points
Waste (kg/vehicle) > 60%
programme. As part of this programme, employees
Volatile Organic Compound
emissions (g/m 2 )
> 70% make a personal commitment and a group declaration
to reduce their impact on the environment.
Water (m 3/vehicle) > 70%

TMUK is striving to reduce its CO2 emissions by They also attend environmental events such as the eco-
reducing its energy usage and by using the most plant exposition and tours around the on-site lakes,
efficient energy sources. Initiatives include : wastewater treatment plant and the on-site recycling
facility. There are six points to collect in total and to
Introducing control technology at its paint shop achieve full eco-points, employees need to implement
booths, which are a major user of energy. an improvement activity to reduce packaging, material,
Solar energy is used in the visitor centre to heat water. energy or waste.
A wind energy feasibility study has been completed
at Deeside, Wales and is now proposed for Burnas-
ton. Further pilot projects are ongoing.

TMUK Paint Shop Annual Steam Consumption 2004-10


%

100 Reduction Reduction Reduction Reduction Reduction

90 15,468
Tonnes
25,760
Tonnes
28,024
Tonnes
44,902
Tonnes
53,299
Tonnes
22%
80
36% 40%
70 TMUK Weld Pilot Group Eco-points presentation
61%
60 74%
50
40
30
20 In 2010 TMUK will become the first Toyota plant
10
0
in Europe to produce a full hybrid vehicle with
2004/5 2005/6 2006/7 2007/8 2008/9 2009/10 production of the Auris Hybrid Synergy Drive®
Fixed set Manual Manual Primer Booth Roll out of
point contro energy
manipulation
energy
manipulation
1 optimised
window
window
control to
(see pages 30-31).
plus Primer control remaining
Booth 1 trials booths
Manufacturing Key Performance Indicators
Toyota European Sustainability Report 2010 I Environmental Performance

As part of our vision to contribute to a sustainable society, we Currently, Toyota Motor Manufacturing UK at Burnaston
continue to examine technologies and solutions which can remains the only European Manufacturing Company included
complement our production processes and lessen our overall within Phase II of the EU-Emissions Trading Scheme for
environmental impact. This section details the environmental 2008-2012. We expect that for Phase III (2012-2020) at least
performance of our production plants. one more of our manufacturing plants will be included.

Energy and carbon dioxide (CO2) Waste reduction


In FY09 despite falling production volumes and one of Waste disposed of at cost decreased by 20.5% from
the coldest winters on record, the average amount of 25.5  kg /vehicle in FY08 to 20.3 kg / vehicle in FY09. This
energy required to produce a vehicle declined by 10.3% to reduction means that we have achieved our FY10 target of
1,442  kWh / vehicle. 24.0 kg / vehicle ahead of schedule. To reduce waste, we
first look at how we can decrease waste at source before
This improvement is due to : looking at reuse or recycling options.

The efforts of our European Manufacturing Companies Waste disposed of at cost


34
to reduce all unnecessary energy usage by implementing
kg/unit
improvement activities - the ideas of which are shared FY10 target = 24 kg/unit
35 32.62
locally, regionally and globally. 29.15
30 27.70
The impact of significant investment in terms of time and 25.54

resources in specially-trained energy reduction teams. 25


20.29
20

Energy 15

kWh/unit 10
FY10 target = 1,375 kWh/unit
1,800
1,536
5
1,600 1,495 1,442
1,332 1,356 0
1,400
1,200 FY 05 06 07 08 09

1,000
800
600
400
200 In FY08, we reported that since January 2008 all our
0 manufacturing facilities achieved zero waste to landfill. This
FY 05 06 07 08 09 was a target set in our Fourth Environmental Action Plan
in 2005. In FY09 one of our manufacturing plants needed
to dispose of a small quantity of asbestos to comply with
CO 2 emissions legislation. The figure would not be included due to rounding
methodologies, but we mention it for transparency.
Kg/unit
FY10 target = 425 kg/unit
500
443
450
443 417 420
Waste to landfill
386
400
kg/unit
350 FY10 target = 0 kg/unit
4 3.7240
300
250
200 3
150
100
2
50
0
FY 05 06 07 08 09 1
0.0875 0.0545 0.0008
0.0000
0
FY 05 06 07 08 09

Consolidated CO2 emissions reflected this, with a 5.2% reduc-


tion from 443  kg / vehicle in FY08 to 420  kg / vehicle in FY09.
Toyota European Sustainability Report 2010 I Environmental Performance
Our designated ‘sustainable manufacturing plants’ (facilities Volatile Organic Compound emissions
nominated by Toyota Motor Corporation in 2007 as being
g/m2
model plants for carrying out sustainable activities) in the UK and FY10 target = 19 g/m2
35
France have a zero incineration policy which means that energy 29.7
30
is recovered from any waste and is used as a fuel substitute. 25.6

25
19.9 18.9
Water usage 20
18.4

In FY09 the amount of water required to produce one vehicle in 15


Europe decreased by 10% from FY08 to 1.90  m3/vehicle. This is 10
our best consolidated result on record and reflects significant indivi- 5
dual activity at our European Manufacturing Companies to reduce
0
baseline water usage while facing declining production volumes.
FY 05 06 07 08 09

Water usage
m3/unit
FY10 target = 1.70 m3/unit 35
3

2.26 2.21
1.98
2.11
1.90
Environmental management
2 All seven of our European Manufacturing Companies
have Environmental Management Systems (EMS) that are
independently certified to the international environmental
1 management standard, ISO14001 (see page 18). In FY09
we continued to support our manufacturing facilities with
the ongoing implementation of Toyota Environmental
0 Management System which is complementary to ISO14001.
FY 05 06 07 08 09
Toyota EMS is built on three pillars :
Ensuring compliance
Minimising environmental risk
Our manufacturing company in France now harvests a significant Achieving number one performance.
proportion of its water needs from rainwater in addition to
recycling its wastewater using reverse osmosis treatment. As a This is the focus and guiding philosophy of Toyota’s
result of these activities, 30% of the plant’s water consumption environmental activities globally.
was met using sustainable sources in FY09.
Environmental leadership
Looking to FY10, achieving our target will be challenging as we
Our aim is to be at the forefront of environmental leadership
had expected significant technological investment at our Turkish
in the automotive industry. In FY09 our manufacturing plants
manufacturing plant, which is currently on hold due to the current
received the following external recognition :
economic climate. We will continue to look for ways of reducing
water usage across all our manufacturing facilities.
National
Toyota Motor Manufacturing UK (TMUK) received the Big
Volatile Organic Compound (VOC) emissions Tick Award for environmental leadership and climate change
Last year we were able to report that we achieved our FY10 reduction activity from business membership organisation,
target two years ahead of plan with the understanding we would Business in the Community, and the ‘Process Premier
continue to focus on Toyota’s guiding principle of kaizen (conti- Award’ from environmental not-for-profit organisation,
nuous improvement). This focus has led to us setting a new re- Business Commitment to the Environment.
cord in FY09 with a further 3% reduction in VOC emissions from
solvent-based paints and cleaners in the vehicle painting pro- Regional
cess. The average VOC emissions per square metre (m2) of vehi- Toyota Motor Manufacturing France (TMMF) received
cle body surface painted across our four vehicle assembly plants the ‘Energy Efficiency Award’ from the North of France
decreased from 18.9 grams in FY08 to 18.4 grams in FY09. In Industrial Society (SINF).
terms of absolute emissions (total tonnes), our improved perfor- TMUK received the ‘East Midlands Carbon Positive
mance combined with the decrease in production volume resul- Pioneer Award’ from business membership organisation,
ted in an 11% reduction in VOC emissions compared to FY08. Business in the Community.
Logistics
Our logistics operations are divided into three separate divisions :
Production and Logistics Control, Vehicle Logistics Group and Parts
Supply Chain Group.

Production and Logistics Control


Hiroyuki Ikeda
Vice-President, Strategic Production Planning
and Production and Logistics Control,
“  Our Production and Logistics Control division distributes
components from suppliers to our manufacturing sites
Toyota Motor Europe
for vehicle assembly. We monitor CO2 emissions from
transportation activities on a monthly basis. We aim to
minimise CO2 emissions involved in the collection and
distribution of parts by reducing kilometres travelled and
ensuring the optimal use of trailers.  „
Vehicle Logistics Group
“  The Vehicle Logistics Group manages the import and
export of new vehicles and customises individual orders.
The group continues to expand its European operations
Emile Benaim and scope of its responsibility, although at a slower rate
Director, Vehicle Logistics, than previous years due to the global economic situation.
Toyota Motor Europe Despite these pressures, the group has maintained its
strong commitment to our environmental objectives and
targets.  „
Parts Logistics Group
“  Our group manages the procurement, storage and distribu-
tion of accessories and spare parts for Europe. It is our respon-
sibility to ensure the availability of parts for every vehicle that is
on the road in Europe, regardless of age or origin. To do this we
maintain relationships with all current and previous suppliers in
Jonathan Ballard Europe and co-ordinate the exchange of parts across Toyota’s
Director, Parts Supply Chain, global After Sales network. The main environmental impacts of
Toyota Motor Europe
our operations come from transportation, warehouse opera-
tions and the packaging of parts.  „
Logistics operations

arts
Service p s
e ss o ri e s logistic
tics and acc n
utio
Ve hicle logis The distrib rts
pa
port of of spare
gistics rt and ex to retaile
rs
n parts lo The impo
hed vehicl
es and accessor
ie s
Productio ion and
ct new finis g
and
The colle in
customis
n of parts al orders
distributio of individu
su pp liers to
from ts
an uf ac turing plan
m
Network restructuring progress in FY09
Production and

Toyota European Sustainability Report 2010 I Environmental Performance


We rationalised our parts collection strategy in the south of
Logistics Control Europe and around the Alps. This equates to a reduction of 5,900
kilometres a day and 1,200 tonnes of CO2 emissions a year.

To reduce CO2 emissions from transportation, the Production Flow Before


and Logistics Control division focuses on improving three UK
core aspects of its operations :
TMUK TMIP
TMMP

1- The loading efficiency of trailers and collection routes. VALENCIENNES


Cross
PL
2- Restructuring the network to reduce the number of Dock
CZ
kilometres travelled between suppliers and European TMMF
D SK
Manufacturing Companies.
3- Identifying opportunities to change the mode of trans-
A
CH H
portation from road to train or ship. LYON
F Cross
Dock
Italian
Suppliers

CO 2 Emission - Absolute Amount I


Flow After (as of October 2009)
37
UK
TMIP
120 TMMP
TMUK
100 103
100
87 VALENCIENNES PL
CO2 emissions (ktonnes)

81 Cross
80 70 72 73 Dock
CZ
60
57 TMMF D SK
A
Estimation

40
CH H
20 Italian
F Suppliers
0
ITALIAN
FY 03 04 05 06 07 08 09 10 consolidation
point
I
Getting an engine part from an Italian supplier to our Polish
manufacturing plant

Before After
The situation today
Trucks equivalent/annum 34 34
In FY09 our Production and Logistics Control division achieved
Distance to final delivery (km) 4,600 2,500
its environmental performance target of reducing CO2 emissions
CO2 emissions (tonnes) 131 71 CO2 reduction :
by three kilograms per vehicle, from 99 kg to 96 kg. This reduction
60 tonnes / years
was a result of network restructuring and logistics planning.
Preparing for the future
Our Production and Logistics Control division is participating in si-
CO 2 Emission per Car multaneous engineering for new projects. The purpose of this work
is to minimise the impact of parts and packaging design on the ef-
2009:
140 96 kg Co2 / car ficiency, and eco-efficiency, of logistics. For the 2011 model sourc-
121 121
120 115
102 100 98 96
ing, we have optimised the bulkiest parts unit packaging. Regard-
102
CO2 / car emissions (kg / car)

100 99
100
96 94
ing the heating component it means we can transport 510 pieces
in one trailer instead of 272 pieces. This space optimisation has
80
resulted in fewer truck loads, saved 4,920 kilometres of travel per
60
day and will reduce CO2 emissions by 1,020 tonnes per year.
40
Heating component packaging kaizen
20 Original After kaizen proposal
272 Pces/Trailer 510 Pces/Trailer

0 unused space

FY 03 04 05 06 07 08 09 10
Result 5-year Target

1,020 tonnes of CO2 spared per annum


Vehicle logistics
Toyota European Sustainability Report 2010 I Environmental Performance

Environmental management in our Vehicle consumption resulted in a 13% improvement compared to FY08.
Logistics Group One such example can be seen below from our facility in Sagunto.

In line with our Five Year Environmental Action Plan, the Vehicle
Total energy per vehicle handled
Logistics Group maintains the international environmental
kWh / vehicle
management standard ISO14001 throughout its European 4.0
FY10 target = 2.16 kWh/vehicle
operations. The group is also supporting the activities of the 3.29 3.34
3.5
pan-European Environmental Team, which is composed of
3.0
representatives from all hubs and meets on a regular basis. 2.29
2.5 2.16
In FY09 the team’s main objectives were to manage and
2.0
maintain environmental key performance indicators on energy
and waste for the vehicle logistics sites. 1.5
1.0

Energy 0.5
0.0
Despite one of the coldest winters on record and a decrease in
FY06 FY07 FY08 FY09
38 vehicles handled, energy usage per vehicle handled increased
by only 7%. Continued efforts to reduce the absolute energy

Special feature
Sagunto Vehicle Logistics Centre
Given the warm climate in Spain, an air-conditioning system was required in our Sagunto Vehicle Logistics Centre.
Air-conditioning systems tend to consume a significant amount of energy. Therefore, the team in Sagunto focused
on how they could reduce usage to an absolute minimum. This resulted in a 74% improvement in the energy
consumed per vehicle handled. The measures included :

• Changing the on/off settings


• Changing the temperature settings Energy use at Sagunto
• Workshop doors were opened at night, which reduced 14 12.8

the number of hours the air-conditioning system was 12


needed by 50%.
Energy (kWh/vehicle handled)

10 7.9

6
3.3
4

0
FY08 FY09 FY09
Actual Target Actual
Ferdinand Krijnsen and Mercedes Navarro Puig

Waste
Last year we achieved zero (1) waste to landfill at our vehicle logistics returnable packaging. Additionally, efforts have been made to re-
centres in line with the target set in our Five Year Environmental duce the amount of non-recycled waste per vehicle handled, which
Action Plan. This was maintained in FY09 with only 1% of waste has resulted in a 54% reduction since FY06. This is primarily due
from vehicle hubs going to landfill. to the vehicle logistics centres introducing further waste streams to
In terms of the total waste produced per vehicle handled, we have recycle different types of materials and ensuring employees know
seen a steady decrease since FY06 partly due to increasing our how to correctly segregate the waste.
(1) Definition of zero waste is < 3% landfill
Toyota European Sustainability Report 2010 I Environmental Performance
Waste to landfill Total waste per vehicle pre-delivered
% kg
FY10 target = 1.77 kg
20 18% 2.0 1.77
1.69 1.65
18 1.8
16 1.6
FY10 target = 3%
14 1.4 1.21
12 1.2
10 1.0
8 0.8
6 0.6
4 2% 0.4
1% 1%
2 0.2
0 0.0
FY06 FY07 FY08 FY09 FY06 FY07 FY08 FY09

Mixed waste per vehicle pre-delivered


kg
FY10 target = 0.66 kg
0.8
Managing CO2 emissions in our vehicle logistics 0.7
0.66

0.6
Our Vehicle Logistics Group continued to expand in FY09 0.49
39
0.5
and introduced new routes to supply Japan produced 0.39

vehicles to Turkey, Cyprus, Slovenia, Kazakhstan and the 0.4


0.29

Caucasus region. Despite the introduction of new routes, 0.3

absolute CO2 emissions decreased. This was largely 0.2


a result of the economic downturn and the consequent 0.1
decrease in our production volumes. CO2 emissions per 0.0
unit have however increased. This is due to the significant FY06 FY07 FY08 FY09
shift of destination mix, particularly from the East (Russia)
to the West. Distribution in Western Europe generally
covers short distances and uses trucks, rather than ship
and/or rail. In contrast, distribution to Russia and other To offset the negative impact of this, the group continued to
Commonwealth of Independent States (CIS) countries is analyse its distribution network with the aim of optimising the
primarily ship and rail based. mode and distance covered.
In FY09, the group introduced a new route for vehicles
The change in our mix of destinations increased the distance manufactured in Turkey for the French market by opening a
covered by truck transportation from 21% in FY08 to 28% in new hub in Sète, in the south of France. This has shortened
FY09 while the most CO2 efficient mode of vessel reduced the overall distance and has led to a 14.63% reduction in CO2
from 67% to 58%. emissions (421 tonnes).

FY04 FY05 FY06 FY07 FY08 FY09

Number of vehicles transported 888,442 940,456 1,161,681 1,254,836 1,188,428 769,733

Total km (million) 1,317 1,578 1,999 1,869 1,476 1,039

Kg CO2 / km 0.042 0.040 0.042 0.044 0.051 0.051

Total CO2 (tonnes) 55,661 62,831 84,410 82,274 75,563 53,154

Kg CO 2 / vehicle 62.65 66.81 72.74 65.57 63.58 69.06

To improve our ability to measure, and consequently


manage our emissions, the Vehicle Logistics Group
aims to introduce a new data collection, measurement
and management tool in FY10. This requirement is part
of our Sustainability Purchasing Guidelines issued at the
beginning of 2010.

Vehicle Logistics Management Team, Toyota Motor Europe


Parts logistics
Toyota European Sustainability Report 2010 I Environmental Performance

Parts Supply Chain Group (PSCG)


Within our network we have one central warehouse in partners can now directly optimise every load in their process.
Belgium and 13 regional depots in Europe. In 2009 we have By looking at how we can reduce environmental impacts
been able to make environmental improvements and at the throughout our supply chain we have made significant steps
same time, reduce costs which is essential in the global and will continue to look for improvements for the future.
economic context.
The three main environmental impacts of our operations are :
With this sense of urgency we have taken our environmental
mission to the centre of every process and to our transport 1- CO2 emissions from transportation
network. For example, we have built on our previous 2- The environmental impact of our facilities
successes in network optimisation so that our shipping 3- Packaging materials

CO2 emissions from transport


40
Managing CO2 emissions (1) FY04 FY05 FY06 FY07 FY08 FY09

Total CO2 emissions (tonnes) 29,919 38,174 46,429 52,062 48,434 44,175

CO2 emissions (kg/m3 transported) 15.49 15.82 15.30 16.18 15.31 15.14

CO2 emissions (kg/km transported) 0.489 0. 499 0. 516 0. 520 0. 491 0. 472

In FY09, our Parts Supply Chain Group divisions continued their changed with the distance by truck reduced by 52% resulting
efforts to further improve and reduce CO2 emissions. While the in a saving of 37.76 t CO2 emissions.
Warehouse Operations Division focused on improving case and 3- Implementation of a rail connection between Genk and
truck density by adapting internal picking, packing, modulating Verona for shipments to Italy and Greece, resulting in an
and loading processes, the Transportation Division concentrated annual saving of 257.53 t CO2 emissions.
on switching to environmentally friendly transportation modes.
Transport methods evolution (share of kilometer)
In 2009 a number of activities were completed including:
12% 82%
1- Changing the mode of transport for all of our shipments to Por-
10% 80%
% for Sea, Air and Rail transport

tugal from trucks to ships, which has led to a reduction of 1,103


kilometres travelled and 288 tonnes of CO2 emissions per year. 8% 78% % for Truck transport

6% 76%
C0 2 emissions
4% 74%
1,000 t CO2 kg CO2/km

80 0.8 2% 72%

0.52
0.49
0% 70%
60 0.48 0.49 0.51
52.06
0.47 0.6
48.43 44.17 FY07 FY08 FY09
46.43
38.17 Sea Rail
40 0.4
29.92 Air Truck

20 0.2
We reduced airfreight volume by 14% from FY08 to FY09. This
was achieved by introducing measures such as consolidating
0 0
packaging and adapting the box size to the actual volume.
FY 04 05 06 07 08 09
The graph above shows the impact of changing the way we
t CO2 kg CO2/km
transport our parts, which helps us reduce CO2 emissions
 wo other routes have been reviewed to reduce the distance
2- T from transportation. It also has helped increase operational
travelled by trucks. Firstly, routes to Ireland were sent by sea efficiencies and reduce costs. We will continue to review the
resulting in an 84% reduction in distance travelled by truck network to identify other ways we can reduce CO2 emission
a year, which equates to a saving of 19.76 t CO2 emissions. from transportation, and we will work with our logistics partners
Secondly, routes to the Finnish depot in Helsinki were also to invest in environmentally friendly trucks.

(1) The reported data includes all Toyota Motor Europe controlled parts accessories logistics.
Toyota European Sustainability Report 2010 I Environmental Performance
Environmental impact of facilities The increase for the second KPI is due to the number of ope-
rating hours reducing at a faster rate (10%) than the ener-
All 14 of our parts distribution centres are certified to the
gy reduction (7%). The decrease in energy is due to each
ISO14001 Environmental Management System. The key
site team maintaining the kaizen (continuous improvement)
environmental aspects we track are energy consumption
principles and making improvements wherever possible.
and waste management.
For example, Toyota Parts Centre Deutschland carried out
a re-lighting project which contributed to 5% reduction in
Energy consumption
energy consumption.
Despite one of the coldest winters on record and the
number of parts handled increasing, the total energy used
in FY09 by our parts distribution centre decreased by 7%
Waste management
since FY08. The Parts Supply Chain Group has two energy All parts distribution centres worked hard to achieve zero
related Key Performance Indicators (KPIs) to monitor : waste to landfill, which meets the target set in our Five
Year Environmental Action Plan.
1- total energy/1,000 pieces shipped
2- total energy/warehouse volume multiplied by the number 41
of operating hours Total waste per 1,000 pieces shipped
kg
FY10 target = 25.76 kg
Energy per 1,000 pieces shipped 40
33.09 33.55 33.65
kWh
FY10 target = 288.1 kWh 35
350 329.9
30
307.2 25.96
288.1 296.0
300 25
250 20

200 15
10
150
5
100
0
50
FY06 FY07 FY08 FY09
0
FY06 FY07 FY08 FY09

Mixed waste per 1,000 pieces shipped


kg

Warehouse energy use per m 3 4.5 4.11

kWh 4.0
FY10 target = 0.0610 kWh FY10 target = 3.29 kg
0.07 3.5 3.02
0.0610 0.0563 0.0584
0.0558 2.75
3.0
0.06
2.5
0.05 1.78
2.0
0.04 1.5
0.03 1.0
0.5
0.02
0.0
0.01
FY06 FY07 FY08 FY09
0.00
FY06 FY07 FY08 FY09

We achieved a 10% reduction in energy consumption for Additionally the total waste produced per part shipped de-
the first KPI. However, for the second KPI there was a slight creased by 10% as a result of increased reuse of packaging
increase of 3.5% from FY08. However, we remain on target material at a number of depots. The amount of mixed waste
to achieve the FY10 target for both KPIs set out in the Five per part handled was 1.78 kg / 1,000 pieces shipped, which is
Year Environmental Action Plan. a 57% decrease since FY06.
Special feature
Toyota European Sustainability Report 2010 I Environmental Performance

Implementing employees’ ideas


on reducing waste
Toyota Parts Centre Austria (TPCAT) implemented an initiative to reduce the environmental impacts of distri-
buting parts to the Ukraine. Previously, small parts which were shipped to the Ukraine were shipped in small
boxes which were packed inside large carton boxes to avoid damage. The small boxes needed to be pur-
chased and generated waste. A TPCAT employee suggested carton boxes which were used to pack oil filters
should be reused for this purpose. This has now been implemented and has reduced the need to purchase
1.9 tonnes of carton boxes a year, which has also helped reduce costs.

r pack
42 il filter ove e
Reuse of o all parts to Ukrain
ack o n fo r s m
lter over p ca rt
Store oil fiady for reuse
one carton re
n used for
New cartoging small parts
way packa

Reducing packaging material


Packaging material is used in the distribution of our spare
parts and accessories to retailers in Europe. Fluctuating
volumes and different shipping styles means that we have a
number of ways of packaging these parts.

Despite efforts to standardise our in and outbound flows, we


Evolution usage re-use or returnable
continue to generate packaging waste at our Parts Centres packaging vs new material
and Dealerships. To reduce this waste we are:
%

Increasing the usage of returnable packaging in inbound 100


supply flows.
80
Standardising shipping pallet boxes through specifica- 61.72 63.78
66.87 67.69 64.74 69.19
69.65
tion agreements with our suppliers. These boxes are then 60
71.24

reused for outbound shipping purposes. In FY09, 89% of


packaging was either returnable or re-usable packaging. 40
17.35
Only 11% of the packaging was from new packaging 11.38 15.88
16.19 16.84
13.88 17.56
20 17.35
material, which is 8% lower than in FY06. 21.74 20.92 19.07 19.37
16.43 16.47 13.25
Continuing to monitor the accuracy of our data to support 0
11.41

correct waste declarations by our National Marketing and


FY 03 04 05 06 07 08 09 10
Sales Companies to their local authorities.
New material
Ensuring Kaizen (continuous improvement) of the individual and
Re-use packaging
logistics packaging conditions realising a saving of 173 tonnes
Returnable palets
in FY09.
Special feature

Toyota European Sustainability Report 2010 I Environmental Performance


Installing solar panels at our European parts
distribution centre
Our aim is to make all operations sustainable through- Van den Bossche, Flemish Minister for Energy at the
out the product lifecycle. opening ceremony.

In line with this aim, solar panels were installed on the TPCE has implemented the environmental manage-
roof of Toyota Parts Centre Europe (TPCE), in Diest, ment standard ISO14001 since 2001.
Belgium in FY09. Covering 80,000 m2, it is one of the
largest thin-film solar panel rooftop installations in Major improvements at TPCE include :
Belgium.
In the latest expansion of our building we incorporated
several new environmental initiatives such as using 43
rainwater for sanitary facilities.
In FY09 we organised two tree planting events and
3,000 trees were planted.
In terms of electricity consumption :
1- We purchase 100% green electricity.
2- W e have upgraded lighting, installed light and
movement sensors and raised awareness
through events such as the Green Month
campaign and through environmental training
for newcomers.
TPCE solar roof
These initiatives are expected to result in a significant
reduction in our energy consumption.

This installation will produce between 15 and 20% TPCE Electricity consumption - MWh
of the annual electricity requirements of the facility. Consumption
This will reduce TPCE’s energy costs as well as CO2 (MWh)
-3% -13% -19%
12,000
emissions associated with energy use. Forecast
10,000
-16%
The 80,000 m² roof, which was financed, built and 8,000 solar energy
Projects saving
operated by Blue Planet Solar NV, includes 12,800 6,000
(target -3%)

panels. With a peak power supply of 1.84 MW, the 4,000


panels can produce 1,620 MWh a year. The CO2 saving
2,000
forecast is 1,700 tonnes / year.
0
“This project is a great example of how government FY 07 08 09 10
support in combination with industry initiative results
in innovative renewable energy projects” said Freya
Toyota European Sustainability Report 2010 I Environmental Performance

Sales and Marketing


“  Having ongoing dialogue with our customers
is essential to our business, particularly when it
concerns the quality and safety of our vehicles.
Alongside our commitment to our customers, is
our commitment to protect the environment and to
Andrea Formica create pathways for sustainable mobility.  „
Senior Vice-President, Sales, Marketing,
44 Product Planning and Communication, Andrea Formica
Toyota Motor Europe

Our aim is to become the cleanest brand in Europe In terms of distribution, getting our vehicles to our customers
requires a network of hubs and retailers. For more information
We believe that we can achieve this aim by investing in innovative
on the environmental performance of our vehicle distribution
technologies, such as hybrid and Plug-in Hybrid, and reducing
( please see pages 38-39 ).
emissions associated with our vehicles and distribution.
Our commitment to European society is built on
Developing our hybrid line-up will create one of the main
a solid foundation
pathways to becoming the cleanest brand in Europe. In FY09
we launched the third-generation Prius. In FY10, we began Ensuring cus-
producing the first full hybrid vehicle in Europe - the Auris tomer safety by
Hybrid Synergy Drive® at our Burnaston plant in the UK. We providing clean
aim to have a hybrid version of every vehicle in our model and safe prod-
line-up by the 2020. ucts, while us-
ing advanced
Our CO2 performance is on the right track. We have made technologies to
significant progress in reducing the CO2 emissions associated ensure energy-
with our vehicles, and met the EU target of 140 g/km CO2 emis- efficient vehicles,
sions in 2009. We achieved 130.1 CO2 g/km (a reduction of ap- is key to the on-
proximately 10% from 2008, and about 20% from 2005). going success
of our company.
Toyota strategy to bring HSD / Hybrid Our passion for
to mainstream models excellence is
brought to all
2010 2015~2020 stages of our
operations - at
HSD mix design, manu-
>20%
Prius + facturing and
Auris HSD marketing. Our Bridie Tucker is a team member in the
HSD mix production area of our Burnaston, UK
towards 50% commitment to plant. She is featured in our Toyota Brand
campaign. ‘Your Toyota is My Toyota’
regaining cus-
Prius only
tomer confidence
in our products
is genuine, absolute and urgent. Combining this passion
Stage 1 Stage 2 Stage 3
and demonstrating our accountability is key to our vision to
grow in harmony with society.
Environmental leadership in our products

Toyota European Sustainability Report 2010 I Environmental Performance


Towards zero emissions
Toyota Motor Corporation (TMC) has been researching and With fossil fuels remaining the key energy resource of the
developing environmentally friendly mobility solutions for immediate future, we will continue to improve the efficiency of
more than 40 years with the aim of developing the ultimate our petrol and diesel engine vehicles by using Toyota Optimal
eco-car. Drive technologies, which already feature in most of our
model line-up in Europe.

Today, Toyota’s early vision has been realised. The past few
years have seen a marked increase in the production of
environmentally friendly vehicles, and most manufacturers
are now developing hybrid technology.

Toyota’s Hybrid Synergy Drive ® has led hybrid powertrain


innovations, throughout the three generations of the
Toyota Prius.
45

360° approach to our environmental leadership


activities
Toyota Optimal Drive
Designed to optimise the balance of performance and driving
enjoyment with fuel economy and low emissions, Toyota
Optimal Drive focuses on several key aspects of powertrain
development such as environmentally friendly technologies,
timal Drive
Toyota Op
low-friction components, light-weight materials, compact
design and enhanced combustion efficiency.

In FY09 we completed the rollout of Toyota Optimal Drive


as a core standard technology on the petrol and diesel
powertrains, as per below.
Benefits
tim al Drive
Toyota Op ndard
gy as sta
Technolo
D series Emissions
Diesel-D-4 1. Reduce ncy
l - R Serie
s Fuel Efficie
Petro 2. Increase o n
e Concept 3. No com
promise
D-4D Engin L, 2.2L)
1.33 Engine (1.4L, 2.0 drivi ple
n g asure
1.0 Engine
2.2 D-CAT
Valvematic L)
, 2.0
(1.6L, 1.8L

Toyota Optimal Drive in Auris range


Toyota’s Auris is in the C-segment, a small family car. This ment best levels. Even prior to the introduction of Hybrid
segment represents almost 20% of total European new car Synergy Drive® to the model range in 2010, the overall Auris
sales. In 2010 we plan to sell 101,000 Auris. The applica- CO2 average has been reduced from 152 g / km in 2007 to
tion of Toyota Optimal Drive across the Auris range in 2009 142 g / km in 2009. In 2011, which will be the first full year of
has resulted in a significant improvement in the model’s en- Auris Toyota Optimal Drive and Hybrid Synergy Drive® sales,
vironmental performance, lowering CO2 emissions to seg- the figure is expected to decrease to just 125 g / km.
Toyota European Sustainability Report 2010 I Environmental Performance

Full hybrid technology

Toyota’s hybrid cars are powered by a petrol engine and


an electric motor. The technology is designed to operate
at maximum efficiency by combining the advantages of In FY09, we sold 44,179 Prius vehicles in Europe, an increase
both energy sources. The vehicles consume less fuel and of 3% from FY08. Given the challenging economic market,
therefore help reduce greenhouse gas emissions. They also this was a significant achievement. The third-generation
produce less emissions than conventional, diesel-powered Prius made up two thirds of the sales. We are committed to
46
vehicles and less CO2 and nitrogen oxide emissions than extending Hybrid Synergy Drive® to our core models, making
petrol powered vehicles. these benefits accessible to more customers.

Hybrid Synergy Drive® has been fundamental to the global In August 2009, the Prius was ranked as the most
success of the Prius. The Prius is now in its third generation. The environmentally friendly car for the fourth time since 2004 by
first generation was launched in 1997, the second generation in Verkehrsclub Deutschland, the German transport non-profit
2004 and the third generation in 2009. Since the first generation organisation. The third generation Prius has CO2 emissions of
Prius, improvements have continued to be made including 89 g / km, an industry first for a car of this size.
increasing the system’s power by 30% and decreasing fuel
consumption and CO2 emissions by about 25%.

Toyota’s Hybrid Synergy Drive® was awarded ‘Green Engine


of the Year’ in 2010, winning the award for the 6th time since
2004.

FY09 review
Toyota has sold more than 2.6 million hybrid vehicles globally
(June 2010) since launching the world’s first mass-produced
hybrid. This vehicle was also the first commercial hybrid to
be introduced in Europe in 2000. Since that time, we have
sold more than 230,000 Toyota and Lexus hybrids.

Prius awareness continues to contribute


to Toyota image The Prius has also been awarded the maximum five
% % star rating in the newly revised Euro NCAP crash test
60 60 assessment (see page 65).

The perception of Toyota as a green car manufacturer


50 50
continued to grow in 2009, as shown by customer survey
results (chart at left). Considerable gains in perception were
made in the major European markets from the previous year
40 40
with the 2009 results continuing the positive trend of the
past eight years.
30 30
Prius has been the leading driver of Toyota’s environmentally
friendly and innovative image in recent years. In Germany,
Cares of environment Launches innovative models the UK, France, Italy and Spain customers’ awareness of the
Among those aware of Prius Among those aware of Prius
Prius has a significant effect on the Toyota brand image.
Toyota European Sustainability Report 2010 I Environmental Performance
Auris Hybrid Synergy Drive ® Eco-driving with ‘A Glass of Water’ iPhone
application
The Auris Hybrid Synergy Drive ® (HSD) made its world
debut at the 2010 Geneva Motor Show. To encourage and teach the principles of eco-driving, we
introduced a free application to iPhone users: A Glass
Exclusively designed for the European market, the Auris of Water. The aim is to drive without spilling any water.
HSD introduces full hybrid technology to a core model at The application helps motorists adapt their driving styles
the heart of the Toyota line-up, This is the first step in the to drive at lower speeds and to accelerate and brake
deployment of hybrid technology across the company’s more smoothly. This application can be downloaded at
entire European model range by the early 2020s. Built at www.aglassofwater.org
Toyota Motor Manufacturing UK, the Auris HSD marks an
important milestone for Toyota Motor Europe and for the
European automotive industry.
The hybrid effect in mainstream
With CO2 emissions of 89 g / km, the Auris HSD will help Two years before governments in Europe started introducing
reduce Toyota’s whole fleet CO2 average. In FY09 the whole incentives for motorists to exchange their old vehicles for new
47
fleet CO2 average was 130.1 g / km, down by 16 g / km from cars, Toyota Germany launched a competition with a Sunday
FY08. newspaper to win a Prius.

For more information about the Auris HSD please see pages A total of 104 people won a Prius ( the number of winners
30-31. reflects the 104 g / km CO2 emissions of the second generation
Prius ) and in exchange, needed to dispose of their existing
older vehicle. Winners were not typical Prius buyers and the
competition helped increase awareness in Germany of the
benefits of the Prius to a wide audience.

In FY09 we contacted the winners to find out about their experien-


ces of driving the Prius. We were able to reach 80% of the original
winners. Around 75% of them still owned and drove the car.

The research found that the ownership experience has


been satisfying – with an overall satisfaction level of nine on
a ten-point scale. Feedback from the winners suggested
that the strongest source of satisfaction is not the low fuel
consumption. Rather customers were most satisfied with
the experience of owning and driving a hybrid vehicle and
described it as stress-free, relaxing and comforting. The
research found that success of the Prius is based on four
Auris HSD
pillars of customer satisfaction (as below).

Comfort
d ease
Comfort an ive
e concept of the dr
Avant-gard rship
ne
Pride of owtechnology
ful
and power

Relaxed re
su
driving plea

Reliability
,
Safe, secure
liabl e partner.
ption an d re
enance,
Low consum easure Easy maint ies
g driving pl
Enablin warrant
ising
while minim mage
da
ecological
Sustainable National Marketing
Toyota European Sustainability Report 2010 I Environmental Performance

and Sales Companies (NMSCs)


360° environmental leadership approach
ental
id Environm s
Full Hybr Brochure
Launches
The National Marketing and Sales Companies are respon- Toyota (Prius/A
uris) Eco Even
@ Retaile
ts
rs
Drive
Optimal
sible for marketing and sales in the national markets across Greenin
g Eco Tour
s/
s
C OMM Roadshow
the Fleet
Europe. As such, they have a key role to play in advancing TS S
UN
ws
C E Motorsho

IC
environmental activities among customers, retailers and in C

ER U
ecycle

AT
PHV/EV Prius Lif

VI
& S OD
Analysis

IO
their own operations.

PR

N
Achieve
CO2
120 g / km
mental
Environ rship
POS
Materials
A 360° approach has been developed which outlines the

T
Lead e

EN
NM
ental
contribution sales and marketing makes to our vision of achieving Environm kills Energy

BE
ge-S dit ELV & HV
Knowled kaizen Au

O
I R llection

HA
ix VI
environmental leadership. Grand Pr
OU
R E NV Battery co
Social
HSD/Toyo
ta
Contribut
ions Retailer
ets
Optimal
Drive CO2 Targ
s ental
The approach focuses on four key areas : products and service, Awarenes Environm
e-learning New Reta
ilers
Eco-Drive Sustainab
le
cour s
se
ISO14001
communication, retail environment and behaviour, and has & Hybrid
Drive
@ Retaile
rs Retailer
(SR)
48
led to the development of a range of environmental activities.
Two examples of these activities are given below from Toyota & KPI Plann
ing
ion Plan
ship Act
Sweden and Toyota Motor Hungary. ironmental Leader
360° Env

Special feature
Toyota Sweden
“ Our retailers have done fantastic work, better than
launches C O2 we hoped for. It is all about helping customers reflect
on questions such as ‘ Do I really need a big car ? ’

competition at its Through this dialogue, we can help meet customers’


needs while making positive changes for the

retailers
environment, ” says Ulf Winberg, President of Toyota
Sweden AB.

For the fifth consecutive year, Toyota retailers in Sweden


Average CO2 emissions of Toyota cars sold in Sweden
have managed to reduce the average CO2 emissions
CO2 g/km
from new car sales. The average carbon dioxide
180
emissions for all new Toyota cars which were sold in
168
Sweden during FY09 was 133.8 g CO2 / km exceeding 170 163.4

the planned target of 138 g CO2 / km. An ambitious 160


158
154.9
target has been set for FY10 to achieve 129.85 g 149.1
150
CO2 / km. 146.6

138
The “CO2 @ retailer scheme” was introduced in 2007 to 140 133.7
reduce the total average CO2 emissions from the new
130
cars that are sold. All retailers have individual targets
that are adjusted to their respective markets. 120

In the four years since the CO2 targets were introduced, FY 06 07 08 09


Target
the average CO2 emissions for new Toyota cars sold
Result
in Sweden have reduced by almost a fifth, from 163 g
CO2 / km to 133.8 g CO2 / km in FY09.
Special feature

Toyota European Sustainability Report 2010 I Environmental Performance


Toyota Motor Hungary The mayor of Budapest and local politicians took part

promotes hybrid in this event. Information about Toyota’s environmental


commitments and performance were distributed.
In total, more than 100,000 people were reached
technology through these events.

Toyota Motor Hungary (TMH) participated in European


Mobility Week (16th-22nd September 2009) with a
number of activities in Budapest. The aim of the
events was to motivate the public to reduce their
fuel consumption and to publicise Toyota’s hybrid
technology and environmental philosophy.
49

As part of European Mobility Week, the company took part


in a conference on Green Mobility at Budapest University of
Technology and Economics. TMH also displayed a Toyota
Prius in the centre of Budapest that people could test drive.

Renewable energy use and landfill rate Environmental performance at National Marketing
and Sales Companies (NMSCs)
60% 56% NMSCs in Europe continued to steadily improve their
50%
performance in energy consumption, waste management,
39%
water consumption and paper consumption in the reporting
40% 37%
period. To manage and control their environmental impacts, the
33%

30% NMSCs have all either attained ISO14001 certification or are


19%
22%
planning to attain it in the near future.
20%

10% 5%
7%
Each NMSC is responsible for operating their office and training
facilities. In FY09 a total of 11,747 tonnes of CO2 was produced by
0%
NMSC facilities, an increase from 11,009 tonnes of CO2 in 2008.
FY 06 07 08 09
Landfill rate
Renewable energy
This was mainly due to the addition of energy data from the new
facility in Russia. However, significant efforts have been made to
increase the amount of energy used from renewable resources.
About 33% of all energy needs for NMSCs is now drawn from
renewable sources, compared to 19% in FY08. Unfortunately,
waste going to landfill increased due to the new facility opening
in Russia, where current rates to landfill are high. This has had
an adverse impact on the NMSC’s total landfill rate. We are now
mitted:
of CO2 e investigating how to reduce the volume of waste to landfill.
Volume nnes
11,747 to
Input:
mption:
rgy consu
Total ene kWh Output:
60,225 ste
me of wa s
nergy: g& Total volu 5 tonne
ewable e Marketin d : 2,64
Total ren kW h National mpany generate
33%
Sales Co
ption:
r consum
Total Wate 57 m³
101,0
Sustainable retailers
Toyota European Sustainability Report 2010 I Environmental Performance

Environmental action at the point of sale Environmental Management System


Our Sustainable Retailer Programme, which was launched We have set a target for all retailers to have a certified
in 2008, aims to ‘green’ all 3,000 Toyota retailers in Europe. Environmental Management System by 2015. Currently
The main objectives of the programme are to reduce CO2 a number of markets have achieved complete certification
emissions and energy consumption and to improve Toyota to ISO14001 or an equivalent standard including Denmark,
Motor Europe’s overall impact on the environment while Italy, Adria(1), Poland and Switzerland, with more than 32% of
reducing operating costs in all European retail facilities. The Toyota Motor Europe retailers already achieving certification
programme applies to existing retailers, new builds and major to ISO14001 or an equivalent standard.
refurbishments. A sustainable building is defined as one
capable of being maintained at a steady level without causing Environmental assessment for new retailers
ecological damage or exhausting natural resources. Our
Each new retailer or major refurbishment will be subject to a
ultimate objective is for retailers to achieve zero emissions.
Toyota Retailer Environmental Assessment on eight key areas :
energy, water, waste and materials, pollution, land use and
ecology, health and well being, management and transport.
50
iler
ble Reta The assessment is designed to encourage best practice in
Sustaina
eco-friendly construction and design and has been deve-
loped by Toyota Motor Europe based on standards set by
2 the UK’s Building Research Establishment Environmental
Outlets Assessment Method (BREEAM).
1 ets Existing
New Outl
& Full We have a flagship Sustainable Retailer in La Rochelle,
hments
Refurbis France (see next page). Our Maribor Sustainable Retailer
in Slovenia opened in December 2009. In FY10, additio-
Energy nal Sustainable Retailers will open in (Salzburg) Austria
EMS kaizen and (Weil am Rhein and Freiburg) Germany. Several other
tailer Certified 001) audit
Toyota re ntal (e.g ISO
14 countries also have planned projects.
nm e
enviro ent
ass es sm

Energy audits
Existing retail outlets are subject to an energy kaizen
(improvement) audit. There are two parts to the audit.
Firstly a specialist engineer analyses a retailer’s actual use
of electricity and gas and benchmarks this against similar
size facilities to determine whether the retailer can reduce its
energy consumption. This can be done remotely based on
historic energy bills.

If this analysis shows that energy usage is high, a specialist


will visit the facility to understand how energy is used and
recommend improvements. The targeted payback for any
eventual investment is a maximum of three years. Pilots in
several markets have seen savings ranging from 10% to 25%
which, for a small retailer, can be worth more than € 8,000
a year. All Toyota retailers in Europe are expected to have (L-R) Katarina Manske, Maribor Retailer Owner (Stajerski Avtodom) and
Tadashi Arashima, former President and CEO of Toyota Motor Europe
participated in the audit by 2013.

(1) This includes Bosnia and Herzegovina, Croatia, Montenegro, Serbia, Slovenia, and Kosovo.
Special feature

Toyota European Sustainability Report 2010 I Environmental Performance


Sustainable Retailer
La Rochelle
Our flagship La Rochelle Sustainable Retailer demonstrates
the business case for eco friendly design and construction.
The retailer was opened on the 17th June 2010 by Toyota
Motor Europe President Didier Leroy, Hiroshi Ito, Chairman
of Toyota France, and Ronan Chabot, the owner.

51

View of Opening Ceremony

The retailer in La Rochelle demonstrates how a retailer can


implement innovative environmental technologies and be-
come ‘carbon neutral’(1). The aim is to achieve an ‘excellent’
rating from an independent environmental assessment
based on BREEAM(2), a European assessment procedure
for sustainable construction and building design.
Q&A with Ronan Chabot, Owner, Toys Motors Group
The La Rochelle facility has been designed in line with envi-
Where did the idea come from?
ronmental best practice. A ‘green roof’ will provide a natural
It fits with the development of our current retailer
internal cooling system and serves as a wildlife habitat. The
network. Further, this new project fits with the
other roofs capture and divert rainwater into a 150,000 li-
brand and Toyota’s approach to sustainable
tre underground tank. A system of pipes (a Canadian well)
development across the vehicle lifecycle.
which is two metres underground pre-heats the air in the
winter and pre-cools the air in the summer. This efficient ven-
Is doing such a project complicated?
tilation approach reduces the building’s energy consump-
Naturally it is more complicated than a ‘normal’
tion. Also, 2,000 m2 of solar panels have been installed
retailer building, but we have engaged specialist
producing three times the energy needed for the building.
consultants to help us make the best choices.
A wood pellet boiler is used to heat the paint booth.
Either way, I consider going in this direction as
essential. This is not a fashion statement but
These measures are expected to provide significant
a real step by Toyota to reduce environmental
environmental improvements such as:
impact, with a sound business case behind it.
CO2 neutral with photovoltaic solar panels produ-
cing three times its own energy consumption.
Consumes 50% less energy than a standard building
(according to French building regulation RT2005).
Uses 67% less water compared to a similar type
of building.
The rainwater tank provides 70% of the site’s
water requirements.
By using LED technology, the lighting is 40% more
efficient than in a conventional showroom.
The car wash recycles 80% of the water used,
while 20% is topped up by rainwater.
La Rochelle Sustainable Retailer
All road surfaces contain 20% of recycled aggregate.

(1) Carbon neutral – according to the UK’s Department of Energy and Climate Change carbon neutrality guidance 30th September 2009.
(2) BREEAM – Building Research Establishment Environmental Assessment Method.
Toyota European Sustainability Report 2010 I Environmental Performance

Lexus
“   Lexus has pioneered key technologies that
offer a premium driving experience with category
leading environmental performance. In particular,
Lexus is building on its leading knowledge and
experience with full hybrid technology to increase
the proportion of cars sold with ‘Lexus Hybrid
Drive’, which provides a refined and rewarding drive
with category-leading environmental results.  „
Andy Pfeiffenberger
Vice-President, Lexus,
Andy Pfeiffenberger
52 Toyota Motor Europe

Full hybrid technology


Now in its second generation, Lexus Hybrid Drive combines can be further developed as new technology becomes more
electric motors and a petrol engine into a sophisticated feasible. For example, hybrid technology works together with
power source that reduces emissions, boosts fuel economy a whole range of current and advanced fuels, from advanced
and offers refined performance. biofuels to hydrogen.

Lexus Hybrid Drive meets customers’ demands for lower


CO2 emissions as well as their preference for performance.
The demand for improved environmental performance
continues to increase. The concept of full hybrid technology
has substantial development potential compared with
conventional powertrains. The new RX 450h, the first vehicle
to use second-generation Lexus Hybrid Drive, demonstrates
the advances that are already being made. Compared to
the previous model, it benefits from a 10% improvement in
power output and a 23% reduction in CO2 emissions.

In 2010, the CT 200h will go on sale, reinforcing Lexus’


commitment to making full hybrid technology available to a CT 200h
wider section of the European customer base. The CT 200h
will have category leading environmental performance. Its
CO2 emission levels will be the lowest in the segment and
particulate matter and nitrogen oxide emission levels will
be significantly lower than diesel engines.

The CT 200h will contribute to the acceleration of the mix of


full hybrid technology within Lexus’ overall European sales.
Currently, approximately 50% of all Lexus’ sold in Europe are
equipped with Lexus Hybrid Drive. The launch of CT 200h will
see this proportion increase to around 75%. The aim is to have
100% of all Lexus’ sold in Europe equipped with Lexus Hybrid
Drive by 2013.
RX 450h
In addition, Lexus Hybrid Drive uses a flexible platform, which
Toyota European Sustainability Report 2010 I Environmental Performance
RX 400h and RX 450h system output
and combined CO 2 versus competitors Lifecycle impact
V8 average
270 Petrol Lexus looks at the whole lifecycle of a car to help measure
250 Diesel its overall environmental impact in terms of materials,
6-cylinder emissions and end-of-life vehicles. Lexus is pioneering the
230 average
Combined CO2 (g/km)

4-cylinder use of materials with high recoverability, and researching and


Petrol RX 400h
210 average utilising parts that are easy to reuse at the end of their life. For
+10%
190 Petrol Diesel example, bumpers are recycled to make trim for the luggage
Diesel
compartment and shredded sound proofing material is used
170 -23%
for the silencer behind the dashboard.
150 RX 450h
130 Car door trims are now made with the stem of kenaf, a
100 140 180 220 260 300 member of the hibiscus family, rather than the woodchips
Output (kW) previously used. Kenaf absorbs between two and five times
53
as much CO2 as other plants and is mixed with old waste
bumpers from car repair shops to make door trim that is
CO 2 and NO x lighter, has better sound-proofing, and uses material that
Lexus RX 450h versus competitors does not deplete forests.

320 V8
300 V8
6-cylinder
280
260 Petrol
Combined CO2 (g/km)

average
240 6-cylinder
220
Diesel
200 average

180
160
RX 450h
140
0 0.05 0.10 0.15 0.20 0.25 0.30 0.35
NOx (g/km)

CO 2 and NO x
Engine technology Lexus RX 450h versus competitors
-16% -16%
100 1
Both petrol and diesel fuels will continue to be the dominant -3%
80 -5% 0.8
sources of internal combustion engines in the immediate
term, and so Lexus is making major efforts to reduce the
60 0.6
environmental impact of powertrains using these fuels.
40 0.4
By re-examining the whole structure of the internal -4%
combustion engine, Lexus has developed technologies like 20 0.2
Electronic Variable Valve Timing with Intelligence, which
0 0
raises the efficiency of the combustion process meaning
A B A B A B A B A B
less fuel is used and D-4S, which features both direct and CO2 NOx NMHC PM SOx
port injection, improving performance and efficiency across Material Production Driving/Maintenance A RX 400h
Vehicle/Parts Production Recycling B RX 450h
the power band.
After Sales
“   Our After Sales business is made up of Authorised
Retailers and Repairers who are the primary contact point
for customers for parts and accessories, maintenance
and repairs. Despite the global economic downturn, our
After Sales business remained robust with parts sales
showing an all-time sales record and accessories sales on
target. After Sales contributes to Toyota’s environmental
leadership by maintaining the car’s performance through-
out its lifecycle while minimising environmental impact by,
Bas Kasteel for example, using remanufactured parts.  „
Director, Customer Service,
Sales and Marketing, Bas Kasteel
Toyota Motor Europe

Toyota Customer Service Management


Our Toyota Customer Service Management (TSM) cars are repaired satisfactorily the first time.
programme provides retailers and repairers with training
and encourages them to pursue a culture of continuous As part of this programme, retailers must comply with
improvement. Modules in the programme include sales, environmental standards. Out of a total of 3,000 retailers,
parts and service, environmental management, marketing more than 1,700 retailers have been certified to the first level
and operations management. We are in the process of in the TSM programme. The remainder have started the
enhancing the programme by introducing elements such certification process. There is an auditing process to ensure
as “Fix it Right” which aims to ensure that customers’ continued compliance to the standards over time.

0w-20 Engine Oil


In FY09 we made our 0w-20 engine oil widely performance versus traditional higher viscosity oils
available on the market. The oil, which is made from by reducing friction while maintaining the necessary
a fully-synthetic formula, increases the fuel economy lubrication in the engine.

Use of reusable and recyclable materials


To avoid waste in workshops, we utilise reusable the end of the product’s lifecycle. Our disposable floor
protection covers for Toyota and Lexus vehicles. No mats are made from 100% recycled paper, and steering
magnets or lead weights are used in the reusable wing wheels and handbrakes are made from recyclable
and front covers, so there are no metals to recover at plastic.

Remanufactured parts
By reusing components and thereby reducing the demand and in FY09 the volume of remanufactured parts increased
for raw materials, we are also saving the energy needed to by 10%. We recorded a core return rate of 90% and
convert those raw materials into finished products. managed a lead time from the retailer to the supplier of
We are expanding our range of remanufactured products less than a month.
Toyota European Sustainability Report 2010 I Environmental Performance
End-of-Life Vehicles
and Sustainable
Recycling
“   Earlier this year, the Environmental Committee
of the European Parliament met with the European
Commission to discuss the implementation status of the
Willy Tomboy EU Directive 2000/53/EC on end-of-life vehicles (ELV).
Director, Environmental Affairs, The implementation of this Directive by the member
Toyota Motor Europe
states has not always been smooth due to : 55

•T
 he involvement of different government bodies
• Problems in making economic operators liable
• The insufficient number of qualified, certified dismant-
ling facilities
• Different methodologies used to comply with the
targets (a working group with representatives from
the car industry has been established to prepare
common guidelines).  „
Willy Tomboy

Members of the European Automotive Manufacturers’ efficient recycling infrastructure, such as post-shredder
Association (ACEA) have identified some action points to technologies and energy recovery options, and not used
improve the results of the ELV Directive : for other purposes.

1- Harmonise legislation. National recycling definitions 4- Enforce landfill ban. This will help direct shredder
must follow the definition given by the waste framework and post-shredder material streams into recycling and
directive. There should be no constraint for acceptance energy recovery routes. If it is prohibited to dispose
of applications with regard to the definition of recycling of more than 5% in landfill there will be more pressure
throughout EU member states. to build up recycling and recovery infrastructure and
to increase the performance of the whole recycling
2- Harmonise and establish quota calculation systems. chain.
Use the fixed assumption approach proposed by ACEA
in all member states for parts of ELVs which are constant 5- Put pressure on non-authorised facilities. Member
like metals, oils and other fluids, tyres and non-metallic states have to fight against fraud. Non-authorised facilities
reuse. This provides a transparent and clear definition of increase the risk of not achieving set quotas. This creates
the recycling and the recovery quotas. Establish quota market distortion.
calculation systems using the expertise of the car industry
who can share the experience they have gained over the Our industry is increasingly concerned about the apparent
past decades. rise in illegal ELV treatment and illegal ELV export. Both
activities have negative environmental impact, and are
3- Use of existing infrastructure. Select the most detrimental to the authorised ELV treatment business.
professional and efficient operators for ELV collection Authorised facilities have stringent environmental standards
and treatment. Where fund or deposit systems are legally and are managed by national Environmental Protection
required, financial resources must be directed to the most Agencies.
Social
Performance
“ Our focus is on maintaining stable employment and employee morale.
We also focused on achieving our aim to be the number one company
for complete customer satisfaction, enhancing a culture of health


and safety and strengthening Toyota’s good corporate citizenship
performance.
Didier Leroy
Toyota European Sustainability Report 2010 I Social Performance
Toyota: a Good
Corporate Citizen
Didier Leroy
President and Chairman of CSR Committee,
Toyota Motor Europe 57
Managing Officer,
Toyota Motor Corporation

Transparency and cooperation


with stakeholders

We aim to build long-lasting, co-operative relationships with


our stakeholders. We measure our success, and areas for
improvement in our stakeholder relations, through a yearly
European Key Stakeholder Survey, in which stakeholders rate
Toyota’s environmental, social and business performance (see
pages 60-61).

Our stakeholder engagement includes :

1- C
 ustomer engagement 3- Business partner engagement
We seek to establish strong relationships with customers during We support our suppliers by providing training and shopfloor
and after the sale of a vehicle, from both a service and quality improvement clinics where we can share best practice. Various
perspective. All employees in the Toyota network are trained programmes are in place to ensure that our supply partners
in programmes to ensure a focus on “ Customer First ”, “ Envi- are fully integrated into our business and enjoy open two-way
ronmental Leadership ” and “ Good Corporate Citizenship” (see communication. (see pages 75 to 77).
pages 63 to 64).
4- Engaging with the community
2- E
 mployee engagement We aim to build long-term relationships with the community.
Employees are one of our most important stakeholder groups. This is reflected in our initiatives and partnerships with non-pro-
To encourage dialogue, we carry out regular satisfaction sur- fit organisations and other stakeholders at the local level (see
veys at all European affiliates to identify areas for improvement pages 78 to 81).
in the management of human resources (see pages 71 to 72).
Managing our CSR performance
Toyota European Sustainability Report 2010 I Social Performance

The management of Corporate Social Responsibility (CSR) Our CSR process is based on internal (CSR Assessment) and
at Toyota Motor Europe is underpinned by a process which external performance measurements (European Key Stake-
emphasises continuous improvement (kaizen) in our CSR holder Survey). These measurements provide opportunities for
performance. improvements which contribute to mid and long-term growth.

rowth
Mid-term G
s
le Busines
Europe Favourab ment
yota CSR Activities in Environ rities,
al autho
To bodies, loc
Regulatory Os, Media
External NG

SR Image t
Internal Chancement Enhance
men
partner
rm anc e En Good Attractiveess partners
Perfo
ts Corporate Future busin
ployees
mmitmen
Future em
Toyota co Social Citizen
tions
contribu
20
CSR Vision 20 Affinity
Customer ent
58 Policy
To be Lead
ing player enhancem
Europe
CSR in greater
y contributors
Policy To be a Ke yota succes
to global To
Contribution lder
towards Self
reliance Stakeho tion
Sustainable Good nica
Development
Toyota
Environ-
mental
Corporate
with focus
on core Commu AWARENES
S
Customer Citizen models
Delight Leadership E
KNOWLEDG

LIKING
T
AT ION PRODUC
BRAND
CONSIDER POWER
ental
, environmance POWER
CE
Economic
PREFEREN
l perform
and socia Connect to a MARKET RE
PRESEN TATION

s in
consumer RVICE CAPACITY
EKSS ient and RETAIL & SE ip
more effic Ownersh
l) wa y
(externa effective TRADE-IN ce
essment Experien
CSR Assrnal)
(inte POWER AVAILABILIT
Y
SELLING
ility to BUY (OR
Improve ab erers RE-BUY)
nsid
convert co
to sale s

Measuring CSR performance – Internal stakeholders


CSR Assessment definition and process ts
Commitmen
rs
The CSR Assessment is an internally developed tool which Stakeholde
enables us to identify performance improvement opportuni- n
• Innovatio fety
ties. The tool is based on Toyota’s Global CSR Policy. • Product Sa
• al ity
Customers Qu
er Fi rst
• Custom
The diagram on the right shows how the commitments d employee
satisfactio
n
t an
made in our CSR Policy are linked to our key performance • Respecde lopment
• People y anved no discrimination
indicators. The assessment is undertaken among all National Employees • Equalit & safety
• Health
Marketing and Sales Companies and majority owned ess partner
s
t for our busin
European Manufacturing Companies. • Respecgr th
• Mutual g loow ng-term re
lationships KPI
rtners in
• Build ocurement
Business Pa pr
• Fa ir

lue
e co rporate va
• Enhancol rs benefits
• Shareh stdeable growth
rs • su re
Shareholde En
• Disclosure
t
vironmen
y with the en
• Harmon ndly netw
ork
omotion
• Eco-frie nology pr
ental tech rships
• Environm
nmental pa
rt ne
Environmen
t • Enviroia e
Community • Compl hrnc hy &
• Philant utop
ion to Soci
ety
contrib
Toyota European Sustainability Report 2010 I Social Performance
CSR Assessment results 1- Be number one in Complete Customer Satisfaction
Our NMSCs have improved their position across Europe
Specifically in relation to our priorities for FY09 (be number
and score well on customer satisfaction in sales and after
one in Complete Customer Satisfaction, maintain employee
sales. In the recent recall campaigns, the NMSCs and
morale and motivation, enhance a culture of health and
the retailer network have shown exceptional dedication
safety and strengthen Toyota’s European good corporate
to serving our customers and maintaining customer trust
citizenship performance) the CSR Assessment FY09
and loyalty.
shows :
2- Maintain employee morale and motivation
On a standardised scale of ten, results are shown below for
Scores for ‘respect and employee satisfaction’ are up both
2007-2009 by company type.
in EMCs and NMSCs. This shows that the measures we
undertook to maintain stable employment and employee
motivation (see pages 67-74) were well received by the
employees.
National Marketing
and Sales Companies (NMSCs) 3- Enhance a culture of health and safety 59
This examines employees’ perception and operational
10 9.0 8.9
9.4 9.3 health and safety indicators. Especially in our European
8.6
9 8.4 8.5
8.2 Manufacturing Companies, health and safety is a
7.7 7.9
8 6.8
6.7 fundamental element in the yearly planning cycles and
7
6
in continuous improvement projects. The average score
5 for health and safety has improved significantly due to
4 focused activities in several plants and continued employee
3 awareness of the health and safety systems in place.
2
1
4- Strengthening good corporate citizenship performance
0
Overall corporate citizenship performance is measured by
CCI(1) Customer Respect & Health &
First Employee Safety the Corporate Citizenship Index (CCI). As shown in the
Satisfaction graphs, the score steadily increases over the years, due
FY07 FY08 FY09
to the sharing of best practice in our companies and a
growing awareness of CSR.

Based on the CSR Assessment the following areas for


European Manufacturing
Companies (EMCs) improvement activities in FY10 were identified, both on a
pan-European and on a local level :
10 9.3

9
7.8
For the manufacturing plants (EMCs) : European projects
8 7.5 7.1 7.2 will be introduced to strengthen risk management, to
6.5 6.7 6.6
7
5.8 create awareness on CSR and Environment in the local
6
5
supplier base and to follow up on any Code of Conduct
4 cases.
3 For the sales and marketing companies (NMSCs) : Due to
2 the large spread of individual company scores, support will
1 be given to the countries with the lower scores. In addition
0
we will focus on helping increase retailers’ involvement in
(1)
CCI Respect & Health &
environmental and social contribution activities. Special
Employee Safety
FY07 FY09
Satisfaction attention will also be given on a European level to
FY08
strengthen the risk management processes.

(1)
CCI = Corporate Citizenship Index.
Measuring CSR performance – external stakeholders
Toyota European Sustainability Report 2010 I Social Performance

We measure the perceptions of our external stakeholders


through our European Key Stakeholder Survey. In the survey,
which results in an overall corporate citizenship score,
external stakeholders from 11 European countries rate our
ntal
environmental, social and economic performance. These Environme
three pillars are further broken down into drivers and specific
1 Inspira n
ti o
attributes (as illustrated in the graphs below). The survey
compares our performance against other companies in our
industry. Environment ntal
Environme
ce
Performan
Results of the 2009 survey show that Toyota remains the
leader in corporate citizenship achieving the highest overall
corporate citizenship score in the industry.

The global economic crisis seems to have affected overall


corporate citizenship (CC) scores for the car industry with
Economic
60 n
both the absolute score of the industry average and Toyota Contributio
showing a slight decrease.
2
The graphs show the deviation from the Social
mean scores (average score of all OEMs Corporate Society Contributio
n
including Toyota), which are represented Citizenship
as the 0.0 axis on the graphs. In other
le
words, both the highest and the lowest Responsib
Emp lo y e r
score compared to the average score (all OEMs including
Toyota) and Toyota’s performance versus the average are
visualised.

Innovation

3
Integrity
Business

Business
ce
Performan
Overall CC score compared to competitors in industry
2,0
1,5
1,0
0,5
0,0
-0,5
-1,0
-1,5
Environment Society Business Corporate
citizenship

FY 07 08 09 07 08 09 07 08 09 07 08 09
Toyota Worst scores Best scores
CSR Assessment results

Toyota European Sustainability Report 2010 I Social Performance


Rating for Toyota on ‘Environmental Performance’– deviation from industry average
Environmental Indicators
3,0
2,5
2,0
1,5
1,0
0,5
0,0
-0,5
-1,0
-1,5
Its activities has led Is committed to help tackling Is a leader in developing Is reducing the environmental Is committed to reduction the Is a leader in hybrid technology
to environmental climate change environmentally-friendly impact of its car from environmental impact of its
Question issues moving up vehicles manufacture to disposal vehicles across its full range
society’s agenda of models

FY 07 08 09 07 08 09 07 08 09 07 08 09 07 08 09 08 09
Toyota Worst scores Best scores

Toyota remains the leader in environmental performance due to the leading environmental technologies applied to
and has improved its score in four of six attributes. This is both its vehicles and operational processes.
61

Rating for Toyota on ‘Social Performance’– deviation from industry average


Social Indicators
1,5
1,0
0,5
0,0
-0,5
-1,0
-1,5
Important contribution to Creates employment in Is committed to Works in partnership Builds Offers employees Treats employees & Has good labour Offers secure
the economies of Europ. Europe reduction road with and supports local relationships with excellent learning and jobs applicants equally relations employment
Countries accidents organizations gov., NGOs and development
other opportunities

FY 07 08 09 07 08 09 07 08 09 07 08 09 08 09 07 08 09 07 08 09 07 08 09 07 08 09
Toyota Worst scores Best scores

In general the perception of Toyota’s social performance has re- age on two of the nine attributes. It is our priority to address these
mained stable. However the company is performing below aver- attributes and overall improve our performance as a result.

Rating for Toyota on ‘Business Performance’– deviation from industry average


Business Indicators
1,5
1,0
0,5
0,0
-0,5
-1,0
-1,5
Produces high quality products Puts customers first Acts with integrity Is a company you can trust Makes cars which are amongst the
safest on the road

FY 07 08 09 07 08 09 07 08 09 07 08 09 07 08 09
Toyota Worst scores Best scores

The score for Toyota’s business performance has increased. and quality are part of the Toyota Way and as such, form
The values of the business performance : safety, integrity the foundations of the company.
Special feature
Toyota European Sustainability Report 2010 I Social Performance

How did Toyota


handle the recall
campaign ?
“  Here in the Corporate Communications division, there
are two things that we need to do when a recall happens:
first, get the facts and second, explain them to the media.
The media will then interpret those facts and any other
62
information that they have to produce their articles. Of
course, they are able to get information from other sources
as well, in order to build their story. These days, with the
Colin Hensley
General Manager, Corporate Affairs internet it is very easy to gather material from across the
and Planning, globe to compare and contrast what is being said. It
Toyota Motor Europe became clear from the start of the accelerator pedal recall
that the speed of change of coverage of the issues and of
the public opinion on those issues was way beyond what
we had previously experienced. „
Colin Hensley

In Europe, we were determined to have the right The External Affairs team also spent many hours directly
information on which cars were going to be recalled. engaging with our stakeholders, primarily the media, but
Our primary obligation is to the customer and this also with the authorities when necessary. We were han-
meant that we had to give the correct information dling about 20 enquiries from journalists every day, in each
to the media to ensure the customers were well case explaining the latest developments. Media sentiment
informed. However, it takes time to get the information had quickly changed to being negative, so direct discus-
in a recall of this size. The accelerator pedal which sion and explanation was essential for us to get the facts
was potentially showing some ‘stickiness’ was used across. This was all the more important as we established
in a wide variety of models, and we needed to be sure new processes, to ensure customer satisfaction. You can
of the facts. Consequently, this took longer than we read more about these on pages 63-64.
would have liked, and left the customers with some
uncomfortable uncertainty.
Toyota European websites
In an effort to minimise that uncertainty, we News section = visits and share
maximised the use of online tools to communicate. '000s of visits % of all visits
50 25%
Special web pages were developed on toyota-
europe.com and on many of the National Marketing 40 20%
and Sales Companies websites. An online vehicle
30 15%
identification number checker was developed,
allowing customers to instantly check if their car 20 10%
was affected. This was in parallel to the letters that
10 5%
were issued to all of the affected owners. Traffic to
the news section of the Toyota European websites 0 0
peaked at approximately 40,000 per day at the /20
10 010 010 010 010 010 010 010 010 010 010 010 010 010 010 010 010 010 010
/2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2
/01 4/01 6/01 8/01 0/01 1/02 3/02 5/02 7/02 9/02 1/02 3/02 5/02 7/02 9/02 1/02 3/02 5/02 7/02
/2
22 2 2 2 3 0 0 0 0 0 1 1 1 1 1 2 2 2 2
beginning of February 2010, which were ten times Visits

more visits than normal. % of site Visits


Toyota European Sustainability Report 2010 I Social Performance
Engaging
with customers
(L-R) Customer Relations, Experience & Satisfaction Team :
Nancy Mboga, Diane Ramirez, Tom Abrahams, Sofia Ovlinger
Ann Cleynhens, Ilaria Todesco and Leila Kerroudj.

Complete Customer Satisfaction (CCS)


63
To build customer loyalty we have set a strategic objective To track our progress, we conduct an annual benchmarking
of achieving Complete Customer Satisfaction (CCS) by survey which asks customers to rate their experience from
delivering products and services of superior quality. completely satisfied to completely dissatisfied.

Our ‘Customer First’ philosophy guides our interactions with The graphs below show our CCS position in European
our customers. By focusing on the total customer experience, countries for both sales and after sales, and overall
from the time of purchase and throughout ownership, we satisfaction levels for these groups.
seek to build a long-term relationship with customers.

Toyota CCS#1 position Toyota CCS#1 position


in European countries - Sales in European countries - After Sales

20 30

25
15 24/29
20
Number of countries

Number of countries

14/20 21/29
13/20 19/29
12/26 12/19
10 15 17/29

10
5
5

0 0
FY 06 07 08 09 FY 06 07 08 09

Product recalls
In early 2010, for the first time in its history, Toyota globally To better understand the impact of the recalls on our
implemented a major recall for several of its models. We customers and their concerns, we also contacted
are fortunate to have a strong network of retailers around thousands of customers directly. Feedback from customers
Europe who helped us get information about the recall to suggested that the company handled the recalls in a
our customers. satisfactory way.
The role of the Customer Relation Team
Toyota European Sustainability Report 2010 I Social Performance

The beginning of 2010 was an exceptional period for our


Nature of Customer Contacts
customer relations team, largely due to the recall of some
of our models. Most of our markets in Europe experienced Not involved in the Experienced the same
customer recall volumes that were about ten times higher than recall but experienced problem in the past
a similar problem 3%
their normal levels. This increased activity lasted for about 2%

two months and particularly affected our major markets - the


UK, Italy and France.

In keeping with the current nature of global issues, the media Wants to know
details of recall
was a key factor in determining how events unfolded. For 23%

example, on the day a major UK newspaper published


the Toyota recall issue on their front page, almost 14,000
customers called Toyota Great Britain.

In line with our commitment to put our customers first,


Whether or not my
64 all markets responded immediately to ensure adequate vehicle is involved
72%
resources were available to look after each customer.
Toyota Great Britain and Toyota France brought in extra staff The recall situation has provided us with an opportunity to
and extended working hours. In Toyota Motor Italia, each learn and improve, and our focus for FY10 is to reaffirm our
department allocated staff from their team to respond to commitment to customer satisfaction, customer relations
customer concerns. and the overall customer experience.

Trend of Customer Calls - Pedals


Answered Cust. Calls

13,696
14,000
……..

5,000

4,000

3,000

2,000

1,000

0
Fri. Tue. Sat. Wed. Sun. Thu. Mon. Fri. Tue. Sat. Wed. Sun. Thu.
29/01 02/02 06/02 10/02 14/02 18/02 22/02 26/02 02/03 06/03 10/03 14/03 18/03

Russia Great Britain Spain


Germany Italy France
Safety

Toyota European Sustainability Report 2010 I Social Performance


360° approach to safety
As a major vehicle manufacturer, we seek to reduce traffic System in the new Prius. The technology aims to warn
accidents, injuries and fatalities, by making vehicles safer to the driver about a potential collision. The speed is then
drive. We also need to take an integrated approach to road reduced which lowers the likelihood of injury in the event
safety by working in partnership with our stakeholders. of a collision.

Supporting road safety initiatives European New Car Assessment Programme (Euro NCAP)
We have a responsibility to raise safety tests
public awareness about road safety. Euro NCAP is an independent safety assessment programme
We have supported the Road backed by seven European governments, the European
Safety Performance Index (PIN) Commission and motoring and consumer organisations in
programme, run by the European every country in Europe.
Transport Safety Council, since
2006. PIN encourages EU Currently, Toyota and Lexus has vehicles that are among the
member states to improve road best overall performers in safety across the full range of Euro
65
safety and identifies key road NCAP tests. In FY09 Toyota vehicles achieved the top score
safety performance indicators. for four out of the five cars tested.

In FY09, Toyota Motor Europe and our Safety research


affiliates participated in three PIN debates in Italy, Germany We are one of 15 public and private partners of the EU co-
and Spain, bringing the total number of countries visited funded project ASSESS, which commenced in July 2009
since the beginning of the programme to 23. and aims to develop a set of test and assessment methods
for active safety, such as pre-collision systems. Project
Findings from the PIN programme on issues such as deliverables should form the basis for future rating procedures
speeding, drinking and driving and child safety, may help for these systems and provide policy recommendations for
determine targets set in the EC’s European Road Safety their implementation.
Action Programme 2011-2020.
We are also collaborating with the French National Institute
eSafetyAware! initiative for Transport and Safety Research (INRETS) on the passive
We are also a founding member of safety of vulnerable occupants (elderly people) and rear seat
eSafetyAware!, an EC funded pro- occupants. Through the partnership we are also examining
gramme that organises events to ergonomics, by identifying future potential protection of users
demonstrate how advanced vehicle in the pre-collision phase.
technologies can help save lives.

In September 2009, we took part Further information on these programs can be found at :
in the eSafety Challenge in PIN programme : www.etsc.eu/PIN.php
Italy and demonstrated eSafetyAware ! program : www.esafetychallenge.eu
the life-saving potential ASSESS program : www.assess-project.eu
of the Pre-Crash Safety Safety at Toyota Motor Europe : www.toyota.eu/safety

New Euro NCAP ratings for Toyota vehicles

New rating scheme Year Overall Adult Child Pedestrian Safety


rating Assist

Toyota Verso 2010 ★★★★★ 89% 75% 69% 86%

Toyota Urban Cruiser 2009 ★★★ 58% 71% 53% 86%

Toyota Prius 2009 ★★★★★ 88% 82% 68% 86%

Toyota Avensis 2009 ★★★★★ 90% 86% 53% 86%

Toyota iQ 2009 ★★★★★ 91% 71% 54% 86%


Special feature
Toyota European Sustainability Report 2010 I Social Performance

Eco-Driving
66

By making simple changes to everyday driving Eco-driving activities are also undertaken in other
behaviours, motorists can reduce their fuel countries such as :
consumption. This is the message that our retailers
are promoting to customers to raise awareness of Germany: Toyota Deutschland launched a country-
eco-driving. wide Eco-Driving programme with the national
motoring organisation, ADAC. The company has
In FY08, 55% of our retailer network implemented donated 50 Avensis cars, which are stationed at 15
eco-driving activities, such as giving customers eco- of ADAC’s safety driving centres and used to train
driving tips at showrooms or demonstrating eco- people in eco-driving techniques.
driving techniques during test drives. Denmark: In the run-up to the Copenhagen summit,
Toyota Danmark rolled out an extensive eco-driving
This year, with non-profit organisation Global test drive programme to its entire retailer network. It
Action Plan International, we launched eco-driving also held an Eco Roadshow.
workshops at showrooms. Under the guidance of
trained supervisors, participants learn new driving
techniques on Toyota simulators that recreate the
driving experience and test how far drivers can travel
on 0.1 litres of fuel.

Eco-driving practices include shifting earlier into a higher


gear, looking ahead and anticipating the traffic flow,
keeping car windows closed and using the ventilation
system. Savings can be achieved through proper
vehicle maintenance and planning journeys ahead of
time. By having the correct tyre pressure, for example,
drivers can improve fuel economy by around 3%.

We piloted the workshops with retailers in the


Netherlands, Norway and Belgium. The programme
was well received by the local community. For
example, one of our retailers in the Netherlands,
Valkema B.V., hosted nine workshops at its
showroom and an eco-driving tour in various
Customers attending a dealer Eco-Driving workshop
municipalities in the local region.
Toyota European Sustainability Report 2010 I Social Performance
Engaging
with employees
“  The global economic crisis, while challenging,
was an opportunity for us to demonstrate our
commitment to our people to maintain stable
employment and improve mutual trust and
understanding. This strategy is built on a solid
Seiji Abe foundation of thorough communication and the
Vice-President Human Resources,
Toyota Motor Europe
long-term development of our people. „ 67
Seiji Abe

Workforce statistics
We make a significant contribution to local economies Headcount at EMC
by directly employing 20,051 people in our Head Office
(Evere and Zaventem), our European distribution centre 20,000
(Toyota Parts Centre Europe), our European Manufacturing 3,600

Companies and in our majority-owned National Marketing 15,000 1,040 3,578


3,602
and Sales Companies. 2,108 890
714
2,008
3,347
10,000 2,055
2,959
Toyota Motor Europe (Head Office) – 2,023 people 2,860
3,965
Toyota Parts Centre Europe (TPCE) – 645 people 5,000
3,344
3,377
European Manufacturing Companies (EMC) – 15,464 people 5,547 4,904
3,987
National Marketing and Sales Companies (NMSC) –
0
1,919 people
FY07 FY08 FY09
TMUK TMMT TMIP
TPCE and Head Office Headcount TMMF TMMP TPCA

3,000
2,500 Also includes temporary employment
343
2,000 268

1,500 European Manufacturing Companies


TMUK = Toyota Motor Manufacturing UK
1,000 2,167
2,023
(Burnaston+Deeside)
169 149
500 TMMF = Toyota Motor Manufacturing France
672 645
TMMT = Toyota Motor Manufacturing Turkey
0
TMIP = Toyota Motor Industries Poland
FY08 FY09
TMMP = Toyota Motor Manufacturing Poland
Permanent TPCE Permanent Head Office
TPCA = Toyota Peugeot Citroën Automobile
Temporary TPCE Temporary Head Office
(Czech Republic).

Note : The employment data reflects the situation on 31st March at each financial year.
Toyota European Sustainability Report 2010 I Social Performance

National Marketing and Sales Companies Headcount NMSCs


TGB = United Kingdom
TFR = France 2,500
5
TES = Spain 88
88
4
2,000 4
TMI = Italy 418 320 86
221
82 84 82 83
TDG = Germany+TIS = Toyota Information Systems 1,500
60
112
62 79 80
61
109
111
TMP = Poland 425 427
402
TMH = Hungary 1,000
282 299 269
TDK = Denmark 169 182 177
500
TSW = Sweden 200 194 186
371
TFO = Finland 361 343
0
TNOR = Norway
FY07 FY08 FY09
TNRD = Nordic
TGB TES TDG TMH TSW TNOR
TFR TMI TMP TDK TFO TNRD

68
Also includes temporary employment

Employees by gender, age and by length of service


The tables below show our permanent employees at Head Companies and our majority-owned National Marketing and
Office, Toyota Parts Centre Europe, European Manufacturing Sales Companies.

Employees by gender Male (%) Female (%) Total

Head Office 1,406 (70%) 617 (30%) 2,023

Toyota Parts Centre Europe 428 (66%) 217 (34%) 645

European Manufacturing Companies 13,691 (89%) 1773 (11%) 15,464

National Marketing
1,336 (70%) 583 (30%) 1,919
and Sales Companies

Total 16,861 (84%) 3,190 (16%) 20,051

Employees by age < 25 (%) 25-34 (%) 35-44 (%) 45-59 (%) >60 (%) Total

Head Office 9 (<1%) 951 (47%) 758 (37%) 292 (14%) 13 (1%) 2,023

Toyota Parts Centre


37 (6%) 271 (42%) 220 (34%) 117 (18%) 0 (0%) 645
Europe

European Manufacturing
906 (6%) 8,155 (53%) 5,002 (32%) 1,375 (9%) 26 (<1%) 15,464
Companies

National Marketing
15 (1%) 464 (24%) 714 (37%) 658 (34%) 68 (4%) 1,919
and Sales Companies

Total 967 (5%) 9,841 (49%) 6,694 (33%) 2,242 (12%) 107 (1%) 20,051
Toyota European Sustainability Report 2010 I Social Performance
Employees by length <1 year (%) 1-4 years (%) 5-9 years (%) 10-14 years (%) >15 years (%) Total
of service (1)

Head Office 20 (1%) 923 (46%) 631 (31%) 261 (13%) 188 (9%) 2,023

Toyota Parts Centre


0 (0%) 234 (36%) 225 (35%) 118 (18%) 68 (11%) 645
Europe

Total 20 (1%) 1,157 (43%) 856 (32%) 379 (14%) 256 (10%) 2,668

Employees by length of <1 year (%) 1- <3 years (%) 3-5 years (%) 6-10 years (%) 11-15 years (%) >15 years (%) Total
service (1)

European Manufacturing 69
74 (<1%) 2,014 (13%) 4,298 (28%) 7,029 (45%) 901 (6%) 1,148 (7%) 15,464
Companies

National Marketing and


18 (1%) 281 (15%) 335 (17%) 395 (21%) 318 (17%) 572 (30%) 1,919
Sales Companies

Total 91 (1%) 2,295 (13%) 4,633 (27%) 7,424 (43%) 1,219 (7%) 1,720 (10%) 17,383

Maintaining stable employment


We make every effort to ensure stable employment and Some of our companies also introduced work-sharing. Where
job security for our employees. Responding to changing applicable, such conditions were discussed and agreed with
environments and market requirements can mean evaluating local trade union representatives :
job functions and workforce totals.
TMUK and Toyota Motor Manufacturing Turkey (TMMT)
The global economic crisis and the decrease in demand for introduced work-sharing in their operations to cover non-
vehicles meant that during FY09 we needed to implement production days and reduce labour costs. Almost all man­
measures to minimise the loss of employee income. These ufacturing companies introduced work-sharing features in
measures include temporarily re-allocating work to other FY09.
parts of the business in Europe. For example :
In certain cases, where decreases of sales volume were si-
Several team members voluntarily moved from Toyota gnificant and long term, the company negotiated to introduce
Motor Industries Poland (TMIP) to Toyota Peugeot Citroën voluntary separation programmes to make structural adjust-
Automobile (TPCA) in the Czech Republic and Toyota Mo- ments to the operations.
tor Manufacturing Poland (TMMP).
Toyota Motor Manufacturing UK (TMUK) employees volun- In FY09, TMUK and TMIP introduced voluntary separation
tarily took the opportunity to work for Toyota Parts Centre programmes and about 400 employees opted for such re-
Europe in Belgium, shifting from manufacturing activity to lease schemes.
After Sales operations.

(1) We calculate length of service using different categories for Head Office and TPCE, compared to EMCs and NMSCs.
Toyota European Sustainability Report 2010 I Social Performance

Other measures included : In FY09 our turnover rate was 4.00%, compared to
7.70% in FY08. These figures are for our Head Office
Our Head Office in Brussels introduced 16 unpaid days (Evere and Zaventem, Belgium). We do not currently
in FY09. report turnover for our other operations but plan to do
Toyota Deutschland (TDG), working with their works so in the mid-term future.
council, re-engineered their company operations based
on a benchmarking study that examined Toyota Motor
Europe, other National Marketing and Sales Companies
(NMSCs) and other automotive distributors. Employee Turnover
Other NMSCs introduced voluntary unpaid holidays and
implemented organisational changes to enable better 10%
flexibility to ensure long-term prosperity and employee 7.40 7.70
8%
stability.
6%
With improved market conditions towards the end of FY09, 4.00

70 some of these measures were scaled back. For example, 4%


work-sharing was stopped in most offices and manufacturing
plants prepared for a gradual return to stable working 2%

conditions.
0%
FY07 FY08 FY09
To make the required structural changes for the long-term
recovery of the organisation, some of the measures were
retained, such as limiting the number of overtime hours.

Employee communication
In all the European countries in which we operate, we Communication Channels
adhere to European and national legislation and we have
established employee representative bodies to inform and
communicate within the framework of social dialogue. Where
required, Toyota Motor Europe has established collective Company
ement)
bargaining agreements covering all employees at a specified (Top manag
location. European and national consultations have helped Supervisors
to create and maintain awareness and motivated two-way
communication concerning the company’s business position,
surrounding environment and business challenges. d
Unions an
HR Employee
Under the severe business conditions caused by the economic atives
Represent
downturn, it was essential for us to provide open and timely
communications to our employees on critical business issues
and company decisions

/Union
Employees
Toyota European Sustainability Report 2010 I Social Performance
One of the ways we share information with our employees is globally. The purpose of the initiative is to ensure all Toyota
through the Toyota European Works Council, which is also employees around the world are provided with up-to-date
called the Toyota European Forum (TEF). The Forum consists of information about business operations. Communication
representatives from each country in Europe that Toyota has op- packs are prepared and sent to divisions, sales and marketing
erations in and includes representatives from National Market- affiliates and manufacturing companies. Communication
ing and Sales Companies (NMSCs), European Manufacturing sessions are held by local management with employees to
Companies (EMCs), the Head Office and senior management. share information and employees can request additional
Through TEF, employees receive regular updates on various information and give feedback at these sessions.
business issues for Toyota’s global and European operations.

In FY09, much of the discussion was related to the global


economic downturn and the impact on employees. TEF
Two-way Communication - Employees Feedback
usually meets twice a year, but due to these concerns,
additional meetings were arranged.
Other 5%

At the December 2009 meeting, a new TEF agreement was 71


signed between management and employees representati-
ves (in line with the new European Works Council directive, Global & European
Current issues /
business situation
despite no legal necessity to do so). The agreement ex- 12%
hot topics
34%
pands TEF priorities, including information and consultation
by management with TEF representatives when significant
Vision / Mission
changes are being considered that impact our employees. of Toyota
in Europe
18%
300K Communication

To strengthen communications, Toyota has globally launched


the “ 300K communication activity. ” The name of the initiative Terms & conditions /
stable employment
comes from the 300,000 employees that Toyota employs 31%

Work-life balance
We have continued to introduce measures to ensure employees
Current utilisation of Time Credit Promotion
have a work-life balance. By identifying priorities in our day-to-day in Head Office per main functions
operations and optimising processes, we are helping employees
manage their workloads during a time when there are measures Manufacturing support
in place for no recruitment or overtime. Among other activities, 19%

in our Head Office in Brussels, reducing overtime hours has Sales - Marketing
43%
enabled employees to better manage the ratio between the time
spent at work and at home (work/life balance).

Based on local laws and regulations, employees in our affiliates 5,5%


R&D 97 employees
were provided with the opportunity to take advantage of flexible 10%

work arrangements, sabbaticals and part-time work.

Corporate
28%

Note : Collective Labour Agreement allows 6%.


Team building
Toyota European Sustainability Report 2010 I Social Performance

During a time of global economic change, it has been Office, more than 130 employees in 34 teams participated
important to maintain and enhance employee motivation. in this event, which was organised by the employees.
In FY09 employee events included the Ekiden (relay race) Local Ekiden were also held in Toyota companies around
Festival for employees and their families. At our Head Europe.

Learning and development '000 hours


TME training hours overall (1)

50 45.7

We support long-term employee development by offering 36.5


38.8
40
internal training courses. These courses are offered to
employees in the Head Office and in our manufacturing 30
companies, as well as to retailers and the after sales network.
20
Training sessions for our employees are complemented by
10
72 annual performance appraisals and competency assess-
ments for all permanent and temporary employees. 0
In FY09, the number of training hours decreased from FY08
FY07 FY08 FY09
(see graph above) due to training being limited to internal
training because of cost-saving initiatives.

On the job development me


nt 1 Id e n
tify
ieve h) Su
t
ch row ita
na A

bl
so of

The On-the-Job Development course provides managers and

eW
l
(Per nse

ork
supervisors with a standardised approach to facilitate employee
Se

2
Give a

development in their daily work. The purpose of the course is


to help employees to practice the Toyota Way principles. On the Job
The course takes the participants through the four stages in Development
the Plan-Do-Check-Act cycle. In the Plan stage, suitable work
is identified which slightly challenges employees so that they
4 Wo
rk

gain a sense of achievement. The Do stage includes assigning


Co Mo

p
gn
m

the work and motivating the employee. In the Check and Act ni lete
As
si

to
r& Work
stages, the manager or supervisor evaluates the work and
discusses the employee’s personal growth and the next steps
Lea
d 3
needed to help them in their development.

Managing people the Toyota Way lace


t workp
Efficien

This course takes junior management through all elements of the Members
Act efficiently

Toyota Way, hoshin kanri (direction management) and On-the-


Job Development, and demonstrates how these philosophies
Think deeply

manage
motivate

can be implemented in daily practice.


develop

(3)
Designed as a tool to enhance the management skills of newly- JKK
promoted managers, the course also serves as a refresher TBP
(2 )

course for more experienced leaders in the company.


The core elements are (a) the role of a Toyota manager in devel-
oping human resources (b) motivating employees to continually
improve and (c) the role of management in ensuring employee Members
development.

(1) The training figures include Toyota Motor Europe’s Head Office and Technical Centre.
(2) TBP = Toyota Business Practices
(3) JKK = Jikotei Koteï Kanketsu
Health and Safety

Toyota European Sustainability Report 2010 I Social Performance


Having a strong foundation for safety is fundamental in
Lost Time Injury frequency rate
a changing environment. Changes in FY09, including in Parts Centres and TPCE
preparation for manufacturing hybrid vehicles in Europe, %
meant we faced many new challenges. This process has 50
given us an opportunity to expand our knowledge and further
strengthen our safety culture. 40 35.29

28.56
30 27.77
This effort has already been recognised, with Toyota Motor

Freq rate
Manufacturing Poland (TMMP) winning a national award for 20
safety in the workplace – “ Pracodawca – Organizator pracy
bezpiecznej ” (Safe Work Organiser) in 2009. More than 400 10
organisations competed to win this award.
0

In FY10, we will continue to strengthen safety communication FY07 FY08 FY09

with the creation of a ‘Safety Promotion Committee,’ made 13 Parts Centres only

up of representatives from senior management, who will set 73


the direction on safety throughout our European operations.
In parallel, the process of sharing safety information and Formula: No of LTI/ Work hours x 1,000,000
best practice between different areas of our business will be
strengthened, so that our safety management system will Note : TPCE included
continue to develop.
Safety in vehicle logistics
We take an active role in ensuring the safety of our contracted
vehicle logistics network. In FY09, for example, we worked
with our rail logistics partners to prevent falls from height
during rail transport.

Pedestrian access to the top of the rail carriages used to


transport our cars is essential. Due to the height of rail bridges,
it is not possible to install a fixed barrier which would protect
employees from falling from the top of the rail carriage. Our
vehicle logistics team worked with our rail logistics partners
Production and health and safety employees at TMMP with the to overcome this challenge. The group developed a system
Safe Work Organiser award
of adjustable barriers, which protects employees from falling
while ensuring that the carriages remain suitable for rail
travel throughout the European network.
Safety in our parts centres
Our 14 parts distribution centres are responsible for the storage
and distribution of parts and accessories to retailers around Europe.

Following the introduction of a global strategy (called “ STOP


6 ”) in FY08 which aims to reduce the risk of the most
serious and frequently occurring types of accidents within
our operations, a significant improvement was made. This
improvement has continued through FY09.

STOP 6 risk assessment tools and check sheets were


developed and are now used at each depot. As a result
of these assessments, we implemented a number of
improvements and the level of risk has significantly reduced.

As part of its STOP 6 activity, Toyota’s European distribution


centre - Toyota Parts Centre Europe (TPCE), focused on
separating human work and machine work, avoiding falls
Adjustable barriers fixed to rail carriages
from height and developing a safety awareness plan.
Toyota European Sustainability Report 2010 I Social Performance

Safety in our manufacturing plants managing ergonomics is through the Plan-Do-Check-Act


In FY09 we saw a significant improvement in our Lost cycle (see bottom left). The start of production of the new
Time Injury (LTI) rate. During the year we strengthened our generation Auris provided an opportunity to further improve
reporting of ergonomic injuries and now report these types the company’s ergonomic management system.
of injuries separately.
Employee involvement
LTI Frequency rate in European plants Initiatives undertaken in FY09 to encourage employees to
engage on safety include:
4
3.0 Toyota Motor Manufacturing UK (TMUK) Deeside
2.8 2.7
3 introduced departmental safety meetings, providing all
CO2/car emission (kg/car)

0.4
members with a forum to discuss safety.
2 Toyota Motor Industries Poland (TMIP)’s annual
0.5
2.6
safety month focused on the importance of employee
1
communication in identifying and reducing risks. To
74 1.6
encourage employee participation, TMIP even stopped
the production line.
0
FY05 FY06 FY07 FY08 FY09
Overview of line stop activity at TMIP
Single event
Ergonomic
on,
er feedback
Obtain memb alisation
re
Action plan a whole
as
Toyota Peugeot Citroën Automobile data integrated of The activity
mins) 6 months
stop (30 rs l, including
2nd line activity
from FY07 ba ck to membe intensive to al
Feedback wsletter
Fe ed ion of ne
explanat via W ee kly
ins) including n plan
Ergonomic injuries are reported separately from FY09, op (30 m
1st line st d to identify
tion
1 month ac ent actio
aske lopm
Members eir safety plan deve
previously they were integrated into these statistics. and list th points
ent
improvem
Formula: No. of LTI/ Work hours x 1,000,000
In November 2009 we established an Ergonomics Working
Group (EWG). The EWG complements existing ergonomics To date more than 80% of improvement points have been
activity within our manufacturing plants and provides an addressed and 70% of employees said they would like to
opportunity for specialists from all of our plants to share have this opportunity more often. A more permanent system
best practice. for employee safety suggestions is being developed.
EWG works jointly with our Safety Working Group, which
provides a platform for discussion on safety in Europe.

Ergonomics at Toyota Motor Manufacturing Turkey


Toyota Motor Manufacturing Turkey’s (TMMT) approach to

from
Learning

P LA N
dels
past mo
including
n stage,
on at desig ce risk of ergo
Cooperati du
nts, to re rts fit.
other pla du ring pa
concern

P R EP

AC T
RO
all TMMT
. TMIP production members receiving a health and safety award for
ining for their efforts during safety month.
DU

p
mics tra and Grou
• Ergono for Team
C

al training
TION

• Addition
leaders. h ist . MI C
healt
• Member cess to physiothe
rap ER GO NO EN T

DO
ac EM
• Provide IM PR OV burden
ed part de
sign
• Improv process design
} Reduce er
to memb Head Office and Zaventem
N

ed ce ntre)
• Improv
IO

ness
ntre" (fit
"ergo ce for work.
We strengthened our risk assessment system for chemical
CT

• Use of remain fit


A P
DU
PRO to help pr
epare &

products at our Head Office in Brussels and our Zaventem sites,


C D which include garages, workshops and laboratories. Using a
CHECK hed syste
m observa
tion
preventative approach, the risk to safety, health and environment
• Establis remaining risk
fy
to identi
• Member
health ers
of memb ncerns.
is recorded, evaluated and subsequently controlled throughout
ntifiation
• Early ide of ergo co
who may
be at risk
the lifecycle including during purchase, storage and disposal.
Toyota European Sustainability Report 2010 I Social Performance
Engaging with
business partners
“  Our relationships with our business partners
and specifically our suppliers were challenged in
recent months. As a company, we chose to dem-
onstrate even stronger consistency and alignment
with our Purchasing Policy which allowed us to
Mark Adams further build and rely on our established business
Vice-President,
Purchasing,
relationships. „
75
Toyota Motor Europe
Mark Adams

The global economic crisis, as well as natural disasters, We believe that Toyota’s Guiding Principles and the Toyota
have all delivered challenges to suppliers of automotive Way in Purchasing provide us with a sound approach to
components. These challenges include supply disruption, business that will deliver sustainable business results for our
production interruption and logistics failures. suppliers and us as well.

We are not immune to the consequences of these macro The words of Toyota Motor Corporation founder, Kiichiro
events, and the past year has provided an opportunity to Toyoda, are still valid today: “Toyota and its suppliers work
fully test the strength of our purchasing policies and supplier together as one entity, not only in times of prosperity, but also
relationships. in times of adversity.”

The Toyota Purchasing Policy


At a time when the automotive industry is facing unprecedented Toyota purchasing priority model
challenges, we believe that our Purchasing Policy is more for global manufacturing
important than ever. The three cornerstones of the policy are:

Fair competition based on an open-door policy supporting


our aim of continuously improving the supplier base Growth
Mutual benefit based on mutual trust through an open and Sustainable
transparent dialogue
Good corporate citizenship by contributing to local Cost
communities and economies.
Production
Throughout our history, the application of these principles
has cultivated long term and sustainable growth for our
partners and us. We remain committed to ensuring that Quality
the Purchasing Policy is consistently practiced in order to
support the overall company vision of growth in harmony Safety
IBILITY
with society. RESPONS
T E SOCIAL
CORPORA
Corporate social responsibility is the foundation of our
Purchasing Policy and priority model, with safety and quality
representing core principles in our relationships with suppliers.
Protecting the Supply Chain
Toyota European Sustainability Report 2010 I Social Performance

A European cross-functional taskforce, led by the Purchasing information sharing when managing relationships with all
Risk Management team, ensures the continuation of business suppliers and other stakeholders in the business.
and production within the supply chain.
The following diagram outlines our process to protect the
Its effectiveness relies on the Toyota Way principles of business from any type of risk in the supply chain (financial,
transparency, clarity, honesty, mutual trust and speed of social or natural disasters).

Cure curs)
(if risk oc

Monitor
Predict ntingency
plan
Deploy Co m
proble
itoring (tra
cking) Solve the al
ugh Risk mon g e back to norm
ering thro y plan Ma na
Data gath ontingenc
ho lder ne twork Develop C
76 multi-stake
ssment
Risk Asse
G
E PLANNIN
PROACTIV

Competitiveness and Sustainability


We aim to develop long-term partnerships with our suppliers suppliers’ production teams. Their mission is two-fold: to
to ensure mutual growth for ultimate customer benefit. conduct a thorough production process assessment and to
apply the Toyota Production System and tools, with the aim
The market context today sets a challenging framework of constantly improving supplier competitiveness.
for development and growth. We are therefore focusing
on sharing our core in-house knowledge and experience In FY10 we will continue to work with our suppliers to share
by assigning Toyota Production System specialists to our our knowledge and further strengthen our supply base.

Quality in our Supply Chain


In partnership with our collective supply base, we conti- their counterparts in our supply chain on quality issues.
nuously look to improve the quality of our suppliers’ pro- Built-in quality at suppliers: Transferring our manufacturing
ducts and processes. knowledge and experience to achieve zero defects in the
manufacturing processes of our suppliers.
This principle is applied to both the development of new
vehicles and to existing production and has led to significant In addition, we improved our processes by examining
quality improvements in the order of 90% since FY06. We quality considerations at the design stage. Engineers
introduced a number of activities to support our suppliers. from Toyota and our suppliers work together to study and
identify opportunities to eliminate risks in the development
These include: and design phase and allocate resources appropriately to
ensure the highest-quality output.
Quality information system : Just-in-time quality perfor-
mance information with multiple dimension data ensures Despite our core principles of quality and continuous
maximum visibility for enhanced quality improvement ac- improvement, recent warranty incidents have demonstrated
tivities. an opportunity to identify further areas for improvement in the
Remedial quality communication : Building on the suc- production preparation stages of new vehicles and existing
cesses made in FY08, our top management work with production to ensure ultimate customer safety and satisfaction.
Expanding TEAM in Europe

Toyota European Sustainability Report 2010 I Social Performance


The Toyota in Europe Association of Manufacturers (TEAM) In FY09, the quality performance of
is an association of strategic European Toyota business part- TEAM members showed a near 90%
ners who come together to improve their individual and collec- improvement compared to FY06.
tive performance through networking, mutual assistance and
through the sharing of ideas and techniques. We bring the We plan to expand TEAM membership over the next three
suppliers together, who meet regularly to exchange best prac- years to more accurately reflect the geographic distribution
tice ideas from the shop floor. In the reporting period, we also of our supply base. This will double the membership num-
made our internal training facility available to TEAM members bers and these suppliers will represent 75% of our annual
and shared the latest techniques used in our assembly plants. purchasing spend.

Sustainable Purchasing Practices across the Supply Chain


In 2002, we issued our first Environmental Purchasing Guidelines.
77
Addressing the increased expectations towards sustainable
development, we revised the guidelines in 2007 to become the
Green Purchasing Guidelines, which included ‘Contribution
towards Sustainable Development’, focusing on good
corporate citizenship.

In the 2010 edition, named Sustainability Purchasing Guidelines,


the Corporate Social Responsibility (CSR) Policy and Guidelines
were added, along with a separate chapter on chemical substan-
ce management, REACH, substances of concern and recycling.

The new guidelines include :

Human rights : No child labour or forced labour to be used


Labour : The right of employees to freely associate, or not
to associate
Legal compliance : Comply with applicable laws and
regulations of each country and region as well as the
spirit thereof
Disclosure of information to stakeholders : Strive to disclose
to stakeholders such information as is pertinent to them.

Our culture of Genchi Genbutsu (‘going to the source to find


the facts’) means that we regularly visit the workplace of our
suppliers. This gives us the opportunity to witness first hand, the
implementation of our SPG guidelines in the supply chain.

Annual Business Meeting 2010


Around 350 suppliers and senior management from Toyota have demonstrated outstanding achievements, with 29 awards
Motor Europe attended the Annual Business Meeting in March being handed out in 2010.
2010 at the Toyota Technical Centre in Zaventem, Belgium.
The focus of the meeting was on Toyota’s commitment to
The annual meeting enables suppliers and Toyota represen- sustainable growth based on the Toyota Way and the Pur-
tatives to meet each other face to face and exchange ideas chasing Policy. The meeting concluded with the agreement
regarding business targets and achievements. that in times where new challenges are constantly emerging,
we need to remain focused on maintaining and continuously
Highly sought after awards are presented to suppliers who improving our supplier relationships towards recovery.
Engaging with
the community
Andy Pfeiffenberger “  We understand that we need to focus on rebuilding trust
with our stakeholders : our customers, our employees and
Vice-President,
their families, and our business partners. One way of doing

Corporate and Business Planning, CSR,
Toyota Motor Europe this is by engaging with the communities we operate in.

Andy Pfeiffenberger

Working Together
Our social contribution projects provide us with the opportunity BUSINESSEUROPE (Confederation of European Businesses):
to understand the expectations of our local stakeholders. We BusinessEurope is composed of 40 industrial and employers’
want to be a good corporate citizen at the most local level. federations. We participate in the Confederation’s working
groups on subjects such as climate change and research
In FY09, 20% of retailers and 3% of manufacturing and Head and development. For more information please see
Office employees were involved in local social contribution www.businesseurope.eu
projects.
CSR Europe: We are a member of CSR Europe, the
In addition to social contribution programmes, we interact with business organisation that promotes corporate social
stakeholders on corporate social responsibility as a member responsibility in Europe. For more information please see
of international associations and federations including: www.csreurope.org

ACEA: European Automobile Manufacturers’ Association. World Business Council for Sustainable Development: We
We are a member of the association and participate in the are actively involved in a number of WBCSD activities and
various expert groups dealing with issues of interest to the working groups, namely those on Energy and Climate and
European automotive sector. For more information please Mobility for Development. For more information please see
see www.acea.be www.wbcsd.org
Toyota Fund of Europe (TFfE)

Toyota European Sustainability Report 2010 I Social Performance


The Toyota Fund for Europe provides seed funding and gives safety and technical education increased from 66% to 72%.
direction to social contributions within the company. Environmental projects received increased funding and
make up 44% of our total contributions. We also supported
non-profit organisations through employee involvement,
fundraising and in-kind donations.

2009 achievements: Examples of our environ-


mental projects in Europe
Toyota involvement in Eco-Schools extended to Toyota
retailers
The TFfE is governed by a Board composed of 13 members Eco-Schools is an environmental education programme run
from senior management and representatives from our by the Foundation for Environmental Education which helps
subsidiaries. The Board meets twice a year to define the schools become more sustainable. More than 2,000 schools
overall social contributions strategy of both TFfE and Toyota in 30 European countries are part of the Foundation’s Eco-
Motor Europe as a whole. Its role is to : Schools network. 79

Identify, select and fund appropriate projects for TFfE.


Review, follow up and evaluate the projects funded.
Support Toyota subsidiaries’ project development and
strategy setting.

In FY09, the TFfE Board committed to supporting 18 projects.


Spending on social contributions via the TFfE in this period
totalled just under €600,000.

Despite the changed business environment, the TFfE con-


tinued to support key international and national projects

2009 European total spend on social contributions


Although there has been a reduction in the amount spent on
social contributions across our operations since the start of
the financial crisis in 2008, we have maintained a steady level
of support to our local communities.
Our focus on the strategic areas of environment, road

Evolution of Social Contributions


% A student in Turkey signs to commit to take responsibility
for the electricity use in his classroom
12 100
62%
62%
80
66% 69%
8 We support the Eco-Schools Environment and Innovation
51% 60
Millions €

Competition, which encourages schools to come up with


40 innovative and creative solutions to environmental problems.
4 Winning entries receive a grant to help them put their ideas
20 into action.

0 0
Since 2005, the competition has generated 188 entries from
05 06 07 08 09
schools and has led to the funding and implementation of 59
Environment Technical Education Strategic focus environmental projects.
Road Safety Other
Toyota European Sustainability Report 2010 I Social Performance

In FY09, for the first time, Toyota retailers in Denmark and Toyota Slovakia Living Trails
Slovenia worked together with schools to develop and
Together with the Ekopolis Foundation, Toyota Slovakia
implement environmental projects in their local communities.
supports the ‘Living Trails’ initiative to improve tourist
The winner of the last cycle was the Odtü Gelistirme Vakfi
infrastructure and reforestation in the Low and High Tatras
Özel Ilkögretim Okulu Primary School in Ankara, Turkey. The
mountain parks. The 2009 project began in January with the
school received the award for the ‘I Take Responsibility’
launch of a competition to fund local initiatives to protect the
project, which encourages students to take responsibility for
natural and cultural heritage of the parks.
electricity use in their classrooms.
For more information please see www.eco-schools.org
As part of this project, seven tourist paths in the parks were
rehabilitated. The paths are located in five different Slovak
Reforestation activities by Toyota España
national parks. The activities undertaken ranged from
Toyota España held its second Reforestation Day in November cleaning trails after windstorms to improving their safety by
2009 (see pictures below). More than 10,000 people, including repairing surfaces, fixing safety chains, undertaking anti-
staff and customers from Toyota’s retail network, planted seed- erosion activities, improving trail markings and installing
lings in 61 locations across Spain. Around 160,000 oak tree information panels (see below).
80
seeds and 10,000 seedlings were planted on the day.
This is the second consecutive year that Toyota Slovakia
has supported this initiative. The company has received the
Via Bona Award in recognition of its environmental projects,
including the Greenways and Living Trails initiatives.

The aim of the project is to increase awareness of environmental


issues in the community. Toyota’s retail network and Toyota
España were supported by the Spanish Environmental Ministry,
the Fundación Biodiversidad (Biodiversity Foundation), the
Fundación Felix Rodriguez de la Fuente, and more than
50 local partners including public institutions, non-profit
organisations and companies. For more information please see
www.habiaunavezunbosque.com

Toyota manufacturing plants interact with the local


communities

Our manufacturing plants intensified their contribution to the students about environmentally friendly vehicle engineering and to
local communities in FY09. Initiatives include: encourage the consideration of engineering as a future career.
TMUK Charitable Trust : Established in 2008 to distribute
funds to good causes, the Trust generated £201,403 in FY09
Toyota Motor Manufacturing UK (TMUK) from corporate and employee fundraising activities. Every
Technology Challenge : A nationwide competition to educate pound will be donated to support local projects.
Toyota European Sustainability Report 2010 I Social Performance
The campaign includes a regional drawing contest and
the distribution of 6,800 education packs and videos on

TMUK Charitable Trust

81
Toyota Motor Manufacturing Poland (TMMP)
Safe Driver Programme: TMMP has organised this programme TMMT volunteers supporting students to develop their ideas

with the Walbrzych Safe Driving Academy since 2006. In FY09 a


number of training sessions were held to educate staff and local
traffic safety features for children.
residents on ecological and safe driving.
Technology challenge: This competition aims to engage
young people in technical research and development. Students
Renovation of bike and running trail: A bike and running
submit ideas and Toyota employees lend support by showing
trail was renovated near the company’s facilities in Walbrych
them how they can turn their ideas into practical solutions.
by TMMP staff members in July and August 2009.

Toyota Motor Manufacturing France (TMMF)

Opening of the renovated trail

Toyota Motor Industries Poland (TMIP)


Students learn about biodiversity near TMMF plant
Playgrounds renovated: Playground renovation was
undertaken by volunteers from TMIP, their families and local
residents from Miloszyce and Leg. Educational partnership for sustainable development:
Since December 2005, TMMF has partnered with sustainable
Clean up the world: From 2007-2009, TMIP employees development organisation, CPIE Bocage de lCPIE Boca, to:
volunteered to help local authorities clean up the forests and
schools around the plant. More than 250 TMIP employees
Maintain biodiversity on the plant’s grounds
and friends participated. In FY09 a follow-up project was
Enhance children’s environmental awareness of the sur-
launched on recycling waste.
rounding communities.

Toyota Motor Manufacturing Turkey (TMMT) More information about these and more than 300 Toyo-
Road safety competition: TMMT continued its traffic ta social contribution projects in Europe can be found at
safety education campaign during Traffic Week 2009. www.toyotafund.eu
Economic
Performance
“ We need to put in place strategies and actions to adapt to ever-changing
market conditions. Flexibility in the development and production of our vehicles
in order to satisfy customer needs will become a significant area of competitive
advantage. Our top priority must be on rebuilding our customers’ trust.


Long-term trust is more important than short-term profits. We will pursue mutual
growth with our business partners based on mutual trust.

Ludo Vandervelden
Toyota European Sustainability Report 2010 I Economic Performance
Self Reliance
with Focus
on Core Models
Ludo Vandervelden
Senior Vice-President,
Accounting and Finance, 83
Business Services, Legal,
Toyota Motor Europe

Market Context
In FY09, the automotive market continued to expand in One of the reasons for this was a change in the market
China, India and other developing countries. In developed structure resulting from shifts in consumer demand to
countries, despite government efforts to stimulate demand, small family cars (C-segment) and for cars in the lowest
overall market conditions were difficult. price segments.

In FY09, our net revenues in Europe decreased by 22% However, our operating loss was €252 million in FY09
from FY08 to €16,390 million as a result of both reduced compared to €995 million in FY08. This was mainly due to
sales and vehicle unit production. cost reduction efforts in all areas.

Consolidated Financial Results for Europe (in million Euro)


FY05 FY06 FY07 FY08 FY09

Net Revenues 19,764 23,615 24,651 20,925 16,390


Operating Expenses 19,083 22,699 23,777 21,919 16,641
Operating Income 681 916 874 (995) (252)
Assets 17,908 19,448 19,294 16,143 15,733
Source: TMC Annual Results - Segment Information
Vehicle and Market Share in Europe
Toyota European Sustainability Report 2010 I Economic Performance

The European car market decreased by 2.8 million units to The year-on-year decrease in Western Europe was contained
18.3 million units, falling below the FY02 level. at 2.6% by the introduction of programmes to provide
incentives to motorists to scrap old vehicles and replace
Vehicle Sales and Market Share them with new more energy-efficient vehicles. However,
'000s of vehicles 6 these programmes were not offered in Eastern Europe,
5.6%
1,300 5.4%
5.3%
where markets collapsed by 41.5%. Under these conditions,
4.5%
4.7%
4.9% 4.9%
5 Toyota’s 882’351 sales in Europe represented a decrease of
4.1%
1,100

1,233
3.6% 3.6% 4 229’670 units or 20.7% compared to CY08. Toyota’s market

1,125
3.1%
3.2%
share was 4.9% in CY09, which is 0.4% lower than in CY08.

1,112
900 2.8%
3
1,001

882
950

700 Despite this, we managed to contain the impact of the decrease


855

2
769

in volume and mix deterioration by substantially reducing our


677
678

500 costs. In addition, by enhancing the supply and demand


1
614
556
490

management process, we have reduced inventory levels and


300 0 adjusted production volume to meet market demand.
CY 97 98 99 00 01 02 03 04 05 06 07 08 09
84 Market
share
Vehicle sales
(%) We expect sales to decrease further in 2010 when government
Market share
stimulus and incentives packages will come to an end.

Production Volumes '000s of vehicles


Vehicle Production Volumes

800
Our production volumes were adjusted to adapt to the
decrease in demand. As a result, our annual production 600
volumes reduced from 589,794 units in FY08 to 544,050
units in FY09. The reductions mainly affected production of 400
the Avensis and Auris vehicles.
200
This reflects the market trend towards small family car
vehicles. Government scrapping incentives programmes in
0
FY09 also benefitted cars in this segment.
FY 97 98 99 00 01 02 03 04 05 06 07 08 09

TMUK TMMT

Investments
TMMF TPCA

Investments in FY09 amounted to €229 million compared to €777


Investments
million in FY08, which is the lowest investment for the past ten years.
(million Euro)

1000
The €548 million reduction is due to the absence of major
946
882 model changes in FY09 (investments for Avensis and Corolla
804 798
800 707 715
777 Verso model changes incurred in FY08) and because we
659 needed to prioritise investment projects in FY09.
600 539

In FY09, the production of a full hybrid version of the Auris in the UK-
400
based facility in Burnaston, Derbyshire was confirmed. Production
229
200 of Toyota’s first European-built full hybrid will commence at Toyota
Motor Manufacturing UK (TMUK) in mid-2010. Engines will be
0 produced at TMUK’s facility in Deeside, North Wales.
FY 00 01 02 03 04 05 06 07 08 09
In FY09, construction for the expansion of the testing facilities
of our research and development premises in Zaventem,
Source: TMC Annual Results Belgium began. Through this investment, we intend to
strengthen our capability to develop vehicles that meet the
expectations of our European customers.
Glossary of terms

Toyota European Sustainability Report 2010 I Economic Performance


Agence de l'Environnement et de la Maîtrise Hoshin kanri Direction Management System (Japanese)
ADEME
de l'Energie HSD Hybrid Synergy Drive
ABM Annual Business Meeting HVO Hydro-treated Vegetable Oil
Assessment of Integrated Vehicle Safety French National Institute for Transport and
ASSESS INRETS
System for Improved Vehicle Safety Safety Research
European Automobile Manufacturers’
ACEA ITS Intelligent Transport Systems
Association
ISO International Organization for Standardization
Diesel Blended with up to 7% Volume
B7 Japan Automobile Manufacturers’
Bio-diesel JAMA
Association
Building Research Establishment
BREEAM Jikotei Kanketsu (Built-in Quality, Process
Environment Assessment Method JKK
Standardisation Methodology)
CC Corporate Citizenship
Japanese term that roughly translates to
CCI Corporate Citizenship Index Kaizen
’continuous improvement’
CCS Complete Customer Satisfaction
KPI Key Performance Indicator
CEO Chief Executive Officer
LED Light Emitting Diode
CIS Commonwealth of Independent States
LCA Lifecycle Assessment 85
CLP Classification, Labelling, Packaging
LTI Lost Time Injury
CO2 Carbon Dioxide
NCAP New Car Assessment Programme
C-Segment Small Family Car
NMHC Nonmethane Hydrocarbons
CSR Corporate Social Responsibility
NMSC National Marketing and Sales Company
CUS Urban Community of Strasbourg
NOx Nitrogen Oxide
Calendar Year (1st January – 31st
CY Organisation for Economic Cooperation and
December) OECD
Development
D-4D Direct Injection 4-Stroke Diesel Engine
OJD On-the-Job Development
Direct Injection 4-Stroke (Petrol) Superior
D-4S PDC Parts Distribution Centre
Engine
Dual-VVTi Dual Variable Valve Timing (intelligent) PDCA Plan-Do-Check-Act
Petrol Blended with up to 10 % Volume PHV Plug-in Hybrid Vehicle
E10
Bio-ethanol PIN Performance Index
EC European Commission PLC Parts Logistics Centre
A way of driving that reduces fuel, PM Particulate Matter
Eco-Driving
greenhouse gas emissions and accidents PSCG Parts Supply Chain Group
Intelligent software controls (battery) power R&D Research and Development
ECO Mode
consumption
RE Renewable Energy
Programme to implement sustainable
Eco Schools Registration, Evaluation and Authorisation
development education in schools REACH
of Chemicals
EDF Electricité de France
SE Simultaneous Engineering
EEA European Environment Agency
SINF North of France Industrial Society
Ekiden Relay Running Race (Japanese)
SOC Substances of Concern
EKSS European Key Stakeholder Survey
SPG Sustainable Purchasing Guidelines
ELV End-of-Life Vehicle
Toyota Business Practices (Toyota problem
EMC European Manufacturing Company TBP
solving methodology)
Environmental Management and Audit
EMAS TCP Time Credit Promotion (Programme in Belgium)
Scheme
Toyota in Europe Association of
EMS Environmental Management System TEAM
Manufacturers
ES Electricité de Strasbourg
TEF Toyota European Forum
ETS Emission Trading System
TFfE Toyota Fund for Europe
ETSC European Transport Safety Council
TMC Toyota Motor Corporation
EU European Union
TME Toyota Motor Europe
European Directive that caps vehicle
EURO 5 TMH Toyota Motor Hungary
pollutants’ emissions
EV Electric Vehicle TMIP Toyota Motor Industries Poland
EWG Ergonomics Working Group TMMF Toyota Motor Manufacturing France
FY Financial Year (1st April – 31st March) TMMP Toyota Motor Manufacturing Poland
Japanese term that roughly translates to TMMR Toyota Motor Manufacturing Russia
Genchi genbutsu
“go to the source to find the facts” TMMT Toyota Motor Manufacturing Turkey
GHG Greenhouse Gas TMUK Toyota Motor Manufacturing UK
GRI Global Reporting Initiative TSM Toyota Customer Service Management
Global Reporting Initiative Index
Toyota European Sustainability Report 2010 I Economic Performance

GRI Indicator GRI Description Comments PageS

1.1 Statement from the President.   4


1.2 Key impacts, risks, and opportunities.   4
2.1 Name of organisation.   3
2.2 Primary brands, products, and/or services.   3
2.3 Operational structure of organisation. 3
2.4 Location of organisation’s headquarters. 3
2.5 Number of countries where the organisation operates.   3
86 2.6 Nature of ownership and legal form.   3
2.7 Markets served.   3
2.8 Scale of the reporting organisation.   3, 67, 83
2.9 Significant changes during the reporting period. 3
2.10 Awards.   35,46,73
3.1 Reporting period.   3
3.2 Date of most recent previous report.   3
3.3 Reporting cycle.   3
3.4 Contact point for the report.   3
3.5 Process for defining report content.   3
3.6 Boundary of the report.   3
3.7 Limitations on the scope or boundary of the report.   3
3.8 Reporting on joint ventures and other entities.   3
3.9 Data measurement techniques. 3
3.10 Explanation of re-statements. 6
3.11 Significant changes from previous reporting periods. 3
3.12 Table of standard disclosures.   86-91
3.13 External assurance. We undertook rigorous internal auditing to ensure the data
in this report is correct. Our GRI application level has been
checked by an independent provider, Net Balance. We have
not undertaken external assurance for this report.
4.1 Governance structure.   12
4.2 Chair of the highest governance body.   12
4.3 Independent and/or non-executive board members.   12
4.4 Mechanisms to provide recommendations or direction to the board.   12
4.5 Compensation and performance. Executives within Europe are compensated according to
industry rates and performance.
Senior executives of Toyota  in  Europe review the performance
against annual objectives and key performance indicators
under the Toyota Global Assessment Performance framework.
4.6 Avoidance of conflicts of interest.   12
4.7 Board selection process.   12
4.8 Mission and values statement, codes of conduct and   10-12
principles.
4.9 Management of performance.   11-12
Toyota European Sustainability Report 2010 I Economic Performance
4.10 Performance evaluation. Executive remuneration is subject to annual review and
is composed of a fixed salary payment and an incentive
programme that is tied to the achievement of organisational
targets in the financial year.
4.11 Explanation of whether and how the precautionary principle   4,17,
is addressed. 21-22
4.12 Externally developed economic, environmental, and social   78
charters.
4.13 Memberships in associations.   28,65,78
4.14 List of stakeholder groups.   58
4.15 Basis for identification and selection of stakeholders.   57
87
4.16 Approaches to stakeholder engagement.   56-61
4.17 Key stakeholder topics and concerns.   56-61

Economic
4,82-84
Disclosures on management approach.

Economic Performance

EC1 Direct economic value generated and distributed.   6,79,82


EC2 Financial implications of climate change.   21-22
EC3 Organisation’s defined benefit plan.  Depending on the country of operation, our operations in
Europe have social security systems that are competitive in
the industry and locality where required by local practices.
EC4 Significant financial assistance received from government.  Toyota Motor Europe has not received significant financial
assistance from government in the reporting period.
Market Presence
EC6 Locally based suppliers. 6
EC7 Procedures for local hiring. Since our operations are spread across Europe, we attempt
to hire from across the region, with a focus on hiring local
people wherever possible.
Indirect Economic Impacts
EC8 Development and impact of infrastructure investments and   78-81
services.
EC9 Indirect economic impacts.   78-81

Environmental 4,21-22
27-29,32
Disclosures on management approach. 44,54

Materials
EN1 Materials used by weight or volume. We do not have the data collection systems to collect this
information. We plan to do so in the mid-term future.
EN2 Percentage of materials used that are recycled input  See EN1. 54
materials.
Toyota European Sustainability Report 2010 I Economic Performance

Energy
EN3 Direct energy consumption by primary energy source.   32,34-35
38, 41,43
EN4 Indirect energy consumption by primary source.   32,34-35
38, 41,
43
EN5 Energy saved due to conservation and efficiency   32,33,34
improvements. 37,38,40-
41,43

EN6 Initiatives to provide energy-efficient or renewable energy   5, 23, 24-


based products and services. 26, 28, 30-
31, 45-47,
50, 53, 55
EN7 Initiatives to reduce indirect energy consumption and   5, 13, 16
reductions achieved. 19, 33, 43

Water

88 EN8 Total water withdrawal by source. Most of the company’s water is sourced from municipal 6, 32, 49
water suppliers with the remainder sourced from rainwater
harvesting methods.
Biodiversity
EN11 Land in biodiversity habitats.  We do not report on this indicator as it is not deemed
material as we do not have land in biodiverse habitats.
EN12 Impact on biodiversity rich areas. Not applicable - please see EN11 comment. 80
Emissions, Effluents and Waste
EN16 Direct and indirect greenhouse gas emissions.   6, 32, 34,
37, 39,
40, 48
EN17 Other indirect greenhouse gas emissions. We do not have the data collection systems to report on this
indicator fully. We plan to do so in the mid-term future. The
majority of our greenhouse gas emissions are covered by EN16.
EN18 Initiatives to reduce greenhouse gas emissions.   13,
18-20,
25-31,
33, 34,
37, 38-41
EN19 Emissions of ozone-depleting substances. Toyota Motor Europe sites do not use materials that contain
ozone-depleting substances, except for fire extinguishers, some
refrigerants and air conditioning units, therefore emissions of
these substances are minimal and not deemed significant.
EN20 NOx, SOx, and other significant air emissions.   32, 33,
35, 53
EN21 Total water discharge. Our water discharges are associated with our 32, 33, 35
manufacturing facilities. In FY09 the total amount of
wastewater was 689,261 m3 for our production sites.

EN22 Weight of waste by type and disposal method.   6, 32,


33, 34-
35
EN23 Significant spills.  There have been no significant spills in the reporting period.
Products and Services
EN26 Impacts of products and services.   5, 25-26,
27-29,
45-47
Toyota European Sustainability Report 2010 I Economic Performance
EN27 Products sold that are reclaimed. We do not have the data collection systems in place to be 55
able to report on this indicator fully. We plan to do so in the
mid-term future.
Compliance
EN28 Fines and sanctions for non-compliance with environmental   6,32
laws and regulations.
Transport
EN29 Impacts from transport.   36-42

Labour
69-74
Disclosures on management approach.
Employment
LA1 Workforce.   67-69
LA2 Employee turnover.   70
89
LA3 Benefits for full-time employees.   71-72
Labour/Management Relations
LA4 Percentage of employees covered by collective bargaining Percentages differ by our countries of operation. We 70-71
agreements. recognise the right of employees to freely associate and
adhere to all applicable laws on collective bargaining in
each country we operate in.
LA5 Minimum notice period for operational changes. Operational changes are determined in line with the local
legislature of the locations in which we operate and, in line with
which and as applicable, discussions with our social partners.
Occupational Health and Safety
LA7 Absentee rates and injuries.   6, 73-74
LA8 Programs for serious diseases.   74
Training and Education
LA10 Training per employee.   72
LA11 Career and skill development programmes.   72
Diversity and Equal Opportunity
LA13 Workforce by diversity.   67-69
LA14 Salary ratio by gender. In terms of pay between males and females, the company’s
pay policies are designed to promote equal pay for equal
contribution, capability and experience. There is no
difference between pay ratios by virtue of gender.

Human Rights 10-11,


Disclosures on management approach. 77

Investment and Procurement Practices


HR1 Investment agreements with human rights considerations. 77
HR2 Supplier screening on human rights.   77
Non-discrimination
HR4 Total number of incidents of discrimination and actions taken. We have had zero number of incidents of discrimination.
Toyota European Sustainability Report 2010 I Economic Performance

Freedom of Association and Collective Bargaining


HR5 Risk to freedom of association and collective bargaining. In line with our CSR policy, all employees have the right to freely
associate or not to associate, complying with the laws of the
country in which we operate. Based on local legal requirements
employees are covered by collective bargaining.
Child Labour
HR6 Risk of child labour. In line with our CSR policy and local legal requirements, we
do not tolerate any forms of child labour in our business.
Forced and Compulsory Labour
HR7 Risk of forced or compulsory labour. In line with our CSR policy, we do not tolerate any forms of
forced labour in our business.

Society 56-57,
Disclosures on management approach. 78

Community

90 SO1 Managing impacts on communities.   56-60,


65, 78-
81
Corruption
SO2 Analysis on corruption. Toyota’s Code of Conduct sets out our approach to
preventing corruption and managing corruption if it occurs
or is reported.
SO3 Employees trained on corruption. Every employee at Toyota Motor Europe is required to read
and understand the company’s Code of Conduct which sets
out the type of ethical behaviour that is required of every
employee, including honest and fair transactions and the
policy on receiving gifts, hospitality or other favours.
SO4 Actions in response to corruption. No significant incidents of corruption have been reported or
been found in the reporting period.
Public Policy
SO5 Public policy positions and lobbying.   21-22,
27-29
Compliance
SO8 Fines and sanctions for non-compliance with laws and 6
regulations.

Product Responsability 4,44, 62-


Disclosures on management approach. 64, 65

Customer Health and Safety


PR1 Life cycle stages of products and services.   5, 15, 18,
21-22,
62-64,
65
Product and Service Labelling
PR3 Product and service information.   63
PR5 Customer satisfaction.   4, 47,
63-64
Marketing Communications
PR6 Marketing communications.   63-64
Compliance
PR9 Monetary value of significant fines. Nil.
© Toyota Motor Europe NV/SA. All rights reserved 2010.

Toyota Motor Europe is a Belgian limited company


with a registered office at :

Avenue du Bourgetlaan 60
1140 Brussels, Belgium

The Toyota European Sustainability Report 2010 is provided


to you by Toyota Motor Europe for informational purposes only.
For any questions, please contact :

Corporate Affairs and Planning: info@toyota-europe.com


Environmental Affairs: environment@toyota-europe.com

www.toyota.eu/sustainability

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