- A major Toyota supplier wants to reduce the number of part types by a third.
- Toyota Boshoku is targeting a 76 percent reduction in headrest components.
- Meeting duration is going down by 42 percent.
Toyota is looking for ways to cut costs, and one of its biggest suppliers has a surprisingly simple answer: build fewer parts. Toyota Boshoku, the company responsible for a huge range of seats and interior components, is targeting a major improvement in profitability by 2030, and reducing complexity is one of the key ingredients.
The supplier wants to increase its operating profit margin to seven percent by the decade’s end, up from a forecast 3.8 percent this year. To get there, Toyota Boshoku says it will work on both sides of the equation by increasing the added value of its products while lowering costs through measures such as reducing the number of part types, improving productivity, and using existing assets better.
One of the more eye-catching targets is called RPT33, which stands for a 33 percent reduction in part types. Rather than simply making individual components cheaper, Toyota Boshoku wants to simplify what goes into its products in the first place. Fewer unique parts should mean less complexity throughout development, purchasing, manufacturing, inventory, and logistics.
Fewer Parts, Shorter Meetings
The company is already showing how dramatic this approach can be. Through collaboration with OEMs, the Toyota supplier cites a massive 76 percent reduction in the number of headrest components as an example of how it can build a more profitable earnings base. In other words, the goal isn’t necessarily to make a cheaper headrest. It’s to make the same basic product with far fewer individual pieces.
Toyota Boshoku isn’t stopping there. Its next-generation seat frames are designed to use fewer parts and fewer manufacturing processes while increasing the percentage of work performed in-house. These new seat frames will be 20 percent thinner “than the thinnest competitive product” and five percent lighter “than the lightest product” currently available.
Elsewhere, it has already found an easy target for improvement: meetings. It wants to cut total meeting time by 42 percent as part of its “stop, change, and find a better way” initiative.
Inevitably, AI will also be used for things such as automated design tools, while process innovation is intended to eliminate waste in manufacturing and logistics.
Interestingly, this isn’t purely a race to make products cheaper. Toyota Boshoku is simultaneously trying to increase the amount of business it gets from other automakers. It wants non-Toyota sales to reach three times their 2022 level by 2030.
Volkswagen Is Also Downsizing
Toyota Boshoku isn’t alone in concluding that complexity has become too expensive. Volkswagen Group is pursuing a remarkably similar strategy, although on a much larger scale.
The German conglomerate has announced plans to reduce its model lineup by up to 50 percent and cut available options by as much as 75 percent. Toyota’s new CEO also thinks the company has too many models in its sprawling portfolio.
Motor1's Take: The idea is straightforward: sell more units of fewer configurations, allowing companies to spread development, purchasing, manufacturing, and logistics costs across higher volumes.
It’s a very Toyota-like approach to cost reduction: don’t just negotiate harder with suppliers or make everything cheaper. Build fewer parts, use fewer processes, eliminate waste, and find a smarter way to make the thing in the first place.
The VW Group has reached a similar conclusion, although its strategy focuses more heavily on reducing the number of configurations and variants customers can choose from. In both cases, the parts bin is becoming the battleground for profitability.
