Toyota eases pressure on suppliers to reduce prices
Auto parts suppliers to Japanese automaker Toyota said Toyota plans to ease its price cuts from April as the Japanese automaker has recently made a profit.
Auto parts suppliers to Japanese automaker Toyota said Toyota plans to ease its price cuts from April as the Japanese automaker has recently made a profit.
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| A Toyota assembly line. (Source: AAP) |
Specifically, Toyota plans to require suppliers to reduce costs by less than 1% from April to September 2014 compared to the previous request of about 1.5% because the company's business profit is expected to reach a record 2,400 billion yen (23.64 billion USD) in fiscal 2013 ending this month.
The move will help Toyota's suppliers raise wages and increase investment, many of which are small businesses.
Toyota achieved this impressive growth thanks to cost-cutting measures and the devaluation of the yen.
The depreciation of the yen helps increase product competitiveness and profits from Toyota's overseas car operations, but it also increases the cost of importing raw materials for suppliers.
Speaking to reporters after a meeting with suppliers, Toyota senior management official Keiji Masui said price negotiations “will be conducted carefully according to the individual circumstances of our business partners.”
According to Vietnam Plus
