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Toyota to take over ASEAN car development in wake of Daihatsu safety scandal – will Perodua be affected?

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Toyota and Daihatsu have made far-reaching structural reforms in the wake of the latter’s crash test rigging scandal, which caused a stop-sale on all Daihatsu-developed models and impacted the near-spotless reputation of both companies. The press release stated that the move will affect the firms’ overseas business structure and reorganise Daihatsu into a “mobility company centred on mini vehicles [i.e. kei cars].”

The reforms are aimed at preventing a repeat of the so-called “procedural irregularities” by recognising “Daihatsu’s [lack of?] resources and actual conditions,” instead leveraging the company’s strengths to “build ever-better cars.” Such a statement can be read in several ways, but it essentially means that Daihatsu will withdraw from global car development and return to building kei cars for the Japanese market.

As a result of the reform, the Emerging-market Compact Car Company that spanned both Toyota and Daihatsu will be dissolved, with product planning responsibilities being shifted to the Toyota Compact Car Company. The latter will be the contractor to Daihatsu in emerging markets (such as Southeast Asia) and handle the entire process of creating future models, from development to certification.

Toyota To Take Over Asean Car Development In Wake Of Daihatsu Safety Scandal – Will Perodua Be Affected?Toyota To Take Over Asean Car Development In Wake Of Daihatsu Safety Scandal – Will Perodua Be Affected?

The Perodua Axia (left) and Toyota Vios were affected by Daihatsu’s crash test rigging scandal

Additionally, the business and product management responsibilities will also be transferred to Toyota’s Business and Sales Unit. The company will take over other areas related to subcontracting – including resource management and optimisation – to strengthen its partnership with Daihatsu.

These structural changes will be reflected in the renaming of the two companies tasked with developing and manufacturing cars for the greater Asia region. Toyota Daihatsu Engineering & Manufacturing (TDEM) in Thailand and Toyota Motor Asia Pacific (TMAP) in Singapore will henceforth both be named Toyota Motor Asia (TMA) and form Toyota’s Asia regional headquarters. The aim is to make the both of them self-reliant and broaden their collaboration. The reforms are expected to be completed in June.

Daihatsu had hitherto been instrumental in the development of cars for the ASEAN market, building the Daihatsu New Global Architecture (DNGA) that underpins several models sold in the region. These include the Daihatsu Rocky/Toyota Raize/Perodua Ativa, Xenia/Veloz/Alza and Ayla/Agya/Axia triplets, as well as the Toyota Vios and Yaris Cross.

Toyota To Take Over Asean Car Development In Wake Of Daihatsu Safety Scandal – Will Perodua Be Affected?

How will next-generation Perodua models like the Bezza be affected?

The Ayla/Agya/Axia and Vios were affected by the aforementioned safety scandal, in which modifications were made to pass crash tests that were not present in production vehicles. Another crash test scandal affected the Rocky and Raize e-Smart Hybrid, whereby the results of the passenger-side side impact test were copied over to the driver’s side without repeating the test properly.

An independent panel that investigated the crisis found that the scandal was rooted in management that focused on “short-term development” and did not take measures to address the fraud. The team, it added, “did not fully grasp the actual situation on the ground and only responded on an ad-hoc basis,” leaving workers “unable to speak up when they have a problem.” The reorganisation, which relieves Daihatsu of the burden of global car development, will surely hope to draw a line under the scandal.

One aspect the press release did not touch on is Perodua. As Daihatsu’s part-subsidiary, the national carmaker played a key role in the development of cars built on the DNGA platform. Will this reorganisation diminish the company’s standing in the partnership? And will the move affect future models like the new electric vehicle and the forthcoming next-generation Bezza? Only time will tell.

The post Toyota to take over ASEAN car development in wake of Daihatsu safety scandal – will Perodua be affected? appeared first on Paul Tan’s Automotive News.

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