Edwards Demingis unique in the annals of management. Toyota got its start in 1925 as a maker of automatic looms and entered the car business in 1936. After the war, one of its early successes was the Toyopet, which,

An expansionminded Toyota had already launched an export business by selling trucks in South America. Executives believed it made sense to combine the companys strengths and export cars as well. For that, they decided to target the worlds single largest pool of customers: Americans. The decision to target the U.S. came about this way, according to Toyota Jidosha Kabushiki Kaisha in Toyota: A History of the First 50 Years. Shotaro Kamiya, president of Toyota Motor Sales, had visited America on a business trip in 1955 and was astonished by the number of small cars he saw. Nearly 100,000 were on the roadall of them European and most of them Volkswagens. Toyota had been successful selling its Land Cruiser SUV overseas, so perhaps it could do the same with passenger cars. But Toyota would have to move quickly. Kamiya feared that the success of the Europeans would

S. to impose import restrictions. If the Japanese didnt establish a presence in the U.S., they risked being shut out. Kamiyas proposal sparked a great debate within Toyota. Going up against GM, Ford, and Chrysler in their home market with small cars seemed too great a challenge for a company that had been making cars for such a short time. But Kamiya found a strong supporter in Taizo Ishida, president of Toyota Motor Corp. (The sales and manufacturing arms of Toyota operated as independent companies from 1950 to 1982.) Ishida had also visited the U.S. and noticed how little attention Detroit was paying to small cars. It was the era of V-8 engines and tailfins. Small cars like the Corvair and the Pinto wouldnt be introduced for another several years. Ishida had enjoyed success exporting Toyotas automatic looms overseas, and he believed that the company could do the same with passenger cars. His arguments won the day. With minimum preparation, Toyota Motor Sales U.S.A. was in

It made its headquarters in Beverly Hills and found an old American Motors outlet in Hollywood to serve as its first dealership. On the showroom floor were the only Toyotas in the U.S: a pair of Toyopet sedans. Toyota sold its first car early in 1958, and by years end it had sold just 268 more, along with one Land Cruiser. The feeble sales performance was a sign of a larger problem: The Toyopet (later renamed the Crown) was not ready for primetime. In the rush to move into the U.S., Toyota had shipped an inferior product. It cost $700 more than a VW Beetle and wasnt nearly as good. The car vibrated badly at speeds over 60 miles an hour and tended to overheat when driven up mountains or in the desert. It also guzzled gas and stalled without warning. Toyota had discovered that it was uncompetitive, but it was too late. In December 1960, just three years after it arrived and its reputation in tatters, Toyota suspended U.S. operations. It had sold