Toyota Part 1. Chapter 1. Section 2.

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Item 1. Setbacks at Toyoda's Loom Works

Establishment of Toyoda's Loom Works, Ltd

In January 1906, the Shimasaki-cho Plant was completed, and Toyoda Shokai Office transferred from Buhei-cho to Shimasaki-cho. Several new models were released in succession, including the 1906 Toyoda Power Loom, the improved successor to the 1905 Type, and the compact loom, which simplified the warp halting device and other functions, and was affordable. The compact loom was popular as it was not only efficient, but also cost around half the price of conventional looms, and ended up outselling the 1906 power Loom.

All of the looms invented by Sakichi Toyoda, including the 1905 Toyoda Power Loom, were types of power looms known as narrow-width power looms.1 Widths of the looms ranged from 45.5 centimeters for the compact loom to 49.2 centimeters in the 1905 and 1906 power looms. Textiles manufactured using narrow-width power looms were sold in Japan, the Korean Peninsula, and China.

The textile testing plant at Shimasaki-cho operated 120 narrow-width power looms. With the Buhei-cho Plant already running 80 looms and the Nishishincho-Plant operating 100, the total number of looms in operation grew to 300. As a result, profits in the company's weaving department grew strongly and business was brisk.

The success of Toyoda Shokai's popular narrow-width power looms caught the eye of Kamenosuke Fujino, head of the Osaka branch of Mitsui & Co., Ltd. To improve the production capability of the company's looms, Fujino proposed in May 1906 that Toyoda Shokai become a joint-stock company.

At the time, the Japanese cotton spinning industry was undergoing a period of mergers between small and medium firms due to excess production capacity. The number of spinning companies had halved from 79 in 1900 to 36 in 1908. Furthermore, production hours were being cut under the control of the Japan Spinners' Association. Meanwhile, production and export of high added value cotton cloth was promoted as a means of reducing the excess supply of cotton yarn. To achieve this, the spread of power looms which would efficiently produce textiles was necessary.2

Looking at the number of looms in Japan in 1906, there were 716,171 hand looms and 20,657 narrow-width power looms in use, as well as 9,601 broad-width looms operated by the weaving departments of cotton spinning companies. Correspondingly, there were 463,165 businesses in operation, with the majority of the market comprised of small businesses which operated hand looms.3