The official launch, on March 4, of the Corolla export programme was the culmination of a multibillion rand project to turn Toyota SA from a small, inward-looking company into one of global proportions.
As recently as 2003, production capacity at the company's Durban assembly plant was only 100 000. Of the 75 000 vehicles built that year, almost all were destined for the SA market.
Since then, capacity has more than doubled. Actual production this year will be 215 000, and it will increase to the 220 000 limit next year. If necessary, says Toyota SA president Johan van Zyl, it can be stretched to 240 000.
WHAT IT MEANS
 Almost R20bn is the combined export value of Toyota cars and components for 2008
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Two-thirds of production is destined for other markets. Almost 147 000 of the 215 000 vehicles built in Durban in 2008 will be shipped through the city's harbour to countries in Europe, Africa and the Middle East.
To complete Toyota SA's transformation, the 215 000 production will be made up of only two vehicle platforms - the Corolla sedan and Hilux-based pick-ups and sports utility vehicles (SUVs). The entry-level Tazz, RunX hatchback and HiAce minibus taxi are gone. Their successors are imported. This year the company expects to import 80 000 vehicles.
When government launched the motor industry development programme (MIDP) in 1995, one of its ambitions was to halt the proliferation of uneconomic vehicle ranges made locally. Companies should build fewer models in greater numbers. Using the carrot of generous export incentives, the MIDP intended to create an efficient, cost-effective industry able to compete in export markets.
Of the 220 000 units to be built each year by Toyota SA, 100 000 will be Corollas and 120 000 Hilux vehicles. The latter will include some Fortuner SUVs built from the same platform. About 5 500 Hino and Dyna trucks also come out of the Durban plant each year. But these are assembled from imported kits and are for domestic customers.
Following the launch of the MIDP, a number of other motor companies quickly shifted their emphasis towards exports. But Toyota SA, for a long time, appeared to be missing the boat. There was still no credible challenge to its SA market leadership, but in terms of exports it appeared to be going - literally - nowhere.
Van Zyl says plans started to be put in place in 1995. That year Toyota Motor Company (TMC) of Japan bought 25% of Toyota SA from the Wessels family, which founded and owned it. However, it was only when TMC upped its stake to 75% in 2003 that the results of those plans started to show.
When asked why his company wasn't exporting more, former Toyota SA chairman Bert Wessels used to say TMC, which would have to approve contracts, had to be convinced the factory could meet the necessary quality standards. Nor was it interested in small-scale deals. When Toyota SA hit the export trail, it would do so in a big way.
Not everyone bought his explanation, but as Van Zyl says: "TMC did not become one of the best car companies in the world without long-term focus. It knew what it intended to do but it also knew that global standards had to be in place first."
The first export programme, of the previous Corolla model, required Toyota SA to send 10 000 cars to Australia each year. This was effectively a low-risk test of the SA company's ability to meet cost, quality and delivery standards. Van Zyl says: "This was our homework, to show us what needed to be done to become a supplier to a global market."
The Durban plant presumably proved its readiness. When the Hilux programme was announced in 2005, it was indeed the "big way" promised by Wessels.
Toyota SA was chosen as one of four source plants to build the global group's new innovative multipurpose vehicle, or IMV. Of the 500 000 to be built annually, Toyota SA would be responsible for 120 000.
Hilux is exported to about 40 countries. Now, with the number of Corolla units, Toyota SA is a fully fledged member of TMC's global production network.
Van Zyl stresses, however, that this does not mean Toyota SA's transformation is complete. In some ways, it is just beginning. The shift to a two-platform manufacturing strategy has clearly had a beneficial effect on costs. With Japanese guidance, the company has made significant inroads into fixed and variable costs throughout the business. Manufacturing and assembly processes are more efficient, quality better, materials waste has been reduced, and the environmental "footprint" improved.
But SA is still miles away from many of its major markets in Europe. There are Toyota plants in other developing countries that are closer and could also service them. SA's labour and some costs are comparatively high compared with some of these countries. Distance-related transport costs also work against SA.
In Toyota SA's favour, however, is the reciprocal free trade agreement between Africa and the European Union, which allows the company's cars to enter EU markets duty-free.
There are conditions, of course. To qualify, the vehicles must contain at least 60% deemed local content, which can include components sourced from Europe. That is a big help: Toyota SA uses a considerable number of European-built parts in its cars. As a result, Corolla easily beats the 60% target. Hilux is about 70% of the way there, meaning some duty is still payable on vehicles destined for Europe - a bill for which Toyota SA itself is responsible.
Despite the relative success in meeting the 60% target, Van Zyl is not satisfied. He says Toyota should get there without the aid of European components. Indeed, manufacturing director Henry Pretorius thinks the company should achieve at least 70% genuine local content.
That means improving the local supplier base. Motor companies need supplier skills and output on their own doorstep, not half a world away. Also, if it is to be the base for a true vehicle manufacturing industry, SA needs a globally competitive supplier industry.
The problem for most motor companies until now has been that their production volumes have been so small that they have not offered the lower unit costs that would make local components producers competitive against overseas suppliers.
Even some of the companies with medium-volume exports have found it difficult to justify raising local content. Economically, it doesn't make sense. Mass-produced imports are cheaper.
But at 100 000 for one product and 120 000 for the other, Toyota has entered a new league. Pretorius says: "Suddenly our numbers are interesting to global components suppliers. For the first time they are coming to us and asking for business, instead of us having to persuade them." The vehicle export drive has had the added - and intended - effect of also creating export markets for local components suppliers.
Already, Toyota SA's expansion - aptly named the 220K Project - has attracted 12 new international suppliers to invest in SA.
Van Zyl says: "The next phase of our transformation is to strengthen our foundation, to further revitalise the organisation to become even more cost competitive. One of our biggest challenges is to develop the supply base. We are pushing local content as hard as we can."
He adds: "One of the problems faced all around the world by industries that develop very quickly, as ours has, is that you run out of logistics capacity. It's something we need to address urgently. As soon as that is in place, we can consider the next phase of growth."
To support its capacity and export growth, Toyota SA has spent R300m on employee training and development in the past five years. The programme has created 4 000 new jobs.
The combined export value of Toyota vehicles and components this year is expected to be nearly R20bn.
