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Toyota now plans to use modules, but in its own way.

Toyota now plans to use modules, but in its own way.

Treece, James

Toyota is reorganizing key parts of its supplier network to follow the industry trend toward modules.

But Toyota is taking a typically innovative approach. It is urging suppliers to consolidate and form joint ventures without giving up its equity stakes in those companies. That will have two benefits. Toyota will gain cost and resource savings, but suppliers’ power as Tier 1 module developers will be limited.

Nissan, Mitsubishi and Mazda have also moved to lower costs by buying modules. But Toyota’s actions are notable because it has strongly opposed modules, and because it …