The competitor probably could have purchased a sewing machine and replicated the engineering drawings themselves. Teardowns of competitor products is common today, and I'm sure it was back then as well.
I think Toyota's "helpful" attitude comes from the Western paranoia in the 70-90s that Japan was going to completely dominate worldwide manufacturing. After all, their rise was fast: in the mid 60s, Japanese manufactures were practically begging to sell rudimentary formed metal components in the USA, but by the early 80s, they were a leader in the high-tech manufacturing. That rise caught many people off guard and I've heard it said that the "lost decade" in Japan was the result of American trade policy specifically designed to curtail Japan's growth in manufacturing.
Viewed in that light, it makes sense that Japanese companies would appear "helpful" to American ones. Why else would Toyota co-build a plant with GM in order to teach GM their Kaizen philosophy for manufacturing?
I have no idea of whether this is true at all, but I really like the story anyway.
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What I do know is true is that modern day Toyota doesn't mind sharing the solutions they have come up with to various problems, because they think the real value is in the people and processes to (a) identify the problems in the first place, and (b) come up with solutions suited to those specific problems.
Blindly applying Toyota's solutions to Toyota's problems to your organisation, just hoping that you have the same problems as Toyota and that their solutions will work also for you is a recipe for confusion, and not what matters. (Yet virtually every "development methodology" is a specific solution to a specific problem blindly applied to an organisation.)