The typically boosterish San Antonio Business Journal sees nothing but blue skies and green lights ahead as the decades long move of manufacturing jobs out of California and into Texas continues with the announcement that the Tacoma is moving into the brand spanking new San Antonio factory. San Antonio has been busy not building very many Tundras, so locals there are thrilled at the prospect of feasting on NUMMI’s loss. “Year to date through July, Toyota says it sold 42,419 Tundras — down 52.6 percent from the same seven-month period in 2008. The news isn’t much better for the Tacoma, a smaller truck. During the first seven months of this year, Toyota sold 65,713 Tacomas. It sold 95,732 Tacomas during the same selling period in 2008.” Toyota will have to spend an estimated $100 million tooling up San Antonio to build Tacomas, but the combined volume of Tundras and Tacomas still will not fill the San Antonio factory unless something dramatic happens to increase Toyota’s truck sales.
If you ask me, the real mistake was in building a huge new dedicated pickup truck factory in Texas with which to attempt to conquer a market segment Toyota has failed repeatedly to penetrate. The huge new San Antonio plant was a massive PR effort aimed at making Toyota a legitimate player in the US large pickup truck market. That gambit failed. The smarter move would have been to mothball San Antonio, go back to making the Tundra in Indiana and keep the fully depreciated NUMMI factory building small cars and small trucks. But, no, image is everything and Toyota would never admit to making a big mistake on the massive San Antonio project. GM’s exit from NUMMI makes it easy for Toyota to close that factory and blame someone else. Toyota closed NUMMI because it was the most face saving way to reduce overcapacity.