By on October 14, 2010

A report in Japan’s Kyodo news agency [via Reuters/Automotive News [sub]] must have raised a few eyebrows in Japan: thanks to a rising Yen, Toyota is reportedly eying an end to Corolla exports from Japan by 2013. Toyota has since emphasized that

it has made no decision to halt production in Japan of its Corolla automobiles for overseas sales but said it was always considering an optimum global production structure.

The yen hit 81 to the dollar today, both on Yen strength and dollar weakness. ( A Euro buys 1.41 dollars again – get ready for Eurotrash invading Manhattan.)

Toyota has already shifted the bulk of its Corolla production overseas: last year it built 815k Corollas outside of Japan, and only 235k in its home country (60 percent of which were exported). Still, Toyota has long considered stability in its Japanese workforce as core institutional value, and previous currency rises led to changes in design and quality philosophy rather than reductions in Japanese production levels. But then Toyota is no longer in a position to release currency pressure by targeting “fat” or “overquality” product the way it could in the early 90s. The “overquality” simply isn’t there anymore. Like everyone else, Toyota’s major competitive option is to move production closer to cheap labor and large markets.

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23 Comments on “Toyota Mulling The End Of The Japanese Corolla...”


  • avatar
    dwford

    “Overquality” is definitely not there anymore. We just bought several 2009 Corollas at auction, and what pieces of junk they are, especially the interiors – barely better than the awful Caliber and current Focus. Lots of cheap, poorly fitted plastics.

    • 0 avatar
      windnsea00

      The driver side b-pillar covers like to come loose so you need to replace the two plastic inserts on the bottom of where it snaps in. Annoying but cheap and easy fix.

      Also the air vents like to loose their tabs that allow them to be adjusted, that is a disappointing flaw.

      Lastly, if you hear a nasty rattle and/or feel a stutter from the engine upon cold start, there is a TSB out there for replacing the timing gear mechanism but it has to be under the 5/60k warranty still. Sigh, these were not issues on the previous generation!

    • 0 avatar
      Sugarbrie

      Cheap plastic interior parts are not such a big deal as long as they do not cheapen the power train (engine, transmission, etc).
       
      VW has kept their interiors quality high, and the higher price reflects it.
       
      It is a choice.
       
       

  • avatar
    zbnutcase

    Never, ever, EVER buy a Japanese car not assembled in Japan, might as well buy a GM product

    • 0 avatar
      psarhjinian

      The Corolla has been built in North America for a very long time and has been completely reliable.  So has the Civic, as well as any number of cars. I don’t think there’s been a Japanese-built Corolla sold new in North America for a decade at least.
       
      The “made in Japan” thing is just as short-sighted (and borderline racist) as VW fans’ attempts to blame low-quality products on Mexican assembly, despite that a) German made models suck, too and b) it’s the same management making the decisions.
       
      Put it this way: if a car is going to be unreliable, it has everything to do with management’s decisions to make it so, and very little to do with the inherent attributes of where it’s assembled, save for the quality decisions at the plant and it’s supplier base.

    • 0 avatar
      Canuck129

      psarhjinian,

      There have been quite a few new made in Japan Corollas sold in N.A. over the past few years.

    • 0 avatar
      psarhjinian

      I stand corrected.  I thought all Corollas were domestically assembled (either Cambridge or Fremont); it turns out that only Canadian-market ones are.

    • 0 avatar
      slavuta

      psarhjinian, I just drove Jap-made 2010 Corolla

    • 0 avatar
      Stingray

      @ psarhjinian
       
      I partially agree with you. On my experience, factory conditions differ on each country. The management may be the “same”, but worker’s culture and even locally available products/parts/consumables influence the end result. Even how quality standards are applied differ.
       
      Whatever the plant, the cars are built using a mostly the same quality standards and parts, so the end result is very similar. I’d buy the locally built product since I tend to think it’s better adapted to local conditions.
       
       

    • 0 avatar
      Sugarbrie

      I had a 1992 Corolla that was assembled in Canada.   Ontario if I remember correctly.

      A 1995 I bought used in 2004 as a commuter car was from that joint GM plant in California.
       

  • avatar
    zbnutcase

    Why is there a goddamn hyperlink in my previous post? I DID NOT PUT ONE THERE

  • avatar
    obbop

    I demand a recount.

  • avatar
    ash78

    The problem with Toyota is just like the problem with VW, from other ends of the spectrum
     
    One company sells cars that were traditionally cheap, very boring, but extremely reliable. The other sold cars that were a little more expensive, with great initial quality, but poor long-term reliability.
     
    These days, competition has closed the gap like a vise from BOTH sides, marginalizing those two companies into a sea of undefined blandness

  • avatar
    L'avventura

    The world is currently in a race of Competitive Devaluation of currency.  China is head-strong about devaluing its Yuan, America is going through yet another round of QE ‘printing money’, South Korea continues to engage in comparative devaluation policies, and even Brazil is moving to weaken its currency.
     
    America contends that the artificially devalued Yuan is forcing everyone’s hand on this.  Economics Nobel-prize winner, Paul Krugman lately wrote in the NY Times that Competitive Devaluation is an inherently unstable game for all participating parties.
     
    Oddly, its a game that the Japanese have pulled away from.  While both the BoJ, as well as the EU, have engaged to reduced their currency somewhat.  Its been reactive, and largely to appease political critics.
     
    The consequence is that Japanese companies like Toyota moves their production overseas.  Those same companies benefit from incredible strong yen, costing those companies less to build foreign factories.
     
    Ben Bernake said that deflation is the easiest thing to fight (just print more money), and he is proving himself right.  Inflation is hard to fight, and Competitive Devaluation is massive inflationary vehicle, and the benefits aren’t present if all parties engage to devalue their currency.
     
    Japan may risk losing more manufacturing jobs, but Japan, and the EU, may ultimately be wiser by pulling themselves out of this fight.

  • avatar
    windswords

    “What is more American, a Ford Fusion built in Mexico or a Toyota Camry built in Kentucky”?
    .
    Well maybe you should take a closer look at that Camry bud, ’cause it could very well have been built in Japan, as a lot of them still are. Same for Honda and Nissan I think. At least the Ford has a lot of US/Canadian parts. I doubt Toyota is importing any significant NA parts for Japan built Corollas and Camrys.

    • 0 avatar
      slavuta

      windswords,
       
      Camry IS the most-American car – fact. It has highest content of all cars of parts
      made in America and it is mostly built in America and it sells in such numbers that
      forget about Ford. One of the reasons I will not buy Fusion – it is made in Mexico.
      I will not buy any car made in Mexico, Britain or Italy.
       

    • 0 avatar
      psarhjinian

      More parts are domestically sourced than you might think.  JIT gets harder when you’re bringing parts on the slow boat

    • 0 avatar
      windswords

      slavuta,
       
      Apparently not all Camrys are assembled equal, since some for sale in North America are made in Japan.
       
      Psar,
      No doubt domestic parts are in Kentucky built Camrys (especially from American divisions of Japanese part makers) but I doubt little if any content from American sources are in Camrys and Corollas built in Japan.

    • 0 avatar
      psarhjinian

      I’m not too sure (since I was just schooled above on the Corolla) but I think the only Japanese-assembled Camrys are hybrids and five-speed SE models, which isn’t very many at all.
       
      I am interested to know which Corollas are Japanese-assembled or why.

    • 0 avatar
      L'avventura

      Car.com has a “American-made’ index which breaks down the percentage of parts that are North-American sourced:
       
      http://blogs.cars.com/kickingtires/2010/06/toyota-camry-tops-carscoms-american-made-index-for-second-year.html
       
      The Camry, which is built in Kentucky and Indiana, use 85% American sourced parts, and is #1 on the list.  As of 2009, virtually all of Camrys sold in the US are made in the US, even the Camry hybrids are produced in Kentucky.
       
      Let’s compare that with the Ford F-150, which now only uses 55% American made parts, down from 75% from last year for the same design.  Most of those parts are coming from Mexico, the Detroit 3 have had a massive exodus there over the years.  The Detroit automakers don’t have the option of setting up plants in the South like the transplant automakers because the UAW requires all their US plants to be run by the UAW (hence is no cheaper), so most of the supply chain has moved south of the border for the domestics.
       
      If American jobs are important to you then the Camry and Accord is the most “American”.  Toyota and Honda even export more American-made vehicles overseas then Detroit.

    • 0 avatar
      slavuta

      windswords,
      I never said that all of them assembled in America. Most of them are, and considering their sale numbers they are super-American.
       
      psarhjinian,
      Japanese made Corollas are the ones with VIN starting with J. Other then that they can be any model. sometimes this is not true, like in case with Highlander. But most of the time it is all about current demand. If they need more LE and LE is currently available from Japan, they will ship it. Next time they need more SE, they will ship that. They look at patterns of sales and they trying to predict what to make and when.
       
       
       

    • 0 avatar
      Canuck129

      psarhjinian,

      Most recently, Fremont closed and Toyota needed to backfill orders from Japan.  But prior to the recession, Corolla sales were so ridiculously high that Japan had to supply even with 2 N.A. plants.  Who knows what they’ll need in the future because I believe Mississippi is going to be building them??

    • 0 avatar
      windswords

      “and only 235k in its home country (60 percent of which were exported).”
      .
      Remember that this number is down due to the economy. Before carmeddon, there were significant numbers of Accords, Civics, Camrys, and Corollas imported here from Japan. Anyone can look the numbers up and it was more than just few thousand. Of course other brands (Lexus, Accura, Scion) were built almost exclusively in Japan. The trend is now firmly headed towards local production but it’s still no guarantee your car was built by southern good ol’ boys.


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