Automotive News [sub] reports that Toyota is delaying opening its $1.3b Tupelo, Mississippi production plant from early 2010 to… sometime later that year. Toyota cites weakness in American sales and a tight credit market for the delay– which it downplays as a relatively minor adjustment. "We made adjustments within a certain range of time," Toyota Executive VP Mitsuo Kinoshita soothed. "The change wasn't that critical." The plant will employ some 2k Mississippians building about 150k Highlander crossover utilities. Toyota has seen its sales drop for seven of the last nine months, and recently announced an estimated 28 percent drop in profits. Toyota's San Antonio Tundra plant has already seen its production trimmed, as the global leader in auto sales volume struggles with North American overcapacity. With small, efficient Toyotas continuing to sell well, from the Prius to the Yaris and even the Camry, could Toyota simply switch production over from Highlander's to something that will, y'know, sell?
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“could Toyota simply switch production over from Highlander’s to something that will, y’know, sell?”
Japanese based manufacturers tend to stress flexibility in their plant designs. I would suspect that they can, and will, change the product mix at their existing plants to reflect market realities.
Excellent!
If the UAW were crafty, they’d be camping out in Tupelo for the next 2 years surreptitiously convincing all prospective workers to organize once they’re hired.
Spread the infection, guys.
Spread the infection, guys.
You have that correct…. unions = infection.
Toyota is smart. They’ll adjust quickly as they have a lot more ground to gain thanks to the UAW.
The combination of falling dollar and rising oil prices screams “move hybrid production to the US”.
Or is production in Japan still more profitable than production in the US? In that case the dollar has a lot further to fall.
Hopefully Toyota will take the time to start making the Highlander Hybrid in the new plant, at least. (the current plan was to make only gas Highlanders)
nice trip to the past!thanks
The new Corolla/Matrix/Vibe are out, and w/Americans apparently going nuts for small cars again, why not do the change over? Sort of a NUMMI east…
Highlander has it’s roots in the Camry platform, so one would think that it shouldn’t be too hard for Toyota to reconfigure the new plant for Camry production. Or, maybe Toyota will kill the 4Runner so as not to have it and the Highland competing in a shrinking market.
I doubt that the UAW will be able to make hay out of this decision.
You have that correct…. unions = infection.
Toyota is smart. They’ll adjust quickly as they have a lot more ground to gain thanks to the UAW...
The UAW can’t organize these plants because Toyota give them too good a deal. It is not worth it to get dragged into all the union complications for marginally better compensation. However, when the UAW ceases to be a threat, the compensation package at Toyota will deteriorate. Maybe it will start with a two tier pay scale, but no way will the deal be as sweet as it is now. So, those Toyota guys ought to thank the UAW for their good deal. Enjoy it guys. You will be undersold. Upper level management simply can’t help themselves.
Toyota ought to come up with a plan B – there aren’t enough ships to go around (autoobserver.com) to bring more cars over here.
I agree with golden2husky.
Toyota now has people in their plants that have been “temps” for 2 to 3 yrs. These are the people they are now cutting in their SUV and truck plants. But they can still say they aren’t laying off employees, I mean associates.