By Frank Williams
March 17, 2008 - 3,560 views
Timing is. Everything. ToMoCo spent $1.28b to build a state-of-the-art, full-size, full-size truck plant in Texas– just as the pickup market was starting to tank. The new state-of-the-art factory can crank-out 300k restyled Tundras a year. As production began, the Japanese automaker set a relatively low (for trucks) sales goal of 200k Tundras for the first year. They just fell short, in spite of Detroit-level incentives. Then, with the truck-based SUV market softer than Sponge Bob at bath time, Toyota's launched the redesigned Sequoia. So now Automotive News [sub] reports that they're cutting production of both vehicles. ToMoCo won't reveal the extent of the cutback, but they say they'll throttle back production rather than laying off workers. You have to wonder if and when Toyota may admit defeat, move Tundra production back to Indiana and convert the San Antonio plant to Camry, Corolla or even Prius production. ©2008 ttac.com
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March 17th, 2008 at 8:58 am
Or the other way around - Tundra/Sequoia in Texas only, cars and Sienna in Indiana. Or the planned Mississippi Highlander plant, which Toyota execs now admit is overcapacity which doesn’t look so good with the rising yen.
Looks like lots of auto companies are getting the shaft from currency fluctuations, with few exceptions.
March 17th, 2008 at 9:01 am
They already build Sequoia and Tundra in Indiana. It would be easier to increase Tundra production there than to relocate Sequoia to Texas.
March 17th, 2008 at 9:10 am
I think that Indiana has separate lines for Tundra/Sequoia and the Camry-based Sienna, and is located closer to Toyota’s manufacturing base in KY, WV, IL (Subaru plant).
Given the economic shitstorm that’s coming in the near future, I don’t think any company’s going to be increasing production anytime soon. Bear Stearns at $2/share?!
March 17th, 2008 at 9:32 am
Wow, I don’t think I’ve ever seen a regular cab Tundra like the one in the pic. It looks cute. If it wasn’t so massive it could be a cool compact truck.
March 17th, 2008 at 10:02 am
If they unionize the Ontario plant maybe they can move their production to Indiana or less likely Texas.
March 17th, 2008 at 10:19 am
I think NUMMI might find a newer, cheaper, non-union home in San Antonio.
March 17th, 2008 at 11:06 am
Was just discussing this with somebody the other day.
TMMI (Sienna, Tundra, Sequoia) is having sales issues with all three. Tundra and Seqoia are tankin, and Sienna is soft as its long in the tooth.
They just built and opened TMMTX for the Tundra and are now cutting back production.
SIA (Subaru) and TMMK and TMMC are doing fine. I believe NUMMI is as well.
However, they have 2 plants below capacity already (TMMI and TMMTX) and now they’re adding TMMC-Woodstock for the RAV4 and TMMMS for the Highlander?! Holy over-capacity Batman!
I don’t see much of a way around it. You could shut down NUMMI, which I hear could happen. But is that going to be enough volume and worth the expense to cover TMMC-Woodstock, TMMI, TMMTX, and TMMMS? Its odd how much this Toyota thing is starting to sound awfully similar to Ford and GM’s situation….
March 17th, 2008 at 11:49 am
Toyota doesn’t sell anything above 1/2 ton yet, but has plans from what I read. This should soak up some capacity. And the Big 2.x are bleeding to death, so who knows what that will bring. Sure Toyota would like to run at capacity, but they can wait; the others can’t. Also, there’s room at the San Antonio site for another line when needed. I doubt they’re worried long term.
March 17th, 2008 at 12:17 pm
As Homer would say…. “DOH!”
All the same, around here (Indiana) pickups are still king.
March 17th, 2008 at 12:37 pm
I think it’s better for them to bring Sequoia to TX than moving all the Tundra to IN. It’s a newer plant and I guess both share the same platform… if they use a lean/flexible/whatever line, they can assemble there.
In any case, both are truck plants, that will require HEAVY retooling to make cars if they want to do so.
Anyway, they have a ton of cash, so they can do whatever they want and/or suits their needs better.
March 17th, 2008 at 1:16 pm
Given that Toyota sells something like half their trucks in Texas, it would seem likely that Indiana would be the one to make less trucks. Transportation costs would seem to be a factor hard to overcome.
March 17th, 2008 at 7:26 pm
Isn’t there a plan to move Tacoma production from NUMMI to Texas and convert NUMMI to Prius?
March 18th, 2008 at 11:17 pm
TMMTX will keep Tundra production production will stay within TMMI and TMMTX.
Toyota has a lot of flexibility with SIA, TMMI, and TMMK.