Toyota's New Mississippi Plant Still a Go. For Now…

According to the AP, “Toyota Motor Corp. said Friday that for now it is sticking with plans to open its new Mississippi plant in 2010 despite media reports that Japan’s top automaker is mulling a delay.” Mississippi was originally supposed to get Highlander production.. Those plans ran aground on $4 a gallon gas. In a fit of hybrid mania, Toyota Mississippi jumped off the Highlander horse and onto the Prius this past July… just in time to see crude oil prices peak and roll over. Remember all that talk of building a Scion-like separate Prius brand? You have to think that plan is on hold. “Earlier this month, Toyota said its net profit for the July-September quarter plunged 69 percent. The car maker also downgraded its full-year profit forecast to 550 billion yen ($5.5 billion) — about a third of last year’s result. Executive Vice President Mitsuo Kinoshita said after the earnings release that the company had convened an ‘Emergency Profit Improvement Committee’ to cut costs and maximize revenues. Toyota is also assessing its manufacturing operations by ‘re-examining aspects such as the timing and scale of new projects.'”

The case for ramping-up Prius production– which looked brilliant only a few months ago– now seems extraordinarily high-risk. Honda is launching an overdue frontal attack on the Prius with the new Insight, fuel prices are falling like a rock, feel-good by buying green posturing has been replaced by feel-good by buying nothing pragmatism and a new administration less friendly to buying Japaneso is coming to power. With money tight and buyers on strike, is there any need for more Toyota production capacity of any kind? What if one or more of The Big 2.8 packs it in? What if they don’t? Times like these drive even the most sober-minded long-range strategic planners to binge drinking. More saké!