San Antonio Snags NUMMI's Tacoma Production
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.
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Was the UAW the only factor? No. But many of the "bad management decisions" were compelled by the economic realities of having to cut corners elsewhere to offset the higher costs of the UAW being on the premises. Not just direct hourly labor costs but also legacy costs, strike costs, overhead having to deal with grievances and negotiating, and the featherbedding and inefficiency of UAW work rules. Costs not borne by their union free competition. Hence the squeeze on suppliers and lower quality components, the Fisher-Price interiors etc.
Caterpillar management had the guts to drive a hard bargain with the UAW. GM & friends didn't.