As reported recently, even though Toyota halted Tundra production for a while, the company pledged not to lay off its workers. At a total cost of potentially $1 billion to the company, Toyota instead placed the employees in retraining and civic works programs during a Kaizen and Development Period.
What kinds of civic programs? One of them, in San Antonio, is called the City-Toyota Green Clean-Up Project, which has put up to 340 workers on the streets to "clean, paint, and plant." Factory staffers have painted curbs, picnic tables and trash cans, trimmed trees and plants, and cleaned up lots. While employees do want to get back to the factories, they're enjoying the time away and being able to give back to the city -- all the while earning their regular wages and benefits.
A second round of city improvement will begin next month. After that, Toyota expects to have all hands on deck again at the factory in November, building 2009-model-year Tundras.
Despite the fact that its full-sized truck competitors from Ford, General Motors and Dodge will all offer new small-displacement diesel engines within the next year or so, Toyota has reportedly canceled plans for a similar powertrain for its Tundra. Instead of dumping money into the stalled full-size market, the automaker has reportedly contacted key suppliers for quotes on systems for its radical A-BAT concept truck from the Detroit Auto Show. Powertrain choices for the trucklet would include a traditional four-cylinder option along with a hybrid drivetrain, possibly sourced from the Camry hybrid. If it went into production, the A-BAT would join the lonely Ford Ranger in the small pickup market and would use a uni-body platform in lieu of a full frame, which is standard fare on most other trucks. Then again, it may never be given the green-light for production at all.
The Toyota Tundra is the most competent pickup Toyota has ever produced, but the two-year-old truck has been hit hard by the harsh reality of the US auto slump. Gas prices and a sluggish housing industry have conspired to put a wet blanket on the Tundra party, and the San Antonio plant will be closed from August 8 until mid-November to allow dealers to clear out Tundra inventory. When the Texas plant does come back online, a portion of its production could wind up overseas.
At the Management Briefing Seminars, Toyota Motor Manufacturing Kentucky Inc. President Steve St. Angelo said some Tundras and Sequoias could be produced in the US and shipped overseas. While markets like Europe and Asia aren't likely to turn to trucks and SUVs in large numbers, both the Tundra and Sequoia could be a welcomed addition in the Middle East, where cheap gas prices makes big vehicles more acceptable. While the overseas truck market isn't likely to produce huge demand for the Tundra and Sequoia, the currently untapped markets could help the San Antonio plant come closer to running at its peak efficiency.
Toyota's got some changes and rearranges underway with its North American facilities to better serve the demands of the market. The biggest news is that Prius production will be coming Stateside, which will help unkink the supply pipeline, if not also lower costs. A new facility in Blue Springs, Mississippi is being readied for the battery-pack-mobile, though the location was initially meant to turn out Highlanders. With consumer desires shifting with the rise of fuel prices, cranking out more Priuses is a higher priority, and beginning in fall 2009, the Highlander will shuffle off to Princeton, Indiana. With the Highlander elbowing its way into the Princeton plant, the vehicle currently produced there, the Tundra, will see its production move under a single roof in San Antonio, Texas.
The big-truck moves are of little consequence when the plants are scheduled to be idled beginning August 8th due to lack of demand. Huntsville, Alabama will also hold up on cranking out V8 engines. While Toyota is putting some plants in neutral, it pledges to provide employment to affected team members during the shutdown. All of this shuffling is an attempt by Toyota to avoid sustaining humongous hits as the market for new cars takes a dump, as well as ensuring that the products it remains building match up with consumer desires. Always a good thing to make the things people want.
Toyota posted a 10% sales decline for its bread-and-butter brand of over the month of June, with numbers that are even worse -- an 11.5% drop -- when the Scion and Lexus brands are added into the equation. In response to these very un-Toyota-like sales declines, the automaker is now revamping its vehicle production in the States. Though it has already introduced measures to slow the production of full-size Tundra trucks and Sequoia SUVs, reports indicate the further cuts will be made at the San Antonio truck plant. The Indiana plant, which also produces Tundras, will see workers transferred to other lines where more popular vehicles are assembled. Even plants in Japan that export vehicles to the U.S. could be affected. Toyota is hardly used to seeing double-digit drops in sales in the U.S., so it will be interesting to see how the giant Japanese automaker responds in the months to come.
The full-size pickup truck woes continue to worsen, leaving even mighty Toyota little choice but to slow production of its Tundra model. In fact, Toyota's brand new plant in San Antonio that was built just for the Tundra will be shutting down a total of 14 days between now and October. Full-time workers at the plant will be able to use vacation days, take the time off unpaid or find something else at the plant to do while the assembly line is halted.
Unfortunately, temp-to-hire workers aren't so lucky. Two-hundred employees who were hoping to land full-time positions at the plant will be laid off this summer. Toyota spokesman Mike Goss says, "We have a very long-term view of that factory in Texas. We're trying not to overreact. We're trying not to shut it down." Whoa... back up. Shut it down? We hadn't heard any such thing until it was spoken by Goss. Sounds like things are just as bad for Toyotas with beds as they are for pickups from Detroit.
The famous Baja 500 begins today in Ensenada, CA, and one of the more interesting dirt racers discovered by our friend Mike Levine at Pickuptrucks.com is the Tundra D-Cab PreRunner from TForce Motorsports. It looks good, has ridiculously huge King off-road racing shocks, and it's owned by former Indy 500 champ Danny Sullivan, but that's not what makes this rally racer unique. Power for the PreRunner comes from none other than GM's LS2 small-block. TForce crew member Matt Riggle told Levine that the team chose the 375-hp, 400 lb-ft powerplant because of its reliability, as well as its ability to run on regular Pemex gas that's much cheaper than facing fuel.
For the record, Toyota does not sponsor team TForce or its hopped-up PreRunner, but you can imagine that choosing a GM engine over one by Toyota because of reliability isn't exactly what the folks in Aichi, Japan like hearing.
Toyota has earned its reputation for producing fuel efficient vehicles, but one dent in the Japanese automaker's armor has been the gas-guzzling Tundra and Sequoia. To help rectify the situation, Toyota Engineers have been working hard on a 4.5L clean-diesel powerplant that will substantially improve fuel economy for the body-on-frame trucks. The 4.5L engine is reportedly scheduled to arrive Stateside by 2010, and it's a no-brainer in light of the fact that both Ford and GM are offering similarly sized oil-burners for their trucks and SUVs.
You may remember the Dually Tundra fantasy truck that was shown last year at SEMA. Well, this news means the mega-sized diesel may not be far from reality. Inside Line is also reporting that Toyota may be delivering a monstrous 7.0L diesel for a commercial-grade Tundra, with a possible production date around 2011-2012. Toyota still hasn't given the go-ahead for a heavy duty Tundra, so the king-sized diesel powerplant likely will arrive only if the larger Tundra does, too.
Sluggish market conditions in the United States are the reason Toyota Motor Corp. is slowing down the launch of its new Highlander crossover plant in Tupelo, Mississippi. Originally scheduled to open in late 2009 with production at 150,000 vehicles per year, Toyota will instead begin production in May 2010 with an expected reduced annual output of 120,000 units a year. Of course, that number will increase if U.S. market conditions improve.
While the slowing economy is a leading reason for the delay, Toyota officials also confirmed that they are facing difficulty hiring skilled labor for the Tupelo project. They are now recruiting from around the country to fill positions in maintenance, along with tool and die engineers. Toyota expects to employ 2,000 workers at Tupelo. This isn't the first time Toyota has faced recruiting issues. When they opened San Antonio in 2004 and 2005, they found themselves challenged to staff the Tundra pickup plant. The Texas plant recently made headlines when Toyota slowed production of the Tundra. For the fiscal year, Toyota is forecasting operating profits to decline by 29-percent.
Although Toyota has recently claimed the title of the World's Largest Automaker in terms of global sales, the Japanese-giant is finding out that life at the top isn't all it's cracked-up to be. While the Camry, Corolla, Yaris and Prius sedans are reportedly brisk movers, the same thing cannot be said about Toyota's line of trucks and sport utility vehicles. Toyota has cut Tundra and Sequoia production already, but dealers are still declining to purchase them, pushing the number of unclaimed units to an all-time high. Automotive News quotes an unnamed Toyota dealer as saying, "Last month, Southeast Toyota had 9,700 vehicles that had been turned down twice by dealers and are either sitting at the port or at sea. That's a significant number." Right now, Toyota/Scion has a high 58-day supply of available inventory on hand.
Some dealers, though, see the high number of available units as a blessing-in-disguise. "We've been asking for more inventory for two years and now we finally got it. This is a great opportunity. You have to take it when you can get it," says Steve Cain, general manager of Lewis Toyota-Scion in Topeka, Kansas. Regardless of your viewpoint, we expect that Toyota will align itself with market realities in order to bring production in line with actual sales sooner rather than later. In other words, if you've been in the market for a Toyota truck, chances are good you'll get a decent deal.
