Toyota suspends work on Mississippi Prius plant

[Danny]

According to Reuters & statements from Toyota, Toyota is suspending work on the Mississippi plant that will eventually build a US-based Prius.

DETROIT, Dec 15 (Reuters) - Toyota Motor Corp is suspending work on a new plant in Mississippi indefinitely in response to a "steep decline" in U.S. industrywide auto sales, the automaker said on Monday.

Toyota's Mississippi plant was slated to produce its Prius hybrids beginning in late 2010.

"Due to the uncertainty of the market, it is impossible to say at this time when production will begin," Toyota said in a statement.
"Toyota continues to evaluate its operations globally and reduce production as necessary to match the weak market."

Toyota said it would finish construction of the building, which is 90 percent complete, but would hold off on equipment installation and other subsequent actions, delaying the start of production.

Toyota said that employees already hired for the Mississippi plant would keep their jobs.

The decision comes at a time when major automakers are cutting production, delaying investment or closing plants in the face of slumping demand from consumers hit by tighter credit and a weak economy.

Toyota's U.S. sales plunged 34 percent in November from a year earlier -- slightly better than the overall U.S. market's 37 percent drop. (Reporting by Soyoung Kim, editing by Gerald E. McCormick)

UPDATE 1-Toyota suspends work on new U.S. plant | Markets | Markets News | Reuters

[efusco]

Yikes...anyone know what this means for the 2010?
Will they be importing instead, I assume they weren't going to be able to have the plant operational by the time the 2010 goes on sale anyway.

[tcooper185]

More articles (basically stating the same thing) here:

Wall Street Journal

Detroit Free Press

[tcooper185]

Originally Posted by efusco

Will they be importing instead, I assume they weren't going to be able to have the plant operational by the time the 2010 goes on sale anyway.

You would think they would have opened the plant ready to make the 2010 Prius out of the gate. Wonder if they are retooling their production process, and going to refine it overseas first, then copy that here?

[JSH]

Originally Posted by tcooper185

You would think they would have opened the plant ready to make the 2010 Prius out of the gate. Wonder if they are retooling their production process, and going to refine it overseas first, then copy that here?

The Mississippi plant was originally intended to make the Highlander SUV. It was part of Toyota's expansion into the very profitable SUV and truck market in North America. When the SUV market collapsed Toyota decided to make the Prius there instead. That makes sense because more that 60% of Prius sales are in the US. The plan was to start production in Japan in 2009 and then add production in the US when the Mississippi plant was finished.

US auto sales are only projected to be 2/3 their normal levels in 2009 and only slowly recovering through 2012. Toyota has way too much production capacity. This will be worse if the US buyer continues to turn away from SUV's and trucks. Half of Toyota's production capacity in the US is dedicated to light trucks.

Indiana: Sienna, Highlander
Texas: Tundra, Sequoia
Kentucky: Camry, Avalon, Venza
Canada: Corolla, Matrix, Lexus RX
NUMMI: Vibe, Corolla, Tacoma

[paprius4030]

For the DUMMI....where is NUMMI?

[JSH]

Originally Posted by paprius4030

For the DUMMI....where is NUMMI?

NUMMI is New United Motor Manufacturing, Inc opened in 1984. It was Toyota's first assembly plant in the US and is a joint venture with GM. NUMMI currently makes the Tacoma, Matrix, and Pontiac Vibe. Previously it made the Corolla and Chevy/Geo Prism.

Toyota has publicly talked about ending production at NUMMI when the current UAW contract ends in 2010. GM has said they will be eliminating the Vibe in the restructuring of the Pontiac brand. Every thing points to NUMMI shutting down in 2010.

[rigormortis]

i wonder if its because of an economic slowdown... or the falling gas prices!

[zenMachine]

Originally Posted by rigormortis

i wonder if its because of an economic slowdown... or the falling gas prices!

Yes.

[hyo silver]

Originally Posted by jhinton

...Half of Toyota's production capacity in the US is dedicated to light trucks.

Indiana: Sienna, Highlander
Texas: Tundra, Sequoia
Kentucky: Camry, Avalon, Venza
Canada: Corolla, Matrix, Lexus RX
NUMMI: Vibe, Corolla, Tacoma

It's not like it's only Detroit that's hurting. Looking at this list, I'd surmise the plants in Kentucky and Canada might be around longer than the others. At least until all the manufacturing goes back to Japan.