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Koreans: (Hyundai, KIA)
Japanese: (Toyota, Honda, Nissan, Subaru, Mazda)
European: Volkswagen, Mercedes Benz, BMW

just to name a few are doing quite well manufacturing/engineering/assembling vehicles in the USA with USA labor. Toyota cannot currently meet demand for its passenger size vehicles even running full capacity at its USA Plants

Ford and GM do have problems - Why?
... and what is the difference between them and the Korean, Japanese and European Manufacturers/Plants located in the USA that are doing well?

 

Toyota does that on purpose. They make sure everything is at max capacity while being well under demand. Or should I say, they build their factories just big enough to be just under their actual demand even running at full capacity. That way nothing goes to waste. They do not overproduce, and they do not build factories that can overproduce, even though they could.

Ford, GM and Stellantis seem to think that they can build an infinite amount of vehicles and all of them will be bought, regarless of the price they put on them. They build too big of factories and too many vehicles for the demand. So, they end up with a bunch of vehicles that might sell well one year but then the next no one wants them. This leads to bigger booms and busts for them compared to Toyota, and therefore the need to cut back production.

 

That's too bad. Sometimes manufacturers miscalculated demand - failing to have suppliers deliver enough parts to meet the increased demand, causing customers to pick a different vendor instead. Sounds like Toyota didn't know their audience.

.

 

what is the problem at gm?

 

??????

Toyota Motor Manufacturing Kentucky - Toyota USA Newsroom
"Toyota Motor Manufacturing Kentucky is Toyota’s largest vehicle manufacturing plant in the world, capable of producing 550,000 vehicles and more than 600,000 engines annually. Toyota broke ground in Georgetown, Kentucky, in May of 1986, and two years later (May 1988), produced its first Camry. Since then, more than 14 million vehicles have rolled off Toyota’s assembly lines in Kentucky, where full-time employment is 9,950. In addition to the Camry Hybrid, America’s best-selling car, Toyota Kentucky also manufactures the RAV4 Hybrid, and the Lexus ES 350 and 300h, as well as four-cylinder and V-6 engines. Toyota has invested more than $154 million in various community philanthropic and educational initiatives since 1986."

 

Yes, they are the largest car producer in the world when ranked by units sold. That still doesn't mean that they couldn't produce an oversupply if they intended to.

 

Worked for Toyota for many years-
helped when they engaged their partner Subaru to dedicate a line at their Indiana Subaru Plant to help meet Camry demand-
they also engaged the Tsutsumi Plant in Japan to supplement the US Demand for the Camry at the time.
Helped with the construction, staffing and eventually the manufacturing of a second Plant on site to meet the growing Camry demand.
Went to Japan for 6 weeks on intensive training in the Toyota Production System to include the "pull" system concept for auto production.

Your qualifications please:

 

Reality.

There has to be a limit. If Toyota built 50 more plants and produced 25,000,000 vehicles a year I'm sure they'd surpass their demand. Toyota could build at least one more plant in the USA that produces 550,000 vehicles a year. Why don't they?

Look. We both agree that Toyota is doing very well. We both agree that Toyota sells more cars than anyone else, even Volkswagen. But it is well known that a big part of why you never see a Toyota factory at half capacity is that they go by a waste-not philosophy. They like keeping their production as streamlined as possible, in spite of the fact that they could sell many more cars whenever there is a boom by having built even more production capacity.

Ford, GM, Stellantis and others are known of overproducing. Every time they have a boom they think that they will sell more cars continuously forever and ever, until they have cars piling up on lots. If they followed the same philosophy as Toyota they wouldn't do that. They'd have smaller factories and produce way fewer vehicles regardless of booms or busts. You wouldn't see cars piling up on lots, even during a bust.

Sure, Toyota decided to use Subaru to make more Camrys because, frankly, the Toyota philosophy does get on some of their customers' nerves. When they have a boom, many of their customers can't find a Toyota, so they go elsewhere. But this isn't just the Toyota building good cars, it is also Toyota's fault for their waste-not philosophy and not putting in more manufacturing plants.

 

Still waiting for your qualifications:

I can explain Toyota's concept of matching Auto Manufacturing to Demand and the tools used to do that.
It is a fruitless undertaking to do that unless a person is open to new ideas and has a receptive heart.
An argumentive type personality would not learn but only get more confused and argumentative.
Auto Manufacturing is a complicated, expensive undertaking and initial investments approach billions of dollars to just get started

Even experts in the field whose job it is to predict and match demand get surprised. Auto Manufacturers have entire departments dedicated to predicting demand and matching manufacturing - and they sometimes with all their available resources struggle to do that.

It is refreshing to hear someone who thinks they could do a better job than the experts at matching manufacturing to demand and has all the answers to manufacturing challenges that every Automaker struggles with.
That individual would have to have an endless supply of money and be a heartless no-good s _ _ to build new Plants in good times filling them with new hires only to close the Plants and then lay off all the people hired a few years ago when demand goes south due to circumstances beyond the Auto Makers control. Things like Recessions, Wars, Covid, Consumer Trust, falling Dollar, Tariffs, Perceived Product Problems, Political Climate, Consumer Confidence, World Crisis, Consumer Preference etc. and on and on all effect long term production.

There is a razor edge every Auto Manufacturer in the world must walk to maintain profitability and long-term stability.
The type of planning involved requires whole Departments dedicated to just that aspect.

 

If you want discussions with people whose qualifications meet your standard for your topic, you are on the wrong site.

 

I in no way implied or meant that I know what Toyota should or shouldn't do. I do know they could make more or fewer cars than they do now if they so desired, and that would cause more supply or less supply.

 

well said

 

Analyzing this again:

1. Isn't Nissan on the brink of bankruptcy?
2. Isn't Volkswagen also having a terrible time financially?
3. What I was saying about Toyota I feel still holds true. Yes, they are doing well, I agree, but their way of arranging their supplier agreements and therefore their way of keeping up (or not keeping up) with demand is fundamentally different than other car manufacturers, so is not a meaningful metric towards their superiority IMO.

It's hard to quantify all the reasons why certain companies are doing better than others.

• Some fell into thinking that just because there was a high demand during the pandemic and lots of people were willing to pay anything for a car that that trend would continue.
• So they've continued making high priced vehicles that people aren't buying with the current economic uncertainty that many people are facing.
• Some companies also have hurt themselves by selling vehicles with reliability issues and then not doing enough about the problem to satisfy customers. When Toyota had engines self-destructing they replaced all of them. When Nissan had CVT transmissions blowing up you didn't see Nissan doing anything to fix them. I've seen similar transmission issues with Fords that are landing people with a $9,000 repair bill before the car reaches 100,000 miles.
• Now add the tariff war into the mix, which will include parts made in other countries too, not just cars manufactured here or not. One party gets into office and incentivizes and disincentivizes whatever kinds of cars they want, then the next party gets into office and does same with different cars.
• One thing this "just make it in America" has done is it is killing the econo car, and as a result used car prices are going up again. So, while this is great for car manufacturers and new car buyers, that doesn't mean it's great for used car buyers.