Tupelo Prius plant put on ice!

I couldn't view that first link because I'm not a paid subscriber. Now on that second link is a pretty good review for a cordless mower!

 

Ditto. : ) Weird, I found the article in a google news search, but when you try to link it, it sends you to a log in page. strange.

Rgathright, I took some liberty, and here's a copied and pasted version...

Prius freeze slows Toyota's U.S. output goal


Lindsay Chappell
Automotive News
December 22, 2008 - 12:01 am ET

Toyota Motor Corp. put its Tupelo, Miss., Prius factory on ice last week, knocking the automaker another step from its goal of producing 60 percent of its U.S. sales in North America by 2010.
The market has frustrated Toyota's plan to reduce its reliance on imports. Sales of U.S.-made Tundra pickups, Sequoia SUVs and Solara coupes have been soft. Production at the San Antonio Tundra plant was stopped for three months this fall.


Last month, 55.2 percent of Toyota's U.S. sales were North American-made vehicles, down from 56.3 percent in September.
Toyota's elusive target
Toyota is slipping away from its goal to produce at least 60% of its U.S. sales in North America.
Sept. 2007: 58.7%
Sept. 2008: 56.3%
Nov. 2008: 55.2%
2010 target: at least 60%
Source: Automotive News Data Center


Now the indefinite halt of the $1.3 billion Tupelo project will knock a planned 200,000 U.S.-made cars a year out of Toyota's equation.
The 60 percent goal insulates Toyota from currency swings. It also reduces political friction caused by imports, a touchy issue as the Detroit 3 try to avoid Bankruptcy Court.
Toyota originally planned to produce Highlander crossovers in Tupelo. But when gasoline prices spiked this year, the automaker decided to start making the fuel-efficient Prius hybrid there instead.
Now Toyota says it has no timetable to start production in Tupelo.

 

I have to question the wisdom of building anything complex in Tupelo. My impression on stops in the region was that the local work force was incredibly incompetent.

 

Sales of Toyotas are down 33%, and the high demand projected for the Prius was unfortunately largely based on the high (speculator-fuelled) oil price. Now that the speculators have largely had to deleverage and go home, the oil price has crashed (peak $147/barrel in mid-July, now trading around $40 and the price of US West Texas Intermediate has dropped below UK Brent Crude, which I'm sure was the other way around before) and the demand isn't there. Some people just won't consider buying the more expensive car even if it does save them fuel and generate fewer greenhouse and toxic gases.

 

Toyota is getting cold feet. There is a backlash coming and they know it. I will take heat on this, but the Japanese miscalculated on how Pearl Harbor would affect the American Psyche and they did not have the stomach for a third attack on pearl harbor for the "knockout punch".

The Tupelo plant will never be staffed, and the "American Prius" will stay on the drawing board.

 

Wrong read.

This has nothing to do with that. I know that you see it daily but there is a massive massive recession in the auto industry. From 16-17 million vehicles it looks like 2009 will be a 10 million unit year. Then a slight improvement in 2010. It may take us 5 yrs to return to the former levels, maybe even longer.

• First, there is a 3 million unit inventory overhang currently. If the expectation for 2009 is that 10 million units will be sold that means that only 6-7 million will be built!!! That's a 60% reduction in production next year!!
• Chrysler is likely to go belly up and it's supplier base will be damaged. There will be some collateral damage as well to the survivors.
• Then, all of those buyers who have trucks and other BOF vehicles are going to have to stay in them for longer than normal because these vehicles will unsalable on the open market unless one just want's to dump and eat the loss.
• Anyone in a vehicle with negative equity is just going to have to stay in it until it's all but paid for because banks are not going to be anywhere as flexible as they were til now.

It's all about the market and the buyers. Right now it looks like no maker will be on safe ground for 2-4 years. Making additional investments now for use in 5 yrs is nonsensical.

 

I heard yesterday the plant building has not been stopped but only the production of cars.Also I was told the people they hired were still on the payroll and being paid.
Is there anyone on this site that lives in that area can confirm this?

 

IMO this sort of reasoning helped get Detroit into its current situation. When one waits until a plant is needed to build it, then it is too late.

Granted there is & will be vast overcapacity in the industry but old, inefficient plants need to be closed and new efficient plants built for corporations to be competetive.

People need to start looking 8 years in the future, not 8 months, not 8 days.

If Toyoda did not mandate in 1990 that a car be built that doubled existing FE there wouldn't have been a Prius in Japan in 1997.

 

The difference is btween building a plant for production that then requires that production be put through it to recoup costs..
..and..
doing developmental work for the vehicle of the future.

I'm speaking of the first and you're speaking of the second.

There is no need at this time to bring new production capacity onstream. Doing so is a waste of resources that could be used to develop new technologies.