Toyota was the biggest beneficiary of cash for clunkers, and right after it has ended they say they’re pulling out of a California factory – the only one where they have the dubious pleasure of dealing with the UAW. But it’s not quite that simple.
The first two paragraphs make it sound like Toyota are the bad guys. Thanks Reuters. You’re the guys who just lay out the facts with no spin and no secret offensive codewords, right?
Toyota Motor Corp will end production at a California plant it has shared with General Motors for 25 years, prompting regret and criticism from labor and politicians facing more job losses in an industry and a state pummeled by recession.
The move to cease operations at the plant in Fremont by March 31 puts at risk more than 4,500 jobs and highlights significant overcapacity global carmakers are facing as they try to shake a recession-fueled sales downturn.
The UAW is outraged.
“This is no time to close a highly successful manufacturing facility,” Jimmy Settles, a United Auto Workers vice president, said in a statement. “California is one of the most important markets for Toyota.”
It was the only UAW facility operated by Toyota.
The decision stung even more for labor and lawmakers in light of news this week that Toyota was the biggest beneficiary of the $3 billion U.S. government “cash for clunkers” incentive program designed to jump-start industry sales.
You have to read between the two blocks above to get the rest of the story…. (emphasis mine)
The decision on the venture with GM known as New United Motor Manufacturing Inc, or NUMMI, was part of the Japanese automaker’s plans announced earlier this week to slash production more broadly to stem losses.
GM pulled out of the partnership in June as part of its bankruptcy reorganization, prompting Toyota to follow suit.
So let me get this straight. We supposed to be mad at Toyota because Obama/UAW-owned GM backed out of its half of this plant and Toyota won’t go it alone? No, seriously?
Well at least Sen. Feinstein gets it to some extent, though her solution is to look to Washington for help of course.
Senator Dianne Feinstein said Toyota told her staff that GM’s decision to pull out of the venture in June left Toyota operating a facility at less than full capacity “with no demand to justify” expanded production.
“I’m profoundly disappointed,” Feinstein said. “I very much regret this.”
Feinstein said she was also told by Toyota the Fremont plant was aging and could not compete with two other plants in the South, and that production costs were too high in California.
Feinstein said Toyota grew “more remote and less transparent” over attempts by her office to determine NUMMI’s fate and weigh options.
Her staff has met with the Obama administration’s autos task force to discuss other manufacturing options for the facility.
UPDATE – A Bloomberg article has more background and other info. These quotes are not in the same order as in the article.
GM was the factory’s sole owner from 1963 until 1982, when it closed the Fremont Assembly plant owing to escalating costs and labor conflicts with union workers.
Shared by GM and Toyota since 1984, Nummi was Toyota’s first U.S. auto-assembly factory. It’s the only large auto- assembly plant on the U.S. West Coast.
Nummi has the capacity to make 420,000 cars and pickups each year. It only made money in 1992, the result of California’s taxes and labor and pollution rules, as well as the plant’s UAW contracts, according to an estimate by Credit Suisse Group AG analyst.
Toyota’s announcement “is devastating news for thousands of workers in California,” said UAW President Ron Gettelfinger. “They deserve better than to be abandoned by this company.” (Wait a second! Didn’t the UAW’s own company — GM — abandon them too?)