Toyota plant in Mexico still far from being approved

Article by Christian Andrei, on October 24, 2014

Toyota Motor Corp. admitted that while it has assigned a team to study the possibility of building a plant in Mexico, the project is far from being green-lighted by higher-ups, according to Steve St. Angelo, head of the carmaker’s Latin American operations.

Toyota is only major carmaker not having a high-volume assembly plant in Mexico, which has been luring a number of top vehicle manufacturers thanks to lower labor costs and favorable trade pacts with the US and some Latin American countries.

In fact, Kia Motors Corp., BMW and a Daimler AG-Nissan Motor Co. partnership each has disclosed $1 billion-plus factories since June this year. President Akio Toyoda, however, has not been a fan of expansion after a massive growth lead to a loss in the fiscal year ending March 2009 as well as recalls of over 10 million vehicles for unintended acceleration.

He prefers exhausting all measures to increase production with existing plants. St. Angelo remarked that the grandson of the company founder is very firm about “growing in a sustainable way. He noted that Toyoda doesn’t want the carmaker to go through another recession that may lead to plant closures.

He added that Toyoda was able to muster the support of the carmaker’s Latin American sites by operating at over 100 percent capacity utilization via using Saturday shifts. St. Angelo disclosed that he is urging the Indaiatuba and Sorocaba sites in Brazil to each build up to 85,000 vehicles annually, despite having a full capacity of about 70,000 units.

Toyota can make the plants produce more vehicles by increasing the number of shifts from two to three. This will be the case for its Tacoma pickup site near Tijuana, Mexico, which is the carmaker’s smallest in North America.

Topics: toyota, mexico, plant

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