Toyota studying plans to reorganize its manufacturing operations in Japan

Article by Christian Andrei, on August 25, 2010

Toyota Motor Corp. is considering plans to reorganize its domestic manufacturing operations in such a way as to merge the production of similar vehicles across its group companies. Currently, Toyota produces a single model at various factories in several cases. In an interview at Nagoya, Atsushi Niimi, Toyota's executive vice president in charge of production, said that some assembly lines could be closed as part of these efforts.

A Toyota spokeswoman confirmed his comments. The Nikkei business daily had said that Toyota seeks to remove 100 billion yen ($1.1 billion) from its annual production costs by 2012.

Toyota will attempt to do this by increasing the use of common parts among different models. Niimi said that the decision will be made this summer on what the sequence the reorganization would have.

He said that he doesn't expect that jobs will be cut if any assembly lines were ended. It's possible that staff will be shifted around within the group.

The spokeswoman said that Toyota has yet to decide on how to go about the realignment. Niimi expected domestic Japanese production to range from 12,500 to 12,600 units a day, about 1,000 units lower than the guidance Toyota sent to its suppliers for the March-May period.

Last January, Toyota produced 15,000 units a day in Japan. Niimi acknowledged that the recall crisis was affecting sales in North America, as well as in Europe and China. He said that it's hard to assess production levels by looking at the current situation, but that Toyota will have to be prepared.

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