Toyota’s truck plant in San Antonio running at full capacity for the first time

Article by Christian Andrei, on August 25, 2010

Toyota Motor Corp.'s truck plant in San Antonio, Tex., is now operating in full capacity for the first time since it opened in late 2006, adding 1,000 workers for the production of compact Tacoma pickups. When the plant opened, it had built only larger Tundra pickups. However, there had been a lower demand for Tundras than Toyota had expected.

Earlier this year, Toyota's former California joint-venture plant also closed, prompting the shifting of Tacoma production to Texas at a cost of $100 million.

Jim Lentz, Toyota's US sales chief, told reporters that the collapse of the US market in 2008 was not predicted and that no one anticipated that full-size trucks "would fall as much as they did."

He described Toyota's current 270,000-unit North American pickup run rate, which includes 50,000 Tacomas built in Mexico, as "about right."

Toyota had an annual sales target of 200,000 Tundras when it started producing the truck in 2006 in both Texas and Indiana. In its first year, sales failed to hit the target and a few years later, US volume fell as fuel prices were at a record high in 2008.

Sales continued to drop with the recession the next year. In an interview, Atsushi Niimi, executive vice president for global manufacturing, said that the addition of Tacoma raised investment in the Texas plant to $1.4 billion.

He predicts that recouping that investment will take a decade, compared to seven years for most Toyota plants.

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