TOYOTA URGES U.S. PLANT TO CUT COSTS
Camrys made in Japan more profitable than those built at Kentucky factory
TOYOTA Motor Corp issued an unsettling warning to Kentucky workers building its top-selling Camry sedan: cut costs now or face an uncertain future.
The carmaker can build a Camry in Japan, ship it all the way to Kentucky and make more money selling that car than from one built at Toyota’s factory in the state, the plant’s president told employees in a 2½ minute-long internal video.
“I’m not sharing this to scare you, but to heighten your awareness of the current risk we now have,” said Wil James, who has managed the plant for more than seven years.
He said Toyota isn’t planning to close the factory and would continue to invest in it for the next 30 years.
“But all of this is on the assumption that we can make as much progress in cost reduction and efficiency as we’ve made in quality and safety.”
The video provides a glimpse into the cost-cutting drive spearheaded by president Akio Toyoda that’s freeing up resources for a record research-and-development budget.
While Toyota is spending heavily on electrification and artificial intelligence — technologies that have the potential to transform the car industry — the company is squeezing its vaunted production system for more savings.
The message James delivered showed Toyota’s willingness to include its United States operations in cost-cutting efforts during politically sensitive times.
President Donald Trump has pressured Toyota and its Japanese carmaking peers to locally produce more of the vehicles they sell in America. Bloomberg