Toyota cuts North American production further

December 5, 2008 8:31 PM ET

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DETROIT (Reuters) - Toyota Motor Corp on Friday said it was cutting North American production of its best-selling cars including the Camry and Corolla sedans in response to rising inventories and a slump in sales.

Toyota will idle assembly plants for additional days in December and January in Georgetown, Kentucky; Princeton, Indiana; and Fremont, California, spokesman Mike Goss said.

Toyota, like its smaller rivals, has been caught out by the collapse in demand for cars and trucks in the United States, a downturn that accelerated in October and November amid tightening credit and deepening consumer uncertainty.

Despite a high-profile zero-percent financing offer, Toyota's U.S. sales tumbled 34 percent in November.

Toyota had previously said it would shut down its U.S. assembly plants on December 22 and December 23. Now, with the exception of a Texas truck plant, it is idling its factories for additional days.

The Kentucky plant, which makes the Camry, Avalon and Solara, will be shut for nine additional days in December and January, Goss said.

Toyota's NUMMI plant in Fremont, which makes the Corolla, will be shut down for 10 more days in December and January.

The Indiana plant has two assembly lines. One, making the Sienna minivan, will be idled for six additional days in December and January. The other, making the Sequoia SUV, will be idled for one additional day this month.

Inventories have built up at the automaker famed for running a lean and cost-efficient production system where parts are delivered just in time to be installed in vehicles on the assembly line.

Measured by the number of sales needed to clear inventory, Toyota's unsold stock of vehicles has doubled from 45 days one year earlier to near 90 days for some vehicles now.

Toyota's plant in San Antonio, Texas, was idled for three months until early November as the automaker ran down an excess supply of its full-size Tundra pickup truck.

Toyota continues to pay its U.S. nonunion workers during the time they are not employed on the assembly line because of plant shutdowns.

A similar practice at General Motors Corp under its agreement with the United Auto Workers union has come in for sharp criticism as GM and other U.S. automakers seek a $34 billion federal bailout.

The UAW said this week it would scrap that controversial "jobs bank" provision of its contract with U.S. automakers.

Plenty of pain to go around...

But Toyota is supposed to step in and save the day, no?

Why doesn't the government just make Toyota pay the bailout money for the Big 3 seeing how they have been over here selling their garbage for years making profit while our Automakers are punished for it!

Because if we punish Japanese firms the Japanese will punish American firms wanting to do buisines in Japan.

Much better would be laws leveling the playing field so that American vehicles could be sold on a fair basis in Japan.

Chris

Because if we punish Japanese firms the Japanese will punish American firms wanting to do buisines in Japan.

Much better would be laws leveling the playing field so that American vehicles could be sold on a fair basis in Japan.

Chris

See... I then misunderstand the situation. I thought those laws were already in place?

Because if we punish Japanese firms the Japanese will punish American firms wanting to do buisines in Japan.

Much better would be laws leveling the playing field so that American vehicles could be sold on a fair basis in Japan.

Chris

Thats hilarious. You're pretending that the Japanese government doesn't already make it nearly impossible to do business there. LOL! Good one!

>>"Now, with the exception of a Texas truck plant, it is idling its factories for additional days."<<

Didn't the TX toyota truck plant just come off a 2 or 3 month idle period ?? Nice reporting there, Reuters !!

Poor bastards they prolly figured with all the bads new about the Domestic's it would help them it might have some but not that much. I am glad they can feel some pain too.