Steve St. Angelo, jefe of Toyota’s Latin American operations, poured more cold water on widely reported, and then strongly discounted news of building a plant in Mexico. Lunching with a small group of reporters at Toyota’s swank Kioi Club yesterday, he said that as much as he would like more capacity in South America, a plant in Mexico is “far from an approved project.”
“We work every possible Saturday,” said St. Angelo, “and I would work more if the unions would let me.” In some plants in South America, Toyota is working at 120% percent capacity, but the marching orders from top management in Japan is to use the brain, and no bricks and mortar.
“Akio is very firm on us about growing in a sustainable way. He doesn’t want us to go through another recession and have to shut down plants,” said St. Angelo, echoing a cautious mantra that could have been heard at Toyota for more than a year.
Rumors that Toyota’s secretive TNGA modular architecture would drastically increase output of existing plants likewise received a cold shower from St. Angelo. “TNGA will allow us to get more of a variety of vehicles. It won’t help us increase volume per se.” In any case, it will be a while for TNGA to arrive in St. Angelo’s area of responsibility. “They will use it Japan first, and fully debug it.”
In the meantime, capacity is being increased the old-fashioned way, by going to three shifts. Toyota usually doesn’t like three shifts, they tax people and quality. Nonetheless, Toyota is testing three shifts at its Tacoma plant in Baja de California, Mexico, “and this could open up a possibility for other plant to do three shifts where it makes sense.”
In most of South America, three shifts make little sense, said St. Angelo. “The labor laws in Latin America make three shifts not economically feasible.”