For quite a while, the world’s largest automaker, Toyota, refused to grow larger. For a while at least. Internally, the matter is explained as a flight of stairs that have landings, and right now, Toyota is walking a landing. According to a new Reuters report, Toyota will start climbing again, at least in the foreseeable future.
People did not want to believe that a large multinational company would say no to growth, and accordingly, there were sundry reports of new factories in the past. These reports were all shot down.
The new report is by Reuters reporter Norihiko “Nori” Shirouzu. He’s one of the best, and you can take his reports to the bank. Nori says that Toyota “is looking to open two new assembly plants in China and another in Mexico,” and he has it from “four executives familiar with the company’s plans.” In Detroit, Nori cornered Jim Lentz, head of Toyota’s North American operations. Confronted with the findings, Lentz conceded that Toyota “will climb the staircase” again. Toyota will do it carefully, “it’s not going to be growth for growth’s sake.”
The plans still have not been greenlighted, and in the past, well-laid plans for expansion were stopped at the top. In the past weeks, there were noises at Toyota that it will stick to its “no new factories before March 31, 2016” plan. However, one should expect new factories soon thereafter.
“Even if we decide today, plans, permits etc. will take some time. 2016 is next year,” a Toyota exec told me before Christmas. Nori was warned that new assembly lines in Mexico and China could offset older factories that get closed as “part of an overhaul of its production systems.”