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5/16/2015

3 Reasons Why Toyota Is On A March In North America

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Micheline Maynard (http://www.forbes.com/sites/michelinemaynard/) Contributor

I look at all the ways we get around
Opinions expressed by Forbes Contributors are their own.

AUTOS (/AUTOS)

3/28/2012 @ 10:44AM

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3 Reasons Why Toyota
Is On A March In
North America
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Just a few years ago, Toyota’s world was Total Recall
– not the movie that’s being remade, but the neverending wave of bad news about its cars.
It lost its spot as the world’s best-selling car company to General Motors
(http://www.forbes.com/companies/generalmotors/), and some people wondered if Toyota could ever get back its sterling reputation.

What Pure Michigan Means to Business Leaders

But this year, Toyota has been on an

(Image credit: Getty Images North America via
@daylife)

investment march, and Canada and the United
States are reaping the benefits. On Wednesday,
Toyota announced

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3 Reasons Why Toyota Is On A March In North America

(http://toyotanewsroom.com/releases/toyota+canadian+manufacturing+operation+increase+rav4+volume.htm? view_id=30039)its latest move, involving its newest Canadian plant.
The Japanese carmaker will invest $80 million (Canadian) in its factory in
Woodstock, Ontario, about two hours west of Toronto.
It will increase production of the RAV4 small sport utility from 150,000 a year to 200,000 annually. The step will add 400 jobs at the factory by 2013.
The move comes not long after Toyota added jobs at its Blue Springs, Miss., plant, which builds the Corolla, bringing it up to full staff. It also is shifting production of the Highlander solely to its plant in Princeton, Ind., where it is investing $400 million and adding 400 jobs.
The Woodstock announcement comes as Canadian Prime Minister Stephen
Harper has been in Japan, making initial moves on a Canada-Japan free trade agreement that could be a boon to Canada’s auto industry.
Why is Toyota making these moves now?
1) The yen. Japan’s currency isn’t quite as overwhelmingly strong as it has been, but a rate of 83 to $1 remains an obstacle for Toyota and other Japanese companies that operate world wide. Toyota, whose Japan-centric culture was highlighted by its initially slow recall response, is finally being pushed by the yen to move more production elsewhere.
“The exchange rate plays a very important role in our business decisions.
That’s why we are are considering all the possible scenarios of trying to mitigate the impact,” Toyota’s North American president, Yoshi Inaba, said in
Toronto (http://m.theglobeandmail.com/report-on-business/toyota-eyesexpansion-of-ontario-plants/article2341364/?service=mobile) earlier this month. 2) The market. There are signs that consumer confidence is finally returning, leading a number of companies and economists to raise their 2012 estimates for auto sales. Many believe U.S. sales will reach at least 14 million, compared with 12.7 million in 2011. While that’s still below the heights of the
’00s, it’s healthy considering unemployment and housing prices.

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