Company executives take a breath to reassess Toyota Mexico manufacturing strategy and plans.
Earlier this month, it was reported that company officials were actively scouting a Toyota Mexico manufacturing site. The company is the only major automobile OEM without significant production capacity in the country.
Last week, however, Toyota president, Akio Toyoda, put the project on hold in order to review the company’s North American production capacity in terms of projected NAFTA region market demand. It is expected that Toyota Mexico manufacturing plans will be formulated and resumed should it be determined that projected demand for Toyota products require the installation of further automotive assembly capability in the foreseeabe future. Toyota planners are seeking to avoid any missteps, which may cause the delay of any new Mexican plant, such as those that caused a delay in the start up of the company’s Mississippi plant for eighteen months.
Present Toyota Mexico manufacturing is limited to the production of the Tacoma truck model. Sixty-three thousand units roll of lines that are located in the Mexican state of Baja California. Before introducing passenger vehicle into Mexico, Toyota wants to review its use of North American capacity in order to ensure that it is being used as efficiently as possible.
Company management has expressed that a decision on a Toyota Mexico manufacturing site will not be arrived at, at least, prior to the beginning of 2015. It is expected, however, that when a decision is made, Toyota will locate its second vehicle assembly in either the Mexican South Central states of Guanajato or Queretaro. The South Central region of Mexico is where, over the last several years, major investments in production have been made by companies such as Nissan, Mazda, BMW, Audi, Volkswagen, Nissan and Honda.
The intensified push into the nation by major global automotive OEMs has been driven by the need to lower costs in order to be more competitive on the basis of price in the U.S. market. Toyota’s to executive, Akio Toyoda, has expressed that due to this imperative, his company must “build a solid presence in Mexico, sales-wise and manufacturing-wise.”
When Toyota Mexico manufacturing does commence at the location of the companies choosing, it has been expressed that the model that it will seek to build and mass market there will be its popular Corolla model.