Toyota Working Overtime to Replenish Stock

All of Toyota Motor Corporation’s North American production facilities for are in high gear, working overtime to restock low supplies of vehicles and keep up with growing demand.

At the Toyota plant in Woodstock, Ontario, a second shift comprised of 800 employees will be hired “immediately” to keep pace with the boost in demand. This is the latest in a series of gains for Toyota, coming as a result of booming sales of the RAV4 crossover vehicle.

Executive vice president of Toyota’s North American manufacturing and engineering group, Ray Tanguay, was recently quoted as saying, “Despite the market decline, the model is selling better than last year. This is a vote of confidence that the market is recovering.”

Sales of Toyota’s RAV4 are up 3% from last year. Through the end of November 2009, Toyota sold 132,346 new RAV4s. The number was 128,225 for the same period last year.

Toyota’s ramped up production schedule is in stark contrast with its situation in the first quarter this year; like many automakers at that time, Toyota was cutting production, jobs and inventory. The second shift at the Woodstock plant was put on hold as financial troubles loomed on the horizon; as a result, Tanguay says it’s over a year behind schedule.

Both the production plants in Woodstock and Cambridge, Ontario are running at nine hours of overtime daily and on some Saturdays.

In Fremont, California, the Toyota production lines at New United Motor Manufacturing Inc. (NUMMI) are working some Saturdays restocking supplies of Toyota Corollas. Toyota announced in September that it plans to shut down NUMMI on the grounds that it is unprofitable. General Motors Company, Toyota’s partner in the production facility, had to back out after undergoing bankruptcy and restructuring this past year.

Tanguay says that the Cambridge plant will be running even more overtime to make up for the NUMMI plant closing, but that there are no plans to add capacity for the Corolla model. He stated, “There is more demand than capacity, but we’re not going to add any capacity.”

Also on the rise are U.S. sales of the Lexus RX model, which is up 10% over the first 11 months of 2009.

The addition of a new production facility in Tupelo, Mississippi is still being considered by Toyota, says Tanguay. Late last year a $1.3 billion project to build a Prius factory was abandoned but Tanguay says, “We’re watching the market very closely. We stay very committed to Tupelo.”

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