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Sunday, May 11, 2008

Toyota postpones opening of new plant in the face of lower sales

World’s second biggest car maker, Toyota Motor Corporation (TYO:7203), has changed its decision to open a new plant in the face of lower sales in the USA. In 2007, Toyota chose its factory site near the village of Blue Springs at Tupelo in Mississippi. Toyota wanted to open the manufacturing plant in 2009. Now, the opening date has been shifted to 2010. In this new plant, Toyota will produce its mid-size highlander crossover SUVs. Memphis Business Journal reports:

The world's second-largest auto company (NYSE: TM) said fourth quarter net income decreased 28 percent and predicted a 27 percent drop in earnings this year. It was the first annual profit decline since 1999.

"We are facing a severe business environment," president Katsuaki Watanabe said Thursday in a statement on the company's fiscal year-end results. "To this end, we will aim to eliminate waste and review the process and structure of every aspect of our operations."

Mike Goss, a spokesman for the company's North American manufacturing group, said Thursday the Blue Springs, Miss., plant near Tupelo is schedule to open by mid-2010, Bloomberg reported.

Toyota Motor Manufacturing Mississippi’s vice president of administration, Dave Copenhaver, downplayed the news and said that everything is on schedule and Toyota is committed to Mississippi. He said that his company will be producing Highlander in the spring of 2010. Copenhaver also mentioned Toyota’s sales forecast announcing a decline in Highlander sales compared to six to twelve months ago. After the release of the company’s financial report, Toyota Motor Corporation’s president, Katsuaki Watanabe, said that his company will work aggressively to address the issue of profitability.

Related article:
Memphis Business Journal

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