Published on May 1, 2014

Toyota to combine U.S. operations into Texas

By Mark Rechtin, Crain News Service

LOS ANGELES (May 1, 2014) — Toyota Motor Corp. will combine and consolidate its far-flung U.S. operations into a single campus in Plano, Texas, with a targeted move-in completion date of late 2017, the auto maker confirmed recently.

Following a week of rumors regarding the relocation of Toyota’s sales and marketing operations based near Los Angeles came confirmation of a much larger-scale relocation of nearly all Toyota’s North American processes and operations to the suburb north of Dallas.

The move will affect 2,000 positions at Toyota Motor Sales U.S.A., in Torrance, Calif.; 1,000 employees of Toyota Financial Services, in Torrance; 1,000 employees of Toyota Motor Engineering & Manufacturing North America (TEMA) in Erlanger, Ky.; and some employees of Toyota Motor North America based in New York, the auto maker said in a statement.

The only operation not relocating is the Toyota Technical Center in Ann Arbor, Mich., which is in its own growth mode and will absorb the direct-procurement duties from TEMA’s Kentucky operations.

“We’re looking at bringing together, for the first time in our 57-year history, four headquarters affiliates into one unified North American team,” said Julie Hamp, Toyota’s chief communications officer. “We believe the advantages will be better for our customers and dealers, the career development for our associates, and allow us to vastly increase our ability to compete.”

After moving from its existing headquarters, Toyota will continue to have about 2,300 employees in California and 8,200 employees in Kentucky.

The vehicle maker’s move won’t affect its 10 U.S. manufacturing plants.

The move was announced to a small, stunned group of Toyota executives during a hastily scheduled lunchtime meeting April 25. The rest of the staff was notified April 28.

As part of the relocation plans, Toyota will offer all full-time employees and their spouses an expenses-paid site visit to Plano, as well as a lump-sum relocation payment should they choose to relocate, a Toyota official said.

Although Toyota is taking an “everyone is invited” stance for the relocation, officials admitted there likely will be some headcount attrition from employees who do not wish to move.

The auto maker will be consolidating certain overlapping functions that will now be shared between the different branches of North American operations. Although a final decision has yet to be made on which functions will be consolidated, departments under consideration include information services, human resources, legal, accounting and communications.

The move will occur in stages as Toyota’s new campus is being built, in the style of Apple’s new sprawling campus in Silicon Valley.

The first moves, involving those working most closely on the company’s redesign and move details, will begin this fall. The second wave, encompassing the overlapping functions due for consolidation, will begin in December 2015. The rest of the affected Toyota Motor Sales and TEMA employees will move in early 2017, while Toyota Financial Services will move in late 2017.

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This report appeared on autonews.com, the website of Automotive News, a Detroit-based sister publication of Tire Business.

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