Hino of Toyota Will Halt Production at California Plant

Will this cause some adjustment of sales projections among competitors?

By Brendan Moore


Hino Motors Ltd., the light commercial truck subsidiary of Toyota, said today that it would stop production of vehicles in their California production facility and move that output to a plant in West Virginia in order to maximize operational efficiencies. The move comes amid falling market demand in the U.S.

Hino produced approximately 5000 trucks at the California plant in 2007, and produced about 300 trucks at the plant in West Virginia, which just came on-stream in November 2007. The new West Virginia plant can produce around 2500 vehicles from a single daytime shift, and can accommodate a second shift quickly if needed.

Hino’s announcement comes fast on the heels of Toyota’s announcement that they would start consolidating production of their trucks at plants in Texas and Indiana due to falling demand in the United States. Hino ran the California plant at full capacity in 2007 and sold 7100 trucks as a result last year. Hino’s projection for sales in 2008 was 10,500 units, an increase of 48%, but there is now some doubt as to whether they’ll even be able to equal their 2007 sales number if the U.S. economy stays in a recession this year.

The Long Beach, California Hino plant produces both commercial trucks for Hino and auto parts for Toyota brand cars and trucks at the facility. It employs around 850 people, none of whom will be laid off, according to Hino. The expectation is that the vehicle production work will be replaced by parts manufacture production as the market rebounds.

As reported earlier this month, Nissan has announced plans to enter the North American light commercial vehicle market in the near future, throwing some doubt on Hino’s ability to recapture their market share after the recession ends.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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  1. You mean we’ll have less Toyotas on the road? Oh, what a terrible thing that would be!

  2. Those are American jobs. Maybe you wouldn’t be sarcastic if it was your brother losing his job.

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