Toyota to Liquidate NUMMI: Report
Nummi is the largest private employer in Alameda County.
Thursday, Jul 23, 2009 | Updated 2:22 PM PST
Workers worry about job security
Toyota Motor Corp. has decided to liquidate its stake in Fremont's NUMMI plant, which if true, is devastating news to the Bay Area.
For now, a Japanese news agency is the source.
NUMMI is jointly operated with General Motors.
The Japanese car maker will begin negotiating with the "Old GM" starting next week, Kyodo News reported, citing unnamed company officials.
The Fremont plant is a small part of the Toyota universe, but it is a huge part of Fremont.
Nummi is the largest private employer in Alameda County. Some 4,700 work there, not to mention the trickle down effect a closure would cause on the nearby businesses who cater to the automaker.
The plant brings in $2.3 million a year in property taxes alone for the city of Fremont. You might be surprised to know that Fremont is the Bay Area fourth-largest city.
The city would feel the loss as it already faces a $16 million budget shortfall.
Members of California's congressional delegation are asking Toyota officials what they could possibly do to help keep the plant open.
In their letter to Toyota President Akio Toyoda, lawmakers say the plant has been a great asset to the state's work force as well as to the company.
They say they look forward to hearing from Toyota and are eager to work together on what they called a "very important challenge." The contingent of lawmakers includes the state's two U.S. senators as well as 15 House members.
Toyota spokesman Mike Goss would not confirm that the Japanese automaker had made a final decision on NUMMI's fate. Goss said Toyota will begin negotiations with the GM officials about the plant and added that the company is conducting an "extensive review" of its production needs.
A GM spokeswoman was not immediately available to comment.
NUMMI's fate was thrown into question last month when GM announced it was withdrawing from the 50-50 joint venture. GM emerged from bankruptcy protection shortly after the announcement and the company's stake in NUMMI is now part of Motors Liquidation Co. -- also known as Old GM -- where it will be liquidated under court supervision.
The NUMMI plant, established in 1984, makes the Pontiac Vibe station wagon for GM, and the Corolla compact car and Tacoma pickup truck for Toyota.
Toyota has been reexamining its U.S. strategy after plummeting U.S. auto sales helped drag it to its worst-ever overall loss for the fiscal year ended in March.
On Monday Yoshi Inaba, president of Toyota Motor North America and chairman of Toyota Motor Sales USA, said the Japanese automaker was carefully evaluating its options for NUMMI and hoped to make a decision "as quickly as possible."
He said Toyota was studying whether it could be economically viable in the future and considering factors such as the company's idle factory space, labor and image.
California represents Toyota's largest market within the U.S. California lawmakers have held discussions with the company about ways of keeping the plant open.
The United Auto Workers union represents employees at the joint facility and their labor contract expires next month. The joint venture was developed to have American workers learn Toyota's production methods, which were much leaner and more efficient. The UAW has not been able to organize workers at a Toyota plant in the U.S.
It's only speculation, but there has been some of it that says Tesla Motors would be an obvious choice to move in to the plant IF NUMMI closed. Tesla is also based in the Bay Area and has been scouting around for months for a location to build its Model S series.
The Fremont facility has much plant that Tesla would need, but the idea keeps popping up on everything from Blogs to the corner coffee shop in Fremont.
Copyright Associated Press / NBC Bay Area
Posted Thursday, Jul 23, 2009 - 9:19 AM PST
