Toyota Blames High Costs for Closing NUMMI

Japanese manufacturer Toyota announced a few days ago that it will close the NUMMI plant in California, a move which, according to preliminary figures, could affect around 50,000 people, more or less involved in the business. The UAW quickly reacted and criticized Toyota for telling the decision first to the press representatives and not to its workers who are the first affected by this “devastating” closure.

In a statement issued today, Executive Vice President Atsushi Niimi explained that the high labor and logistics costs represented the main factor of the decision and pointed that California is a “high-cost location” with higher-than-average cost of living.

"The UAW presence does not have a direct impact on the decision," he said according to Autonews.

Niimi also revealed that Toyota is looking to boost production of the Corolla in North America, as this particular model is one of the best selling Toyotas in the US. But the UAW believes that "it's unfortunate the company chose to close a U.S. facility after benefiting so greatly from the federal cash-for-clunkers program, which is funded by U.S. taxpayers."

Toyota is the best selling company in the US Car Allowance Rebate System, with 19.4 percent of all orders through the scheme going to the Japanese manufacturer. Furthermore, the Corolla posted the highest sales, followed by Honda’s Civic and Toyota’s Camry.

"Toyota's announcement that it will close the NUMMI plant is devastating news for thousands of workers in California," UAW President Ron Gettelfinger said.

"This plant is a profound asset to Toyota. It has a highly experienced, diverse and award-winning workforce," Jim Wells, UAW Region 5 Director added. "For a company that prides itself on quality and being a good member of the community, this decision is stunning."