Can this marriage be saved?
The answer appears to be “no.” The marriage in question is the 25-year partnership between General Motors and Toyota Motor in a joint venture, New United Motor Manufacturing, Inc. — widely known as NUMMI.
GM this week gave out a brief statement that it could not agree on future product plans with Toyota. The NUMMI plant makes the Pontiac Vibe sport wagon for GM, and production of the Vibe is set to end later this summer — well ahead of the scheduled phase-out of the Pontiac brand.
GM said its 50% interest in NUMMI would stay with “Old GM” — the bankrupt carcass of bad assets and debt that will be left behind when the company emerges from Chapter 11, which could be next week, if the Obama administration’s auto task force can muscle the company’s case through bankruptcy court. “New GM” may be out of bankruptcy reorganization in 40 or fewer days, which would top Chrysler Group’s record of 42 days.
At the NUMMI plant, which is hailed as a highly efficient American implementation of the vaunted Toyota Production System, the UAW-represented workforce makes Tacoma pickups and Corolla sedans for Toyota to sell in North America. What happens to the NUMMI plant now is a big question for Toyota and its new president, Akio Toyoda, the grandson of the automotive manufacturer’s founder.
As the global downturn in the automotive industry took hold last year, Toyota called a halt on completing its new plant in Mississippi, which was going to build the Prius hybrid. Rumors abounded that Toyota would convert NUMMI to Prius production in light of high demand for the third-generation Prius, one of the few car models in the world that’s garnering pronounced popularity. Toyota officially quashed those rumors, however.
Akio Toyoda has a thorny problem in pondering the fate of NUMMI. The factory has long outlived its purpose and value as an experiment in cooperative production. It’s not the traditional practice of the giant Japanese automotive manufacturer to shutter a factory, lock the doors, and throw away the key, as Chrysler and GM did with so many North American plants. (The sprawling NUMMI factory was a GM plant until it was closed in 1982.) Toyota doesn’t do big layoffs. NUMMI is the last car plant in California, it has a unionized workforce of some 4,700 employees, and it’s a highly visible employer in the San Francisco Bay Area. Pulling the plug on NUMMI would be a public-image nightmare for Toyota. Not that it would slow down sales of Toyota vehicles in the US any more than the recession already has, but it would be an international liability to the corporation’s image.
BTW, the NUMMI plant is a few miles north on the Nimitz Freeway from the Great Mall of the Bay Area — a facility that was a Ford Motor plant from 1955 to 1983 and which was redeveloped as a giant shopping mall in 1994. Maybe that could be the future of the NUMMI factory, as well, although the mall business isn’t what it used to be, either.










