The Auto Writer

Seemingly invincible Toyota has had its own share of woes to contend with over the past year. The Japanese automaker, the world’s largest car manufacturer, posted its worst annual loss when it closed its books on its most recent fiscal year ending March 31st.  Toyota has also seen its share of the lucrative, but competitive US market drop as it found itself top heavy in large pickup trucks and SUVs while demand for its popular Prius hybrid model plunged.

Toyota Loses Billions

But no one is counting Toyota out even if its most recent performance has caught some by surprise. Indeed, if Toyota’s US plant restructuring is any sign of what is coming down, then Toyota should find itself in an enviable position when the current recession is finally laid to rest. Toyota’s multi-billion dollar losses are expected to increase this year over last, but beyond 2010 the auto giant could be better positioned to leave some of its competitors in the dust.

Don’t expect Toyota to build a new plant in the US anytime soon. Its newest plant, which is under construction in Mississippi (and purposefully delayed as the automaker decides what models will be built there), will likely be its last plant for many years. In fact, Toyota may do the unthinkable: close its NUMMI plant in California, an operation it once operated as a joint venture with General Motors. When GM decided to end its involvement in NUMMI last month (leaving that asset with the old GM in bankruptcy court), Toyota was left with an assembly plant that is located in an expensive state and with more manufacturing capacity than it needs. Toyota has a history of avoiding plant closures and layoffs, something the automaker may need to consider if NUMMI cannot be used to build other models.

Most recently, Toyota has decided to invest nearly $500 million in retooling its Princeton, Indiana SUV plant. That move will allow Toyota to build both its midsize Highlander SUV and full size Sequoia SUV on the same assembly line. That Indiana plant had been building the all new full size Tundra pick up truck there, but production was consolidated to Toyota’s pickup truck plant in San Antonio, Texas when demand for the trucks collapsed last year.

Prius For Tupelo?

Once the market improves, expect Toyota to make a final decision on what car will be built in Tupelo, Mississippi. Long rumored to be the Prius, if the hybrid electric car is built in the states it could become the catalyst for several new Toyota, Lexus and Scion hybrid models. As a side note, by 2012 Toyota expects to have its first plug-in hybrid electric vehicle (PHEV) on the market with a hydrogen powered fuel cell model arriving in 2015.

Of course, given the current political climate where GM is a ward of the state and Chrysler is the benefit of taxpayer largess, any move that Toyota takes that could threaten General Motors and Chrysler, perhaps even Ford could put the automaker under unwelcome scrutiny. Although Toyota has been working overtime to reshape itself as an American company by building goodwill as well as funding or backing a number of distinctively American enterprises (NASCAR, for one) its greater visibility means it could find itself in a position GM has long been accustomed to occupying – top dog in an industry that is loved by some and much maligned by others.

See Also — Why Toyota Is Afraid Of Being Number One