Toyota mulls using NUMMI for Prius

Plant shutdown also an option, but problematic

NAGOYA (Kyodo) Toyota Motor Corp. may operate the New United Motor Manufacturing Inc. plant in California on its own to produce the Prius hybrid after General Motors Corp. withdrew from the joint venture, a senior company official said Thursday.

“We’ve upgraded the facilities during the past five to six years, so it would be physically possible to manufacture the Prius,” the official said.

“A shutdown is also an option, but it would be very challenging for Toyota, which has little experience in closing down big plants,” the official added.

Toyota is cautious about shutting the plant because the company has worked to protect employment and avoid friction with the United States, company sources said.

There are about 4,500 employees working at the NUMMI plant, which Toyota and GM have jointly run in Fremont, Calif., since 1984. The plant produces about 20 percent of Toyota vehicles in North America and is considered a symbol of friendship between Japan and the U.S.

But at the same time, Toyota is trying to combat excess supply capacity worldwide, including the U.S., and heavy losses on the back of a shrinking auto market.

Japan’s top automaker is still considering both options for the 25-year-old joint venture plant, after the bankrupt U.S. auto giant recently announced its withdrawal as part of a restructuring program.

Toyota is expected to weigh the concerns of the local community and the current state of the market and reach a decision by the end of July. GM has said it will end production of the Pontiac Vibe at the plant by the end of August.

However, other officials said it may be difficult to move production of the Prius to NUMMI unless demand in the battered U.S. auto market recovers strongly.

Toyota is currently delaying the start of operations at a Mississippi plant that was scheduled to begin production of the gasoline-electric hybrid from next year.

About 460,000 Pontiac Vibes were produced at NUMMI between 2002 and the end of this May. The joint venture was a beachhead for Toyota’s entry into the U.S. market and emerged at the height of friction between the U.S. and Japanese auto industries.