Toyota expands -- and tends to growing pains

Toyota expands -- and tends to growing pains

Lindsay Chappell | Automotive News / April 23, 2007 - 1:00 am

TUPELO, Miss. -- Toyota's frenetic growth in North America has a dark
side that worries senior executives. The company is wearing out its
engineers and manufacturing managers, causing an alarming number of
them to quit.

Now Toyota -- which last week broke ground on one plant and cut the
ribbon at another -- plans to do something about it. The company says
it will decentralize its manufacturing and engineering command and
expand its project management staff.

The restructuring is a sign of growing pains as Toyota adds plants in
North America at a pace of about one a year. Toyota's Kentucky-based
corps of project managers, engineers and supplier support staffers are
being run ragged. Midlevel managers crisscross the continent on
far-flung assignments - from Ontario to Mexico - and it's taking a
toll on the employees and their families, according to an internal
company document.

The solution: Toyota will set up regional centers on the West Coast
and in Texas by 2010. Personnel in the satellite offices will get more
authority to tend to nearby projects.

"It will keep engineers from having to travel so much," says Gary
Convis, executive vice president of the North American manufacturing
headquarters in Erlanger, Ky. "It will enable them to stay close to
home so that we're not putting so much strain on their families."

Losing people

Over the past decade, Toyota has centralized its North American
manufacturing headquarters in Erlanger, just outside Cincinnati. But
according to the company document obtained by Automotive News, the
pace of work at Toyota is proving too much for too many.

"We continue to experience high turnover" reads a PowerPoint
presentation given in 2006 by Seiichi

Sudo, COO at Toyota Motor Engineering & Manufacturing North America
Inc. in Erlanger.

According to the document, Toyota lost 5 percent of its "experienced
members" in 2006 after losing 10 percent in 2005. It is not clear from
the document how many employees those percentages represented. Toyota
won't comment on the document.

About 1,400 employees are assigned to Toyota Motor Engineering &
Manufacturing North America, including clerical staff.

The reasons for the turnover, according to Sudo's presentation:
excessive overtime and travel, an imbalance between work and personal
life, insufficient authority for managers operating in the field and
poor communication within the organization.

Sudo's presentation also said managers suffered from "lack of self
development opportunities" and an "unclear future vision."

Toyota will set up a satellite office in Fremont, Calif., to help
manage vehicle projects and supplier issues out west. The California
office will oversee Toyota's plants in Fremont, Baja Mexico, the Los
Angeles area and British Columbia. A third regional center will be
established at Toyota's new Tundra plant in San Antonio.

The satellites will report to Erlanger, but personnel stationed in
Kentucky will focus on projects in the Midwest, South and the Great
Lakes region.

Each center will have project engineers who work with suppliers and
Toyota's U.S. vehicle development teams.

More factories

Last week, Toyota officials gathered in Tupelo, Miss., to break ground
on a $1.3 billion factory that will produce 150,000 Highlander SUVs a
year. Production will start in 2010. And on Friday, April 20, the
officials gathered a second time in Lafayette, Ind., to cut the ribbon
on an assembly operation that will build 100,000 Camrys a year. The
Camrys will be produced at Subaru of Indiana's plant.

The Lafayette plant and a new factory in Woodstock, Ontario, will
bring to eight the number of Toyota assembly operations in North
America.

Toyota is expected to announce another project soon - production of an
all-new crossover at its plant in Georgetown, Ky. The company also is
ramping up its Tundra pickup plant in San Antonio and in 2008 will
launch RAV4 production at Woodstock.

Convis, who will retire in June, will have responsibility for the
satellite office program, serving in a consulting role. He will move
his office from Erlanger to Fremont. The company operates New United
Motor Manufacturing Inc., a 50-50 joint venture with General Motors,
in Fremont.

C. E. White wrote:
> Toyota expands -- and tends to growing pains

I didn't even have to look to know who posted this. <G>

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where the lure hits the water!

Be very, very, quiet...