Chain Reactions

Toyota Conquers the United States

Pundits tend to exaggerate for effect – that’s part of the job description for a pundit, after all (some day, when I’ve completely run out of other things to talk about, I’ll run down the job description for an editor) – so maybe lean expert James Womack didn’t literally mean it when he said, in this New York Times article: “ Tundra in Texas marks the complete Americanization of Toyota. There are no segments left to conquer and no part of the country overlooked.”

The article, as you’ll see, focuses not so much on Toyota opening up a $1.2 billion truck assembly plant in San Antonio, Texas, as on how this move by Toyota in the Lone Star state effectively signs the death warrant for Detroit’s Big Three automakers.

Another pundit, automotive industry analyst John Casesa, weighs in with the observation that Toyota’s strategy “can do serious, even potentially fatal damage to Detroit’s financial health by attacking the domestic industry’s last sizable source of extraordinary profits.”

Last week, I posted an article that discussed how China is emerging as an auto manufacturing giant, and now we hear that Toyota has potentially delivered the knock-out punch to the U.S. auto industry. So what do you think? Is there a viable counter strategy for Detroit? I think back to that scene in “The Untouchables,” where the Sean Connery character says something like, “If Capone pulls a knife, then we pull a gun,” and I imagine a similar scene where GM, Ford or DaimlerChrysler would respond, “Okay, you want to open up a truck plant in Texas? Fine, then we’re going to open up TWO plants in Osaka.” Of course, if things were that easy, then Detroit wouldn’t be in the mess it’s in now.

In the meantime, if you’d like to tour another Toyota plant – specifically, the Toyota Industrial Equipment Manufacturing facility, showcasing the Toyota Production System – then you ought to seriously consider attending next year’s IW Best Plants Conference in Indianapolis, April 24-25. Dr. Shankar Basu, president and CEO for Toyota Material Handling U.S.A. Inc, will in fact deliver a keynote address on the TPS. Just click here for the details.

TAGS: Supply Chain
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